Property measures not hurting Malaysian property sales

And more are flocking to the local label of the new Puteri Cove Residences. This new luxury condominium is developed by local property developers, Pacific Star and DB2, with sea and harbour-view units up for offer, local investors seemed to have taken a liking to this new property.

Puteri Cove Residences. Photo by Pacific Star Singapore.

Puteri Cove Residences. Photo by Pacific Star Singapore.

450 of the 600 residential, 56 Soho and 340 serviced property units were sold within a week of its launch. Upon its targeted completion in 2017, this mixed-use development will also include a waterfront promenade housing eateries, retail stores, commercial businesses and clinics. Located strategically between the Second Link at Tuas and the Woodlands Causeway, it’s poised to have a brisk flow of traffic. Units consisted of one- to four-bedders between 600 to 4,100 sq ft. Prices ranged between RM 1, 180 (S$457) to RM 1, 580 (S$612) psf.

Most buyers were Singaporeans, followed by Malaysians and Indonesians. And with talks in the way between Singapore and Malaysia to improve transport infrastructure, such as the Kuala-Lumpur  expressway and a train system between Singapore and Johor Bahru, investors in the know are looking at long-term profitability. Will new Iskandar region properties continue to woo Singaporean investors?

68% drop in private home sales

In comparison to 2013′s Q1 home sales figures, the chasm is deep. And so are moods in the real estate market.

Private home sales have been on the decline for some time now. And recent figures are not exactly uplifting. Buyer sentiments are pessimistic, as the loan curbs implemented last year takes its toll on buyers and sellers alike.

Hillford Retirement Home
It has become much harder for buyers to secure loans, with the Money Authority of Singapore’s Total Debt Servicing Ratio framework in place. Buyers can no longer loan as much as they would like, which may place them just out of reach of their target property. The lack of new property launches this quarter has also dampened the mood somewhat. And property developers have been slow in introducing new units into the market as they are now accutely aware of a softer market.

Some properties nevertheless have beat the odds and continued to enjoy brisk sales. Topping the list is the 281-unit The Hillford in Jalan Jurong Kechil. Since its launch in January, units have been completely sold. Next up are a couple of neighbouring properties in Sengkang – Rivertrees Residences and Riverbank @ Fernvale. Most of the units went for an average of $1,000 to $1, 100 psf. Industry analysts are wondering if this could signify that buying power for suburban private properties will now hover around this ceiling.

Rivertrees condoThe rest of the year may see a tussle of prices between new and resale properties. As developers cut prices to make sales, resale home sellers may be forced to face the competition head on.

Jurong private properties in demand

For those who are not used to living in the west, the lure may not be strong. Not yet perhaps. But as it changes from the industrial, remote ‘wild west’ into a well-greased regional commercial and education hub, many have seemed to change their minds.

LakevilleThe 695-unit Lakeville at Jurong West Street 41 has sold so well last weekend that the developers, MCL Land had to release 50 additional units to its original release of 150 units. Most buyers were Singaporeans, and they purchased mainly two- and three-bedders. A total of 180 units were sold thus far, at an average of $1, 300 psf. J Gateway, which was the last westside property launched since Lakeville, sold at an average of $1, 480 psf.

Despite constant reminders that the property market may be on a downturn, the response has buoyed the mood of the real estate market. This could however be due to the lack of private properties, especially new ones, in this neck of the woods. New amenities such as the Ng Teng Fong General Hospital and Jurong Community Hospital, and new commercial properties promises of more jobs, and better services, which could drive up rents of both HDB and private properties in the area.

Commonwealth TowersSlightly more inland, Commonwealth Towers, which will be linked to Queenstown MRT station, could be the next property to watch. This 99-year leasehold property will likely be launched in May, with mostly one- and two-bedders in its massive 895-unit development. If nearby condominium prices are anything to go by, buyers could be looking at prices of between $1, 300 to $1, 700 psf.

Overseas property – New frontiers

Malaysia. Australia. London.

There are the usual hotspots for Singaporean property investors. But have you ever wondered what else is out there for the taking? Which other markets have green pastures providing long-term fodder for the profit-hungry?

Dubai, which once saw plummeting real estate prices when a bubble burst, is recovering well and once again housing prices are on the rise. To catch the property on its up cycle would be every investor’s dream. The Dubai authorities have since tightened up regulations, targeting in particular speculators. Their Real Estate Regulatory Agency, a regulatory arm of the Dubai Land Department, has rolled out a rental index which is updated every four months. As Dubai continues to expand as a commercial hub, the stream of expatriates who will be looking for rental units keep investors happy for now.

Vida Residence DubaiPhoto Credit: Emaar

Besides commercial properties, some of the most sought-after residential real estate in the Emirates are in popular communities and districts such as Downtown Dubai, Dubai Marina, Arabian Ranches and Emirates Living.  The 57-storey Vida Residence in Downtown Dubai with 320 serviced apartments are selling one-bedders for approximately S$660, 000.

Japan, which most would regard as one of the countries with the highest standard living, surprising has some good property investment opportunities. The low yen has no doubt helped. In the highly populated Tokyo for example, properties in Shinjuku and Shibuya, the 2 most popular shopping districts, are popular with investors. Since Tokyo won the right to host the 2020 Olympics, interest in properties near the proposed Olympic stadium in Harumi have also gained momentum. These include the freehold Harumi Tower with prices starting at S$900 psf. Just 800m away from the Tokyo Tower is the 13-storey Concieria Mita, a freehold property with studio apartments going at a surprisingly competitive S$436, 000.

Conciera Mita condo

Photo Credit: ECG

So it might truly be worth the time and effort to look beyond the usual suspects for investment opportunities which might be more profitable than fighting for those closer to home.

Lakeside’s Westside Story

Off on the west-side, Jurong and Woodlands are the main areas of business and redevelopment. But with the authorities planning to diversify commercial activity into the suburbs and redeveloping the Jurong Lake District into yet another hub for waterfront living, leisure and business, Lakeside may no longer be the town just on the side.

URA Jurong Lake District

Photo credit: Urban Redevelopment Authority (URA).

Jurong Gateway and the potential working population and medical tourist it will bring serves to bring new life to the sleepy Lakeside township. Other businesses in the mix are Big Box, Westgate, Genting Hotel, Ng Teng Fong General Hospital and Jurong Community Hospital. The previously very much industrial west-side of Singapore will see new life in many ways.

Already response at The Lakefront Residences spoke volumes, as it sold out of its 629 units during its launch in 2010. Prices then were at an average of $1, 000 to $1, 050 psf. Units were already selling this year at $1, 1199 psf. Units at The Lakeshore and Lakeholmz saw similar sales values with promising increases throughout the past few quarters. Though rentals and sales may not yet peak this year, the potential for growth is tremendous.

LakevilleThe newest kid on the block is Lakeville in Jurong West Street 41. Developer, MCL Land, is expecting buyers to mainly be HDB upgraders from the nearby, though not ruling out savvy investors who might see the rental possibilities of these units near future regional commercial hubs.

New private residential projects breezing into Marine Parade

With its proximity and accessibility to the city centre, and its seaside township feel, properties in Marine Parade have always been an easy breezy sell. But it has been sometime since new properties were launched hence news of upcoming projects might bring a fresh round of excitement.

A new launch to look forward to is the Marine Blue (working title) project whose building is underway across Parkway Parade Mall, developed by CapitaLand.

Coralis condominium.

Coralis condominium.

Other properties which are garnering some eager eyeballs area:

Some of these properties are older resale homes, but some new units  will soon be ready for occupation, with the Silversea possibly receiving its TOP (temporary occupation permit) by end of April. Marine Blue units are expected to sell at a promising $2, 000 psf, which may then also bring up prices at the neigbouring Silversea condominium. Most of the units have been sold at the 383-unit Silversea since its launch in 2009. Recent sales clocked at $1, 714 psf. At the Coralis, which was completed in 2013, sales stood at $1, 842 psf.

SilverseaHigh rental prices are expected to hold up and  future transport links such as the Eastern Region Line which will pass through Tanjong Rhu, Marine Parade, Siglap, Bedok South and Upper East Coast Road may only mean rising value in properties in these districts.

Luxury condominiums going at lower prices

$2,200 psf to $1, 800 psf.
$3.7 million to $3.4 million.

That’s how far lower the prices for high-end luxury apartment units are going for.

Perhaps it’s a case of when the going gets tough, the tough gets going, at lower prices. It’s no secret that while luxury properties are the creme de la creme for property agents and developers, when investment money is slow in coming, these are one of the hardest to sell.

Hallmark residencesAnd the going looks like it is going to be tough for quite some time more. Property developers are struggling to move unsold stock, and depending on whether their holding power is strong enough, they may be forced to make other moves sooner. There were news earlier on this month that developers are looking to convert condominiums into serviced apartments as the pressure of the deadline to sell looms closer.

At MCL Land’s Hallmark Residences in Bukit Timah, the uncompleted condominium development is already advertising sales of units at discounts of up to $300,000. A 969 to 990 sq ft 2-bedroom unit was originally priced at $2 million but is now at a lower $1.8 million. Since its release of the first 20 units in January, 5 have been sold. They are however planning for a proper launch sometime in the first half of 2014. At the 999-year leasehold St Regis Residences on Tanglin Road, prices have dropped from $4,653 to $2, 349 psf. Of the over 10,000 private homes still under construction in the prime districts 9, 10 and 11, nearly half remain unsold.

Once again the story of low demand versus high supply dogs the real estate industry. With the government’s many cooling measures, a bubble is unlikely to happen especially since loans are harder to get. It will be interesting to see how the property market plans for a rebound.

What makes a property tick – Exclusive address and prime location

Though the prognosis for real estate this year may not seem positive, some properties may still sell well. With bigger mass-market condominium projects slashing prices to bring in the sales, smaller developments with lesser units at a prime location and an exclusive address may take the cake this year.

Cluny Park ResidenceA recent million-dollar condominium at the Cluny Park area has garnered strong interest from buyers with thickly-padded pockets. With only 52 units for sale, the freehold Cluny Park Residence has already sold 20 – 6 two-bedders and 14 four-bedders. The project slated for completion in 2016 only has two- and four-bedders and is designed by SCDA Architects, the same people behind The Marq on Paterson Hill and Botanika at Holland Road.

Developers are upbeat about the ultra-rich still buying up properties with well-thought-out concepts, attractive locations and a strong potential for development in the area. In other words, those looking for long-term investments will still be on the lookout and may purchase whenever they come across a project worthy of their money.

Surprisingly, bigger units were the draw. A 754 sq ft two-bedder at Cluny Park Residence is going at $2.3 million and up to $8.3 million for a 2,842 sq ft four-bedder penthouse. The next exclusive mixed-use project to be launched is likely to be Ascent @ 456 on Balester Road this weekend. Prices for its 28 three-bedders of 689 to 829 sq ft are expected to be between $900,000 to $1.2 million and may be perfect for the beginner investor.