Small apartments: New fare better than resale

Prices of private non-landed properties in the central region have risen 0.7 per cent last month, a possible indication of the market bottoming out soon. New payment and incentive schemes could also have helped boost sales numbers, in particular for properties in the prime districts of 9 and 10. Across the board, prices of completed apartments have risen 0.2 per cent.

E MaisonNew small apartment units fared better than resale units as demand for the latter tends to be overshadowed by the former. Buyers are more open to buying small apartment units directly from developers rather than in the resale market as new projects tend to offer more longer-term benefits and immediate rental profits from resale units have been falling as the foreign workforce shrinks as a result of  tighter immigration policies. Most of the buyers are Singaporeans or permanent residents looking for properties to live in or rent out for the long-run, and having waited a couple of years for the property cooling measures to be lifted to no avail, are now dipping more than their toe into the pool.

July has proven to be a good month for the real estate market, with some property agents reporting up to a 50 per cent increase in sales in a year-on-year comparison.

Sengkang properties beginning to shine more clearly

Gone is the decade when Punggol and Sengkang were considered too far flung or unpopulated sans amenities.

HighparkResidencesIf the popularity of latest offering in Fernvale, High Park Residences and other completed private condominiums were anything to go by, more similar properties might spring up in the midst as district 19 continues in its expansion and development. Other private residential developments in the Sengkang area include H20 Residences, Riverbank@Fernvale and Rivertrees Residences. More young couples and extended families are moving into the district and with the average selling price holding steady at $1,060 psf, the private properties here are a more affordable for those crossing over from public housing.

Rivertrees Residences3 new land banks will be put up for tender by the Urban Redevelopment Authority (URA) in the upcoming months, and there may be strong bids coming from developers and consumers may very well have more than sufficient options to choose from soon. One of the sites most likely to gain interest will be the 99-year leasehold residential site on Fernvale road with a site area of 17,196 sq m. The nearby 1,390-unit High Park Residences with a median selling price of $989 psf has already sold almost all of its units within a year of its launch in July 2015.

The proximity of this site to amenities such as Seletar Mall and the stretch of eateries along Jalan Kayu, the Thanggam LRT station and Tampines Expressway (TPE) and schools will no doubt urge developers to seriously consider its potential.

 

 

Incentive schemes may reduce Home loan amount

Pay the full sum for a $2 million dollar property within 10 weeks? Or have the payment deferred and pay within 3 years? Most buyers would be enticed by the latter option. And developers have been dangling that carrot to move their unsold stock.

HilltopsBut now the authorities may have caught on to their game and have issued a circular to banks last week stipulating that the amounts deferred are to be taken into account when computing the final amount a buyer can loan from the banks. This may impact some buyers, especially those who may not have sufficient cash upfront and who may need the time to move monies around in order to make the full payment.

Deferred payment schemes are offered by developers of some completed residential properties such as OUE Twin Peaks whereby buyers are allowed to move into their new home upon exercising the option to purchase and paying a down payment, allowing them to the period of 1 to 3 years to make the full payment. With the Monetary Authority of Singapore’s (MAS) most recent specifications, any benefits will have to be taken into account prior to loan calculation.

Twin Peaks2Under the deferred payment scheme, the amount deferred needs to be deducted from the final purchase price before the loan ratio is applied, thus diminishing the amount the borrower can ultimately loan and raising the upfront down payment.

On top of that, rental guarantee scheme is also under MAS’ scrutiny as these are also considered benefits to the buyer. Under such schemes, properties such as Hilltops apartments on Cairnhill, developers offer guaranteed rental returns for a specific time period.

New Jurong launch boosts July’s private home sales

MCL Land‘s Lake Grande took the lead in July’s property sales with 42.5 per cent of the month’s sales coming from this development. 464 out of its 500 units have already been sold at the median price of $1,368 psf.

LakeGrandeAcross the board, new private home sales have hit a one-year high last month with 825 suburban new private homes sold. In the city fringes and central districts, 213 and 53 units were sold respectively. This could be partly due to the rise in number of units launched, 624 in total, in July plus investors are taking advantage of the low interest rates and lower property prices to buy up available units with long-term potential.

Though the government has not yet eased up on the property cooling measures, they have held back the release of new land plots this year, which could have in turn helped clear unsold inventory. The executive condominium (EC) market is coming out strong with 830 units snapped up in July, more than thrice the 232 units sold in June. The 2 major EC launches last month were Treasure Crest in Anchorvale Cresecent and Northwave in Woodlands.

NorthwaveECPhoto credit: MCC Land

August may be a slower month as fewer deals are likely to be closed during the Hungry Ghost month, but as long as interest rates remain low, buyers will continue to scour the market for good deals. Property analysts are expecting the positive sentiments and increased interest to carry on to the end of the year.

Property market on the road to recovery

2016 has proven to be a fairly good year for the property market. Despite slight price fluctuations, prices and sales volume have been stabilising for a few quarters now, giving analysts hope that it’s on a timely road to recovery.

GramercyParkThough the government has yet to indicate an easing of property cooling measures, the market as managed to right itself within the past year or so. Signs of the luxury property market picking up point towards the property market possibly bottoming out soon, which would also mean the market’s on the road to recovery. In Q2, the fall in private residential price index was a mere 0.4 per cent, the smallest thus far. The market has also been correcting itself for 11 consecutive quarters now.

Since the 2013 peak, property prices have fallen 9.4 per cent. With the interest rates currently low and looking like it will remain so for a longer period of time as opposed to extreme fluctuations, borrowing is kept at a healthy level sans the danger of over-borrowing or a property bubble looming. Investors may be refocus their attention on other sectors, keeping the property sector speculation-free.

Leedon Residence on Holland Road.

Leedon Residence on Holland Road.

Global situations such as Brexit or global terrorism may indirectly affect the investment environment and sentiment in the country and region, but Singapore’s real estate market is considered one of the safest and investors are increasingly looking at longer-term capital appreciation.

 

Strata strategy – Landed homes with benefit

Though owning your own piece of land may seem the ultimate goal in terms of local property, but the maintenance fees, property taxes and other extras it comes with are often mentioned and considered much lesser than they should be.

Eight Riversuites condominium in Whampoa East.

Eight Riversuites condominium in Whampoa East.

And it is this market gap which cluster housing and strata-landed homes fill so well. These landed properties, though mostly leasehold, come with condominium facilities and amenities, not to mention the security of a gated community. In fact, so residents of me cluster housing developments even manage to foster long and meaningful relationships with one another.

Eight Riversuites is one of the latest additions to the sector and they have 19 three-storey terrace strata landed houses, each with their own roof terraces and bdedicated asement parking spaces. Some units even come with jacuzzis. Some other popular landed strata homes include those in Thomson Grand, Whitley Residences and Belgravia Villas

Strategically situated near Boon Keng MRT station in the Bendemeer and Whampoa districts, it is in a hip up-and-coming city-fringe area and is but just 3 MRT stops away from the town centre. There are a number of schools in its vinicity and value of properties around it have risen over the past few years. As MRT stations reach completion, values of properties in their vicinity will no doubt increase as well. Prices of units currently start at $850psf. 

 

Luxury property market heats up 

After the market lull in the past couple of years, buyers are once again picking off choice luxury units in the prime residential property sector.

ArdmoreIIIPrices in this segment have gradually become more competitive over the last year or so and sales volume has increased, partly due to this change. For example, in the first half of 2016 alone, 131 apartments priced above $5 million were sold. Only 166 similar units were sold in the entire 2015.

Investors are favoring Singapore properties they match up well against those in other global cities such as New York and London. Property analysts say most investors are still Singaporeans, though  Malaysians, Indonesians and Chinese continue to feature strongly in the investor pool as they see the value of properties here and are not deterred by the currency fluctuations.

An upcoming luxury development is the 99-year leasehold Victoria Park Villas by CapitaLand which consists of 3 bungalows and 106 semi-detached houses starting from $4.3million. In better times, these houses could have cost up to $6 million. Other high-end units currently in the market include those at Gramercy Park, OUE Twin Peaks and Ardmore Three.

The En-bloc secret

Could you possibly be sitting on an En-bloc golden egg and not know it? Or before you make an investment, do you know if your purchase could earn you a tidy sum in the  future?

Laguna Park

Laguna Park

En-bloc sales of older properties can often be the windfall property owners are looking for and having an idea of the process could be the start to planning for the future. Not every development will have the same potential and often the wait could be longer than the photos yields, but there is money to be made this way.

The first step involves securing 20% of the total share value of 25% or the total number of owners. But should the first bid at a collective sale fail,  50% of the previously mentioned total share value or total number of owners will be required to requisition a extraordinary general meeting (EOGM) within 2 years. Then there is the election of the collective sale committee (CSC). They will then draft the proposed a reserve price as part of the collective sales agreement (CSA). Though a high reserve price may increase the probability of securing sufficient signatures go the sale, the high price may also turn potential buyers away. Developers do after all need to take the time and money to conduct feasibility studies and land surveys of the site.

Then there is also the issue of valuation per unit. The criteria for share allocation as recommended by the Singapore Institute of Surveyors and Valuers are valuation, strata area and share value. In addition,  80% of the owners must also agree on the method of apportionment before the bid can happen.

ShunfuVilleOnly then will  public tender be made and a property valuation be made by an independent valuer on the closing date of the tender. In the 10-week period after the tender closing date, the CSC is still able to enter into a private treaty with a buyer. The process is often long and could take years, such as in the case of the Pearl bank apartments or Laguna Park.