New home sales up in February

After much news about home sales taking the hit, a rebound has brought some cheer to February.

Mainly lead by new suburban property launches, analysts are hoping that this is a sign of the market stablising. Excluding sales of executive condominiums, the Urban Redevelopment Authority released data showing a 28 per cent rise of private home sales of 724 units as compared to January’s 565 units.

2 launches in the Sengkang area, Rivertrees Residences and Riverbank @ Fernvale, made up majority of the sales. 218 units of the 495-uni Rivertrees Residences were sold at a $1,111 psf median while 211 units were sold at the 555-unit Riverbank @ Fernvale at an $1,033 psf average.

Rivertrees condoThe future however may lie in the hands of the property developers. Depending on their pricing structure and strategies, the buying public may respond correspondingly. Some older projects with units yet unsold, as well as resale units may find themselves competing intensely with lower-priced newer properties. But if recent sales are anything to go by, finding the sweet spot that hits home with pocket-conscious home buyers will bring the crowd back into the market.

Buyers who are looking for a good deal may find themselves searching for less salable units in older projects which may still be worth the investment depending on their location and potential for future development. March may be the turning point of this delicate dance between buyer and developer. What will the month show in terms of sales volume and prices?

Homes, homes, homes galore

204,461 in 2016. And a good lot of it will be in the private property market. The number of HDB flats remain the same but there will be an increase in the number of private properties and executive condominiums (ECs) come 2016. One might question if Singapore really does need that many homes or is it a case of having enough homes but at prices not many can afford?

Forestville Executive Condominium.

Forestville Executive Condominium.

In 2013 alone, 15, 824 private homes will be built come end December. In the public and private hybrid housing (EC) market, the number this year is 1,659 and counting. Over the next 3 years, buyers can expect 1, 355 executive condominium and 4,884 new private properties to enter the fold. Sales of private residential homes have already begun to dip, will this increase in supply signify a further price drop over the next 3 years? Or will the supply glut dissipate quickly and redirect interest into the resale and rental markets?

Sales of new properties plummeted 46 per cent with only 2,430 units sold in Q3. 1,340 resale units were sold, at a 35 per cent drop. Overall, private property prices still rose though at only 0.2 per cent. Most of sales came from suburban condominiums. City centre home prices dropped 0.3 per cent but city fringe homes suffered a 1.1 per cent decline.

But despite recent lulls, a rise was registered in the rental front, at an increase of 0.2 per cent . Has the make-up of Singapore’s population shifted, with a larger percentage of temporary residents or has the population’s property purchasing habits changed and more are willing to simply rent rather than purchase a permanent home? Which way is the nation headed and are we becoming more like the bigger cosmopolitan cities in the world?

204, 500 properties to be completed by 2016

At 6,508 more units than the 197,566 units projected earlier this year, there will be 204,500 executive condominium and private apartment units built by 2016, according to data released by the Urban Redevelopment Authority (URA).

Completed condominium units are increasing in number as developers pour fresh new stock into the market mix. Despite having held back on some major launches as the year-end lull draws close, the number of properties available in the market continues to rise. Industry experts are however expecting developers to lower their launch prices in order to boost sales.

The CreekFrom the looks of the recent Inflora condominium launch, selling prices, of new properties at least, may indeed be on the slippery slope. But that perhaps might be good news for those looking to invest. Properties in the prime city centre spots are dropping by as much as 0.5 per cent whereas city fringe and suburban areas enjoy continued growth, however slight.

Over the next 3 years, 4, 884 more private homes will be built as National Development Minister, Mr. Khaw Boon Wan considers it “making good progress in our ramp-up of the home-building programme”. The number of HDB flats to be built will remain the same as projected. 1, 355 executive condominiums will be ready within the same time frame. What does this heightened supply mean for Singapore’s housing market and will the population growth be a reflection of a cause of this increased property growth?

Triple the Subscription at Skypark Residences in Sembawang

506 units at Skypark Residences Executive Condominium (EC) in Sembawang, and 1, 604 applicants. That’s more than triple the number of units available.

This new EC will feature a 1, 250 sqm Skypark 50 meters above ground. Nothing to rival that of the Marina Bay Sands of course, but as high-rise living becomes more the norm than the exception, having a piece of greenery of your own might be more precious a commodity in the near future than you think. Applications came mainly from HDB upgraders and larger multi-generational families.

Skypark Residences ECPerhaps the possible lack of new EC projects in the few years to come have driven buyers to jump on this last opportunity of 2013 to upgrade. Created as a stepping stone for HDB owners into the private property market, executive condominiums have become a rare public-private housing hybrid which has immense potential especially since it becomes a private property after five years and owners can then sell to foreign buyers after ten years. The projected number of new EC launches in 2014 is two.

But there’s still time yet. Bookings will open on 16 November. Prices are expected to range between $720psf to $800 psf. Will more be wiling to bet their chances at applying for an oversubscribed executive condominium in a quiet neighbourhood or purchase a ready-to-live unit in a completed or almost completed suburban condominium? Are long-term benefits on the minds of property buyers or are short-term capitals what they are gunning for?

New Suburban home launches

It’s an exciting time for the suburbs as three new launches make their entrance, most of them in the North.

Nine REsidencesYishun welcomed a new mixed-use property, Junction Nine and Nine Residences. The residential units are selling at an affordable $1, 070 psf. The options are plenty, with 495 sq ft one-bedders to 700 sq ft two-bedders, 915 sq ft three-bedders, 1,001 sq ft four-bedders and 1, 173 sq ft four-bedders. Bigger units such as a 1,367 sq ft five-bedder and 1,550 sq ft duplexes are also available. Though the retail units were the best sellers here, as investors see their potential as residential properties rise in price but not necessary in sale numbers. Also, retail properties are able to skirt around the additional buyers’ stamp duty which has deterred some.

$400,000 one-bedders are available at The Inflora, a 395-unit condominium on Flora Drive. If it’s a dual-key apartment you’re looking for, here’s where to look as well. These units are often rare and hard to come by, thus if you’re looking for one for your extended family, it might be a good time to snap one up.

The Venue ResidencesIn Potong Pasir, there is the mixed-use development, The Venue Residences. There is a range of 495 sq ft one-bedders and bigger units to 2.142 sq ft penthouses. It will only be launched on Friday and prices are expected to hover around $1,450psf.

E-applications for executive condominium (EC) Skypark Resiences in Sembawang has also opened last weekend. Could this launch detract some from going for private condominiums?

 

 

Waterwoods – Luxury in this neck of the woods

Private lift lobbies. Maisonettes. This are just a few of the lovely features at the Waterwoods executive condominium (EC) launched recently in Punggol East. Out of the 373 units, there will be 16 maisonettes and 32 five-bedders (there will be 49 in total) will have private lift lobbies. The project is developed by Sing Holdings and UE E&C and will also feature penthouses.

Waterwoods Punggol ECExecutive condominiums are a hybrid between private and public housing. Buyers can apply for grants from HDB and after the minimum occupation period, are able to sell the properties on the open market as private condominiums. After 10 years, selling of the units to foreigners is also possible. As resale HDB flats’ popularity take a hit, the rising popularity of ECs is certainly understandable, as their pricing is often comparable to resale HDB flats, but yet often well under private apartment prices. It also helps that these ECs often come with amenities and are located in prime locations, near MRT stations or bus interchanges, for example.

Other recent EC launches include Lush Acres in Sengkang and Ecopolitan in Punggol with prices averaging $790 psf. Prices at Waterwoods are expected to vary within the same range as well. E-applications have been open since 27 September and will close on 6 October.

HDB flats median COV lowest in 4 years

Not too long ago, COV (cash-over-valuation) prices of resale HDB flats were the talk of the town. Red hot and almost scorching. Burning holes in the pockets of buyers.

But now, median COV prices have dropped $2,000 from the previous average of $20, 000 in July. In January this year, it was at a thundering $35,000. And since April, resale HDB flat prices have also fallen 4 months in a row. It is speculated that most of the drop is due to January’s loan curbs which restricted the percentage of monthly income which could be used to pay off home mortgages.

Waterwoods Punggol ECIn addition, starting from July, singles were able to apply for new BTO flats directly from HDB and from the overwhelming response to the initial launch, many may have withdrawn from the resale HDB flat market. The lowest COV prices were for bigger HDB flats in the outside-of-central HDB estates. An executive condominium (EC) which was put for sale in the resale market in Punggol only had a $13,000 COV premium. At the other end of the spectrum, popular mature estates such as Bishan and Queenstown continue to command high COV prices. One of the highest recorded COV prices for a bishan flat was at $120, 000.

As the number of resale HDB flats being sold dip, the market is kept on its toes about whether COV prices will continue to drop as the supply of new flats and private properties continue to enter the market or will the potential resurgence of home prices once again cause a peak in COV prices as resale HDB flats seem the more advisable option?

Home sales slow down

Possibly due to the recent stricter loan framework. Over the weekend, sales were considerably slower with only 80 out of 200 sold at The Glades and 45 out of 150 at The Skywoods. Executive Condominium (EC) Sea Horizon was the happy exception. There has been talk about buyers possibly jumping ship and going for ECs instead as they are not subjected to as strict a loan framework as private properties. Almost two-thirds of the 495 units have been snapped up.

Sea Horizon ECAt The Glades in Tanah Merah, where units were going at an average of $1,500 psf, and at The Skywoods with sale prices of $1,250 psf, buyers are finding it increasingly tougher to find banks which are able to loan them the huge amounts required for property purchases. Under the new  total debt servicing ratio (TSDR), loan amounts are capped at 60 per cent of the borrower’s gross monthly income.

And as the Hungry Ghost period draws to a close, developers may be rolling out more launches, which could mean stiffer competition for resellers. Buyers are also becoming aware of the choices they have, thus may be more willing to wait for a unit of choice rather than lock their cash up in property too soon. Developers have already been reviewing their pricing system. For example, The Skywoods have had a price adjustment downwards of $1, 300 to $1, 2500 psf. It may not be a sign that interest is waning, but merely that interested buyers may no longer be successful in borrowing enough to meet the selling price.

GladesWhich property sector is most likely to profit or be least likely to be affected by the new loan curbs? Buyers seem to be pooling in the Executive Condominiums for now. But when will the winds of change blow and in which direction?