Sengkang attracts the home-buying crowd

The far-flung places in Singapore are getting more attention from property developers and love from home buyers. Sembawang, Punggol, and now Sengkang.

Rivertrees ResidencesAlong the quiet Sunggei Punggol Reservoir, 1,000 new homes will be enjoying its new residency. 555 units from The Riverbank @ Fernvale and 495 units from Rivertrees Residences. These are all private condominium apartments and both with 99-year leaseholds. Stretching 150 metres along the reservoir, 90 per cent of the units at Rivertrees Residences will be able to boast a waterfront view. Units will include three-bedroom and strata-titled duplex homes.

The developers, Frasers Centrepoint, Far East Orchard and Sekisui House are calling this development one of the “only waterfront landed houses in Singapore, apart from Sentosa Cove“. As expected, prices will likely hover around $950 to $1,150 psf. UOL’s Riverbank @ Fernvale has also garnered much interest, with over 500 cheques collected prior to its launch today. Home buyers may be attracted by the waterfront-living style of apartments and the exclusivity of its location. Coupled with the fact that Singapore is only going to get more crowded, areas such as Sengkang may be one of the last few residential places in the mainland to truly enjoy a bit of space and greenery.

What’s the situation with the rental market?

The sheer number and speed of new homes entering the market is bound to have some effect on the rental market. And indeed the cracks are beginning to show. Even in areas where resale properties have been commanding considerable rents, there have been signs of price compression. In the River Valley stretch, a four-bedder at Aspen Heights used to go for $5,700 just two years ago, but now $5,000 is the norm. With new properties such as RV Edge coming into play, comparison may make for stiffer competition in the rental front.

RV Edge in the River Valley area, just off the Orchard road belt and the Central Business District.

RV Edge in the River Valley area, just off the Orchard road belt and the Central Business District.

For the next couple of years, the rental market is expected to suffer, whether in terms of lower rental prices or longer periods of vacancy. This year alone, there are 17, 458 vacant units for rent by the end of Q3. Some home owners had bought resale units at the peak, and now may find themselves having to come down on the prices or risk a longer wait before finding a tenant. Next year, 19,302 new private home units will be ready for occupation. Combine that with 19, 727 in 2015, and stricter immigration and labour policies, the rental market may be facing some tough challenges moving ahead.

Shoebox apartments and smaller condominium units were popular for the past year. But now, it seems supply has larger overshadowed demand. The dip in rental prices were most obvious here, with a 10 per cent decrease. A two-bedroom apartment at Cote d’Azur in Marine Parade for example, which would have been rented out at $3,000 per month last year is only going for $2,700 in the current market. New homes at Silversea and The Shore Residences which will be ready soon, may only lower the prices even further. And landlords who are eager to recoup their capital may have to lower prices in order to secure a tenant in order to make their mortgage payments.

Shore Residences on Amber Road

Shore Residences on Amber Road

As supply of HDB flats reaches a saturation point, and lower sale prices mean more HDB owners are upgrading to private properties and renting out their HDB flat, the options for tenants have opened up tremendously. That also means they are more likely to compare or wait for the best deal, putting landlords at a disadvantage. The prediction is a 5 to 10 per cent drop come 2014. Will governmental policies be likely to change to the benefit of home owners anytime soon?

Private properties take a back seat

November heralded a boom to the private property market. But as the month draws to an end, so does the interest. In the weekend past, sales were slower and many developers were resorting to price cuts to attract customers.

Clermont ResidencesAt Clermont Residences in Tanjong Pagar, possibly the tallest residential building in Singapore when it’s completed in 2016, approximately 10 units were sold at $3, 000 psf. But that could be due to the high price tags of the units, including a $30 million “super penthouse”. As the property-buying crowd become more experienced, they are leaning towards less expensive options and smaller units in suburban developments are more palatable for the immediate investor.

Alex Residences in Redhill launched just a couple of weeks ago to a good deal of activity, but most of that has tailed off, with only about 20 units sold over the weekend at an average of $1, 680 psf. The other recent new property, DUO Residences fared slightly better, mostly because of its relatively lower prices, especially for something so close to the CBD and Orchard belt.

And now the record launch of close to 9,000 new HDB flats, and the upcoming festive season, will sales dip even lower?

Waterfront Singapore

URA Master Plan 2013As an island country, waterfront living seems like it should be a buzz word. And it certainly will be, come as early as 2023. A new blueprint, the Draft Master Plan 2013, for nation planning has been put in place, with promises of more and better homes, and a more sustainable green and ecological living environment. National Development Minister, Mr Khaw Boon Wan, has said in his blog post that “the underlying philosophy of making Singapore an endearing home and a clean, green, livable city remains unchanged”.

About half a million new homes have been planned for new housing areas. These include Bidadari, Tampines North and Punggol Matilda. Other older HDB estates will also see the injection of some new blood, in Sembawang, Yishun, Hougang and Choa Chu Kang. A strong focal point of the Master Plan is the Greater Southern Waterfront, a 1,000 hectare development along the south coastline.

Punggol Matilda HDB1And as recent property news have signaled, the Kampong Bugis and Marina South areas will be a hotbed for private residential home activity, with the possible yield of 13, 000 new homes. Out of the 13,000, 9,000 private properties are designated for the Marina South area, which will only be developed once the Thomson Line is completed in 2017 or 2018. And cyclists may have something to cheer for, with URA setting the wheels in place to make Singapore more cyclist-friendly.

As the nation becomes more congested, it now becomes less practical to travel too far from home for work, and the constant development and setting up of regional commercial centres will make the most sense. The Woodlands Regional Centre and North Coast Innovation Corridor are just two of the many scattered around the country.  There were also talks about a new commercial centre in Punggol, and new industrial sites at the Seletar Aerospace Park, and also in Defu and an area called 2 West near the Nanyang Technological University. Since properties near commercial and financial hubs usually fetch the highest prices,  could this also cause property prices to rise overall?

Red hot Redhill

Location, location, location. And then again, location. Top of the list on adding digits to a property’s selling price is where the property is situated. Being close to the Central Business District and also the Buona Vista science parks makes Redhill the prime spot for property sales.

Though part of their popularity comes from the lower prices of 99-year properties, recent launches have set the bar. Alex Residences, which launched just this week had an average selling price of $1, 650 psf. This is quite close to the $1, 795 psf for the 508-unit Echelon nearby. All units at the Echelon have been sold out. Ascentia Sky which is situated near the Echelon went for $1, 709 psf.

Alex ResidencesThe overall housing market has seen a little less action in the rising prices front, though the number of transactions of private properties sold remain high. New homes in particular now come with a smaller price tag, and those looking to sell their resale units may find themselves having to match these competitive prices.

On the other hand the rental market in this area, though stable, has not been especially vibrant. Prices have remained at around $4.22 psf to $4.54 psf  over the past 12 months. But industry experts think that if you can hold out for about 7 years, the outlook may look rosier.

Q3 spells trouble for Singapore’s real estate market

Suburban, city fringe, prime districts, city centre. All around, property prices and transactions were on the way down. Possibly at its lowest since 2009, only 2, 200 to 2, 400 new homes were sold in the last 3 months. Less than 100 new homes were sold in the city centre an less than 150 in the city fringes. In the suburban areas, the number was almost halved from 1, 050 units in H1 to less than 600 in July and August.

Sky VueProperty agents and industry experts are putting the drop down to the new TDSR (total debt servicing ratio) framework which the Monetary Authority of Singapore implemented in June this year. But with the recent new launches, the numbers may improve marginally, especially as foreign buyers return after the initial pauses caused by stamp duty hikes earlier in the year. Executive Condominium (EC) Waterwoods and Skypark Residences, The Skywoods, Sky Vue and Thomson Three private apartments were some of the latest offerings on the home buyers’ plates.

As the year draws to an end, there are almost 2 more months for the property market to respond. Will developers sense the lull and boost sales with discounts and other offers? Or will buyers realise the opportune time to come back and snap up units at the latest launches?

Iskandar properties excite Property investors

It certainly so. By the way they are snapping up units. As far as foreign property goes, Iskandar Malaysia is one of the most popular destinations for Singaporean investors when it comes to exploring into foreign lands.

Proximity to home, stepped up security measures and increasing number of new property launches make for better fodder. And the investors are certainly finding this fertile feeding ground. Property developers are also offering more, and better discounts. And it’s not only the new homes which are finding new owners. Resale units are already commanding heightened interest, with buyers who are looking to move in immediately and into areas where amenities are established.

Meridin SUiteMeridin Suites, Medini Signature and Horizon HIlls count as some of the chart toppers in the preferred list of properties investors are looking at. How much are most investors willing to spend? Although foreigners are only allowed to purchase properties valued above RM$500,000, most buyers are willing to go as high as RM1 million. As a second property, that might be a viable option, especially as locally, curbs and other cooling measures are in place and makes investing in the second or subsequent property more difficult.

There are some concerns, of course. Top on the list are Malaysia’s fluid policies surrounding land and property ownership, and also the political situation in the region.

Tipping Point for New Property Launches?

1,600 new homes will be out in the market this week. But will those pricing above the $1,400 psf mark hit the sweet spot for home buyers?

Property analysts are predicting September might be the month where telltale signs of the market’s true response to recent home loan restrictions will show. Since the first two months after implementation of new rulings are usually a little uncertain as adjustments are made and buyers hold back in wait of what may come, the third month is a good test of the actual market sentiments.

Onze Tanjong PagarSome delectable offerings are already available, and more will be launched in the upcoming weeks:

Launched last Thursday, the 56-unit Onze@Tanjong Pagar  is a mixed-use development with 13 other commercial units for sale. Apartments are going for $2, 200 to $2, 500 psf. The Glades in Tanah Merah sold at $1, 400 to $1, 600 psf with 726 units of one to four-bedders ranging from 500 to 1,450 sq ft.

GladesThe Skywoods at Dairy Farm were the most affordably priced of the lot, at $1, 250 psf. Will buyers head straight for this development since it is within a price range which most home loans can cover, just like what the experts predict? Or will location still take priority? Originally slated to sell at $1, 300 psf, The Skywoods is an example of recent private condominium launches where prices were dropped to help interested buyers qualify for a home loan. What does this ultimately mean for Singapore’s home prices and property market? Is it a cure or merely a stop-gap?