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20 May

Variety of New Properties for the picking

After a brief respite in the property market, new property launches are back to make for a hot and heated summer.

Stratum in Pasir Ris.

Stratum in Pasir Ris.

Five new residential developments across the island are offering home buyers plenty of sweet ptions to pick from. Properties in the city centre include the 366-unit Corals at Keppel Bay near HarbourFront MRT station and Liv on Sophia near Dhoby Ghaut MRT station. The proximity of these developments to transport and amenities should mean they are popular with buyers and investors alike. Corals at Keppel Bay is situated beside the Caribbean condominium and previewed the weekend past. 100 more units will be launched this weekend. Prices range from $2, 000 psf for a one-bedroom unit of between 570 and 732 sq ft. Ferra condominium in Leonie Hill in the prime district 9 also released its remaining 22 units of its 104 units. A 732 sq ft unit is going for $3,160 psf.

Fancy being even nearer the city centre? Liv on Sophia on Adis Road offers 64 two-bedders starting from $2,500 psf. Buyers will have to wait a little longer for these though as they are launching only end of this month or early June. Also in the property launch pipelines is the mixed-use project King Albert Park Residences. With the Bukit Timah Shopping Centre and Bukit Timah Plaza nearby, King Albert Park Residences will add even more colour to the area with its 107 retail units and 142 residential units. It will also be flanked by the  upcoming King Albert Park and Beauty World MRT stations. Property agents are expecting prices to start at $2, 000 psf for the smallest 484 sq ft units.

King Albert Park Residences is a mixed-use development with retail and residential units.

King Albert Park Residences is a mixed-use development with retail and residential units.

And further in the East, Stratum in Pasir Ris launched last Saturday with a $900 psf median. The 99-year leasehold condominium will stand across Elias Mall and the new Singapore University of Technology and Design. Will this increase the potential investment value of the property? How will other older condominiums nearby fare?

Another new suburban launch to look out for is the Jewel at  Buangkok, just 2-minutes away from Buangkok MRT station. To be launched within the next few weeks, a small 463 sq ft apartment is expected to go for $1, 000 psf. In an area yet to be saturated with private high-rise properties, how will this new project fare? Will it bring more interest and development into the area?

13 May

HDB Resale flat sales lowest in 16 years

The numbers are low but the prices may not be so. Is this a case of rare treasures raking in high prices?

HDB’s reports have shown that there were only 4,335 resale flat transactions in Q1 of this year, as compared to the average of 8,000 for the first quarters in previous years. However resale flat prices have continued to increase with a 1.3 per cent rise this year. Albeit slower than the 2.5 per cent increase from Q4 of 2012, it is still a 0.6 per cent rise when compared year on year.

Photo by HDB.

Photo by HDB.

The latest property curbs could have had a part to play here. HDB flat buyers can now only loan up to 35 per cent (previously the cap was at 40 per cent) from HDB and bank loans are now capped at 30 per cent of the household income. Thus with these restrictions, some may now not be unable to upgrade to larger flats and thus taking away a considerable pool of buyers from the resale HDB flat market. PRs who previously form a significant number of buyers, may also be out of the picture as they are now subjected to an additional 5 per cent tax on their first home.

Skypeak @ Bukit Batok. Photo by HDB.

Skypeak @ Bukit Batok. Photo by HDB.

But with the drop in flat buyers, there is in turn an increase in flat renters. HDB reported a 15 per cent rise in subletting transactions, to 7,410 this quarter. The money is coming through rental now as more HDB owners hold on to their flats, hoping to reap in enough profit to help them make the leap to private property.

This, plus the number of new HDB flats being launched and built last and this year, have drawn buyers away from the resale market. Which type of resale flats are seeing the most activity? Is there now less competition for the larger 4 and 5-room flats? Are 3-room flats the current “hot property”? Come July, singles will also be able to purchase new flats directly from HDB. Will this impact the demand for the smaller 2 and 3-room flats?

30 Apr

Changes to Exec Condo housing scheme?

2013 might be the year of housing policies shockwaves. Earlier in the year, news of singles being about to purchase new HDB flats directly from housing board stirred the market a little, then there were the limits placed on dual-key apartments which are now only available to multi-generational families. A cap was also put on the size of executive condominium (EC) units, at 160 sq m. ECs have been put under the microscope of late, with some questioning the amount of subsidies buyers are receiving from the government.

Forestville Executive Condominium.

Forestville Executive Condominium.

Certain members of public have questioned whether EC buyers should receive any government subsidies at all, since they are able to or willing to afford million-dollar units in both new and resale developments. The executive condominium scheme was initially set up by the government in 1996 to help families transit between public and private properties. But as the price gap between ECs and private properties now draw close, there has been a niggling thought about whether changes should be made to this scheme.

National Development Minister Khaw Boon Wan recently highlighted that there might soon be changes in the EC scheme and buyers and developers are poised to react. Forestville, the next EC to launch in June this year, might benefit from increased response since buyers might be leaping at what may very well be their last chance to secure a unit under the current conditions. EL Development‘s Lim Yew Soon has this to say: “Whenever policies change or are alikely to, the immediate launches will have the biggest benefits. There’s a good change that buyers may snap up existing ECs to ensure they still receive the grant.” Will resale ECs also benefit from this rush?

Should there be a drastic adjustment in government subsides, the most affected might be first-time buyers. Buyers and owners of existing ECs are imploring the authorities and public to see things from their point of view. Engineer Eddy Lau, 40, said, “It’s not right to just look at the profit we make. We also pay more in interest over the years for the EC. For us who are sandwiched, ECs are the only option to upgrade.”

Ultimately, the question that probably begets the Government is, what defines “sandwiched class” and what are the housing schemes actually meant to do. And perhaps only honest answers will help everyone fully understand and accept Singapore’s future housing situation.

26 Apr

The Battle of New and Resale ECs

Recent reports show that median prices of resale ECs have outperformed that of new executive condominiums. This is the first time resale EC prices have overtaken that of new EC units. Prices of executive condominiums across the board have risen over the past 2 1/2 years. Westmere EC in Jurong West has seen a rise of up to 40.6 per cent in median prices and Parc Oasis has increased 35.8 per cent in merely 2 years. There are 18 ECs in the whole of Singapore and 92,38 per cent of the 9,130 units available in the market has already been sold.

Parc Oasis condo in Jurong East

Parc Oasis condo in Jurong East

Surprising? Perhaps not. Property consultancy Jones Lang LaSalle proposes that the sheer number of new exec condo units being put up on sale in recent quarters have made pricing of new units more competitive. New units usually fetched a higher price as they had the maximum number of years left on the 99-year lease and everything came new and fresh.

What could be the reason for this recent takeover of interest on resale ECs? Location is the most likely factor. For example, Bishan Loft which is situated near the Bishan MRT station xceeded the $1,000 psf media price in Q1 this year. Another reason could be that new ECs cannot be sold until after the five-year minimum occupation period and thus have yet to enter the market.

Bishan Loft.

Bishan Loft.

Executive Condominiums (ECs) were a category of housing, a hybrid between private and public,  set up by the Government in 1996 to help the sandwiched class who neither qualified for public housing nor had sufficient money to enter the private property market. But perhaps the question we now need to consider is, where do the sandwiched class really lie? Can most of them now afford private, especially since there has been a considerable increase in the number of new units put on sale, and the line between private and executive condominiums are now sinking deeper and deeper into a grey pool or uncertainty?

16 Apr

New private homes sales may match 2012′s high

D'nest condominium.

D’nest condominium.

If anything, worries about the property cooling measures affecting the property market in a big way should be allayed, for now, by the way Q1′s new homes sales figures go. March’s sales gave it a big boost, as buyers returned after the Chinese New year  lull in February. Many buyers were first-timers, and out of the 5,564 units launched in Q1, almost all (5,533  units) were sold.

Property developers had kept launches out of the market in February, and the release of numerous new properties near MRT stations in March could have made up for the pent up demand from buyers who flooded the showflats and new property launches in March, snapping up units in new suburban condominiums such as D’Nest, Urban Vista, Bartley Ridge and Sennett Residence.

According to the Urban Redevelopment Authority’s (URA) data of new home sales, March alone saw 2,793 units sold, breaking the previous record of 2,772 in July 2009. It goes to show that despite the cooling measures, demand is well ahead in the race to balance property prices and inflation at large.

Shoebox apartments were top sellers for HDB upgraders. Seen here is the Bartley Ridge condominium.

Shoebox apartments were top sellers for HDB upgraders. Seen here is the Bartley Ridge condominium.

Property analysts are however not expecting similar sales numbers this month, since March’s bumper crop of new units would have satisfied the pent up demand from previous months. D’Nest emerged the clear winner with 699 units of its 912 units sold. Once again, location and proximity to transport were cited as top reasons for great sales.

15 Apr

Executive Condominiums set for great heights

As new and resale condominiums, and prime and suburban apartments battle it out in the private property sector, the in-betweener is on a roll. A hybrid between private and public housing, Executive Condominiums look set to take lead in Singapore’s real estate market this year.

Twin Fountains Executive Condominium in Woodlands.

Twin Fountains Executive Condominium in Woodlands.

Starting us out is the Twin Fountains EC in Woodlands, launched last Wednesday. Units are priced between $580,000 for two-bedders and $1.26 million for a four-bedroom dual key unit. With 418 units across 8 blocks, each with 14 stories, Twin Fountain will be ready for occupation in 2016. It will be jointly developed by Frasers Centrepoint and Lum Chang.

With a substantial number of dual-key units available, response was naturally heated. 104 dual-key units will be built in this new EC development, and as the home buying trend goes, these are hot properties, aside from shoebox units in the private property sector and suburban non-landed residential properties preferred by most buyers and investors.

One has to take note that new rulings have recently been put in place for dual-key units in particular, to curb property speculation and making sure that the units go not to investors who are looking to rent out these two-entrances units with their potentially high-rental yield. Instead dual-key units will only go to multi-generational families. Frasers Centrepoint Homes chief executive Cheang Kok Kheong expects good response from the launch, especially since there has not been an EC launch in Woodlands since La Casa in 2005.

Forestville ECThe next Executive Condominium to look out for will be Forestville. Online applications for Twin Fountains will end on 21 April and successful applicants can look forward to booking their units on 10 May.

4 Apr

Executive Condominiums back in the fray

As the price gap between ECs and private condominiums continue to widen, more buyers are choosing the former. Why? It may not be because they are unable to afford a private condominium, but for the same price, they get more space in an executive condo. If you have $800,000 to spare, you can either get a 780 sq ft private condominium unit, or a 1, 100 sq ft EC unit almost the size of a 5-room HDB flat.

Heron Bay Executive Condominium in Upper Serangoon View.

Heron Bay Executive Condominium in Upper Serangoon View.

Current prices for private condominiums are above $1,000 psf. For ECs, they hover around $538 to $809 psf. At The Topiary in Fernvale, 185 EC units were sold for between $600 and $809 psf. Waterbay in Punggol went for slightly less at $538 and $73 psf. Heron Bay sold between $612 and $809 psf.

And what you get in an executive condominium may not necessarily be lesser than a private apartment. Ground-floot units, for example, at Heron Bay EC in Upper Serangoon have private pools with Jacuzzis. Sky terraces and many other fancy facilities are increasing the potential value and attractiveness of these public-private housing hybrids.

Topiary Executive Condominium in Fernvale.

Topiary Executive Condominium in Fernvale.

And not forgetting that ECs can be sold in the private property market after their Minimum Occupation Period of 5 years, why wouldn’t the competition in this sector be tough?The Government has already placed some  restrictions earlier this year, capping the size of EC units to 1, 722 sq ft and limiting the sale of Dual-key apartments (units with separate entrances) to multi-generational families. But will this be enough? Is this market something to watch for and will control be necessary? Will this trend result in an eventual increase the prices of executive condominiums or will it decrease the price of private condos?

2 Apr

What does Q1′s slow private property growth rate indicate?

A cooling real estate market? Perhaps. But not by much. Of course, we do have to give the cooling measures time to work. But if we go by the response from the previous rounds, it may not do much. Although the pace has weakened somewhat, a 0.5 per cent growth as compared to the 1.8 per cent jump in the last quarter, private home prices still reached a record high.

QBay Residences

QBay Residences

Private non-landed suburban homes alone showed a 1.7 per cent rise, still a rise, but well lesser than the previous quarter’s 3.8 per cent. Property analysts are expecting further effect from the cooling measures to kick in this year, maintaining home prices at the current levels.

In the HDB flat market, resale flats may expect a fall in demand as singles will be allowed to purchase new Build-to-Order (BTO) flats directly from the Housing Board come July. The bumper crop of new flats being rolled out within the first 3 months of 2013 alone has also taken away the need to purchase from within the resale market. The quota plus the lowering of home loans to 30 per cent of a borrower’s gross monthly pay, 40 per cent if receiving a HDB home loan, has also taken some wind out of the sails. PropNex cheif executive Mohamed Ismail is however still expecting a rise in resale HDB flat prices, of between 4 to 5 per cent.

The Singapore Real Estate Exchange has reported a fall of HDB resale transactions from 4, 635 in Q4 of 2012 to 3, 028 in Q1 of 2013. The median COV prices have dropped by very slightly, from $34, 000 to $33, 000. This may not be quite the comfort buyers are hoping for, especially since resale prices have risen to an average of $457,000.

This could be the time to suss out potential long-term investments in the private property market as many developers are dangling carrots in the form of discounts, rebates and other incentives in order to secure more sales. Recent launches at D’Nest and Urban Vista have also boosted sales. The authorities seem more determined this year than ever to help tame the roaring property lion, but they will need to give property curbs some time to take effect before deciding their next move.

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