Higher future demand for ECs?

Recent news of the income ceiling for new HDB and ECs (executive condominiums) flats possibly being raised have brought about a wave of questions from the market. Will this increase competition for new BTO flats? How will the resale HDB flat market be affected? Will the private property sector see lower or higher demand?

Since ECs and mass market private homes often go after the same pool of buyers, raising the income ceiling for ECs may mean increasing competition for the latter. With the higher income ceiling of $14,000, buyers who were previously ineligible for executive condominiums may now find themselves able to purchase these unique public-private hybrid properties, drawing them away from the private property market.

Sol AcresECs are considered public housing and buyers are able to take advantage of available housing grants for this property type. After 10 years, they become private property, which considerably ramps up their sale value. Buyers who have previously had to turn to private properties at much higher prices, and who are now eligible to apply for ECs will no doubt be in glee. The difference between an EC and a private property is about $300 psf and buyers comparing private homes and ECs in the same vicinity may come up with savings of up to $250,000. Not an amount to be scoffed at.

One recent EC offering, Sol Acres, have since sold 294 units. Upcoming EC launches are expected to give pricier private mass market homes without the calling cards of a good location, a run for their money. Prices of ECs usually stand at around $800 psf whereas private homes go from $1,000 psf and up.

 

Investing in Sydney Properties

With the Singapore dollar strengthening against the Australian dollar, and with property prices and demand rising in the Australia, in particular Sydney, now could the the right time to jump onto the bandwagon. Especially as there is something coming up which could very well be worth buying into.
TheInfinitySydney_1Photo credit: Crown Group Holdings


A new residential-cum-hotel project at the corner of Bourke Street and Botany Road, helmed by Crown Group Holdings will yield 75 hotel suites, and 326 luxury apartments ranging from 37 sq m one-bedders to 138 sq m three-bedroom units with prices starting at A$650,000. Considering that is about the price of a four or five-room resale HDB flat in Singapore, the prestigious address with potential of appreciation and rental profits could be well worth its every inch.

Named The Infinity, this spanking new 20-storey project is situated in central Sydney, within the Green Square Urban Renewal Area. Designed by Koichi Takada Architects, it has clinched the Urban Development Institute of Australia New South Wales Concept Design award last year. Aside from the hotel and residential units, it will also feature a 1,180 sq m open-air garden plaza and a myriad of retail outlets and eateries.

TheInfinitySYdney_2Photo credit: Crown Group Holdings

Its prime location near Sydney’s Central Business District and universities, will no doubt raise its market value but quite a few points. To be completed by 2019, it will also be situated near the Green Square train station. Consdiering Sydney’s town planning has brought quite a bit of day and night life to the town centres and CBD, apartments in town have always been popular fodder for investors.

Exact prices of the apartments will be realised on 29 August.

Property – To buy or not to buy now?

Since the implementation of property cooling measures by the government agencies, property prices have fallen at a gradual pace and seem to have currently reached a plateau. Some may have been waiting for an opportunity to hop into the property buy-sell train, but others may be concerned about whether they should sell now or later.

How do you decide if the time is now or later?

The WaterlineThere are a few fundamental questions to ask yourself:

  • Need or want?

Of course, owning a home of your dreams is the ultimate desire for most. And so it is a want. But you will need to evaluate your situation very honestly – do you absolutely need a new place? Or could it wait? Are you hoping to merely flip a property for profit, or have the ability to hold out for the best deal? If you answer is “Need”, then you have to a few other considerations to take care of.

  • What’s in the piggy bank?

Do you have enough left in your savings and monthly earnings, after setting aside sufficient funds for your monthly bills, every day expenses and insurance to manage the risk of buying a home? Besides having enough to make your monthly mortgage, most people may not realise the need to have an amount within your savings for very real and unforeseen situations such as periods of unemployment or health issues.

  • Are there advantages or pros? 

Is the price on the property you are hoping to buy right? If there is room for negotiation, which is why an experienced real estate agent is a boon, and the mortgage calculator helps you compare rates and tells you that the interest rates are prime, then perhaps the time truly is now.

Shoebox apartments – Supply over demand?

Shoebox apartments – affordable total quantum price, relatively easy to rent and maintain, limited numbers. That used to be the case when these small units were first marketed a couple of years ago. But as developers caught onto the small apartments trend and churned out more of these units, their numbers have increased significantly.

Parc Centros private condominium on Punggol Walk.

Parc Centros private condominium on Punggol Walk.

By 2017, the number of these shoebox apartments with floor area of approximately 500 sq ft, will rise by another 700. Instead of being mostly concentrated in the city and prime districts, they will now be in the Hougang, Punggol and Sengkang areas in residential projects such as A Treasure Trove, Bartley Residences, The Promenade@Pelikat, Parc Centros, River Isles, Jewel@Buangkok and La Fiesta.

Expatriates are usually keen on renting out properties near their workplace, usually near the Central Business District. But as businesses are moving out into the various regional commercial hubs, so may their search for rental properties. What may however be deterring them from renting out these small studio apartments could be the rental prices.

Rental prices of small studio apartment are now at $2,000 to $2,200 per month, down from $2,600 in 2013. These prices are now nearing that of renting out an entire HDB flat, which could prove to draw tenants away from the private property rental market. Could this then in turn increase the demand for resale HDB flat?

Resale HDB flat prices remain level

As the year moves quickly towards the middle of the second half, property sellers may be getting a little on edge about whether the property prices will fall further.

For the resale HDB market at least, property analysts are expecting prices to stabilise, with any fluctuations occurring only slightly on a month-on-month basis. Prices of HDB flats dipped slightly in July by 0.5 per cent, which is 4.3 per cent lower than July 2014. The fall in prices is still within the single digit range, and at the lower end of it, thus sellers could rest assured the boat will not rock too drastically. Most of the price drops were in the four- and five-room flats segment while prices of three-room flats remained flat.

The resale market for HDB flats seem to have taken a dive due to the bumper crop of BTO flats. Photo courtesy of Singapore Tourism Board.

Photo courtesy of Singapore Tourism Board.

Buyers looking to purchase a property within the year will still do so, and resale HDB flat prices and transaction volume looks likely to maintain at the current level for the rest of the year. The property cooling measures have taken a couple of years to take effect, and a sharp turnaround in prospects seem unlikely.

With a few more months to go before figures can be more effectively measured, property experts are nevertheless positive about the market stabilising soon.Though with a possible raising of the income ceiling which may draw buyers’ attention away from resale flats, and with the upcoming General Election in play, it could be anyone’s guess how property prices will fare by year end.

Rising resale HDB flat sales

There’s possible cheer on the resale HDB flat front with a 28% increase in the number of resale flats sold in the last 3 months up to June 30; and a slowdown in the dip of the resale price index at 0.4 per cent. Previous quarters saw a 1.4 per cent decline.

Are resale HDB flat prices going to drop as more new HDB flats are made available to the buying public?

Are resale HDB flat prices going to fall further as more BTO flats become available for occupation next year?

Obviously the lowered prices and announcements of reduced new BTO (build-to-order) HDB flat launches have drawn buyers back into the fold. The HDB estate of Jurong West saw the most number of resale flat transactions with 423 units being sold. This is closely followed by Tampines with 364 units at Sengkang with 341 units.

Property analysts are however wary about a quick and complete recovery. For the rest of the year and perhaps the next year as well, HDB flat prices are expected to stabilise at best. As home buyers are still restricted by the property cooling measures, and as more BTO flats become ready for occupation, more resale units may be expected to enter the market, and heat up the competition. Buyers have more options and can afford to be picky about their selection. Some sellers are already finding it difficult to find a buyer for their current flat which they are required to sell within a stipulated time upon receiving the key for their new BTO flat.

With the upcoming General Elections (GE), what can be expected of the property market?

HDB resale flats – Market recovery soon?

The number of HDB resale flats which exchanged hands in the last 2 months have increased by more than 8 per cent. A sign property analysts are taking as a positive.

Photo credit: The Singapore Tourism Board.

Photo credit: The Singapore Tourism Board.

With a consecutive 2-month rise in prices, at 0.1 per cent in June and 0.2 per cent in May, the HDB resale market seems to be showing signs of bottoming out and a turn for the better may come quite soon. In the months prior, when the property cooling measures just began to take effect, it were the four- and five-room flats which suffered the biggest hit in price drops. But recent market figures seem to show that prices in these segments have risen by 0.3 and 0.5 per cent of late, followed by a 0.7 per cent in executive flats (EC) prices as well. The three-room HDB flats segment however have seen a 0.2 per cent fall in prices.

In the year ahead, as the government reduces the supply of new BTO flats, buyers may have to turn to the resale market instead, which may in turn positively affect the number of sales and prices. However, the rebound, though happening, may be slow as buyers may be more selective of their choice of units and there may be more put into the market as BTO flats reach completion and those who have secured a new flat may be pressured to sell within a stipulated 6-month period of getting the keys to their new units.

Rare landed public housing – HDB Terrace Houses

Who knew public housing was not always high-rise and towering 50-storey blocks.

HDB terrace houses are a rare commodity in modern Singapore and there are only 258 of these on the island. Two storeys, mostly in mature estates, and commanding high prices – most may not even have realised these gems were in their midst.

QueenstownHDBTerracePhoto credit: Queenstown.org.sg

A recent sale of a Jalan Bahagia HDB terrace house at $958,000 may rise eyebrows but considering the rarity and floor area of the unit (241 sq m), and recent sales of resale HDB units at the Pinnacle @ Duxton have already been closing on the $1 million mark, it is quite a steal indeed. It sold at a mere $370 psf and with 60 years or more left on its 99-year lease. In comparison, private properties in the vicinity sell at $2,200 psf. Earlier in the year, another such unit sold at $1.06 million. Previous sales include a 85 sq m unit which went for $760,000 in January; a 104 sq m unit at $875,000 in February and a 81 sq m unit for $708,000 in March.

Built decades ago by HDB’s predecessor, the Singapore Improvement Trust (SIT), these rare landed public housing units reside mostly in Jalan Bahagia in Whampoa, and Queenstown. Although the land can be taken back by the government anytime, and it is not a freehold private property (where the deed belongs to the home owner), these units are nevertheless much sought-after properties and provide the space and luxury of a private property at much less. Taking into consideration that there are an increasingly number of 99-leasehold private properties, being able to get your hands on one of these rare HDB terraced units is quite a coup indeed.