You are here: Home / Archives for Singapore home prices

16 May

New Homes sales halved

New properties rode the big wave earlier this year in the first quarter. Now, the tide has brought them back on the ground.

Sant Ritz near Potong Pasir MRT station.

Sant Ritz near Potong Pasir MRT station.

But the reason may not be because the fish are not biting. There are simply fewer launches in April. Although new home sales saw a spike in March, industry analysts are putting it down to pent-up demand following January’s cooling measures. Are April’s numbers more reflective of the actual effect of the property curbs? As the heat from Q1′s fever dies down, home buyers who are shopping for a home may be holding back in wait of potential launches in the coming months.

The most recent launches were Sant Ritz in Potong Pasir , Jade Residences in Upper Serangoon, Cosmoloft in Balestier and The Siena at Farrer Road. Data from the Urban Redevelopment Authority (URA) indicated 104 units sold at the 214-unit Sant Ritz, at an average of $1,494 psf. At Jade Residences, buyers snapped up nearly half of the 171 units at a medai of $1, 592 psf.

cosmoloftBuyers are becoming more savvy, and are increasingly not only drawn by a property’s location but also design and potential investment value. Do buyers now have the upper hand and will developers be pressed to lower selling prices? CBRE executive director of residnetial Joseph Tan believes that buyers now draw the line at properties ranging between $900 to $1, 600 psf. Properties selling above that price line may not see as many takers. For now.

Deputy Prime Minister Tharman Shanmugaratnam’s statement last month which spoke to the unlikelihood of more cooling measures could also mean buyers are now in less of a hurry to buy up properties and can well afford to play the waiting game. It may seem like a supply glut could be near, but as soon as population increases, and depending on how fast a rate, demand will soon rise as well. Is it better to buy now than to wait for prices to drop?

Upcoming launches include KAP Residences at King Albert Part, Corals at Keppel Bay, Liv on Sophia near Dhoby Ghaut MRT station and Stratum in Pasir Ris.

5 Mar

Will Singapore homes ever be truly ‘affordable”?

Not for some time yet, according to Finance Minister and Deputy Prime Minister Tharman Shanmugaratnam.

Waterfront living in Sentosa. Is this the area for expansion in SIngapore's future?

Waterfront living in Sentosa. Is this the area for expansion in SIngapore’s future?

Stuck in the part of the property cycle where home prices run high, all are in wait to see if they run even higher. The Government is doing all they can to cool the market. The previous seven round of property cooling measures since 2009 will attest to that. But Singapore’s real estate market still stands for some price correction before it could get moving and complete the cycle it is apparently in.

It will not amaze most Singaporeans to know that housing prices have risen sharply in the past four years. 30 per cent is a huge leap. In the time where the global economy struggles to right itself from its humpty-dumpty fall, Singapore’s economic growth, lower interest rates and strong capital flow has kept the property market buoyant.

Is the private property market quietening? Image courtesy of Singapore Tourism Board

When will homes truly be affordable for the average Singaporean? Image courtesy of Singapore Tourism Board

Even though the cooling measures may have slowed the rate of increase of home prices, the pricing rise is still significant. We return once again to the question of whether the Government should be responsible for keeping market prices low or simply stall the rise in prices, which is inevitable and should be left to market forces to dictate.

Mr Thaman said as ‘Singapore’s highly open economy lives by being global and regional, the Government’s key priority is to raise productivity to a new level”, since raising incomes for the average person and for the median household is at the top of their to-do list for now.

7 Feb

Property developers discounts may be cut

If you’re waiting to see if the developer of your property of choice might dangle discounts to counter the recent cooling measures, you might have to reconsider. The authorities have caught on to property developers‘ tactics of offering discounts as a means to entice customers to buy new properties, especially since the cooling measures have taken a huge chunk out of the business.
House

But fear not, only the indirect discounts are under review by the Urban Redevelopment Authority. These mostly refer to the rebates and vouchers that the buyer receives only after purchasing the property. Since these are not reflected in the upfront price which the buyer pays, it may make the cooling measures seem ineffective, which also means URA’s quarterly price index based on caveats lodged might not be a true reflection of the market situation.

Property developers on the other hand tend to lean towards indirect discounts as this helps placate early buyers who may not be happy that they had gotten the raw end of the deal. Keeping the upfront price high also helps to keep prices high all around.

Other ways which developers have been trying to help buyers out are through the partial or full absorption of the Additional Buyers Stamp Duty (ABSD) which has been increased in the most recent round of measures. The frequency and fervency of this practice might be what the authorities are watching as it negates the effect of the property measures.

Another concern is also that the true value of the property needs to be conveyed truthfully to the home buyer, but with the discounts and cuts, it might not be the case and it might only confuse consumers. Not forgetting that home loans are based on the property value, thus might buyers be paying more in the end through bank loan interests for a higher priced property?

So are the cooling measures truly working? If it seems that discounts are offered more frequently, then it might be.

25 Oct

$1-million ECs the norm?

Are average home prices adjusting ever upwards, especially now with news that an increasingly number of Executive Condominiums (EC) are selling above the $1m mark?

Since the relaunch of the EC housing property type in late 2010, ECs have been flying off the HDB shelves, price tag notwithstanding. More than 340 new EC units have been sold over the $1-million mark and with 100 in the second quarter of 2012 alone, putting the average price for executive condo units at $822, 000.

One of the highest selling units was at The Arc in Tampines, and a One Canberra executive condominium penthouse unit in Yishun sold for $1.6 million. Most of the buyers were HDB upgraders, who are now more affluent, and have deeper pockets that can last them through the property cooling curbs, rising resale HDB flat prices may have also buoyed their spending power. The lowered interest rates and rising incomes of buyers all round could also be reasons these units are going for higher prices, industry experts say.

Executive condominiums come with the possibility of selling them on the private property market within 5 years of purchase. But with a monthly income cap of $12, 000, there are questions of whether EC units are truly affordable enough for those who are hoping to upgrade to the private residential property market. Which home buyer market do these hybrid properties really serve?

25 Oct

$1-million ECs the norm?

Are average home prices adjusting ever upwards, especially now with news that an increasingly number of Executive Condominiums (EC) are selling above the $1m mark?

Since the relaunch of the EC housing property type in late 2010, ECs have been flying off the HDB shelves, price tag notwithstanding. More than 340 new EC units have been sold over the $1-million mark and with 100 in the second quarter of 2012 alone, putting the average price for executive condo units at $822, 000

Tampines-Executive_Condo-ForSaleOne of the highest selling units was at The Arc in Tampines, and a One Canberra executive condominium penthouse unit in Yishun sold for $1.6 million. Most of the buyers were HDB upgraders, who are now more affluent, and have deeper pockets that can last them through the property cooling curbs, rising resale HDB flat prices may have also buoyed their spending power. The lowered interest rates and rising incomes of buyers all round could also be reasons these units are going for higher prices, industry experts say.

Executive condominiums come with the possibility of selling them on the private property market within 5 years of purchase. But with a monthly income cap of $12, 000, there are questions of whether EC units are truly affordable enough for those who are hoping to upgrade to the private residential property market. Which home buyer market do these hybrid properties really serve?

19 Oct

Resale HDB flat prices still high

As low interest rates continue to flourish due to the monetary expansion in the US and Europe markets, Singapore’s home prices have continued to remain high. Thus the rise of resale HDB flat prices is still highly possible and the authorities are hoping that the property cooling measures will help stabilise the property market.

GreenTops @ Sims Place – one of the BTO flat launches in July this year.

The recent home loans curb are targeted at preventing ‘excessive speculation’, according to National Development Minister, Mr. Khaw Boon Wan. He has also said that the “acceptable resale index” depends on the global economy” and that “if prices remain unaffordable, that means people cannot afford to buy (property), then there will be no buyers and there will be no market”. The issue of singles being able to purchase new HDB flats directly from the housing board was also brought up.

Singles might be waiting to hear what criteria they have to fulfill in order to buy. What changes might this announcement bring to the constantly changing property landscape?

9 Oct

Resale trumps New in September

Leonie Gardens in district 9 is an older property in the city fringe, but nevertheless a considerable option in the resale private property market.

Resale private properties are taking over new properties in terms of sale prices. September registered a 2.5% rise from August, whereas in the new sale market prices dipped sharply at 2.2%. Presumedly aided by low interest rates and the strong desire to be able to rent out their property upon purchase, property investors are looking increasingly at private resale condo units. The corresponding rise in average rents could also be a reason more are looking at purchasing properties with long-term goals in sight. New homes are also said to include a premium price tag of 10% more.

According to data release by the monthly Singapore Real Estate Exchange (SRX) Residential Property Flash Report, resale homes in the city fringe and central region (OCR) saw the most significant increase at a 7.1% rise.

eCO private residential development in Bedok South, near Tanah Merah MRT station, consists of SOHOs, townhouses, condo apartments, suites and lofts.

There might be hope yet for new home sales, as data of sales of the latest eCO condominium launch in Bedok has yet to be captured. What will October bring for both property markets?