More for less – Smaller condo apartments

With the rising prices of land plots sold under the Government Land Sales programme and with developers taking into consideration how the property cooling measures have affected buyers’ purchasing power, private apartment sizes have been diminishing since 2010.

LakevillePhoto: Lakeville at Jurong West

More apparent in units in the city fringes, average sizes have shrunk from 1,051 to 810 sq ft. And in the suburbs, apartment sizes went from 878 sq ft to 811 sq ft; though the average sizes from new projects actually dropped from 1, 113 sq ft in 2006 to 667 sq ft in 2011 but rose again to 928 sq ft in 2014.

In 2012, the Urban Redevelopment Authority (URA) put in place guidelines for the maximum number of units for condominium developments outside of the central area. Developers have since noticed that buyers are more sensitive to the total quantum price of a unit rather than per unit prices, especially since the implementation of loan curbs such as the Additional Buyers’ Stamp Duty (ABSD) and Total Debt Servicing Ratio (TDSR), hence maximising the land area and total number of units would be the best way to go.

Symphony SUitesPhoto: Symphony Suites

There are some residential projects which chose to follow their own path however, including Lakeville and Symphony Suites. But as the population continues to grow, it seems that unit sizes will only continue to diminish. Resale units may then have an edge over the smaller-sized newer units, provided pricing is equally competitive when time comes.

3 new MRT stations – Opportunity for property growth

76 Shenton
3 new MRT stations, part of the sixth phase of the Circle Line to be completed by 2025, have just been announced last week:

  • Keppel
  • Cantonment
  • Prince Edward

These areas are yet to be heavily populated, thus the breadth and depth for growth could potentially attract residential developers and commercial and retail businesses alike. These 3 new stations will link the rest of the island to the new Greater Southern Waterfront district under URA’s redevelopment and rejuvenation Masterplan which will take the place of the Keppel docklands.

Currently, residential areas in these districts are few and far in between. The nearest HDB area might be The Pinnacle @ Duxton and some HDB blocks in the Cantonment and Spottiswoode Park estates. The nearby Tanjong Pagar and Chinatown districts have already seen a positive revival with new apartment buildings and retail shops injecting some life into the previously sleepy region.

The Beacon

Some of the properties near the Prince Edward MRT station which will also benefit from the redevelopment of these districts include Spottiswoode 18, Spottiswoode Residences, The Beacon, 76 SHenton and Lumiere. Nearer the Keppel station, there are private apartment blocks such as The Pearl@Mount Faber and Mount Faber Lodge.

Developers and industry players are hoping this redevelopment project will revive property interest this region as sales have been a little quiet last year due to the property cooling measures.



Tri-factor sustaining Property market – Government, industry and home owners

As 2016 brings a slew of completed new homes into the property market, developers are concerned about what market restrictions and rising construction and project development costs will do to the industry.

Kallang Riverside

Photo: Kallang Riverside

Even as everyone understands that Singapore is a land-scarce country, and the costs of properties will never be unrealistically low, the current market sentiment seems to be one of wait-and-see. But property prices may never fall too far without affecting the quality of homes. Developers are already feeling the financial squeeze as land costs rise, along with regulatory fees for plans submissions and costs of construction, fittings and furnishings. On top of that, developers are also under the time pressure of selling all their units within a five-year period in order to avoid paying the Additional Buyers’ Stamp Duty. At the moment 3,000 units from the development of properties from land plots sold under the Government Land Sales Programme in 2012 remain unsold, they will reach their five-year deadline next year.

Thus as much as a home buyers may be waiting for even lower prices, new properties launched in the months or year ahead may not be able to lower their prices any further. Moving ahead, how the Government manages its land sales programme, and how developers manoeuvre around rising project development costs and market their products may be key to keeping the industry and ultimately the overall economy healthy and growing.

Resale private homes – Slow climb up

There was a glimmer of light in the resale property market last month as prices of homes in the city fringe rose 1.1 per cent and 0.5 per cent in the suburbs. Overall private resale home prices rose 0.4 per cent.

BlueHorizonThough property analysts are not certain if prices will maintain their current level or dip even further in the later part of the year, the numbers gave at least a little hope to private property owners and sellers. While the resale market shows that it has steadied itself with a $0 T-O-X (the median transaction over X-value or a home’s market value), in the city centre district 9 which consists of Orchard Road and River Valley, more resale properties were being sold below the computer-generated  home prices dipped to an average of $55,000 below the X-value.

In district 5 of Pasir Panjang and Clementi however, the highest media T-O-X came up to $30,000; and in the Bukit Timah, Holland Road and Tanglin areas of prime district 10, the number came up to $14,000.

As the number of new properties being launched or completed rise, the prices of resale properties may face the danger of being pushed down by competition. Though location and condition of resale units may always have an upper hand. With the General Elections planned for the year ahead, prices may fluctuate with policy or economic changes. Could this year be the watershed year for the property market?

More data for Private home buyers

Private property buyers will no longer have to grasp at thin air in their attempt to make sense of which way the market is leaning in terms of prices, sales volume and even incentives offered by the developers or sellers.

iProperty Transacted PRices

Photo: iProperty’s transacted property price trends data is provided online

Starting from June 5, buyers or anyone who wants to do their market research can now access the Urban Redevelopment Authority’s (URA) website. Data will be published weekly. That would also mean much more transparency in the marketplace, including information provided to banks in order to allow them to better gauge applicants’ loan limits and also loan amounts which take into consideration value benefits such as cash rebates, legal and stamp duties absorption, rental guarantees and furniture vouchers.

Improvements will also be made into transparency of showflat depictions by developers. Previous complaints about obvious differences between showflats and the actual unit have not fallen onto deaf ears. Now, the Housing Developers (Snow Unit) Rules which will be in force starting from July 20, will keep everyone on the right track. Showflats ready for viewing before July 20 will however be exempted from the rules, though developers are required to made clear the differences between the showflats and the actual unit.

How will these new rules change the playing field? Will it be easier or more difficult to secure loans from the banks once these rules are put in place and enforced? Will that in turn affect the buying power of the already restricted purchasing crowd?

Will shoebox apartments be 2015’s top seller?

Despite a rise in the number of available shoebox apartments over the last year, the fall in prices of this property sector was the lowest amongst all the other completed non-landed private apartments.


Photo credit: Urban Redevelopment Authority (URA)

These small units up to 506 sq ft in size, especially if situated in good locations, will this segment continue to do well this year despite a 4 per cent price decline in 2014? Made popular in 2009, shoebox units in the prime districts such as those in the city centre or city fringes, were snapped up well and fast over the past 5 years. So much so that developers launched projects with shoebox units which made up as much as 80 per cent of the total number of units launched outside the city centre region.

Though these small studio-size units are commonly popular in highly populated cities such as London, Sydney, Tokyo and New York, will they work in suburban Singapore? With new regional hubs such as Jurong and Woodlands coming up, and even more in the next 10 to 20 years under URA’s redevelopment plans, it could possibly be so as businesses fan out from the city centre into these regions, bringing with them expatriates and their housing needs.

For the current year, property experts are waiting to see the markets’ response to resale shoebox units as more of these developments attain their TOP (temporary occupation permit). The most recent additions to the market are The Promenade@Pelikat and The Hillier. It could be a battle between centrally located shoebox units and slightly larger two-room apartments outside of the city.

Re-zoning Geylang – Fewer residential properties

At first instance, this proposal may not sound promising, but it may actually bring good news for owners of existing condominiums in Geylang. The Urban Redevelopment Authority (URA) has recently announced a re-zoning of residential areas in Geylang for commercial use.

Rezi3TwoWhile this means that there may not be as many private residential properties in the area, the value of those which have already been built may appreciate as offices and businesses eventually move into the area. This proposal by the URA could be seen as mainly to facilitate the balancing of residential and commercial activities in the district. The over-building of residential properties in the red-light district could have a reverse effect and introducing more commercial properties and maintaining a suitable amount of residential properties in the area may in turn increase the rental yields and value of properties in its proximity.

With Geylang’s prime location putting it close to the city centre, Aljunied MRT station and the Singapore Sports Hub, rental yields here are already 1.5 per cent higher than those in other districts. With the area mostly made up of smaller land parcels, the likely tenants would be boutique developers and small businesses, with the possibilities of niche eateries and shops.

Some residents have however raised concerns over this re-zoning move as more commercial spaces here may mean an increase in the illegal and disruptive activities normally associated with this infamous district. What are the pros and cons of purchasing property in Geylang and does one outweigh the other?

More transparency with Property prices

The Urban Redevelopment Authority (URA) has recently hinted that even clearer property transaction price trends will be provided publicly come 2015. Within the first half of the year, property players, the buying public, and even policymakers will be able to get their hands on prices of individual units in developer-sold properties.

Photo credit: Urban Redevelopment Authority (URA).

This may level the playing field as currently, even though median prices of units in each residential project is shown on the URA website, only when units have been purchased, and only those with caveats lodged with the URA will have their prices disclosed.

Part of the reason for the change could be the fact that more developers have been offering discounts and rebates of sorts on new units, ever since the cooling measures kicked in, which meant affordability have decreased and total quantum value has now become the new unit of measurement. As these discounts are often not registered in the caveats, the prices disclosed may not paint the entire picture.
iProperty price transaction page


Buyers may be able to now better negotiate their deals instead of relying on developers’ statistics. How will this impact the market and while transparency is a mature way of moving forward, will developers be able to withstand the continued price decline? Or perhaps the question would be, how long more before prices hit the bottom of the curve and begin its upward climb?