News

18 March 2016

All boxed up

Paper might be thin but we accumulate so much of it over time. What’s precious, of course, is what’s on it. Our school notes from all those years ago are still in their folders at the back of the shelf. We’re not going to throw them out because we worked so hard over them, even if we’ll never need to remember what dy over dx, or the Periodic table is. Our favourite books from when we were younger that we know we’ll read again, one day when we have the time.

These items are great memories, but they also take up too much space. An easy way to create some space at home, and still have these items available for when you need them is to use a storage service.

Box up clothes and shoes you rarely use

Let’s be honest. How many of the clothes we keep in our closet do we wear in a month, or even a year? What about the cute little onesies the baby has outgrown? The wedding gown. That favourite dress from five years ago that we know we can fit into again if we just diet a little. Those pretty heels that we’ll only wear for the most special occasions. They’re still in the closet, making it hard to put away the clothes that we wear to work almost every week.Clothes not only take up space, but can end up being quite heavy. Fortunately, there are services that not only store these bulky items for us, but also collect it from our homes.

Clothes not only take up space, but can end up being quite heavy. Fortunately, there are services that not only store these bulky items for us, but also collect it from our homes.

Get rid of bulky items

We’ve all got that really big suitcase we bought for those shopping holidays. Nothing is more fun than hitting those overseas factory outlets or summer sales. But let’s face facts. We might only go on such a holiday once every few years. And all that time, this massive suitcase is taking up space in our store room or bomb shelter.

Storage facilities can accommodate these bulky and even odd-sized items. It would be a lot more practical to use such a service and then retrieve them only when needed. Best of all, they even deliver the item to your house when you need it!

Storage solution

Work+Store Valet Storage offers easy, affordable solutions to help you store these precious items and memories away for when you need them again.

Order a storage box online, and have it sent to you for free. Pack your items, take a photo, and use the handy system to keep track of what you’re putting in storage. Schedule a pick up online, and a team member will pick it up from your home. Now all you have to do is sit back, and think about how to use all the space you’ve freed up.

Whenever you need an item, just schedule a delivery, and have it sent straight to you.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116138/all-boxed-up

Buying property as a corporate entity

It is not just individuals and families who buy homes in Singapore. Sometimes, a corporate entity may purchase a residential property for investment purposes. If you and your business partners are considering doing so, here’s what you need to know.

1) You can buy only private property

HDB flats are meant for owner-occupiers (especially families, married couples and senior citizens), HDB tenants and tenants of non-corporate landlords. The HDB does not permit corporate entities to purchase its flats for investment purposes. Condominiums and landed homes, however are legally permitted for corporate entities to purchase.

2) Consensus is compulsory

The corporate entity involved in the purchase should engage a lawyer to draw up a contract which is mutually agreed upon by all buying parties. All parties must then sign the contract and transfer documents individually before the sale of the property can proceed. Details like each party’s share of ownership in the property and the purpose of the property must be determined and stated in the
contract. If the purpose of the purchase is to lease the property, all parties must also sign the tenancy agreement to lease it.

3) Your share of ownership of the property is not necessarily equivalent to your share in the company

It all depends on the contract, whose terms must be discussed thoroughly among all involved parties. You may have a straightforward situation whereby your share in the company reflects your share of ownership of the property, or it could be that your contractual terms are more complex than that. It is vital to determine amongst all relevant parties what works best before drawing up a
contract and signing it. However, a private limited company is seen as a separate legal entity from its shareholders, and the extent of each shareholder’s liability is limited to his stake in the company.

4) Death has no power here

Unlike in a tenancy-in-common or joint tenancy agreement, the death of any of the owners of a residential property held by a corporate entity will not affect the company, property-wise. If a shareholder wants to relinquish his ownership, this is subject to the company’s Memorandum & Articles of Association (M&AA). He can then sell his shares to either his fellow shareholders or to a third party.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116195/buying-property-as-a-corporate-entity

Hokkaido: Snow City

Although interest in ski resort properties cooled following the 2008 Global Financial Crisis, investor reluctance appears to be thawing, as many global high-net-worth individuals (HNWIs) are now looking to own alpine homes, which have become a status symbol.

According to a 2014 (Knight Frank) survey of wealth advisors representing 30,000 ultra-rich individuals, around 25 percent of those polled in China and 11 percent in Singapore were interested in owning a ski home, especially ski-in ski-out accommodation where the ski slopes are right outside your door.

With the renewed interest, prime property prices in major ski resorts worldwide rose by 5.9 percent in the year to June 2014, revealed data from the consultancy. The price index reached its lowest point in June 2009, but had since risen by 14.9 percent.

Asia’s own Aspen

In Asia alone, there are hundreds of ski resorts, but very few can compare to Niseko in Hokkaido. Dubbed the “Aspen of Asia”, the small town is famous for its fine, powder-like snow.

“Considered one of the snowiest places in the world, Hokkaido has been bestowed with the finest snow which falls consistently every year, thus attracting many ski enthusiasts from all over Asia Pacific,” said Low Su Ming, Executive Director of Low Yat Group, a major Malaysian player in Niseko.

Aside from Niseko’s rugged beauty, she noted that the shorter travelling time compared to long flights to Europe and the Americas has also contributed to the rising number of wealthy Asian investors looking at ski resort properties in Hokkaido.

In addition, the area is easily accessible by train and bus services, while Japanese food and culture appeals greatly to many Asians.

Meanwhile, the Japanese Yen has fallen from ¥77.50 = US$1 in November 2011 to ¥122.54 = US$1 in November 2015, making the country more attractive to potential investors, noted Low.

Aussie connection

Despite the Yen being at a low point, sources told PropertyGuru that Hokkaido’s economy, which is based mainly on food production, has remained stable. But after the discovery of Niseko’s good quality snow some years ago, Australian skiers started investing and creating a community of their own. Since then, more tourists have been flocking there.

As Hokkaido’s popularity is still in its infancy, Low believes many investors will see growth opportunities in the area.

“Hokkaido is similar to Bali or Phuket when it was first discovered. There is a huge potential for growth here. As for tourism, it is becoming an all-season destination. There are plenty of things to do in Hokkaido that are still new to visitors from Asia and elsewhere.”

In a blog post on 360niseko, a website dedicated to information about the town, Keith Rodgers, President of Niseko-based Taiga Real Estate and Project Management, wrote that it is witnessing “the best tourism numbers since 2007”. According to the Niseko Tourism Board, visitor numbers soared by 103 percent during the 2011 and 2012 seasons.

While Niseko’s property market had been dominated by Australian and Hong Kong buyers in the past, nowadays they are coming from Singapore, Malaysia, and increasingly, from Indonesia, Thailand and Taiwan, said Rodgers.

Holiday home

So what are they looking to buy in this snowy location? In the case of Low Yat Group’s Shiki Niseko project, the majority of investors are interested in lifestyle investments, specifically a vacation home, shared Low.

Shiki comprises 68 luxurious apartments on a one acre plot and includes 10,000 sq ft of retail space and restaurants. Its unique location means that all the residential units offer breathtaking views of either Mt. Yotei or the steep slopes of the Grand Hirafu Ski Resort on Mt. Annupuri.

“Most of the units are on leaseback arrangement. Owners enjoy a duration of stay during the year whilst the hospitality arm manages the property based on a pool revenue sharing system at other times of the year. Hence, they receive returns in the months that they aren’t occupying the unit.

“These types of properties are gaining popularity, and Shiki Niseko was the first luxury property to start this type of investment.”

When asked to name one hotspot in Niseko, Low points to Hirafu Village and Kutchan, which are the town centres located close to ski lifts. “There are plenty of ski activities to be found here, while restaurants, cafés and shops are all within walking distance.”

Money matters

Borrowers looking to get a loan for Japanese properties outside of Tokyo will find it tough to do so in Singapore, but the process is much easier through Malaysian banks, according to Low.

In Japan, home loan interest rates are around 1.8 percent to two percent and savvy investors will usually seek the best rates and packages available in the market before making a purchase.

Low reckons that now is a good time to buy a ski resort property, as housing and land prices have already tripled over the last two years. At the same time, Hokkaido has seen many developers entering the market to build new resorts. Right now, rental yields are in the range of two to five percent, depending on the property type and the level of service.

She added: “Demand for accommodation within the area has also increased, especially during the winter season. This comes as the number of tourists flocking to the area rapidly increases every year.”

In fact, most of the resorts and apartment units were fully booked last winter, and tourists found it difficult to secure accommodation even three months before, said a source.

CITY FAST FACTS
(HOKKAIDO)

Population: Around 5.6 million

Total area: 83,457 sq km

Currency: Yen

GDP per capita: US$33,896

GDP growth: 0.1 percent

Future transport: Extension of the Hokkaido Shinkansen (bullet train)

Ski resort prices: Up three times over the last two years

Distance from Singapore: 5,940 km

INTERNATIONAL HIGHLIGHTS

Niseko is home to some of the world’s top ski resorts, which see high demand from wealthy travellers. Here are two new developments you should check out.

COMPLETED PROJECTS

Shiki Niseko
Abuta District, Niseko

Type: Condotel
Developer: AP Land Berhad
Tenure: Freehold
Facilities: Housekeeping services, fully equipped kitchen, ski equipment storage, drying rooms
Nearby Key Amenities: Michelin Star restaurant, gourmet food store, coffee bar, car rental services
Nearby Transport: Shuttle buses, Kutchan railway station
Starting Price: Approx. S$968,000

This luxury landmark condotel is located in the village of Hirafu, comprising 68 units of one- to three-bedroom apartments with amazing mountain views.

Boasting a contemporary Japanese aesthetic, the hotel-style condominium was completed in 2012 and is operational all year round.

First-class facilities include housekeeping services, a fully-equipped kitchen, storage spaces for ski equipment and drying rooms for skiers.

An exquisite Michelin Star-rated restaurant, gourmet store with fresh local produce, and an inviting coffee bar are also available for guests.

Akazora
Abuta District, Niseko

Type: Luxury apartments
Developer: Niseko Resorts Group
Tenure: Freehold
Facilities: Concierge service
Nearby Key Amenities: Japanese restaurants, bars
Nearby Transport: Shuttle bus service, Kutchan railway station
Starting Price: Approx. S$488,000

Situated in the heart of Hirafu village in Niseko, which has been dubbed the “Aspen of Asia”, this development features 25 fully-furnished apartments.

Units range from studios to two-bedroom units up to 956 sq ft, with a spacious four-bedroom penthouse at 1,560 sq ft.

Completed in 2013, Akazora is an eye-catching building that blends Western and Japanese design elements.

The boutique project is just a stone’s throw away from Niseko’s famous ski slopes, popular restaurants and bars. It is also conveniently located near a ski shuttle service.

Picture Source: Hokkaido is famous for its quaint towns and powder snow.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116212/hokkaido-snow-city

Eye on Chinatown: Cultural evolution

Chinatown — there’s one in (almost) every country, yet perhaps, none as diverse as Singapore’s.

Comprising the precincts of Ann Siang Hill, Bukit Pasoh, Kreta Ayer, Tanjong Pagar and Telok Ayer, Chinatown is a mish-mash of the old and the new. While the place certainly lives up to its name, what with its iconic Chinese Buddhist temple, multiple restaurants offering a range of Chinese cuisines (from Hong Kong and Taiwan to mainland China), shops selling traditional Chinese wear and an endless variety of Oriental trinkets, its diversity also makes it unique.

There is no shortage of local delicacies for which Singapore is well known, or even European cuisine. Bars, pubs and clubs catering to the non-Chinese crowd also abound — though mostly in the nearby Tanjong Pagar area — and it is not uncommon to see locals and tourists alike enjoying the sights and sounds Chinatown. There is also a Hindu temple in the estate.

Once upon a time

Needless to say, the Chinatown we know today was not always the vibrant, diverse hive of activity it is now. In Singapore’s early days, migrants from China arrived in the country in great numbers, prompting Sir Stamford Raffles and colony engineer Lieutenant Philip Jackson to begin drawing up the plan for Singapore to ensure organized growth.

The different ethnic groups were subsequently settled into enclaves along the Singapore river; the Chinese, who made up 70 percent of the migrant population, were allotted the entire region southwest of the river. Each dialect group even had its own enclave within the region: the Teochew around Fort Canning and along Clarke Quay, the Hakka and Cantonese in Kreta Ayer, and the Hokkien in Telok Ayer. The Hainanese were the last to arrive and settled wherever they could.

The dialect segregation and challenging environment led to clan associations being formed as a way to provide community support when it came to employment, funerals, and legal matters. However, under the guise of aid and support, kongsi (secret societies that were actually violent street gangs) also arose; opium, prostitution and gambling were their industries of choice. Finally, in 1889, the Suppression of Secret Societies Ordinance cracked down on them.

Chinatown still had to endure the ordeal that was the Japanese Occupation during WWII. As the area was crowded and devoid of air shelters, Japanese air raids claimed up to 2,000 lives daily.

But Chinatown survived and eventually flourished. Food, apparel, markets, street-side Chinese wayang, Chinese medicinal halls, fortune-telling and festival celebrations sprang up all over the estate, marking the beginning of its transformation to Chinatown as we know it today.

Convenience in tradition

Today, Chinatown is considered by a good number of Singaporeans to be a “tourist trap”, abounding in souvenirs and tourist-centric services whose prices are grossly inflated (just ask anyone who has ever been on a trishaw ride in Singapore). But while that much rings true, it still has much to offer.

One cannot deny that it is rich in history and culturally significant. The narrow, cramped walkways littered with food stalls and street hawkers selling a large selection of food from Hokkien mee to satay, are remnants of Chinatown’s past that are highly unlikely to go away any time soon.

Though the place has been cleaned up and offers modern conveniences such as free Wi-Fi, the trademark crowded streets, cluttered shops selling all sorts of things from Chinese fans to cheongsams, and Chinese medicinal halls are still a common sight in Chinatown.

Needless to say, the festivities are always in full swing come the Lunar New Year, and one would be hard-pressed to walk anywhere in Chinatown without having to squeeze his way past the throngs of shoppers patronizing the stores that stay open late into the night during this period.

Still, modern advances have given rise to a mall (Chinatown Point), numerous hotels, and improved connectivity between Chinatown and the rest of the island.

Large sections of it are governed by the Urban Redevelopment Authority’s (URA) conservation act, and being in the Outram planning area, it is in the heart of the central region. The central business district (CBD) is within walking distance, and the Central Expressway (CTE) is located nearby.

Apart from the CTE, the three MRT lines serving the area — the Northeast, East-West and Downtown lines — help to maximize its accessibility. Connectivity will be enhanced even more in the near future thanks to the upcoming Thomson East line, which will pass through the existing Outram Park MRT station and a new station at Maxwell.

The long haul for old homes

When it comes to residential property in the area, buyers and investors should note that most of the housing projects there are relatively old, and take this into account when looking at housing in Chinatown.

Wong Xian Yang, Senior Manager (Research & Consultancy) at OrangeTee.com, says: “Many of the developments, such as People’s Park Complex, People’s Park Centre, Fook Hai Building and Pearl Bank Apartments were completed in the 1970s. As they are quite old, there is an incentive to try for collective sales.

“Investors who are interested in purchasing them in anticipation of en bloc sales could look at some of the older developments. However, they should know that the current measures in place, such as the ABSD (additional buyers’ stamp duty) have bogged down the en bloc market.

“Moreover, there is still a gap in expectations between buyers and sellers, especially in the current lacklustre market. As such, investors would be well advised to view (such purchases) as long-term investments.”

Pearl Bank Apartments is one such example. The multiple attempts so far to put it up for en bloc sale have been unsuccessful. At the moment, its owners are trying to list the development as a conservation project.

Furthermore, older buildings tend to incur higher maintenance fees, which lead to relatively higher holding costs, something buyers and investors should be aware if before making any commitments.

However, residential property in Chinatown is not limited to old apartments. Wong assures buyers and investors: “For buyers who are keen to tap into the convenience of Chinatown and who desire newer housing, there are developments such as Dorsett Residences.”

Completed in 2013, Dorsett Residences is a 99-year leasehold condominium on New Bridge Road, near Dorsett Hotel. It is one of the more recent residential developments in the area, and offers good prospects for both buyers and investors.

Of Chinatown’s property market prospects, Wong says, “In view of area’s connectivity, central location and limited available land, there may be significant interest for collective sales when the en bloc market picks up.”

Picture Source: URA,PropertyGuru Analytics
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116262/eye-on-chinatown-cultural-evolution

HDB outlook for 2016

While condo transactions continue to be scrutinized by most market watchers, often due to the aspirational nature of the property class, it is necessary to keep an eye on HDB resales. To Singaporeans, HDB has always been a very bread and butter issue, with a large majority of families living in them.

Furthermore, for those looking to upgrade from public housing, they would need to sell their HDB starter homes, hopefully with a decent upside, to be able to afford the move to condominiums, or executive condominiums (ECs). The health of the HDB resale market, therefore, affects the private market as well.

We take a closer look at the ups and downs of the HDB market in 2015 to make some predictions for where this market segment will head in 2016.

Overall HDB market

What then, was the pulse of the HDB market in 2015?

In the space of the 12 months of 2015, 19,015 HDB resale units exchanged hands, a 10 percent increase from 2014’s 17,318 (refer to Figure 1). This translates to an average of around 4,700 units transacted per quarter of the year, with the second quarter seeing a high of 5,286 units. This is comparable to the numbers that were seen in 2012 and 2013, before cooling measures froze the market and reduced transactions to a mere trickle.

While the number of transactions increased, prices dipped 1.6 percent. This decline is a far milder than the 6.1 percent dip seen in 2014, suggesting that the fall in prices might be coming to a trough. A burgeoning sign of promise was that prices actually saw a small 0.2 percent bump in the final quarter of the year, according to the HDB resale price index. However, most market watchers caution that it is far too early to call it the start of a recovery, and that more sustained signs of recovery must be seen.

The two key cooling measures that have brought about this fall in prices in the HDB resale market are the Mortgage Servicing Ratio (MSR), and the removal of Cash-Over-Valuation (COV). MSR caps the payable monthly mortgage 30 percent of one’s monthly income. Buyers therefore have to look at what the bank tells them they can afford, instead of what they think they can afford.

The removal of COV was a welcome move as well, because sellers often focused on COV to determine their asking price. This meant that buyers were paying more than the fair valuation price, and had to pay premiums to buy a unit. Furthermore, sellers often set higher and higher COVs, based on what they heard their neighbours had sold for, creating a system of escalating quantums. Removing COV, therefore, put some sense back into the system.

It might be better therefore, to see where HDB prices have gone, not so much as a downturn, but rather, as some kind of sensibility entering the market, with sellers making more rational decisions around the pricing and the actual value of their homes.

Breaking down the numbers

Despite prices falling across the board, the picture gets more complex once we delve into the details.

In general, flats in mature housing estates have held up better in terms of prices than their non-mature counterparts. For instance, the top five performing estates in terms of median prices for four-room flats were Serangoon, Bukit Merah, Geylang, Kallang / Whampoa, and Queenstown. Geylang’s prices showed a 15.3 percent increment, an incredible jump, given the market. However, due to the relatively small size of the estate, it did not move the overall market needle.

Meanwhile, the top five performing estates for five-room flats were also mature estates. Geylang again took the crown, with Toa Payoh, Ang Mo Kio, Bishan and Yishun coming in below it, all showing more moderate increases below two percent.

With the distribution and buildup of resources across the island, it is likely that the reason mature estates do better is due to the greater number of amenities available. Rather, all the mature estates that performed well in 2015 were located within a 20-minute MRT ride to the city, or even closer. Furthermore, Bukit Merah, Queenstown and Kallang / Whampoa are receiving a lot of attention from affluent, younger couples who are drawn to the revivification of those estates with hipster cafés, bars and shops.

Supply is likely to play a part as well. Aside from Ang Mo Kio and Toa Payoh, these are all smaller, early estates. The supply of resale flats within these areas is unlikely to be high, and many of the older blocks could have already been earmarked for HDB’s Selective Enbloc Redevelopment Scheme (SERS), which would discourage people from buying them, only to face the hassle of relocation in the future. This lowered supply then, continues to support elevated prices.

Record busters

In 2015, 110 HDB units sold for prices above $900,000.

Out of these, 53 were units at Pinnacle at Duxton, where record prices continue to be set for HDB flats. In fact, the highest price ever recorded for a four-room flat took place at Pinnacle at Duxton this year, for $990,000. However, even though over 50 units were sold for above $900,000, only nine managed to cross the psychological one million dollar mark, all of which were five-room units.

Three other flats sold in 2015 also managed to cross this threshold. These flats were located in Toa Payoh, Toh Yi Drive and Jalan Ma’mor. The Jalan Ma’mor flat is particularly interesting, because it is also a rare jumbo unit at 3,014 square feet, and sold for $1,060,000. Its size, rarity and location close to Balestier and Novena were factors that contributed to its higher prices.

While we are all used to Bishan’s million dollar maisonettes, it might be surprising to some that Toh Yi Drive also saw seven duplex units move at prices over $900,000, with one unit going for a million on the dot. The proximity to the Bukit Timah school stretch, and the newly opened Beauty World MRT on the Downtown Line likely contributed to those prices. Marine Parade also saw three flats that went for over $900,000. All three were located in point blocks, within walking distance to the beach, and also to the ever-popular Tao Nan School.

These unit types – jumbo flats, point blocks and executive maisonettes – are no longer built, which has definitely made them scarcer. For those looking to live in such units, therefore, and want the conveniences of amenities, popular schools and transport links, there is definitely a premium price to be paid.

Market insiders revealed that buyers of these record breaking flats were unlikely to be regular HDB upgraders. Often, these were owners of private property, who had cashed out of their homes with really decent capital appreciation, and were willing to pay top dollar to purchase a home in a location they desired. They are therefore the exception, rather than the rule.

Public rentals

On the surface, the HDB rental market looks like it is doing quite well. The number of transactions in 2015 was 13 percent more than 2014’s, with 41,109 rental contracts reported to HDB. Five-room units are the most popular, with a 22 percent increase year-on-year (refer to Figure 2).

The pricing story, however, is a lot more depressing for landlords and homeowners. Overall, the year saw a four percent dip in median prices from 2014. Some of the sharpest drops year-on-year came from popular locations. For instance, Marine Parade saw median four-room rental prices drop by a rather steep 11 percent, while Bukit Merah saw prices for the same sub-type decline seven percent.

As such, those who have suggested that the HDB rental market is recovering have actually called it in error. In places like Marine Parade, for instance, tenants could easily threaten to move to a rental condo instead of sticking with a HDB, because declines have also brought down rents in the private market. Most landlords would rather capitulate than lose a tenant and have the unit sit empty.

The reason for the higher number of rental contracts signed is not because tenants have increased. Rather, it is because the frequency of contracts being signed have increased, because tenants are opting for one- instead of two-year contracts, negotiating for further concessions from landlords, be it rental price reductions, new furniture, or subsidized utilities.

Ball gazing

So where is the market likely to move in the next 12 months?

For HDB resale transactions, our house view is that transactions will gain further momentum, even as prices continue to fall. With a bumper crop of 28,000 new Build-to-Order (BTO) flat owners receiving their keys this year, we will likely see an increase in resale flats hitting the market, as upgraders will need to move their existing units within six months. We think that sales volume is likely going to be between 4,200 and 5,400 per quarter, with 2016 closing with under 20,000 units exchanging hands. Given seasonal fluctuations, resale prices are likely to vary about 1.5 percent up or down each quarter. We think that the year is likely to end with overall prices falling between 0.3 and 0.8 percent.

The prognosis of the rental market is more dismal. While volumes might climb moderately, we are likely to see a sharper decline in prices. With a projected global economic slowdown, as well as the political climate on foreign labour remaining negative, there are fewer demand drivers for the rental market.

With a bumper crop of over 50,000 dwelling units hitting the market, there will be a supply glut in the market. HDB rentals are likely going to find themselves competing with investment units in suburban condos, as they race to the bottom dollar to find tenants.

Furthermore, those upgrading from HDBs to condominiums might decide to hold on to their flats and rent them out for income while waiting for prices to further appreciate, exacerbating the supply issue. As such, our house view is that rental prices for HDBs are going decline further by five to eight percent.

Picture Source: HDB, PropertyGuru Analytics
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116190/hdb-outlook-for-2016

Government measures fail to boost EC market

In August 2015, Prime Minister Lee Hsien Loong announced during his National Day Rally speech a slew of new measures meant to impact the real estate market. This included raising the income ceiling for couples buying executive condominium (EC) units from $12,000 to $14,000. As such, higher-income households (making up another six percent of the population) could now qualify for subsidised housing, and would not have to overstretch themselves to buy private property.

At the time, analysts felt the changes would reverse the slump in the EC market, which had seen the number of unsold units rise to an unprecedented 5,200 units as of July 2015, according to figures from CBRE.

It didn’t help that launch prices for most EC projects were hovering around $800 psf for seven quarters before the income ceiling was raised, while the private residential property index fell by 7.2 percent during the period.

But five months after the policy kicked in, the EC market seems suppressed rather than stimulated. Only 124 units were sold by developers in December 2015, down by about 33 percent from the previous month, revealed a JLL report citing data from the Urban Redevelopment Authority (URA).

The report stated that for the entire year, an estimated 2,562 new EC units were sold, compared to the 3,750 units launched.

Further exacerbating the supply glut is the recent launch of two EC sites, one at Yio Chu Kang Road under the confirmed list of the second half 2015 Government Land Sales (GLS) Programme, and the other at Sumang Walk in Punggol under the reserve list. Both are expected to yield a total of 1,300 housing units.

Great expectations

Ong Teck Hui, National Director, Research & Consultancy at JLL, said: “One of the reasons why EC sales have remained slow despite the income ceiling hike is the mismatch between prices and buyers’ expectations.

“Many new ECs are currently marketed at around $800 psf on average, about 15 percent higher than in 2011. With falling private residential prices, some potential EC buyers would be mulling over the possibility of buying private homes instead of ECs, especially with the narrowing price gap between the two.”

The mortgage servicing ratio (MSR) cap of 30 percent for ECs has also led to softening demand, with one developer telling PropertyGuru that the MSR limit for ECs should not be the same as HDB flats, because ECs are a public-private housing hybrid, and therefore, the MSR should be capped at 45 percent.

PropNex agent Edmund Ee agrees that this measure should be tweaked to help homeowners looking for a bigger place.

“With the MSR at 30 percent, HDB upgraders who want bigger units are being limited by the loan amount and are deciding to hold off on their purchases, since upgrading to an EC would mean a smaller living space.

“If the MSR is at 45 percent, it’s definitely good news for eligible buyers, as they will be able to buy a bigger unit.”

But Ong explained that the current MSR rate is a policy consideration and should be kept in place.

“With a lower MSR, buyers will borrow less, which means that EC units will have to be priced accordingly. It is part of the overall plan to keep housing prices in check, maintain affordability and prevent excessive borrowing.”

Another concern among HDB upgraders is the resale levy of up to $50,000 for EC units bought directly from developers, but Ee reckons that buyers will probably consider projects where the land sales were launched before 9 December 2013, when the ruling took effect.

With EC buyers becoming more price-sensitive, Ong does not foresee a pick-up in transactions in the coming months.

“Under current market conditions, a strong sales take-up at launch is quite unlikely, so new EC projects are just trying to achieve gradual and steady sales progress in the months after launching.”

Housing the sandwich class

Despite what the figures show, Ee has observed more first-time buyers from the “sandwich class” (within the $12,000 to $14,000 income bracket) visiting EC showflats since the income ceiling was raised. “They prefer ECs as the room sizes are generally bigger than private condominiums,” he said.

URA data revealed that the top-selling EC projects in December were The Brownstone in Sembawang, which sold 20 units at a median price of $814 psf, The Terrace at Punggol (15 units at a median price of $788 psf), and Sol Acres in Choa Chu Kang (14 units at a median price of $796 psf).

Ee believes these projects reported better sales due to their proximity to public transportation.

“The Brownstone is close to the upcoming Canberra MRT station on the North-South Line, while Sol Acres is near the new Bukit Panjang MRT station on Downtown Line 2. Buyers know that there is a premium to pay for being close to an MRT station, but the price is definitely lower compared to private condos nearby.”

However, Ong thinks the economic slowdown will continue to put pressure on the market, and the only way to revive demand is to price units more attractively.

More launches coming soon

In 2016, a number of new EC launches are expected to take place, including Wandervale at Choa Chu Kang Drive, The Visionaire at Canberra Drive and Parc Life at Sembawang Avenue (refer to Figure 2).

Based on the land prices, developers are expected to price these three projects more competitively, with estimates ranging from about $740 psf to $820 psf, noted Ee.

“As developers become more price-sensitive, hoping for better take-up rates, new EC prices should be at a good entry level.”

He added that tough competition from the new supply will see developers offering discounts for EC projects that are nearing completion.

“Looking at the upcoming launches, I do not foresee a sharp spike in the sales transactions of EC units as there is still ample supply in the market. EC transactions should reach around the 2015 level of over 2,500 units sold.”

Picture Source: URA,JLL Research & HDB,PropertyNet Research
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116198/government-measures-fail-to-boost-ec-market

Completed condo price falls slow

Prices of completed non-landed residential properties in Singapore fell by 0.4 percent in December 2015 after dropping by 0.7 percent in the month before, according to latest flash estimates of the NUS Singapore Residential Price Index (SRPI).

Excluding small units, the central region saw prices decline by 0.6 percent last month, compared to the 0.9 percent decrease in November. In the non-central region, prices fell by 0.2 percent, lower than the previous 0.4 percent drop.

The central region comprises the postal districts 1 to 4 and 9 to 11, while the non-central region covers the other postal districts.

Meanwhile, prices of small units up to 506 sq ft remain unchanged after falling by 1.3 percent in November.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116188/completed-condo-price-falls-slow

Property trough in sight: CBRE

Compared to the robust market conditions seen in 2013, sales of new private homes in the last two years have been severely depressed, with transactions halving to 7,300 units in 2014 and 7,440 units last year, according to CBRE Research.

The report stated that Singapore’s housing market is likely to remain flat this year as demand continues to be hindered by the property cooling measures, economic slowdown and rising interest rates.

As sales have slowed, developers are finding themselves stuck with many unsold units, but the situation is not as bad as before. The number of uncompleted unsold units fell to 23,000 at the end of 2015 from nearly 27,000 in 2014, said CBRE.

“The reduction is due to lesser new projects being added due to fewer sites being sold in 2015, translating to a limited new supply going forward.”

Meanwhile, the private property price index has dropped by 8.4 percent since peaking in Q3 2013. Specifically, the price gap between the Core Central Region and the outer regions have narrowed, presenting a window of opportunity for investors looking for good deals in the prime market, noted the consultancy.

It believes that after suffering nine quarters of price and volume adjustments, the trough may be in sight as supply runs low and prices reach an equilibrium.

“Should the government relax the existing cooling measures, it may stoke buying interest. When that happens, the window of opportunity will narrow and prices might see some upside as early as 2018, led by the prime segment.”

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116176/property-trough-in-sight-cbre

14 March 2016

Shunfu Ville tries to en bloc again

Shunfu Ville has been re-launched for collective sale at the same reserve price of $688 million, or $791 psf ppr, said marketing agent JLL.

This is the second time that the 358-unit residential development built in the 1980s has gone en bloc after more than 80 percent of the owners agreed to the sale.

The first attempt at a collective sale in September 2015 attracted expressions of interest from two developers, but PropertyGuru understands that the offers were rejected for being too low.

Situated in the Bishan/Thomson area, the 408,927 sq ft site is zoned residential under the 2014 Master Plan and could yield over 1,100 units with an average size of 1,000 sq ft.

Yong Choon Fah, National Director of Capital Markets at JLL, noted that while the residential market continues to be bogged down by the property cooling measures, some positive signs are now emerging.

“With price moderation working its way alongside the continued rise in wages and the stabilisation of HDB flat prices, private housing has become very much affordable. We estimate that it now takes about 5.6 years of income to buy a home, close to the 5.9 years in 2003, which was a recession year. At the peaks of the market in 1996 and 2008, home prices were equivalent to nine to 10 years of income.”

With this, she reckons that developers will continue to press on with replenishing their land banks.

Moreover, there has been no Government Land Sales (GLS) site released for sale in the area since the Lorong Puntong land parcel (Thomson Impressions) was awarded to a Chinese developer in October 2014.

The Shunfu Ville site is also close to established schools, shopping malls and two MRT lines.

At $688 million, the estimated breakeven cost for the successful buyer stands at around $1,250 psf, with the new units expected to fetch between $1,400 psf and $1,450 psf, said JLL.

The tender for Shunfu Ville will close on 10 March 2016.

Picture Source: Aerial view of the Shunfu Ville site. (Photo: JLL)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116129/shunfu-ville-tries-again-to-go-en-bloc

Aussie developer dips toes into Singapore’s housing market

Property giant Lend Lease is set to enter Singapore’s residential market after receiving planning approval to develop a mixed-use development in Paya Lebar Central, which includes over 400 apartments, reported The Australian.

The Urban Redevelopment Authority (URA) has granted provisional permission to a consortium comprising the Abu Dhabi Investment Authority (ADIA) and Lend Lease to develop the project.

The developers had won the tender for the 99-year leasehold site with a bid of $1.67 billion.

The project is expected to further expand Lend Lease’s presence in the city-state after building mostly shopping centres during its 40 years in Singapore.

As the lead developer, Lend Lease holds a 30 percent stake in the consortium, while ADIA owns the remaining 70 percent.

Aside from the residential component, the project will also feature 45,000 sqm of retail space and a 90,000 sqm office tower.

Located in the city fringe, the 3.9ha site is part of the government’s plan to establish commercial clusters outside the central business district.

Meanwhile, the move by Lend Lease aims to target key urban regeneration projects in gateway cities across the world.

The Australian group is also jointly developing the International Quarter in London while building the Lifestyle Quarter at Tun Razak Exchange in KL.

Denis Hickey, Chief Executive of Lend Lease Americas, had earlier revealed that the group is running the ruler over various billion-dollar urban regeneration projects in the United States.

Picture Source: Artist’s impression of future developments in Paya Lebar Central.(Photo: URA)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116153/aussie-developer-dips-toe-into-singapores-housing-market

Malaysian property promising despite headwinds

Even with the challenging headwinds ahead, independent economist Lee Heng Guie believes that the medium-term prospects for Malaysian property are still promising, reported The Star.

And while property prices may ease further, he does not expect a significant drop.

“This is because Malaysia is not heading for an economic recession,” said Lee during a presentation at the 9th Malaysian Property Summit recently.

“The softening property market renders the buyers the opportunity to purchase property. For foreigners looking to invest in real estate in Malaysia, the weaker ringgit comes as a boon.”

However, he noted that the market is still hampered by weak economic growth, cautious sentiment and affordability issues.

“The prospects of higher domestic interest rates in 2017 may be a dampening factor,” he said.

“Likewise, the banks are expected to maintain vigilance in the evaluation of property loans while ensuring the good credit-worthy borrowers will continue accessing home financing.”

Lee hopes that the government will keep the property cooling measures in place for now.

“The right time to adjust some of the measures is when the market equilibrium is a lot more certain and sustainable. An over-adjustment of the property sector must be avoided for now.”

In addition, the authorities should closely monitor the supply and demand conditions in order to prevent overbuilding in some segments and avoid a systemic risk to the banking sector, in case of prolonged economic slowdown and severe correction in property prices, said Lee.

“While ensuring a sustainable property sector, Bank Negara should ensure the banking institutions continue to lend to those eligible borrowers,” he added.

“Fiscal incentives such as stamp duty relief and developers’ interest bearing schemes should consider for the first time home buyer and for the property priced below RM1 million.”

Picture Source: Aerial view of Penang.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116119/malaysian-property-promising-despite-headwinds-says-economist

Balestier condo sale rejected

Singapore-listed developer SingHaiyi must first complete the development of the City Suites project before it can be allowed to sell its stake, reported The Straits Times.

The Controller of Residential Property recently rejected SingHaiyi’s application for approval on the proposed sale of the condominium project in Balesteir to Ang Cheng Guan Construction.

Last April, the developer announced plans to sell Corporate Residence, which is the developer of City Suites, for $16.38 million “in view of the possible levy as a result of the Qualifying Certificate on unsold units”.

It revealed that the 56-unit development witnessed slow sales progress at around 10 percent since its launch in May 2013.

Meanwhile, the Singapore Land Authority (SLA) explained that the application was rejected in order “to ensure that the developer fulfils its obligations to complete the development under the Qualifying Certificate (QC)”.

The rule mandates that developers should complete a project and obtain the Temporary Occupation Permit (TOP) within five years from the date of issuance of the QC – which needs to be obtained by foreign developers to acquire private residential land in Singapore.

The estimated TOP for the City Suites project is this year.

“We are working closely with the main contractor to come up with the project timeline,” said a SingHaiyi spokesman.

Under the QC conditions, a developer cannot transfer its shares without prior approval from the Controller until all units have been sold or when the TOP has been issued, whichever comes later, said Lee Liat Yeang, partner at Rodyk & Davidson.

Picture Source: View of Balestier Road. (Photo by Terence Ong / Wikimedia Commons)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/116038/balestier-condo-sale-rejected

MP urges removal of ABSD for Singaporeans

Should a citizen who can afford to buy a second or third property through the Total Debt Servicing Ratio (TDSR) regime also be required to pay the Additional Buyer’s Stamp Duty (ABSD)? This was a question posed by Mr Christopher De Souza in Parliament on Monday, reported Channel NewsAsia.

He urged the government to remove the ABSD for Singaporeans while retaining the ABSD for foreigners and TDSR for Singaporeans.

“By retaining the TDSR, the Singaporean is only going to be allowed a credit line that is within his means. By retaining the ABSD for foreigners, we help ensure that the foreigners will not enter the Singaporean market in an overly speculative way,” said the MP for Holland-Bukit Timah GRC.

First introduced in December 2011, the ABSD was revised upwards in January 2013 to rein in Singapore’s escalating residential property prices.

Singaporeans are required to pay an ABSD of seven percent for a second property, and 10 percent for a third and subsequent property. However, foreigners are required to pay an ABSD of 15 percent for their first and subsequent property purchases.

Meanwhile, the TDSR framework limits the amount borrowers can spend on debt repayments to 60 percent of their gross monthly income.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115896/mp-urges-removal-of-absd-for-singaporeans

11 March 2016

Tough times ahead for self-storage industry

2016 is shaping up to be a challenging year for Singapore’s self-storage industry as more households and businesses tighten their purse strings in anticipation of tougher times ahead.

Helen Ng, Deputy Chair of the Self-Storage Association Asia and Group Chief Executive Officer of General Storage Company, said: “Households may try to discard their belongings instead of storing them and businesses may reduce their inventory to reduce overstock.”

Despite the headwinds for the self-storage industry, Ng believes there are still growth opportunities.

For instance, some demand is likely to come from businesses selling Chinese New Year merchandise. Ng noted that unlike traditional warehousing where there is a lengthy lock-in period, storage terms at self-storage facilities are flexible, and thus more appealing to businesses that want the flexibility to adjust their inventory according to seasonal demand.

Ella Sherman, Founder of popular Singaporean brand Animal Merchandise, which specialises in animal-themed homeware, gifts and cushions, chooses to store her stock at Lock+Store’s Serangoon North branch.

“We expand and reduce our storage space according to the retail season, with Christmas and Chinese New Year being our busiest periods. Storing our inventory at a self-storage facility allows us to scale up to meet seasonal peaks and troughs while managing our operating budget throughout the year. It works out to be far more cost effective and efficient than using a logistics company.”

The rise of Ecommerce storers across the region has also created a new revenue stream for the self-storage industry.

“In Asia, there is a trend of women entrepreneurs leading the Ecommerce revolution by setting up online stores retailing fashion and lifestyle products. They eschew traditional brick and mortar stores for self-storage and choose to operate from homes instead,” said Ng.

Ecommerce storer and owner of Rainbow Lab, Ervinna Neo, who sells lifestyle products such as Hello Kitties, opted to use a self-storage facility because she had run out of space at home.

“I have been using the self-storage space since January 2015. I love the flexibility of going to the facility whenever I wish. There is also an onsite bulk parcel drop-off service. I can access the goods in my storage unit and mail them to my buyers straightaway.”

Picture Source: Photo of self-storage units in Singapore.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115915/tough-times-ahead-for-self-storage-industry

Tenants rule the rental market

Gone are the days when property owners and investors ruled the market as tenants today have the choice of being picky given the influx of new units, reported The Straits Times.

In the case of Celine Tan, her potential tenant wanted the unit to be fully furnished, have new bath towels and cutlery, a bigger TV set and free servicing of air-conditioners.

“It’s quite ridiculous. I never had this experience in the last 10 to 15 years of renting, but everyone in the market is so competitive… (that I) have to accede to most of their requests,” she said.

Although Tan did not provide new bath towels and cutlery, she gave in to the other demands, which included refurbishing the dining room and bedroom, with the tenants selecting the new furniture. “They took a picture at Ikea and showed me the model they wanted,” she added.

With that, she was able to rent her three-bedroom apartment at Robertson 100 in Robertson Quay last year for $4,600 per month, down from $5,200 previously.

Aside from lower rents, tenants are also demanding shorter leases of six months to one year, noted PropNex agent Anthea Yeo. “Rental is coming down; nobody wants to commit to two years because they know next year, it could be cheaper.”

She revealed that the lacklustre market also saw her income drop by $200,000 in 2015 from the year before.

According to data from the Urban Redevelopment Authority (URA), private residential rents dropped by 4.6 percent last year. The suburbs registered the biggest decline, with rents falling 5.6 percent, followed by the city fringe and city area at 4.9 percent and 3.8 percent respectively.

Analysts expect rents to continue sliding this year amid the weaker economy, tight immigration policies and a flood of 26,467 new private homes and executive condominiums.

In fact, rents may fall by more than eight percent this year, said Century 21 Singapore Chief Executive Ku Swee Yong. Private home rents in suburban areas are expected to face more pressure as the bulk of new homes are found there.

Cushman & Wakefield Research Head Christine Li expects the vacancy rate for private homes to increase from 8.1 percent in Q4 2015 to a “critical point” of nine to 10 percent this year.

“At that level, it shows that the market is correcting in a big way, and owners may be a bit jittery, so they may rush to offload their units,” noted Li.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115842/tenants-rule-the-rental-market

New Silver Zone at Lengkok Bahru

Elderly residents living in Lengkok Bahru, a small neighbourhood in Redhill, will now find it easier to cross the road with the completion of the Silver Zone in their estate, revealed the Land Transport Authority (LTA) in a Facebook post.

The Silver Zone programme involves installing senior-friendly road safety features to make motorists slow down and look out for pedestrians, and urges seniors to be more careful when crossing the road.

Launched on Sunday, 24 January, the Silver Zone at Lengkok Bahru includes raised informal crossings, fitted with ramps to provide users with a barrier-free route when crossing the road. In addition, land widths were reduced to encourage motorists to travel at lower speeds.

The LTA said it plans to build 35 new Silver Zones in Singapore by 2020.

Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115824/new-silver-zone-at-lengkok-bahru

Mega project the size of Ang Mo Kio launching soon

A S$58.3 billion township the size of Ang Mo Kio is set to rise near the Tuas Second Link in the Johor Strait.

The first phase of Forest City, a 14 sq km mixed-use development comprising four man-made islands, will launch in Singapore, China and Malaysia in the first quarter of 2016, but the sales gallery is already open for bookings.

Aside from condominium units and high-rise coastal residences, Forest City also consists of hotels, retail centres, parks and leisure attractions, which will be developed in nine phases over 20 years.

Country Garden Pacificview, the master developer, is jointly owned by Chinese property giant Country Garden Holdings and Johor’s Esplanade Danga 88.

As part of long-term planning, Country Garden is in discussions with the Malaysian government to set up dedicated entry points to Forest City, such as a light rail transit system and a ferry network that will link to Singapore and to the planned high-speed rail (HSR) between Singapore and Malaysia.

This is the biggest overseas development undertaken by Country Garden, which has more than 200 projects globally.

At a global press conference held in Singapore on Friday, the Hong Kong-listed developer said that the project is still under construction and prices of the residential units have not yet been set, but will likely cost around RM1,200 psf (S$400 psf) on average. Comprising two- to four-bedroom units, sizes range from about 818 sq ft to 1,915 sq ft.

Meanwhile, a Straits Times report last year stated that the project could house around 700,000 people. So far, 700 residential units at Forest City have been approved for sale, excluding the 336,000 new private residential units in the pipeline for Johor.

Responding to media queries about the future oversupply in Iskandar’s property market, Country Garden Pacificview executive director Datuk Md Othman Yusof said: “We are working with a company (Country Garden) that has a strong capital base and knows how to create their own market. Most of their launched projects are more than 60 percent sold.”

Country Garden is also developing a waterfront project in Danga Bay featuring 9,000 residential apartments. Covering 50 acres, phase one and two have launched with more than 6,000 units already sold. More than 50 percent of the units were sold to overseas buyers from Singapore, Indonesia and the Middle East, said the developer.

Picture Source: Artist’s impression of Forest City.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115789/mega-project-the-size-of-ang-mo-kio-launching-soon

More help for the vulnerable

The Ministry of National Development (MND) on Thursday said it is committed to helping young couples and lower-income families own homes, while enabling the elderly to age gracefully, reported Channel NewsAsia.

“We will ensure that our housing policies continue to help young couples start a family, uplift the lower-income and vulnerable to a better future, and enable our elderly to age gracefully,” said National Development Minister Lawrence Wong in his ministry’s addendum to President Tony Tan Keng Yam’s address to Parliament.

“We remain committed to help Singaporeans own their homes and keep housing affordable for future generations.”

In fact, it plans to enhance various programmes to make housing more affordable to vulnerable groups.

For instance, the MND will work closely with social agencies to provide holistic support to second-timer public rental families under the Fresh Start Housing Scheme. This includes helping them keep their children in school and finding a job.

The ministry also plans to build more public rental flats.

“We will also look into ways to support other vulnerable groups, including divorcees and low-income singles,” shared Wong, noting that demand for new flats from singles has been strong since they were made available to them in 2013.

For senior citizens, the ministry aims to help them live in safer environments, with new smart-enabled homes. It will also build on schemes like the Two-Room Flexi Scheme and Lease Buyback Scheme to ensure affordability for the elderly.

Meanwhile, the living environment of older estates will also be improved via the Remaking Our Heartland initiative, Home Improvement Programme, Neighbourhood Renewal Programme and Selective En bloc Redevelopment Scheme.

The ministry will also make greenery more accessible to Singaporeans, with nine in ten households situated within 400m of a park or park connector by 2030, Wong said. The network of green corridors will also increase to 400km from 300km.

“We will activate green spaces and intensify greenery horizontally and vertically, and work with passionate Singaporeans to conserve our biodiversity and celebrate our built heritage,” he added.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115741/more-help-for-the-vulnerable-mnd

10 March 2016

Private home prices keep falling

Prices of private residential properties fell by 0.5 percent in the last three months of 2015, compared to the 1.3 percent decline in the previous quarter. For the year, prices fell by 3.7 percent, compared with the 4.0 percent decline in 2014, revealed latest figures from the Urban Redevelopment Authority (URA).

For the whole of 2015, prices of non-landed properties in the Core Central Region (CCR), Rest of Central Region (RCR) and Outside Central Region (OCR) fell by 2.5 percent, 4.3 percent and 3.7 percent respectively. Prices of landed properties declined by 4.1 percent.

The URA added that rentals of private residential properties fell by 4.6 percent for the whole of 2015. During the period, rentals of non-landed properties in the CCR, RCR and OCR declined by 3.8 percent, 4.9 percent and 5.6 percent respectively. Rentals of landed properties fell by 4.5 percent.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115721/private-home-prices-keep-falling

HDB resale prices drop further

HDB resale flat prices rose slightly by 0.1 percent in Q4 2015 from the previous quarter, according to the latest resale price index (RPI) from the Housing Board. However, resale flat prices for the whole of 2015 fell by 1.6 percent.

The number of resale transactions for the year reached 19,306 cases, up 11.5 percent from 2014.

As at 31 December 2015, 50,264 HDB flats were sublet, up 0.9 percent from the 49,796 units in the previous quarter.

In 2016, the HDB plans to launch four Build-To-Order (BTO) exercises, with a total supply of about 18,000 new flats. These flats will be spread across various locations, so that home buyers can choose a flat that best meets their budget and needs.

The first BTO exercise will be held next month where about 4,150 flats in Bidadari, Bukit Batok and Sengkang will be offered.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115725/hdb-resale-prices-down-in-2015

CDL, CapitaLand honoured for sustainability

City Developments Limited (CDL) has emerged as the 10th most sustainable corporation in the world and the most sustainable real estate firm globally in Corporate Knight’s 2016 Global 100 Sustainability Index.

This makes CDL the first and only Singapore firm to be ranked on the list for seven consecutive years. The company started in 81st position in 2010, before rising to 34th in 2015 and 10th this year.

Considered the gold standard in corporate sustainability analysis, the announcement was made at the World Economic Forum in Davos, Switzerland.

“Over the past two decades, CDL has continuously innovated, invested and improved on the way buildings sustain life. We are focused on sustainable development and have helped to green Singapore with more than 80 Green Mark buildings,” said Chief Executive Officer, Grant Kelley.

“Our efforts have created stronger brand equity and product differentiation. They have also given us a first-mover advantage as environmental regulations have been mandated progressively for the property sector.”

Meanwhile, CapitaLand was ranked in the Global 100 list for the fifth year running.

The developer was also listed in The Sustainability Yearbook 2016 of RobecoSAM, with a ‘Bronze Class’ distinction, effectively placing it among the top five real estate companies worldwide.

“This is our seventh listing in The Sustainability Yearbook, and our second consecutive listing as a ‘Bronze Class’ recipient. These accolades validate our success in integrating sustainability into our business. We will stay the course and continue developing and operating sustainably and responsibly,” said Tan Seng Chai, Group Chief Corporate Officer of CapitaLand and Chairman of the CapitaLand Sustainability Steering Committee.

RobecoSAM is an investment specialist that exclusively focuses on sustainability investing. Its annual report recognises the top 15 percent of companies across various industries worldwide, and identifies companies that are strongly positioned to create long-term shareholder value.

Picture Source & Source copied: Tree House condominium in Singapore. (Photo: CDL)

JLL: Home price recovery in 2017

Singapore’s annual population growth fell from 3.2 percent in the 2006 to 2012 period to 1.2 percent in 2015, which implies that annual housing demand plummeted from 38,000 to 16,000 units, according to property consultancy JLL.

Nonetheless, housing supply remains high at 50,000 units per year from 2014 to 2018. This comes as the government looks to compensate for the low supply recorded till 2013.

JLL expects most of the new supply to be developed in the suburbs. Public housing units will account for 73 percent of the total stock, down from 80 percent in 2000.

Meanwhile, the slew of property cooling measures rolled out by the government has dampened the mood in the housing market.

In 2011 to 2012, home loans grew by 17 percent and 13 percent per annum for owner-occupied and investment properties, but the number of housing units grew by only two percent per annum.

JLL revealed that loan growth fell to 4.7 percent and zero percent in 2015 respectively after a cap on the Total Debt Servicing Ratio (TDSR) was imposed. Primary sales fell 60 percent as the capital base shrunk.

The presence of the Additional Buyer’s Stamp Duty (ABSD) also saw foreign purchases within the central region shrink to 10 percent from 20 to 25 percent.

Moreover, prices of high-end homes fell by 20 percent following the introduction of the ABSD in 2011, while the implementation of the TDSR in 2013 has resulted in mass market home prices dropping by 12 percent.

Looking ahead, prime and mass market prices are expected to fall five to 10 percent more before recovering in 2017.

The report noted that the government could consider replacing the various additional buyer and seller stamp duties with higher property taxes in order to push up transactions and remove friction in the market.

“Currently, non-owner occupied residential taxes do not differentiate between residents and foreigners and this can be tweaked,” added JLL.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115650/no-housing-recovery-expected-before-2017

Chinese buyers shun Singapore

Discouraged by the high taxes in Singapore, fewer foreigners are purchasing private homes here, leaving the market to rely on local buyers, reported Reuters.

Data compiled by DTZ showed that foreigners, including permanent residents, purchased 499 homes in Q4 2015. This accounted for around 16 percent of total transactions, down from 30 percent recorded in Q3 2011 just before the introduction of the Additional Buyer’s Stamp Duty.

Acquisitions by the Chinese, considered one of the biggest foreign buyers of Singapore private homes, fell 40 percent from a year earlier to 151 units. DTZ noted that the figure is also down 80 percent from the peak in Q3 2011.

The figures were based on caveats lodged as of 15 January, with the land planning authority maintaining an online database.

“Chinese money is being attracted by Australia and the UK,” said Alan Cheong, Research Head at Savills Singapore.

He noted that the stamp duties should be rolled back to a level where the city-state can still capitalise on Chinese funds without attracting too much hot money.

“If we continue to sit by with all these measures, we are just going to miss the boat,” he said.

And with the benchmark 3-month Singapore Interbank Offered Rate (Sibor) on an uptrend, local buyers may also become cautious. The Sibor, which is used to set interest rates on mortgages, rose to 1.254 percent this week, or its highest since October 2008.

Picture Source & Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115643/chinese-buyers-shun-singapore

04 March 2016

New Disney Park in Laos?

There remains a mystery about the possibility of a Disney Laos being built, according to The Nation, with business leaders in nearby Nakhon Phanom in Northeast Thailand trying to verify a report that construction of the project will commence soon. The local government is concerned that the report is a hoax, but could still trigger a round of land price speculation in the province.

Charnyuth Uppapong, chairman of the provincial chamber of commerce, is unable to confirm if construction work is scheduled to take place despite having discussions with officials in the Khammuan province of Laos where the supposed park is set to be built.

He added that this could see investors purchasing land in an attempt to jump on what could be a lucrative opportunity for the region. He explained that if the report of Disney Laos is true, the province could benefit greatly from both tourists coming to visit the area during their trip and people from Laos having more spending power and coming across the border to make purchases.

“If this is true, it would bring great benefits to Nakhon Phanom as our province could be a transport centre, thanks to our readiness in terms of roads and airport,” said Charnyuth. “We have thousands of restaurants and hotels. If Disney Laos takes shape, Nakhon Phanom would be the must-visit province to all.”

But Tharin Phanthumai of the province’s tourism council is not convinced that the project will actually happen because of several logistical issues. “What concerns me is this could be a hoax, designed to drive up land prices. This will affect real estate development. If this is a hoax, it would definitely hurt Thailand,” he shared.

Somjith Aliyaphaphone, chairman of Akane Farm Sole, a Lao investor in the project, told the Vientiane Times that Disney Laos would be part of the third phase of a massive investment project in Khammuan’s Thakhek Specific Economic Zone. He noted that any further reports on the project would be released at the end of this month, but that could be too late for officials in Nakhon Phanom to stop speculators from buying up land in the region.

Picture Source: Disneyland Resort in California. (Photo: Cd637/Wikimedia Commons)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115632/new-disney-park-in-laos

Tanah Merah site launched for sale

UPDATED: A residential site at New Upper Changi Road/Bedok South Avenue 3 (Parcel B) was launched for sale by public tender today, revealed the Urban Redevelopment Authority (URA).

The 2.4ha site which could yield about 570 housing units was made available for sale on the reserve list of the second half 2015 Government Land Sales (GLS) Programme.

On 7 January 2016, the URA announced that it had received an application from a developer for the site to be put up for public tender. The developer had committed to a minimum bid price of $320 million in the tender for the site.

“The bid that triggered the launch of the site is slightly conservative, as the developer may have presumed a 15 percent decrease in sales price from December 2015 to October 2016. Assuming that prices will dip by about five percent, we anticipate the winning bid to be around $380 million ($690 psf) to $400 million ($725 psf),” said Dr Lee Nai Jia, Regional Head of Southeast Asia Research, DTZ.

“Given the location, we expect the number of bids to be around 10,” he added.

The 99-year leasehold site is close to Tanah Merah MRT station, Changi Business Park and the Singapore University of Technology and Design.

“Rental yield in the area is about three percent to 3.5 percent, which is pretty attractive for residential developments,” noted Lee.

The tender exercise will close on 23 February 2016, said the URA, adding that any tender below $320 million will not be considered.

Meanwhile, The Glades, a 726-unit condominium located at the corner of Bedok and New Upper Changi roads, is set to be completed in 2017. The 3.2ha site was sold to Keppel Land for $434.6 million in October 2012.

According to Lee, The Glades has sold 371 of the 400 units launched, while nearly all units in Eco, another nearby development, have been transacted. The prices for The Glades as at December 2015 ranged from $1,274 psf to $1,540 psf.

Picture Source: Aerial view of the site at Tanah Merah. (Photo by URA)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115514/tanah-merah-site-launched-for-sale

Developers cut prices as ABSD deadline looms

Singapore developers are starting to slash condo prices as the deadline for the Additional Buyer’s Stamp Duty (ABSD) looms, reported The Straits Times.

Under the ABSD rules, developers are given five years within which to complete a housing project and sell all units. Otherwise, they must pay the ABSD, which was initially set at 10 percent of the site’s purchase price, and subsequently raised to 15 percent on 12 January 2013.

Since it was first introduced on 8 December 2011, the first deadline comes up at the end of this year.

As such, projects such as The Trillinq, which is believed to be the first site to come under the ABSD rules, saw median prices drop to $1,329 psf in Q4 2015, from $1,545 psf in Q1 2013 during the project’s launch. The 755-unit project has sold 220 units as at end-2015.

Over at Mon Jervois, which is set to incur ABSD from early-2017, median prices for units stood at $1,852 psf in Q4 2015, down from $2,087 psf in Q2 2013. As at end-2015, the project moved 46 out of the 109 units.

Also poised to incur ABSD from early next year is Kingsford@Hillview Peak. The project sold 242 of 512 units as at end-2015, with median prices falling from $1,340 psf in Q2 2013 to $1,288 psf in Q4 last year.

Another source of pressure for developers is the Qualifying Certificate (QC) rules.

Under these rules, non-Singaporean developers should finish building a housing project in five years of acquiring the site and sell all the units in two years from the date of completion. Developers looking for more time on either deadline can pay extension charges. But unlike the ABSD, the amount is pro-rated for QC based on the number of unsold units.

“As the ABSD charges will kick in first, developers are now given a shorter timeline to clear the units if they want to avoid the hefty fine,” said Cushman & Wakefield Research Director Christine Li.

She noted that ABSD charges will still apply even if developers only have one unsold unit. This is “in stark contrast with QC extension charges, which are more progressive, especially in the first year”.

Picture Source: Condominiums in Singapore. Photo: Cheryl Marie Tay
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115525/developers-cut-prices-as-absd-deadline-looms

Famed developer sells $25m bungalow

Luxury property developer Simon Cheong recently sold a good class bungalow (GCB) that he built along King Albert Park within the Bukit Timah/Clementi Road vicinity, reported The Business Times.

The property was sold for $25 million, which works out to $1,493 psf based on the freehold land area of 16,750 sq ft.

Completed in late 2012, the two-storey bungalow has a built-up area of around 10,000 sq ft and comes with a swimming pool. The property is currently being tenanted.

The buyer, Absolute Kinetics Consultancy founder Fang Koh Look, is expected to occupy the property following the end of the existing lease.

Known for building luxurious condos under the SC Global Developments brand, Cheong also develops landed properties under SC Homes. He owns several GCBs on Pierce Road and is believed to be open to selling them at the right price.

Meanwhile, a wholly-owned unit of Soilbuild Group Holdings has acquired an old, two-storey bungalow along Wilkinson Road for $19.28 million. This translates to $1,203 psf based on the land area of 16,031 sq ft.

Soilbuild Executive Chairman Lim Chap Huat noted that the freehold property could easily be 40 to 50 years old.

“We are buying it from a family,” he said.

He revealed that the group plans to redevelop the site, which is zoned for two-storey bungalow use, into two new bungalows.

Set to be completed in two years, works for the new bungalows is expected to begin around the middle of this year.

One of the bungalows will be bigger, with a land area of around 11,000 sq ft and a built-up area of around 6,000 to 8,000 sq ft. It will also feature a swimming pool.

Nestled on about 5,000 sq ft of land, the smaller bungalow will have a built-up area of 5,000 sq ft as well. Both bungalows will be two storeys high with four bedrooms and an attic.

With a construction cost of almost $6 million, the two properties will be the first landed housing project by the group in over two decades.

“In the early 1990s, we developed about 40 landed homes in various locations in the Sixth Avenue vicinity. Even before that, in the early 1980s, we built 18 landed houses at Coronation Road,” said Lim.

Picture Source: File photo of a GCB.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115505/famed-developer-sells-25m-bungalow

Rangoon Road properties for sale

A row of adjoining properties located along Rangoon Road have been launched for sale by tender, revealed marketing agent Knight Frank Singapore.

The 6,879 sq ft site comprises a four-storey mixed-use building and a two-storey shophouse. Under the Master Plan 2014, the entire site is zoned residential with commercial at 1st storey at a gross plot ratio of 3.0.

The properties could be upgraded through asset enhancement initiatives or redeveloped into a brand new mixed-use development with shops on the ground floor and residential apartments on the upper levels, said Knight Frank.

The site is close to Farrer Park MRT station and shopping malls. Connexion at Farrer Park, the world’s first fully integrated healthcare and hospitality complex, is also nearby.

“We expect the properties to attract strong interest in view of their strategic location, proximity to an MRT station, prominent main street frontage and relatively affordable investment size,” noted Ian Loh, Executive Director & Head, Investment and Capital Markets at Knight Frank.

The tender for the subject properties will close on 1 March 2016.

Picture Source: Knight Frank Singapore.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115466/rangoon-road-properties-for-sale

New German school at Dairy Farm Road

The construction of a new German European School Singapore (GESS) at Dairy Farm Road is set to commence next month after a subsidiary of Singapore-listed TA Corporation secured a $94 million contract to undertake the project.

This brings the order book for the group’s construction business to approximately $300 million.

“This new construction contract from GESS marks an exciting start to 2016, and further validates our capabilities and reputation as a top-tier construction company,” said Neo Tiam Boon, Chief Executive Officer and Executive Director of TA Corporation.

“We remain sanguine on opportunities within the Singapore construction industry,” he added.

Some of the group’s notable educational developments include the iconic School of the Arts (SOTA) and the Singapore American School.

The latest contract is not expected to have a material impact on the net tangible assets and earnings per share of the group for the current financial year.

Completion of the GESS is expected within 25 months.

Picture Source: Artist’s impression of the new GESS.
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115437/new-german-school-at-dairy-farm-road

Siglap condo site awarded

A 1.93ha residential site at Siglap Road has been awarded to a consortium comprising Frasers Centrepoint unit FCL Topaz, Sekisui House and Keong Hong Holdings unit KH Capital, after the developers submitted the highest bid of $624.18 million, according to the Urban Redevelopment Authority.

The offer translates to about $858 per square foot per plot ratio.

The tender for the 99-year leasehold site closed on 14 January 2016 with eight bids. It could yield 750 housing units.

The land parcel is within proximity to the future Siglap MRT station and the East Coast Parkway (ECP). Parkway Parade, 112 Katong and established schools such as Victoria Junior College and Tao Nan School are also nearby.

Picture Source: Aerial view of the site at Siglap Road. (Photo: URA)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115381/siglap-condo-site-awarded

03 March 2016

City Suites sale hits snag

The Controller of Residential Property has rejected the application of SingHaiyi Group for the proposed sale of City Suites, reported The Business Times.

This effectively results in the termination of the memorandum of understanding that the company entered into with ACG Construction.

In April 2015, SingHaiyi announced plans to sell Corporate Residence Pte Ltd, the developer behind City Suites, to Ang Cheng Guan Construction for $16.38 million.

Located along Balestier Road, the 56-unit freehold private residential project has witnessed slow sales, at around 10 percent, since its launch in May 2013.

SingHaiyi noted that the Controller rejected both its application and subsequent appeal for approval.

As such, the proposed disposal could not proceed and was therefore aborted, the firm added.

Picture Source: View of Balestier Road. (Photo by Terence Ong / Wikimedia Commons)
Source copied: http://www.propertyguru.com.sg/property-management-news/2016/1/115399/city-suites-sale-hits-snag

Fall in number of Singapore’s ultra-high net worth individuals: Survey

While there was a drop of 205 people with a net worth of more than US$30 million (S$42 million) to 2,360 last year, the Republic retained its second place in the Asian league table, according to the study by Knight Frank.

SINGAPORE: There has been a fall in the number of people in Singapore with a net worth of more than US$30 million (S$42 million), according to a study by UK-based property consultancy Knight Frank.

The study, released on Wednesday (Mar 2), showed that there were 2,360 “ultra-high net worth individuals” (UHNWIs) in Singapore last year, down from 2,565 in 2014.

That put Singapore in sixth place in the global league table, behind New York (5,600), London (4,905), Hong Kong (3,854), Moscow (3,457) and Los Angeles (2,820).

Knight Frank said the study tracks the growing “super-rich population” in 98 cities across 91 countries. The survey was based on the views of about 400 leading private bankers and wealth advisors globally who, between them, manage assets for about 45,000 UHNWIs with a combined wealth of over half a trillion US dollars, it added.

The decline in the number of such individuals in Singapore follows a global 3 per cent slide in the total number of UHNWIs. Almost 6,000 people fell out of the wealth bracket in 2015, the first annual dip in ultra-wealthy populations since 2008, the consultancy said.

Over the next 10 years, Knight Frank projects that the UHNWI population in Singapore will increase a further 48 per cent.

Head of Consultancy & Research of Knight Frank Singapore Alice Tan said the attributes that Singapore had built over the decades — a conducive business environment, clear regulatory framework and a progressive ecosystem of financial and business services — had “augmented its status amongst the wealthy as a preferred location to live and do business in Asia”.

“Singapore’s excellent infrastructure, education and healthcare systems further anchors its global city accolade by promoting a vibrant economy, which will in turn boost the country’s real estate landscape within the next decade.”

THIRD MOST IMPORTANT CITY TO UHNWIS GLOBALLY

The study also ranked the cities that mattered most to the world’s wealthy, based on where they live, invest, educate their children, grow their businesses, network and spend their leisure time.

Singapore was ranked third in the world for its importance to UHNWIs based on these factors in 2016 according to the study, overtaking Hong Kong from fourth place in 2015. London and New York retained the first and second positions as the most important cities to UHNWIs worldwide.

Although more than half of survey respondents did not believe that the two top cities could be overtaken in importance in the coming decade, the 34 per cent of respondents who did believe that this was possible placed Singapore as the top contender for the next most important city in the next 10 years. This included respondents from Singapore, India, Australia, the US, Hong Kong, UAE, the UK, Malaysia and China.

Ms Tan suggested that if the Republic strengthened its trade relations with East and Southeast Asian markets and positioning as a strategic location it could further grow the size of its external market.

“Advancing the growth of wealth management and professional services in key business industries could foster a greater impetus for UHNWIs to make Singapore a city of choice,” she added.

Picture Source: Marina Bay Sands and skyscrapers of Singapore’s central business district. (Photo: Hester Tan)
Source copied: http://www.channelnewsasia.com/news/singapore/fall-in-number-of/2565348.html

Singapore office vacancies to rise as economy falters

Analysts predict vacancy rates will continue to rise this year, with real estate services firm JLL estimating prime office rents to fall between 10 per cent and 20 per cent.

SINGAPORE: Vacancies at Singapore’s gleaming office towers are nearing their highest level in almost a decade, with construction of the city-state’s tallest building - GuocoLand Ltd’s 64-floor block in the financial district - wrapping up just as the economy slows.

Singapore’s export-oriented economy has been hit by the slowdown in China and beyond, which has also put pressure on key sectors such as marine oil and gas, commodity trading and banks. Last year, the economy grew just 2 per cent, its slowest pace since 2009.

A January review by real estate services firm JLL of major foreign international banks in the financial district showed half had either reduced the size of their office space over the past year and a half, or had to contend with extra space.

Analysts predict vacancy rates will continue to rise this year, with JLL estimating prime office rents to fall between 10 per cent and 20 per cent after dropping 15 per cent last year in a city that is ranked the 11th most expensive in the world to rent top-quality offices.

Nicholas Mak, executive director at SLP International Property Consultants, said many of the buildings that are now ready for occupancy were planned about five years ago, towards the end of the global financial crisis.

“Many people thought that this is the new boom, let’s try to capitalise on it. Nobody expected the party to end by end of 2015,” he said, adding that office vacancy rates could hit 13.5 per cent, a level not seen since 2005.

Broader cost-cutting at banks due to the slowdown in the global economy is likely to have an impact on vacancies as financial institutions are key tenants for prime commercial space in Singapore.

Barclays will cut about 1,000 jobs in investment banking worldwide and close its cash equities business in Asia, an internal memo seen by Reuters showed.

Societe Generale gave up two floors in an office tower after selling its private banking activities in Asia to DBS Group Holdings in end-2014, taking up a smaller space in an existing building instead.

Mr Mak said vacancy rates could improve by the end of next year if the economy picks up and as demand catches up with the supply, easing the glut.

In the meantime, office landlords are limiting the number of leases that will expire over the next couple of years as well as diversifying their tenants to cope with the glut.

“This will be a short-term blip,” Lynette Leong, chief executive of CapitaLand Commercial Trust, said in January.

Banking, insurance and financial services represented 33 per cent of Capitaland Commercial Trust’s tenant mix at end-2015, compared with 38 per cent five years ago, its results show.

Picture Source: A view of high-rise financial district office buildings from the Marina Bay promenade in Singapore. (Photo: AFP/Roslan Rahman)
Source copied: http://www.channelnewsasia.com/news/singapore/singapore-office/2561132.html

26 February 2016

3 factors could boost housing demand

Maybank Kim Eng said there are three factors that could help Singapore bump up the demand supply outlook for its residential market, reported Singapore Business Review.

Firstly, the country could review its long-term population target established in 2013, where growth was capped in response to the infrastructure shortfall seen in recent years.

“Recall that population growth was capped in response to Singapore’s infrastructure shortfall in recent years. As Singapore continues its build infrastructure aggressively, including housing, there could be room for a review of the target,” noted Maybank Kim Eng.

To boost demand for housing, Singapore may also revisit its foreign-worker policy.

“The number of EP and S Passes it issued in 2015 was less than a quarter of the 47,300 approved during the peak in 2011. If the economy and job creation pick up, we believe the Ministry could adjust its cap.”

Maybank believes that a revival of the en-bloc market may help overturn the supply-demand disparity.

“Land remains in limited supply in Singapore. With the government reining in land supply in its GLS programme, we believe that a revival of the en-bloc market cannot be ruled out as developers seek to replenish landbank from the private land market. This could raise demolition rates and absorb part of the market surplus,” it added.

Picture Source: Someformofhuman/Wikimedia Commons
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115303/3-factors-could-boost-housing-demand

Nearly 50% drop in Dec home sales

Sales of new private homes by developers plunged almost 50 percent to 384 units in December 2015 from the 759 units sold in the month before, according to data released this afternoon by the Urban Redevelopment Authority (URA).

PropNex Realty stated that cautious market conditions and the year-end holiday period contributed to the fall in demand. Only 173 private homes were launched for sale in the month, the lowest number in the year.

“December is traditionally a lull period for property sales due to the festive season. Many prospective buyers usually go on holidays and prefer to delay their property purchases to the next year. December’s low volume and launches can thus be attributed to the seasonal effect and the continued impact of the various measures together with the TDSR,” said PropNex CEO, Mohamed Ismail.

The top-selling project was the 731-unit Poiz Residences (pictured) in Potong Pasir, which sold 64 units in December at a median price of $1,430 psf.

Meanwhile, PropNex revealed that the primary sales volume in 2015 totalled 7,625 units, a slight increase of 2.5 percent from the 7,437 recorded in the previous year. In addition, developers launched 7.4 percent less units for sale within the same period due to the impact of the tough cooling measures.

Looking ahead, Ismail expects 2016 to be another challenging year for the property market.

A combination of the restrictive loan environment, along with the pending interest rate hikes will prevent market activity from picking up, he said.

“Buying interest will remain selective. It is highly unlikely that volume of transactions will return to the boisterous level as witnessed in 2012,” said Ismail, noting that a project’s pricing and location will be the main drivers of demand.

He expects developer sales to remain muted until after Chinese New Year. The next hotly anticipated launch will be in Toa Payoh – which is slated to be launched in March.

The property agency expects new private home sales this year to reach about 8,000 units as developers will likely dangle incentives to move their unsold units.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115228/nearly-50-drop-in-dec-home-sales

Siglap site draws 8 bids

The tender for a 99-year leasehold residential site at Siglap Road closed on Thursday after attracting eight bids, according to the Urban Redevelopment Authority (URA).

Launched for sale on 26 November 2015 under the confirmed list of the second half 2015 Government Land Sales (GLS) Programme, the 1.93ha site could yield about 750 condo units.

A consortium comprising Frasers Centrepoint unit FCL Topaz, Sekisui House and Keong Hong Holdings unit KH Capital submitted the top bid of $624.18 million for the site, which translates to about $858 per square foot per plot ratio.

The site is located close to the future Siglap MRT station and the East Coast Parkway (ECP). Parkway Parade, 112 Katong and a number of reputable schools such as Tao Nan School and Victoria Junior College are also nearby.

A decision on the award of the tender will be made after the bids have been evaluated, said the URA.

Picture Source: Aerial view of the site at Siglap Road. (Photo: URA)
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115164/siglap-site-draws-8-bids

Home prices near DTL2 rise

The completion of the Downtown Line 2 (DTL2) in December 2015 has boosted home prices near the new stations, as well as pushed up rents and sales volumes, reported The Straits Times.

In fact, Knight Frank’s analysis of caveats lodged for private apartments along major roads close to the DTL2 showed that average prices climbed 4.5 percent from Q3 2015 to $1,592 psf in Q4 2015.

“In this post-Total Debt Servicing Ratio period, these average prices have held up well compared with islandwide price trends,” said Knight Frank Research Head Alice Tan.

In the past two years to 31 December 2015, average prices of apartments along these major roads increased by 3.58 percent, while the property price index of the Urban Redevelopment Authority weakened by around 7.6 percent. Tan noted that the presence of the DTL2 may have supported home prices near the stations.

Greater buying interest was also observed as the DTL2 neared completion. Eco Sanctuary in Chestnut Avenue, for instance, went from 82 percent sold in December 2014 to 91 percent sold in November 2015, said R’ST Research Director Ong Kah Seng.

Over the same period, The Skywoods in Dairy Farm Heights went from 43 percent to 85 percent sold, while Kingsford Hillview Peak in Hillview Rise rose from 33 percent to 46 percent sold.

In the Core Central Region (CCR), Robin Residences near Stevens MRT station saw median prices increase 0.3 percent year-on-year to $2,378 psf in H2 2015, compared with a 2.6 percent drop in the overall CCR price index over the same period, said SLP International Executive Director Nicholas Mak.

Sales transactions in the project also increased from 15 in H1 2015 to 29 in H2 2015.

Rents and leasing activity near these stations appear to have improved as well.

Ong revealed that the number of leases signed within the vicinity of the King Albert Park station jumped 38 percent from Q2 to 358 deals in Q3 last year, while median rents climbed from $3.15 psf per month during the first quarter to $3.23 psf per month during the second and third quarters.

Picture Source: alantankenghoe
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115213/home-prices-near-dtl2-rise

Which districts have the most unsold units?

Due to an unprecedented building boom in the wake of the global financial crisis (GFC), Singapore’s three mass market districts, namely 19, 27 and 3, now account for about a third of the total unsold inventory of condo units within the city-state, reported Singapore Business Review citing research from Maybank Kim Eng.

District 19, particularly Punggol, Hougang and Serangoon Garden, registered the most number of unsold units with 1,832 executive condominiums (ECs) and 2,370 private homes unable to find buyers, the report said.

Overall, the district has 4,202 unsold homes, which makes up 14.4 percent of Singapore’s total unsold inventory.

Meanwhile, Sembawang and Yishun in District 27 account for 12.1 percent of the city-state’s total unsold stock, or 3,531 units (2,468 ECs and 1,063 private units).

District 3, specifically Tiong Bahru and Queenstown, has 2,876 unsold private units, which accounts for 9.9 percent of the total unsold inventory. There are no ECs within the area.

Maybank Kim Eng believes that mass market homes face a huge risk since prices within this sector only fell marginally.

“We reiterate that the mass market has the biggest downside risk. This is because prices in the OCR (Outside Central Region) have corrected the least since the GFC. Furthermore, recent increases in the household-income ceiling for the application of ECs from $12,000 to $14,000 could shrink the pool of mass market home buyers,” it said.

Picture Source: Aerial view of an apartment unit with rooftop pool. (Photo by Hu Totya: Wikimedia Commons)
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115192/which-districts-have-the-most-unsold-units

Regional currency outlook for 2016

When one looks at an overseas property investment, it actually consists of 2 components – the property investment and the currency investment. If you invest in a property that increases in value by 20% over a period of three years, but the currency depreciates by 30% over the same period, you will be realizing a loss if you liquidate.

Usually, Singaporeans will compare the local currency in the country of investment against either the Singapore Dollar (SGD) or the US Dollar (USD). Most often the base currency is SGD, simply because that is the currency that the Singaporean earns, and is most familiar with.

Interest rate trends in major economies

The US economy is recovering, with unemployment at five percent (as of Nov 2015) and an Interest Rate (IR) of 0.25%. On 16 Dec 2015, the Federal Reserve increased the overnight target rate from 0.25 percent to 0.5 percent. Inflation in the US is currently still under one percent, below the Federal Reserve’s target of 1.5 to two percent.

Although the US recovery seems tentative, it is nonetheless an economic recovery. It is possible there will be a few rate hikes in 2016 as the target overnight Federal Reserve funds rate at 0.5% is still low.

However, other global major economies such as the European Union, China and Japan are slowing down. EU’s growth rate is less than two percent, China is struggling to maintain seven percent growth, and Japan’s growth stands around one to two percent. EU’s interest rate is close to zero percent, Japan’s is at zero, while China dropped its benchmark yearly interest rate to 4.35 percent. EU and Japan have no more room to reduce interest rates, while China can continue to reduce both the interest rate as well as the bank’s reserve ratio to increasing lending to corporations to stimulate growth.

Just to put things into perspective, the world’s major economies are:

The European Union – at around 18 trillion USD
USA – Number 2 – at around 17 trillion USD
China – Number 3 – at around 10 trillion USD
Japan – Number 4 – at around 4.6 trillion USD
The world economy is around US$77 trillion dollars. The top 4 economies make up roughly US$49.6 trillion dollars or about 65 percent of the world’s economy and would be a good enough representative study.

Impact of capital flow

Singapore maintains a currency exchange rate based on a trade-weighted basket of its top 15 trading partners (refer to Figure 1) via a Nominal Effective Exchange Rate (S$NEER). Currently, Singapore has set a rate of slower currency appreciation. This means that Singapore watches the exchange rate of its major trading partners and appreciates the SGD against them on an aggregate basis.

Singapore’s top 10 trading partners are:

China
Malaysia
EU
USA
Indonesia
HK
Taiwan
Republic of Korea
Japan
Thailand

Currently, Malaysia’s Ringgit is under pressure due to political events, as well as the decline in oil
prices, one of its most important exports. Meanwhile the national currencies of the Philippines, Indonesia and Thailand are also under threat of funds outflow. This has contributed to a weakening SGD vis-à-vis the USD in recent months, as Malaysia and Thailand are two of the (speculated) currencies in the S$NEER basket.

If most of Singapore’s top 15 trading partners’ currencies are depreciating against the USD, based on a trade-weight S$NEER, the SGD will likely strengthen against some of these currencies, but will weaken versus the USD. Singapore is also entering a period of slower growth as inflation has dropped and GDP growth has slowed, with the Purchasing Manager Index coming in at 49.5 percent in Dec 2015.

The challenge for our policymakers hence, is to find a balance between import-led inflation, export competitiveness and economic growth. To do so, they will need to normalize interest rates upwards to maintain an orderly depreciation of the SGD against the USD.

Why do currencies come under threat?

Currencies generally come under threat when a number of factors are present. These include low foreign reserves, a pegged exchange rate, high debt levels at the state, household, or corporate levels, slowing GDP, inflated assets, low interest rates, among other factors.

Countries with low foreign reserves, high foreign debt and a high budget deficit are most at risk of a weak currency. Furthermore, a weakening economy with several of the mentioned risk factors are likely to suffer an extra blow from capital outflows, when it needs those funds the most. With an untimely exodus of funds from the country, the currency will weaken, causing interest rates to rise, and could lead to a rapid deterioration of its financial position.

High asset prices, such as an inflated stock market or property market, would be susceptible to speculative attacks and magnify the crisis.

Where are the bright spots?

Under-developed countries such as Cambodia, Laos and Myanmar did not receive a large amount of capital inflow. As such, they are less susceptible to capital outflows due to currency fluctuations.

These markets are potential high risk and high return locations to put your money. Their rule of law is weak and there is a degree of corruption within their systems. However, their fiscal positions currently are quite poor. For Myanmar, opening up their economy to foreign investors would be a good development. Should investors wish to enter these markets, they should benchmark property prices to Thailand’s and apply an appropriate discount. This is because Thailand is more developed, and has a better infrastructure. Hence, while these markets are rated positively, their risks are also huger.

Philippines is a fast growing economy with a young population. However, debt levels are high, and exports are weak. This is mitigated by remittances from Overseas Foreign Workers, which continue to be strong. Thus, the outlook on the Philippines is somewhere between neutral to positive.

Thailand’s economy is slowing down and may enter a period of recession, but it has one of the best infrastructure for tourism, far ahead of the Philippines, Vietnam, Cambodia, Laos and Myanmar. Thailand has about US$100 billion in reserves and a floating currency. Unless there is huge political insurrection or rioting, Thailand is unlikely to suffer from massive currency depreciation, and is therefore rated neutral.

Malaysia does have good infrastructure, but its currency has already taken a beating and its political stability is in question. Nonetheless, it is still competitive and runs a trade surplus. Despite its huge debt, Malaysia does have ample reserves, and has taken steps to mitigate currency depreciation by raising interest rates. Singapore’s northern neighbor thus remains good
for selective purchases due to its weak currency.

In the region, perhaps the one market that investors should really be wary of is Vietnam. Vietnam is highly trade dependent, and therefore, will be strongly affected by capital outflows. Furthermore, Vietnam has low foreign reserves and is running a huge budget deficit. Debt levels in this former Communist state are quite high, and corporate non-performing loans are on the rise. The rating on Vietnam is therefore negative, and investors should stay away from it for a while.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115158/regional-currency-outlook-for-2016

Banks bidding for HDB’s largest bond issue

Banks are bidding for the largest issue yet from Housing and Development Board (HDB), totalling up to S$1.6 billion, IFR reported Friday (15 January).

According to the report by the Thomson Reuters publication, the HDB asked banks for proposals to sell a seven-year bond for a target size of S$1 billion and a S$600 million greenshoe. “If it does achieves the maximum deal size, it will beat its largest single issue, when it sold a S$1.5 billion 1.875 percent four-year issue in November 2013.”

Bids are due for submission on Monday (18 January).

The Singapore statutory board obtained its first rating in October 2015, when Moody’s gave it the top rate Aaa, increasing its appeal to banks’ asset liability management desks.

IFR said the rated HDB notes will now have a zero risk-weighting and qualify as Level 1 high-quality liquid assets under the Monetary Authority of Singapore’s (MAS) rules on liquidity coverage ratios, adding that previously, the unrated notes qualified as a Level 2 HQLA and were subject to a 15 per cent haircut under LCR rules.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115202/banks-bidding-for-hdbs-largest-bond-issue

Property Market Retrospective 2015

Another year has passed, but for those in the real estate industry, it has been a long year with few bright sparks. Cooling measures have slowly but surely brought down prices, even as transaction volumes are seeing signs of recovery.

For deeper insights into the Singapore property market, download PropertyGuru’s Property Market Outlook H1 2016 now!

It is possible that both sellers and buyers have come to accept this new normal. We have seen developers start to “right-price” across all segments, helped by the fact that most of the new launches hitting the market saw their land sales taking place after the implementation of cooling measures, so the land bids were more cautious. Likewise, many of those looking for a home might have felt that the overall quantums had fallen to a level that were acceptable for their wallets.

In 2015, the key driver for property transactions remains affordability. The segment is price sensitive, and buyers are motivated by good deals.

Private non-landed property

The non-landed private property market remains lukewarm at best, with over 12,400 transactions caveated in 2015 (refer to Figure 1), an 8.6 percent improvement from 2014’s 11,400-plus transactions. This worked out to be about an average of 1,000-plus units cleared per month, with an overall median price of $1,230 psf.

Flash estimates by the Urban Redevelopment Authority (URA) show that overall prices fell by 3.7 percent in 2015, a slight slowdown in declines compared to 2014’s 4.0 percent. Speculation and short-term flipping have practically fallen off the radar for this property segment, with sub-sales 3.7 percent of total transactions in the year. 56.5 percent of all transactions were new sales, and 40.1 percent were resales.

Right-pricing properties, more than ever, becomes imperative for developers to move properties in an environment where Total Debt Servicing Ratio (TDSR) has constricted liquidity and stamp duties have increased the cost of ownership. CEL Development’s High Park Residences was the clear winner in the private non-residential market in 2015, with 1,105 caveats for the project lodged in the month of July alone, at a median PSF of $1,016. Recorded prices for the project started around $373K for a studio unit, which suggests that capital outlays started at around $74K, a palatable amount for most investors.

To reach this price point however, some compromises were made. The average size of units sold in High Park Residences was around 788 sq ft, which could be a tight squeeze for families with children. This appears to be a trade-off many buyers were willing to make, with the project close to sold out at time of writing, and studios and one-bedroom units fully sold out.

When we look at the top five projects sold in 2015, it is clear that aside from pricing, location is the other common factor. Out of the top five, three are located in the Rest of Central Region (RCR), suggesting that drops in pricing have made it more feasible for buyers to move from the outskirts to locations closer to the city. While Frasers’ North Park Residences is further out than the other projects, it is a massive integrated development and brings huge conveniences to its residents.

Furthermore, all five projects are located within walking distance to MRT or LRT stations, which also increases their value proposition for homebuyers. On the ground, we also see several new launches that are not within close proximity to MRT stations offer shuttle bus rides to the nearest MRT station for residents, to compensate for this.

Executive Condominiums (EC)

This public-private hybrid property class saw some excitement in 2015, with the Prime Minster announcing an increase of the income ceiling from $12,000 to $14,000 during the National Day Rally. This allowed many couples and families who felt that they were part of the “sandwich class” – those who earned too much to buy Build to Order (BTO) flats or ECs, yet found themselves having to stretch financially to pay for private property – a viable option for home purchases.

At the same time, a proliferation of EC land sales by the state in the past couple of years, especially in the North and Northeast regions of Singapore, not only meant that buyers had a variety of projects to choose from, but that developers also had to price even more competitively to attract buyers.

Over the course of 2015, 3,310 EC units saw caveats lodged, with an overall median price of $793 psf (refer to Figure 3). By transactions, MCL Land’s Sol Acres had the best market performance, with 371 caveats recorded, at a median of a rather affordable $788 psf.

Some of the most popular projects for 2015 were not the latest launches (refer to Figure 4). The Terrace, Bellewaters and Bellewoods saw marketing starts in 2014, but their popularity in the past year was likely due to the developer offering attractive rebates and discounts to buyers. Again, right-pricing here, especially in areas where there is plenty of competition for ECs, helped developers move stock.

HDB Resale

After falling for nine consecutive quarters, prices for resale flats rose by a conservative 0.2 percent in the last quarter of 2015. While overall prices did still dip 1.5 percent from the previous year, the decline has slowed, compared to 2014’s 6.2 percent fall in prices. 2015 saw over 17,800 HDB resale transactions, an increase of 10.6 percent from those in 2014. However, market watchers are cautious to declare this a recovery, and we will likely have to see a few more quarters of modest price increases before we can declare that the HDB market is out of the doldrums.

Figure 5 shows HDB resale price and volume trends by estate. A trend that emerges from the data is that estates with a larger volume of transactions also tend to be the ones that are priced a lot more affordably. Like all the other market segments hence, pricing, and indeed, right-pricing are key. A couple of the bigger mature estates with established amenities, like Tampines and Bedok, moved well in 2015, at a median of $401 psf and $423 psf respectively. Scarcity continues to drive higher prices, with resale flats in Bishan, Marine Parade, Bukit Timah and the Central Area continuing to command higher prices.

40 percent of the flats sold in 2015 were four-room flats, which remain popular starter homes with adequate space for a family of four. Executive flats, which include maisonettes and jumbo flats, comprised 7.6 percent of resale stock sold last year. Five-room flats had the lowest median psf price overall at $376 psf, 4.2 percent lower than executive flats, which went for a median of $392 psf.

Pinnacle at Duxton made headlines in 2015 for record-breaking sales, including the record for a four-bedroom flat at $990,000. According to the data, 122 units moved at Pinnacle, of which 90 were four-room flat units. The lowest priced resale unit sold at Pinnacle was a low-floor four-bedroom unit, which moved at $650,000, a relative bargain, while only nine units moved above the million-dollar mark.

Retrospective round-up

The general consensus is that we will begin to see a recovery in 2016 in the property-for-sale market, with 2015 and perhaps the first half of 2016 the trough of our current property cycle. However, developers and sellers need to be wary of being overly optimistic.

Signs of recovery are weak, and the real estate segment remains extremely price sensitive. Coupled with the fact that affordability is unlikely to increase further with the government stating on record that the TDSR is here to stay, sellers could easily alienate buyers by rushing to increase prices.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114984/property-market-retrospective-2015

Colours of Fortune

Rat

Yellow is the colour of wealth for those born in the year of the rat, while blue is the colour to avoid. Shades such as Nippon Paint’s Buttercup Bouquet and Softly Lit are recommended; the former adds a pop of colour to your home, while the latter easily complements furniture and home accessories.

Ox

The ox would do well to incorporate pinks and purples into his home for familial harmony, with lilac in particular a lucky colour for the bedroom and living room. Pink Floss and Royal Mist are good examples of auspicious colours for your home.

Tiger

Those born in the year of the tiger would do well to dress their bedroom in any shade of blue, such as Cerulean, for luck in the romance department. When it comes to wealth, red for the living room is recommended for the positive energy it represents. Sashay Red is a good choice for this purpose.

Rabbit

Soft, muted tones bode well for the rabbits among us, with the colour grey specifically said to bring luck to your household. Colours such as White Concrete and Weatherbell for your dining area and living room can serve as a simple, effective backdrop for the rest of your décor.

Dragon

The mighty dragon can boost his luck this year with white and silver; the former to deflect negative energies and the latter to improve his love life. Colours like Steel Pot for the dining area and Granite Rock for the bedroom are recommended.

Snake

Earth tones of brown and green spell good fortune for the snake in 2016. A shade of green, such as Calm Spirit, for your study can create a relaxing environment in which to work. Your bedroom, on the other hand, would benefit from a brown shade such as Natural Cedar.

Horse

Like the snake, the horse’s lucky colour in the year of the monkey is brown. He is also advised to avoid blue, black and grey. Those born in the year of the horse can use colours like Birch Patina and Old Boots, especially in bedrooms.

Goat

Citrusy colours like yellow and orange are auspicious for the goat in 2016. Invest in orange-coloured furniture to up your stakes in the romance game; shades like Creamy White and Monet’s Purple will brighten your mood, calm your nerves and create a relaxed, harmonious home atmosphere.

Monkey

This is your year, and your lucky colour is — believe it or not — black. This is especially so in the wealth department. Try shades like Gray Ashes in the bedroom and Black Night in the living room for an unconventionally auspicious start to the new year.

Rooster

Those born in the year of the rooster will benefit from a mix of cool (silver or grey) and warm (gold or yellow) shades. A colour like Swan Wing would make the living room look more spacious, while Sassy Yellow works well for the bedroom.

Dog

Pastel colours have all the luck for the dog this year, particularly blue and yellow, as they are calming shades that symbolise confidence and positive energy. For the living room, try a hue like
Laid Back, and for the bedroom, Circus Top.

Pig

For those born in the year of the pig, 2016 is the year to go green. Turquoise and pastel shades are unique and refreshing: a colour like Nice Mint works well for the bedroom, while Paradise Waters would look lovely outside of it.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114945/colours-of-fortune

GIC commits to invest S$520m in Indonesian retailer

The investment reflects its confidence in Indonesia’s long-term growth potential, said GIC on Wednesday (Feb 24).

SINGAPORE: GIC has entered into a partnership with PT Trans Retail, the main retail arm of Indonesian conglomerate CT Corp.

Under the partnership, Singapore’s sovereign wealth fund has committed to invest an aggregate of IDR 5.2 trillion (S$520 million) in Trans Retail, which operates hypermarkets, supermarkets, and cash and carry stores under the Carrefour and TRANSmart brands in Indonesia.

In a statement on Wednesday (Feb 24), GIC said the investment reflects its confidence in Indonesia’s long-term growth potential.

Mr Amit Kunal, Head, Direct Investments Group, South East Asia, GIC said: “We are keen to build lasting partnerships with reputable local partners and look forward to a deep relationship with CT Corp, which also has a strong track record for making good investments and share our investment values.”

GIC manages Singapore’s foreign reserves and invests in a wide range of asset classes, including real estate, private equity, equities and fixed income.

Picture Source: File photo of a GIC sign on a building facade in Singapore. (AFP/Roslan Rahmann)
Source copied from: http://www.channelnewsasia.com/news/singapore/gic-commits-to-invest-s/2544154.html

25 February 2016

Berlin: Europe’s new darling

Property in safe haven markets such as Germany remains attractive as one of the most stable asset classes, especially compared to bond and equities markets, which have seen significant volatility in the run-up to the December 2015 rise in US interest rates, said Alex Bellingham, Director at property investment firm IP Global.

He believes that Singaporeans are still on the lookout for low-risk capital investment opportunities in major cities with a value story and strong currency play.

“In that sense, Berlin fits the bill,” said Bellingham. “When you look at pricing versus other capital cities, it is very attractive, and this is essentially what makes it so compelling.”

Costs less

According to Berlin-based real estate agency ADEN Immo, property prices in Europe’s second-largest city are three to six times lower than those in London or Paris.

At the same time, Berlin is undergoing a major transformation, with a growing population supported by one of the world’s strongest and most secure economies, noted IP Global.

Investitionsbank Berlin (IBB) estimates economic growth of 2.2 percent for Berlin in 2016. This is higher than the national average of 1.6 percent growth forecast for Germany as the whole.

Meanwhile, IP Global expects a population boom of about 340,000 new residents in the city by 2030 to fuel a strong demand for housing. In addition, over a quarter of a million jobs have been created in the last decade, generating demand for some 55,600 apartments.

The surge in population means that 19,655 new units will need to be completed every year to 2020. However, less than 9,000 were completed in 2014, revealed the consultancy.

“This imbalance is driving prices higher, with the average apartment price gaining 11.7 percent in 2014,” said Bellingham, adding that rents rose by six percent over the same period to keep typical gross yields at around five percent.

“The value in Berlin is hard to beat, mostly because of its unique history. Vacancy rates are also low at only 1.8 percent, which is attractive for investors looking for rental yields.”

The shift to smaller households

So what properties are available for sale and what should investors be targeting?

“Due to planning laws and an abundance of high-quality historic buildings, the majority of residential units coming online in Berlin tend to be refurbishments of older residential or converted stock,” said Bellingham.

“Another development has been the trend for smaller households. The average number of persons per household fell from around 1.84 to 1.17 over the past 15 years, a factor that further compounds the rising demand for housing driven by population growth.

“Berlin is the biggest city for singles in Germany and is likely to remain so, hence the great need for additional one- to two-bedroom apartments,” he added.

For non-EU residents keen on purchasing a property in Berlin, Bellingham explained that the process is straightforward. In terms of management costs, it is generally similar to the UK, ranging from five percent to 15 percent, depending on the level of service, the property type, and whether it is furnished or unfurnished. “A key distinction is that if the property is held for over 10 years, then there is no capital gains tax to be paid,” he said. Five to 10 years is IP Global’s recommended holding period for stable growth and returns.

As for financing, the consultancy advises would-be-investors to obtain financing through German banks. “The process is similar to Singapore, in that it is a staged payment system. As soon as documents are notarised, the process begins and it is then similar to any other mortgage process,” shared Bellingham.

Key locations

There are several areas that IP Global is currently exploring, mixing traditional prime neighbourhoods with up and coming hotspots on the city’s fringe. These include:

Mitte

The historic heart of Berlin, Mitte is a political centre that is home to numerous museums, high-end shops and restaurants. It borders Tiergarten, the biggest park in Berlin. In 2014, apartment prices in Mitte rose 24.2 percent, while rents were up 10 percent.

Charlottenburg

Located in West Berlin, this is a traditional neighbourhood full of parks and green spaces. Home to the famous Kurfürstendamm (Berlin’s Bond Street), Charlottenburg is among the city’s wealthiest neighbourhoods. Price performance reflects this, with average apartment prices across the district having risen 20.5 percent over the course of 2014.

Friedrichshain-Kreuzberg

Further out in former East Berlin, this is very much the ‘de rigueur’ location for young professionals as well as artists, and there are many bars, restaurants and art galleries. It is also undergoing major regeneration, especially along the river.

Neukölln

Set to undergo major transformation, this gentrifying suburb in Southeast Berlin is fast becoming very desirable among young professionals, students and creatives seeking affordability, vibrant nightlife and a cosmopolitan lifestyle. The recent closure of Tempelhof Airport has added to this desirability, with the airfield converted into a huge park attracting international acts.

CITY FAST FACTS
(BERLIN)

Population: 3.52 million

Total area: 891.8 sq km

Currency: Euro

GDP per capita: €31,476

GDP growth: 2.2 percent (2016)

Future transport: Extension of the Berlin U-Bahn

Apartment prices: Up 11.7 percent on average

Distance from Singapore: 9,910 km

INTERNATIONAL HIGHLIGHTS

Berlin’s most chic neighbourhoods are home to some striking new apartment buildings. Here are some of our picks.

NEW PROJECTS – BERLIN

The Wilhelm
Wilhelmstrasse 56-59, 10117, Berlin Mitte

Type: Apartment
Developer: Mundial Ag
Tenure: Freehold
Facilities: Concierge and valet services, 24-hour security
Nearby Key Amenities: Brandenburg Gate, Reichstag building, embassies, Mall of Berlin
Nearby Transport: Within walking distance to three underground railway stations (U Bahn Mohrenstrasse, U Bahn Franzözische Strasse, S+U Bahn Brandenburger Tor)
Price Range: €421,000 to €884,000

This luxury new-build development in Berlin’s main business and cultural district consists of 165 units, namely studios and one-bedroom apartments.

Expected to be completed in Q2 2018, the project is close to major tourist attractions such as the Brandenburg Gate. Several embassies, including the UK and US embassies, are also located nearby.

The building forms part of a larger regeneration project in Mitte to revitalise Wilhelmstrasse all the way down to the Mall of Berlin.

Residents of The Wilhelm can enjoy both concierge and valet services, as well as 24-hour security.

Facilities also include a meeting room, wine cellar and a humidor.

Stralauer Allee
Markgrafendamm 36, Berlin

Type: Apartment
Developer: LRC UK
Tenure: Freehold
Facilities: Landscaped central courtyard, children’s playground
Nearby Key Amenities: Treptower Park, Kreutziger Strasse, Badeschiff public swimming pool
Nearby Transport: Berlin Ostkreuz and Berlin Ostbahnhof railway stations
Starting Price: €135,000

Part new-build and part rejuvenation of an old East Berlin block, Stralauer Allee by LRC UK combines old-world charm with modern touches.

Located close to the River Spree, it features 24 high-standard apartments and two sixth-floor penthouses with stunning terraces.

To be ready by Q4 2016, the freehold project lies within one of Berlin’s largest regeneration schemes, making it an ideal location for property investment.

The surrounding area is home to a thriving outdoor café and bar culture, while employment hubs in the centre of the city are just a short distance away.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115034/berlin-europes-new-darling

Eye on Siglap: Singapore’s coolest neighbourhood

Residents of the eastern side of our island have long trumpeted the superiority of their end of the country to the west of Singapore. While the western suburbs tend to be a bustle of activity and a blur of crowds, the east side features pleasantly laid back neighbourhoods and hole-in-the-wall food and beverage outlets.

Siglap is one of the most sought-after areas in eastern Singapore, and is populated by upper-middle class families who reside in clusters of landed homes and condominiums. Just a 20 minute drive from the central business district (CBD), the area manages to avoid the pretentiousness that plagues the quickly gentrifying addresses in other parts of Singapore while still remaining a prestigious area.

Siglap’s residential area is comprised entirely of private housing. While four low-rise HDB blocks used to stand at the intersection of Siglap Road and East Coast Road, they were repossessed by the government under the Selective En-Bloc Redevelopment Scheme, and are slated for demolition sometime in 2016. Former residents of Blocks 1 to 4 are now being relocated to Chai Chee Road.

Siglap’s only public housing blocks still standing were originally built in 1963 for the victims of a fire that broke out close to the former Siglap Market, where Siglap Centre now stands. The culprits of the fire were firecrackers that had been set off during Chinese New Year.

Today, Siglap is a relatively quiet neighbourhood that is still hip enough to attract visitors from all over the island, thanks to strips of restaurants, cafes and bars that line the major roads. The area has been rejuvenated by the explosion of F&B outlets on Upper East Coast Road and at Siglap V, a freehold condominium with retail and dining options on the ground floor.

Some of the most popular cafés in the area include Udders Ice Cream on Upper East Coast Road and up-and-coming Craftsmen Specialty Coffee at Siglap V. Then there are old favourites that long-time residents keep coming back to, like Vie Bar on Upper East Coast Road and BLooiE’s Roadhouse on Jalan Tua Kong.

The newest part of Siglap to get a makeover is the Siglap Canal area, which has been revamped as a community space connecting estates like Marine Parade and Kembangan. An activity plaza where morning tai chi sessions are held has been opened in front of the Kampong Kembangan Community Club, and green spaces and a rain garden have been built over the canal.

No matter where in Siglap you might choose to while away a Sunday afternoon, you won’t hear the click-clack of high heels or catch sight of suited gentlemen staring at their Blackberries. Instead, a mixture of residents and visitors unassumingly clad in casual wear lick the foam off their cappuccinos as they leaf through the Sunday papers, or kick back with a pint of cold beer on a steamy afternoon.

A great place to call home

Residents in the east are already familiar with Siglap, which has long been one of the most sought-after residential areas this side of the island. Part of Siglap’s appeal lies in its proximity to the city and some of Singapore’s most reputable schools.

Eugene Lim, Key Executive Officer at ERA Realty Network, is confident that Siglap’s popularity is here to stay. “Siglap has very desirable location attributes. It is within short driving distance from both the CBD and the airport, which is attractive to working professionals and those who need to travel often,” he said. “There are also many established schools in the vicinity, such as Tao Nan School and Victoria School, which appeals to families.

“Public transport-wise, there are many bus services plying the area and with the Thomson East Coast Line, connectivity will be further enhanced. Also, for those who are willing to pay a premium, Siglap is one of the few places in Singapore with a full sea view.”

The residents of Siglap seem to agree. Nirev Shah, a lawyer and Siglap resident, said, “It’s a lovely residential area with cafes and bars that open till quite late like Häagen-Dazs, plus there are nice houses there and it’s well-connected by bus services. The area is becoming livelier, with decently-priced eateries and bars that provide the public with some entertainment.”

In fact, each weekend non-residents flock to Siglap for a treat at tried-and-tested eateries. Etna and Al Forno serve up authentic Italian cuisine, while Indian Curry House and Thai Express are popular with fans of Asian food.

According to Mr Shah, another of Siglap’s draws is that its adjacent neighbourhoods are chock-full of amenities like shopping malls. “It’s smack in the middle of Bedok and Marine Parade, two good areas for shopping, food and other amenities. Katong Mall is also not too far away,” he said.

There’s a generous range of leisure options for residents and visitors alike, whether it’s getting a massage at a spa, picking up groceries at Cold Storage, or scheduling a grooming session for Rover at Pet Lovers Centre.

The Siglap of the future

The Siglap neighbourhood has stood undisturbed for some time, with no major residential development launches taking place in recent years. But this is about to change.

According to Lim, “Under the H2 2015 Government Land Sales (GLS) Programme, a site in Siglap has been placed on the confirmed list, slated for development into private residential units. Located adjacent to Victoria School and within walking distance of the upcoming Siglap MRT station on the Thomson East Coast Line, it will be a project to look forward to when it is launched, possibly in early 2017.”

In fact, while Siglap has always been a popular residential location, some home buyers have been discouraged by the lack of an MRT station in the area. The upcoming Siglap MRT station, which is expected to be opened in 2023, looks set to boost the popularity of the area and raise property values.

“Siglap has always been an established housing estate, one of the few places in Singapore where freehold condominium projects can still be found. While there are not many vacant land parcels left for development, the construction of the Thomson East Coast Line is expected to boost housing prices once completed,” said Lim.

It looks like Siglap’s enduring popularity is about to grow even more.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115008/eye-on-siglap-singapores-coolest-neighbourhood

Joint Tenancy versus Tenancy-in-Common: What’s the difference?

It’s more common these days in Singapore for single friends to buy private property together under the Joint Tenancy or Tenancy-in-Common scheme. But what are the differences between the two?

1. Shares make all the difference

If you and another person / other people purchase a property together without clearly determining how big each person’s share is, the arrangement is known as a joint tenancy. If, however, you each have a specific share (this can be equal or unequal), the arrangement is known as tenancy-in-common.

2. Regardless of dollars and cents

Under a joint tenancy, each co-owner has the rights of a single owner, as well as an equal interest in the property. This is regardless of how much he paid for the property. Any legal decision made
regarding the property also must be made jointly.

3. Making the distinction

Under tenancy-in-common, each co-owner holds a distinct and separate share in the property. This may be equal (50-50), or unequal. Nonetheless, each of them also has the rights of a single owner and the right to live in the property, regardless of the size of his share. At the same time, each owner is entitled to dispose his share to a third party while he is alive, or leave his share to a third party in a will.

4. Till death do us part

In the event of a co-owner’s death under a joint tenancy, the right of survivorship applies. This means his interest in the property is automatically transferred to the surviving co-owner(s). However, the same does not apply for tenancy-in-common. Upon the death of a co-owner, his share in the property will either be distributed according to his will, or, if he did not leave a will, his share will be handled according to Singapore law.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115027/joint-tenancy-versus-tenancy-in-common-whats-the-difference

Sliding prices may force govt to adjust property curbs

Property consultants believe the government may finally be persuaded to tweak some of the cooling measures as home prices are expected to drop further this year, reported Bloomberg.

JLL National Director of Research & Consultancy, Ong Teck Hui, expects home prices to fall by as much as eight percent this year, while Knight Frank predicts a three to six percent decline in residential values.

“All the noises from the Government are that cooling measures are here to stay,” noted Nicholas Holt, Singapore-based Asia-Pacific Research Director at Knight Frank.

Nonetheless, he reckons that “behind closed doors they are talking about possible tweaking of some of the cooling measures,” especially given rising mortgage rates, slowing macroeconomic growth and falling home prices.

With prices falling for a ninth quarter over the last three months of 2015, the city-state has been successful in cooling its once red-hot property market.

The measures, which include higher stamp duties on home sales and acquisitions, as well as a cap on real estate loans at 60 percent of a borrower’s monthly income, have earned the ire of Singapore’s biggest developers. In November, City Developments urged the government to review the measures as demand for apartments weakens.

Home prices declined 3.7 percent in 2015, almost matching the four percent drop seen in the year before, the first year-on-year decline recorded since 2008. Prices climbed to a record high in 2013, which prompted the government to introduce additional curbs as demand from foreign buyers and low interest rates raised concerns that the market could be overheating.

Ong stated that tweaks to the measures will likely be gradual in order to prevent the market from overheating again.

For a progressive easing, the seller’s stamp duty, additional buyer’s stamp duty and loan-to-value ratio may be adjusted gradually, he said. Holt, on the other hand, said that the government can slowly scale back the high stamp duty, starting with permanent residents and locals.

“The government has maintained that it is not yet time to ease the cooling measures and our sense is that it is more likely to be later rather than earlier in 2016,” shared Ong.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114981/sliding-prices-may-force-govt-to-adjust-property-curbs

Private housing resale market shines as buyers get off sidelines

TODAY reports: Property cooling measures and loan curbs have made private homes more affordable.

SINGAPORE: After waiting more than one year for an opportune time to purchase a condominium to house his family of three, Mr Amrit took the plunge in early 2015 after coming across a resale unit in his choice location with a “reasonable” price tag.

He had always intended to upgrade to a private home, and when prices for Housing and Development Board (HDB) flats started falling in 2013, he decided to cash out before the value of their four-room flat dipped further.

But instead of immediately upgrading to a private property, Mr Amrit, who is in his 40s, decided to bide his time and rent a place with his wife and teenage daughter while they went about hunting for the ideal home. This came about one year later, in the form of a two-bedroom resale condominium in the Western part of Singapore.

“We heard that prices would fall even more, so we thought we should take our time to look around,” said Mr Amrit, who works in the media industry.

Like Mr Amrit, many homebuyers who are owner-occupiers returned to the market last year after property cooling measures and loan curbs put a lid on private home prices.

SRX data shows that by the end of last year, resale prices of non-landed private residences had fallen 7.8 per cent from the recent peak in January 2014. Analysts said compared with new launches sold directly by developers, some sellers in the resale market have been more willing to price down their properties to secure buyers.

The return of potential buyers on the sidelines helped transaction volume in the resale private homes segment grow by 24.1 per cent to 6,160 sales last year from the previous year, far outpacing the 1.7 per cent increase in sales in the primary market to 7,440 units, showed statistics by the Urban Redevelopment Authority (URA).

RENTAL PROSPECTS DIMMED

“I believe there’s pent-up demand that has built up when prices were rising, because a lot of upgrading decisions had to be put on hold then. Now that prices have come down from the peak, it has become a good time for upgraders to buy,” said Mr Colin Tan, director of research and consultancy at Suntec Real Estate Consultants.

Property agents note that besides more realistic pricing by sellers, these buyers often look for larger units to house their families and prefer certain locations that many new launches today are unable to provide. As a result, many of them turned to the resale market — a business opportunity that agents have also tapped.

ERA key executive officer Eugene Lim told TODAY that private residential resale transactions done by the agency jumped 33 per cent last year from the previous year.

“Many buyers nowadays are owner-occupiers (and) these buyers have very specific needs — location and size are very important to them. The sizes of new projects are smaller than some of the older ones and developers have also not dropped prices significantly, whereas there are serious sellers in the resale market who are more open to negotiating,” said Mr Lim.

“The investment climate is not quite there any more. We see the rental market is not doing so well, so generally we see fewer investors in the market,” he added.

Sharing his view is Mr Chris Koh, director of Chris International, who said that rental prospects have dimmed as a result of tighter controls on foreign manpower inflows and the large impending supply of completed homes, with close to 22,000 private homes due for completion this year.

Rents have also taken a hit, falling 7.9 per cent in nine consecutive quarters from the peak in the third quarter of 2013 to the last three months of 2015, showed URA data.

‘SUPPLY STILL OUTPACING DEMAND’

Besides property curbs such as the Additional Buyer’s Stamp Duty (ABSD) and Total Debt Servicing Ratio (TDSR) framework, the current economic climate is also adding to the subdued investment sentiment, with slower growth prospects and rising interest rates deterring big-ticket investments such as property.

The analysts said growth in private residential resales will likely continue for the rest of this year, given that prices are likely to fall further and attract more potential buyers on the sidelines to return to the market. In addition, the number of new launches is expected to come down due to the reduction in land supply in the Government Land Sales programme.

However, the return of owner-­occupier buyers to the market would not be enough to lift the overall market that has seen prices decline for nine consecutive quarters, said analysts.

“I don’t think prices will come up in the short term because supply is still outpacing demand. In 2015, prices have already reached 2011 levels, so it’s starting to look attractive to buyers who have been waiting. By this year, prices would have dropped for three years, I believe more buyers will find it attractive,” said Mr Koh.

By the last quarter of 2015, overall private property prices had fallen 8.4 per cent from the recent peak in the third quarter of 2013, showed URA data. This is still shy of the more than 60 per cent increase in prices after the global financial crisis, which prompted the Government to implement cooling measures to prevent the market from overheating.

The Government has repeatedly said the time is not yet right to tinker with the measures. In October, Minister for National Development Lawrence Wong said that even though the market is stabilising, price adjustments so far had been moderate compared with the price increase in earlier years and the Government did not want to “risk a premature market rebound”.

Picture Source: A view of blocks of private residential condominiums, left, and executive condominiums in Singapore Jan 4, 2016. (Photo: Reuters)
Source copied from: http://www.channelnewsasia.com/news/singapore/private-housing-resale/2535970.html

20 February 2016

GuocoLand tops out $3.2b Tanjong Pagar Centre

Property developer GuocoLand on Wednesday topped out Tanjong Pagar Centre, its $3.2 billion integrated mixed-use project located above Tanjong Pagar MRT station.

At 290 metres high, the development is set to become the tallest building in Singapore, once completed in mid-2016.

National Development Minister, Lawrence Wong, was the guest-of-honour at the ceremony to mark the important milestone.

The building will integrate 890,000 sq ft of Grade A office space at Guoco Tower, a 100,000 sq ft dynamic lifestyle and F&B component, 181 luxury homes at Wallich Residence, the 222-room Sofitel Singapore City Centre and a 150,000 sq ft landscaped Urban Park.

“Tanjong Pagar Centre makes two key contributions to the Singapore city. It will act as a catalyst in accelerating the rejuvenation and transformation of Tanjong Pagar District into a business and lifestyle hub in the CBD. Additionally, its ‘Integrated Vertical Living’ design concept offers a model for Singapore’s urban future. Through intelligent and sustainable designs, we can still achieve excellent quality of life in a highly-urbanised environment,” said Raymond Choong, President and CEO of GuocoLand Group.

Meanwhile, Channel NewsAsia reported that GuocoLand will start selling the residential units upon the project’s completion. Wallich Residence will house Singapore’s tallest and largest penthouse – a triple floor duplex on levels 62 to 64.

Picture Source: Aerial view of the Urban Park at Tanjong Pagar Centre.
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114997/guocoland-tops-out-the-3-2b-tanjong-pagar-centre

HK to increase housing supply

Hong Kong Chief Executive Leung Chun Ying has pledged to increase the supply of new homes in the territory, while dismissing calls by developers to ease property curbs as prices are still too high, reported Bloomberg.

“We should continue to tackle the housing problem head-on and must not concede,” said Leung in his annual policy speech to lawmakers, adding that rentals and prices are “still beyond what people can afford”.

Notably, the target for new public housing supply has been raised to 97,100 units in the next five years from 77,100 previously. Private developers, on the other hand, are expected to release 87,000 new units over the next three to four years.

During the last three years, the Hong Kong government has doubled stamp duties, tightened mortgage requirements at banks and introduced a special tax on non-resident buyers following a surge in property prices. The city saw prices peak in September 2015, increasing by 160 percent from December 2008 – making it the most expensive place to own a home in the world.

With concerns of rising interest rates and the slowing economy sapping demand, prices began to fall in Q4 2015, dropping by 7.5 percent. CLSA Ltd Head of Property Research, Nicole Wong, expects the price decline to accelerate to eight percent this quarter as developers engage in a price war.

But she expects Leung to change the policy within six months if prices fall by 15 percent.

“Any correction should not destabilise society,” said Wong. “If prices fall 15 percent in six months, the government would have to start a policy action.”

The Hang Seng Properties Index, which tracks the performance of 10 real estate firms, has fallen 8.3 percent in the year to date.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114971/hk-to-increase-housing-supply

Analyst: Private home prices may fall up to 10%

With Singapore ‘half-way through the residential down-cycle’, BNP Paribas expects private home prices to drop by another seven to 10 percent over the next two years, reported The Business Times.

Chong Kang-Ho, Research Head for Singapore, Malaysia and Indonesia as well as Asean Property Research, noted that this could be a slow bottoming-out process due in part to the resilience of developers when it comes to price cuts, owing to their strong holding power and higher land costs.

“The implication of a slow bottoming-out process is that policy relaxation could be delayed,” said Chong.

Latest flash estimates from the Urban Redevelopment Authority (URA) shows that private home prices dropped by 8.4 percent in Q4 2015 from the peak in Q3 2013.

Chong’s projection, on the other hand, implies a 15 to 20 percent fall from the 2013 peak. He also expects vacancies to increase to 10 percent by 2018.

Nonetheless, Chong sees a greater likelihood of stabilisation within the high-end segment, which witnessed price premium over the mass-market segment narrow. In fact, the price premium of luxury homes in Hong Kong versus luxury homes in Singapore’s districts 9 and 10 has widened since 2010.

“If I’m an international investor, it is a better time to look at Singapore because prices have plunged so much,” he said.

However, the rental market is expected to remain weak. Chong warned that lifting the property cooling measures in 2017 will not stem out the weakness unless the government relaxes immigration rules.

“Even if the government relaxes immigration rules, we don’t know if foreigners will come in now that the financial institutions are not hiring,” he added.

With interest rates on the rise and net rental yield falling to two to three percent, Chong does not rule out negative carry over the coming quarters, or the cost of holding the property exceeding the return earned.

He believes that a policy reversal may take the form of an increased loan-to-value or tweaks to the mortgage servicing ratio (MSR), additional buyer’s stamp duty (ABSD) and seller’s stamp duty (SSD).

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114900/home-prices-may-fall-by-another-10-says-analyst

PropertyGuru acquires Ensign Media’s real estate businesses

PropertyGuru on Wednesday (13 January) announced its latest acquisition following the purchase of Ensign Media’s real estate media businesses, Property Report and Asia Property Awards.

Ensign Media — which owns Property Report, a regional luxury property and lifestyle magazine and website, and Asia Property Awards, the region’s biggest property industry awards that are held in nine countries annually — is headquartered in Singapore.

PropertyGuru has 14 million users while Property Report has 70,000 online and offline readers. Following this acquisition, these users will have combined access to PropertyGuru’s 600 monthly research and news articles published in three languages across four markets, and Property Report’s 100 plus online features per month.

“The latest acquisition strengthens [PropertyGuru’s] content, geographic reach and services we provide to real estate developers regionally,” said Steve Melhuish, PropertyGuru co-founder and group CEO.

The group also said the acquisition will strengthen its integrated property media capability — combining the company’s leading online property sites and its property shows with a leading print and online publication and a highly successful and prestigious property industry awards platform in Asia.

“The Asia Property Awards are already the region’s largest and most respected real estate awards,” said Ensign founder Terry Blackburn, “now with PropertyGuru’s support, [Asia Property Awards] will be even bigger in 2016 and the years ahead.”

With this full asset purchase, Ensign Media’s existing staff will be absorbed into PropertyGuru, the group said in a press release.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114836/propertyguru-acquires-ensign-media

Indonesia allows foreigners to own homes for 80 years

In a bid to attract more foreign home buyers and investors, Indonesia will allow foreigners to own landed homes for up to 80 years, reported Reuters.

This comes after President Joko Widodo signed a government regulation in late 2015 giving foreigners the right to purchase a landed home for 30 years, which could be extended for another 50 years, said the Cabinet Secretariat.

It noted that foreigners should live, work or invest in Indonesia, as well as “provide benefit” to the country for them to become eligible.

Previously, foreigners were allowed to purchase homes for 25 years, with an extension of another 25 years.

As for apartments, Indonesia has allowed foreigners to acquire units worth more than 10 billion rupiah (S$1.03 million).

Picture Source: Jakarta city centre. (Photo from Wikipedia)
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114887/indonesia-allows-foreigners-to-own-landed-homes-for-80-years

19 February 2016

Mortgagee auctions on the rise

Mortgagee listings at property auctions are expected to increase further this year, reported The Business Times.

“From our experience, a key factor for growth of such listings is foreigners defaulting on loans for their purchase of high-end investment properties. Typically these borrowers do not live in Singapore,” said a banker.

Data from Colliers International showed that mortgagee listings at auctions reached a seven-year high of 241 in 2015, with residential properties accounting for nearly 80 percent of such listings.

The banker explained that putting a property up for auction is a last-resort measure.

“Typically when a borrower defaults – that is, he cannot meet the monthly loan instalments – we call the customer to try and restructure the loan, lengthening the repayment period,” noted the banker.

“Alternatively, we may ask the borrower to try and sell their property on their own – because once the bank steps in, buyers will hope for a fire sale.”

Meanwhile, the eight new listings at Knight Frank’s upcoming auction on Wednesday include an owner’s sale of a four-bedroom apartment with a utility room at The Sovereign in Meyer Road. Sold with tenancy, the freehold property has an indicative price of between $4 million and $4.2 million.

Also set to go under the hammer is the estate sale of a three-storey semi-detached home at Jalan Emas Urai within the Chestnut/Dairy Farm area. Nestled on 2,725 sq ft of land, the 999-year leasehold property spans three storeys and comes with a lift and an open roof terrace. Featuring four bedrooms and a maid’s room, the property has an indicative price of between $3.6 million and $3.8 million.

Separately, Colliers International’s auction on 27 January will include the mortgagee sale of a two-bedroom apartment at The Interlace in Depot Road. The 807 sq ft unit has a price tag of $1.2 million.

JLL’s auction on 28 January will feature two mortgagee sale apartments – a 1,130 sq ft two-bedroom plus study unit on the seventh floor of the freehold Jardin along Dunearn Road and a 1,259 sq ft unit on the fourth floor of The Bayshore. The Jardin unit has a guide price of between $1.8 million to $1.9 million, while The Bayshore apartment has an indicative price of between $1.15 million to $1.2 million.

Although the total number of properties put up for auction (including owner sales and factoring in re-listings) soared to a six-year high last year at 796, only 33 were sold, which translates to a success rate of just 4.1 percent.

Colliers Deputy Managing Director, Grace Ng, attributed the low success rate to the continuing mismatch between buyers’ and sellers’ expectations.

“While banks are guided by valuations in setting their reserve price, buyers often expect a steeper discount in light of falling property prices, the mounting supply of private home completions, rising interest rates and the government’s cooling measures,” said Ng.

To be held at Amara Hotel, all three auctions will start at 2:30pm during their scheduled days.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114772/mortgagee-auctions-on-the-rise

JLL wins award for world’s best property consultancy

JLL has been named ‘World’s Best’ in the Property Consultancy category at the International Property Awards Final 2015.

The firm also won the title of ‘Best in Asia Pacific’ in the regional category for Property Consultancy at the event, held in London in December.

Commenting, Alastair Hughes, Asia Pacific CEO at JLL, said: “It makes us immensely proud to be recognised in the International Property Awards as the World’s Best Property Consultancy, as well as the best in Asia Pacific. This is testament to the hard work of our teams around the world in delivering the highest quality of service to our clients.”

The Awards are judged by an independent panel of 70 industry experts who focus on quality of service and dedication to the industry. Last year, more than 2,000 entries were received from over 110 countries.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114752/jll-wins-award-for-worlds-best-property-consultancy

Deal-making in Asia’s hotel sector set to cool to US$8.5b in 2016: JLL

Transaction volumes in Asia-Pacific’s hotel industry is likely to fall 8 per cent from the previous year to US$8.5 billion in 2016, says global real estate consultancy Jones Lang LaSalle (JLL).

SINGAPORE: After a year of explosive growth, deal-making in Asia-Pacific’s hotel industry looks set to cool modestly in 2016, with global real estate consultancy Jones Lang LaSalle (JLL) tipping transaction volumes to reach US$8.5 billion.

This marks an 8 per cent decline from the previous year, where hotel transactions in the region totalled US$9.2 billion after more than 33,000 hotel rooms changed hands last year.

“In 2015, the headlines featured blockbuster acquisitions of high-profile, gateway market hotels by investors from mainland China, Hong Kong and the Middle East. We also saw a high volume of hotel deals in Japan with increasing interest from foreign investors,” Mr Scott Hetherington, CEO of JLL Hotels & Hospitality for Asia, said in a press release on Feb 10. “This year, we expect transaction activity across the region (to) slow somewhat.”

In particular, hotel transaction volumes in Hong Kong are likely to have reached its peak following a record year in 2015, which witnessed the blockbuster transaction of InterContinental Hong Kong for US$938 million in July. Investors eyeing the Hong Kong market will adopt a “wait and see” approach in 2016, according to JLL.

Deals in Singapore’s tightly-held hotel sector is also likely to be “few and far between” amid a lack of available assets, the report added.

Among the brighter spots in the region, Japan will likely continue to see high volumes of transactions on the back of strong demand from domestic investors and US private equity funds. In addition, industry experts are seeing rising appetite from Chinese investors for hotels in second-tier Japanese markets.

Australia is also poised for a rosy year, with offshore interest expected to continue in the months ahead especially for the coveted Sydney and Melbourne markets. Overseas investors have been pouring cash into the hotel sector down under, with one of the largest deals being the sale of Westin Sydney for US$314.14 million to a joint venture between Singapore developer Far East Land and Hong Kong-based Sino Land last May.

In India, a change in the country’s hotel landscape and improvements in operations will provide the impetus for more acquisition and consolidation in some cities, according to JLL. Secondary markets in Southeast Asia and the Indian Ocean will also come under the radar of investors as interesting opportunities surface in Thailand, the Maldives and Mauritius, the real estate consultancy added.

Meanwhile, the trend of consolidation will likely persist across Asia-Pacific after a string of deals, namely Marriott International’s acquisition of Starwood Hotels & Resorts Worldwide for US$12.2 billion and the purchase of Fairmont Raffles Hotels International Holdings (FRHI) by Europe’s largest hotel operator Accor for US$2.9 billion, shook up the industry in 2015.

Both deals will have a huge impact on the hotel operating landscape in Asia Pacific, JLL said.

“Hotel brands are on a never-ending quest to bolster their pipeline and with the natural attrition in properties and limits to new supply growth, the surest way is often by acquiring operators with strategic management or franchise contracts,” said Mark Wynne Smith, Global CEO of JLL’s Hotels & Hospitality Group.

GLOBAL OUTLOOK

Beyond Asia, the volume of global hotel transactions is expected to hit US$70 billion this year, lower than 2015’s US$85 billion.

JLL predicts hotel transaction volume in the Americas to fall 20 per cent to US$37 billion in 2016, while the market of Europe, the Middle East and Africa (EMEA) is set to see US$25 billion worth of hotel trades, down 15 per cent from the prior year.

“We expect 2016 to be another strong year, although investors’ desire to buy is more measured,” said JLL’s report, which noted that the recent turmoil in global stock markets could weigh on investor sentiment.

“Investors are starting to consider what holding assets through a down cycle will look like and making more careful considerations around financing structures … but the underlying hotel market fundamentals remain positive.”

Picture Source: French hotel and services group Accor bought Fairmont Raffles Hotels International Holdings (FRHI) for US$2.9 billion last December. (AFP/Loic Venance)
Source copied from: http://www.channelnewsasia.com/news/business/international/deal-making-in-asia-s/2502938.html

Private home sales fall in January with fewer property launches

Property developers sold 322 new private residential units in January, down from 384 in December, according to data released by the Urban Redevelopment Authority

SINGAPORE: Sales of private homes fell 16 per cent in January from the previous month as developers scaled back property launches.

Excluding executive condominiums (ECs), developers sold 322 new units last month, down from the 384 units sold in December, data from the Urban Redevelopment Authority showed on Monday (Feb 15). Including ECs, 478 new units were sold last month, down from 508 units.

The fall in sales came as developers held back from launching new units, with 146 hitting the market last month, down from the 173 launched in December.

Commenting on the numbers, Eugene Lim, Key Executive Officer at ERA Real Estate, said that the current downturn in the stock market has had an impact on buyer sentiment, with property sales “somewhat affected”.

“Also, there were no major launches as the market was gearing up for the Lunar New Year festivities,” he said.

Picture Source: File photo of private housing in Singapore. (Photo: TODAY)
Source copied from: http://www.channelnewsasia.com/news/business/singapore/private-home-sales-fall/2516020.html

Rupert Murdoch’s REA Group completes acquisition of Malaysia’s iProperty

“This move is a game changer for our industry,” REA Group’s chief operating officer said of the company’s successful acquisition of Malaysia-based iProperty Group.

SINGAPORE: Australian real estate website company REA Group completed the acquisition of Malaysia-based iProperty Group on Wednesday (Feb 17), in a deal that it described as being a “game changer” for the industry.

REA, which is 62 per cent owned by media magnate Rupert Murdoch’s News Corp, first announced in Nov 2015 its decision to buy the rest of iProperty Group that it did not already own for A$578 million (S$576 million). The deal valued iProperty, a real estate portal listed on the Australian Securities Exchange since 2009, at about A$750.8 million.

Prior to the acquisition, Melbourne-based REA owned about 22.7 per cent of iProperty

“This move is a game changer for our industry,” Arthur Charlaftis, chief operating officer for International and Developer at REA Group, said at a media launch in Malaysia. “The iProperty Group’s local market expertise is second to none and our teams will be working closely together to tap into the needs of buyers throughout the region.”

The deal will add iProperty’s property portals in Malaysia, Hong Kong, Thailand and Indonesia to REA’s stable, giving the latter exposure to a rapidly-growing Southeast Asian market.

According to figures by REA, average property prices in Singapore and Hong Kong have surpassed those in Australia. Southeast Asia is also home to more than a million property transactions per year, a number that exceeds the volumes in REA’s home market.

“These factors have driven our interest in the South East Asian market,” said Mr Charlaftis. “We know that consumers in South East Asia are online and connected. We would therefore expect that the advertising spend will migrate rapidly towards online channels to mirror consumer media consumption.”

“The iProperty Group provides us with exposure to new geographies where we can apply our experience and know-how from existing markets,” added Mr Charlaftis. He also said that the acquisition underscored REA’s “commitment to international expansion” and marked “the next step” in the company’s growth strategy.

According to iProperty’s chief executive officer Georg Chmiel, the firm will retain its name and “continue operations and business as normal”.

“We have strong synergies with REA Group and this acquisition is a major accelerator as this significantly enhances the growth profile for both companies, while giving our customers, property buyers and investors the opportunity to tap into a wider market,” Mr Chmiel added.

iProperty was founded in 2007 by Patrick Grove, a Singapore-born serial entrepreneur and co-founder of Kuala Lumpur-based tech investment firm Catcha Group.

On Wednesday, shares of REA Group closed down 0.23 per cent at A$50.96, tracking a 0.57 per cent decline in the broader S&P ASX 200 index.

Picture Source: Headquartered in Kuala Lumpur, iProperty Group is a company that owns online property portal websites in Asia.
Source copied from: http://www.channelnewsasia.com/news/business/international/rupert-murdoch-s-rea/2522804.html

15 February 2016

$10m for owners affected by MRT Line

Eight owners of partial land lots that are being acquired for the construction of the Thomson-East Coast MRT Line received a total of $10 million, reported Channel NewsAsia.

According to the Singapore Land Authority (SLA), the owners were paid the corresponding market value of their property as determined by private valuers and in accordance with the Land Acquisition Act.

Most of the 24,000 sqm of land is located within the Marine Parade and Changi South areas. Over 17,000 sqm is owned by the Laguna National Golf and Country Club.

In April last year, owners of 15 houses affected by construction of the MRT line were awarded $45 million. The homes are situated at Tanjong Katong Road and Amber Road.

The SLA revealed that some of the owners have accepted the compensation while others have appealed to the Appeals Board. One valuer noted that the valuation process is not that straightforward sometimes.

“The challenges are basically understanding of the asset, what are the encumbrances, covenants or restrictions,” said Tan Keng Chiam, Head of Valuation Advisory Services at JLL.

“I think one has to understand the product and thereafter determine the basis. In many occasions, differences arises because of different assumptions.”

Picture Source: LTA
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114629/10m-for-owners-affected-by-mrt-line

Thailand property to see growth in 2016

Several property firms are predicting that Thailand’s real estate market will see growth of around five to ten percent in 2016, with Greater Bangkok expected to lead the charge, reported The Nation. The government’s investment in infrastructure projects across the country is just one reason for the positive outlook this year.

“When the government starts to invest in infrastructure projects, that will open up new land for property firms to develop residential projects,” said Thongma Vijitpongpun, President and Chief Executive Officer of Pruksa Real Estate. “This will challenge property firms to invest in the new locations following the new mass-transit route from Bangkok to the suburbs and nearby provinces.”

The Nation noted that infrastructure projects either under construction or scheduled to begin construction soon include railway double-tracking, motorways, and ten new mass-transit routes. The goal is to make Thailand a regional transport hub and this in turn will boost demand to buy homes in the country as foreign companies see Thailand as a gateway to other Asean countries, noted Thongma.

He added: “We believe that Thailand’s property market will show average growth of five to ten percent a year from 2016 to 2020. We will launch more new residential projects nationwide to serve strong demand in the market, especially in locations close to the mass-transit system.”

Tritecha Thanmatithum, Supalai Deputy Managing Director, agrees with this sentiment and noted that the government measures to cut transfer and mortgage fees will also help improve the property market this year. He said that the company plans to launch up to 29 residential projects in 2016. Of these, 20 will be low-rise developments such as detached houses and townhouses, while the rest will be condominiums.

Chanond Ruangkritya, President and CEO of Ananda Development, also believes that the property market in Thailand will see growth and the developer is making plans accordingly. It expects to launch ten residential projects in 2016, of which eight will be condominiums and the other two detached housing projects.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114657/thailand-property-to-see-growth-in-2016

Nearly 230 babies born to couples living in PPHS flats

Close to 230 babies have been born to couples living in Parenthood Provisional Housing Scheme (PPHS) flats, wrote Senior Minister of State (Prime Minister’s Office) Josephine Teo in a Facebook post, reported Channel NewsAsia.

Introduced in January 2013, the scheme offers interim housing for those who have booked an uncompleted HDB unit under the Build-to-Order (BTO) or Sale of Balance Flats (SBF) exercises. Applicants under the Fiancé/Fiancée Scheme or married couples, and widowed or divorced parents with children, are eligible to rent a flat under the PPHS.

Currently, there are around 1,900 PPHS flats in several locations including Jurong, Tiong Bahru and Commonwealth, said Teo, who also helps oversee the National Population and Talent Division (NPTD).

She noted that couples need not wait until their BTO flats are completed before marrying or having a child since PPHS offers a temporary rental option within an HDB setting.

“It’s a helpful scheme which I hope HDB will similarly scale up if there’s demand,” she added.

National Development Minister Lawrence Wong recently revealed that this year’s supply of BTO flats will increase by 3,000 units from last year to 18,000 units. This comes after the last BTO exercise in November 2015 saw a healthy response.

“With affordable HDB housing more readily available now, young couples should not wait too long to welcome (a) baby to the family,” said Teo.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114547/nearly-230-babies-born-to-couples-living-in-pphs-flats

Vietnam condo to go on sale in Singapore

The first luxury condominium from Vietnam to be launched for sale in the city-state this year will take place next weekend, 16 to 17 January, at the Grand Hyatt Singapore, revealed marketing agent CBRE.

Located in the Thao Dien area in prime District 2 of Ho Chi Minh City, the 238-unit Nassim project by Hong Kong Land and SonKim Land will bear resemblance to the prestigious Nassim enclave in Singapore.

A selected number of one- to four-bedroom units will be available, with prices starting from around S$195,000 for a one-bedroom apartment.

Set to be completed in 2018, the development is close to the scenic Saigon River, Vincom Mega Mall Thao Dien, restaurants, international schools and clinics, making it popular among wealthy Vietnamese and much sought after by expatriates, said CBRE.

The upcoming An Phu Metro station (Ho Chi Minh City’s first Metro line) will help to improve connectivity and accessibility. CBRE also noted that properties within a 10 minute walk to Metro stations will command a 10 to 20 percent premium over those sited further away.

In fact, prices in the high-end and luxury segments have recorded growth since the market bottomed out, with the sales volume of prime-grade condos starting to pick up since the second half of 2014.

New luxury properties at very prime locations such as those in District 2 will probably reach S$325 to S$377 psf in 2016, added CBRE.

Meanwhile, Leong Boon Hoe, Managing Director of CBRE Realty Associates, is confident that the project will attract strong interest from Singaporean investors.

“The Nassim will be one of the very few and limited high-end condominium projects to be classified as luxury class available for sale now. Early investors will reap very good growth potential given the very limited number of projects of this category in HCMC at this moment. As the city matures and rides the wave of economic reform and increasing foreign direct investments, the growing affluence and confidence of the market in investing into the high-end condominium segment, it is not surprising The Nassim sold very well when it previewed in HCMC just two months ago,” he said.

Vietnam has been in the spotlight in recent months after changes to property ownership rules were implemented in July 2015, allowing foreigners with a valid visa to own property in the country. Previously, only foreigners married to Vietnamese nationals and those making contributions to the country were allowed to buy property.

Picture Source: Artist’s impression of The Nassim. Photo by CBRE
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114523/vietnam-condo-to-go-on-sale-in-singapore

Residential site close to Tanah Merah MRT triggered for sale

A 99-year leasehold residential site at New Upper Changi Road/Bedok South Avenue 3 (Parcel B) that was on the reserve list was triggered for sale today after a property developer committed to bid a minimum price of $320 million for the plot, said the Urban Redevelopment Authority (URA).

As the minimum price committed by the developer is acceptable to the government, the site will be released for sale by public tender.

With a land area of about 2.4ha, the land parcel is expected to generate a gross floor area of around 51,228 sqm and yield up to 570 housing units.

The site is close to Tanah Merah MRT station, Changi Business Park and the Singapore University of Technology and Design. Many condominiums such as Stratford Court, East Meadows, Casa Merah and Optima@Tanah Merah are also located nearby.

The URA will launch the public tender for the site in about two weeks.

Picture Source: URA
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114519/residential-site-close-to-tanah-merah-mrt-triggered-for-sale

12 February 2016

Location, pricing still key to attracting buyers

Last year’s property launches showed that home buyers go for reasonably priced homes in good locations, reported The Straits Times.

In fact, three projects performed exceptionally well during their launch despite the cooling measures, primarily due to pricing and location.

High Park Residences in Sengkang moved 1,169 units at a median price of $989 psf, while North Park Residences in Yishun sold 486 units at a median price of $1,374 psf.

Over in the city fringe area, The Poiz Residences in Potong Pasir moved 277 units at a median price of $1,440 psf during its launch.

ERA Realty Key Executive Officer, Eugene Lim, noted that projects that sold well in 2015 were all attractively priced, situated close to an upcoming or existing MRT station, and near various amenities like shopping malls and reputable schools.

“This year, we expect buyers to be equally discerning of new projects. Prices and location should remain the determining factors behind a project’s performance.”

According to PropNex Realty’s Chief Executive, Mohamed Ismail, a project is considered highly attractive to home buyers when they are priced towards the lower end for the area it is located. For the Core Central Region, this would be closer to $2,000 psf and nearer to $1,000 psf for the Outside Central Region. The Rest of Central Region, on the other hand, would be closer to $1,500 psf.

“However, a premium may be commanded due to the location and availability of transportation – near the MRT – or the nature of the project, such as a mixed development,” said Ismail.

He noted that buyers showed a willingness to pay a premium for mixed-use projects like J Gateway, DUO Residences and North Park Residences.

“But for most cases, price is the main factor,” said Ismail.

This is comes as the “restrictive loan environment prevents developers from setting a price that is unrealistically high,” he added.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114469/location-pricing-still-key-to-attracting-buyers

BCA looks to raise productivity of tunnelling projects

Works for tunnelling projects may soon be completed in a shorter span of time and be less noisy as the Building and Construction Authority (BCA) expands a framework presently used to improve productivity in high-rise buildings, reported My Paper.

Under the buildability framework, designers and developers are required to meet a minimum standard of labour-saving methods as well as technology, or face penalties.

They can, for instance, use machines and prefabrication to reduce the excavation on site.

On prefabrication, Deputy Prime Minister Tharman Shanmugaratnam said: “There’s a lot of reduction of disamenities for the public because projects are completed faster, less noisily and with much less dust.”

In fact, BCA expects site productivity to increase yearly by over two percent in the next five years, up from the annual growth of about 1.2 percent in the last five years, said Mr Tharman, who also serves as Chairman of the National Productivity Council, during his visit to the construction site of Nanyang Technological University’s three new residential halls.

The new residential halls are being built using the ‘prefabricated prefinished volumetric construction’ (PPVC) method, in which whole rooms, including fittings like fans and lights, are made overseas and fitted out further here before being taken to constructions sites where they are stacked ‘Lego-style’.

This construction method helps developers save up to 25 to 40 percent in labour and 15 to 20 percent in construction time.

Mr Tharman stated that while the method costs about 18 percent more than conventional concrete construction, such costs can be reduced as suppliers come onboard.

“The public sector is taking the lead in building up demand,” he said.

Meanwhile, BCA Chief Executive John Keung expects civil engineering projects to take up a bigger portion of future construction demand in Singapore.

“It’s not a building, so you’ve got to find a different way to encourage them to make it easy to build,” noted Dr Keung.

Picture Source: Prefabricated Prefinished Volumetric Construction. Source: UB Australia
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114458/bca-looks-to-raise-productivity-of-tunnelling-projects

16 tips on buying overseas property in 2016

The arrival of New Year is a time when many first-time investors finally plan to buy their dream home overseas.

While the overseas market offers many great value properties for those who know where to look, Chris White, Founding Director of Ideal Homes International, says: “We would always advise buyers to be cautious though, particularly if they haven’t bought overseas before – it’s really important to do your homework and buy through a trusted and reputable company.”

As such, White and his team have put together their 16 top tips on buying a home overseas in 2016, to help buyers turn their dreams into reality.

1. Investigate on the Internet – research potential areas thoroughly, rather than individual properties. Find out about local amenities, from beaches to restaurants, based on your priorities. Think about how those priorities may change in the future as well – a holiday home bought this year could serve as a retirement pad later on, so what facilities would you want on hand then? Don’t fall in love with a particular property until you know the location is right for you!

2. Use an agent with form – opt for an organisation with a good track record. Make sure they have been in business for some time and have a long list of satisfied customers happy to speak about their experiences.

3. Budget carefully – buying overseas isn’t just about the property price. Be aware of the buying costs like fees and local taxes. These can vary hugely from country to country, so do your research and budget accordingly.

4. Plan a trip – once you’ve identified the places you like on the Internet, hop on a plane and check them out for yourself. You will quickly be able to get a feel for whether or not a place is right for you, and a few hundred dollars invested at this stage can serve extremely well when it comes to finding the perfect location for your new home overseas.

5. Know what you want BEFORE you visit – think about how many bedrooms you need, whether proximity to the beach or a local golf course is important to you, whether you simply must have your own pool, and whether the local supermarket can be reached on foot or by car. Whatever your preferences, have them firmly fixed in mind before you visit – and be sure that your agent understands them too. This will ensure that he/she is able to show you properties that perfectly suit your requirements, and avoid wasting time spent touring unsuitable homes.

6. Think about the journey – work out the journey from your current home to the area in which you plan to purchase. What are the flight times and costs like? Is there just one airline that flies into the local airport or several? Can you hire a car easily upon arrival if you need to? These factors will impact on how relaxed you are by the time you arrive at your overseas property each and every time you visit, so think the journey through in detail.

7. Find a reputable lawyer – this is one of the most important elements of buying a second home overseas. A good agent should be able to recommend a reputable lawyer, or you can do your own research on the Internet and by speaking to others who have bought property in the area. Chat on the phone with the lawyer and meet him or her when you visit – test their knowledge and be sure to choose someone you are comfortable with.

8. Think about money matters – once you’ve bought your property, you will need to get money out to that country regularly in order to pay bills, take care of maintenance issues and so forth. Look at what you need to do to set up a local bank account and plan to do this as early as possible in the process. Bear in mind that many overseas banks also have a local branch where you can take care of some of the initial paperwork should you need to do so.

9. Remember the insurance – before you commit to purchasing a property, check that it is insurable and at a reasonable rate. If the area that you like the look of is prone to flooding or sink holes, then it might be time to look elsewhere.

10. Ask about hidden requirements – speak to your agent and conduct your own research online to ensure that you know everything you need to. In Portugal, for example, you need a fiscal number in order to purchase a property. You can get one quickly and easily from the local Finanças department for a small fee – or you can appoint a lawyer to take care of this on your behalf.

11. Consider other significant expenses – what other expenses might your property purchase give rise to? One of the most commonly overlooked items is the need for a car, so think about whether you can access your new home on public transport, whether you will pay for a hire car each time, or whether you would prefer to purchase a car of your own overseas.

12. Is the property just for you? – if you plan to rent your property out as well as using it yourself, then be sure that it appeals to a wide range of holidaymakers. Neutral décor and access to a pool can make a big difference to the number of people choosing your holiday home over another one.

13. Speak to the experts – join some online forums and Facebook groups and chat to those who have already purchased in the area you like. Even better, find people who have moved full-time and benefit from their experiences of local life.

14. Know the market – understand price trends in the country and region you like in order to know whether or not your expectations are realistic based on your budget. Knowledge of local prices will also help you to gauge whether you are paying over the odds or picking up a real bargain.

15. Think about maintenance – unless you are planning a permanent move, you will need to consider how best to maintain your property from afar. An isolated villa might be your dream holiday home, but an apartment on a managed condominium might present far fewer headaches in terms of regular maintenance, particularly if you plan to rent it out as well as use it yourself.

16. Use an agent who does it all – find an agent you trust and who can offer you the whole package. They will be able to support you with every step of the process, from finding a reputable lawyer to arranging an inspection trip. This can often be by far the quickest and cheapest approach – and also the least hassle!

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114358/16-tips-on-buying-overseas-property-in-2016

New survey to seek input on smart homes

Leading up to the launch of Singapore’s first smart executive condominium (EC) in the first quarter of 2016, Qingjian Realty is looking to find out young couples’ attitudes towards smart living.

In a statement, the developer said this will be achieved through a survey of about 100 respondents living in Singapore.

The EC project in Sembawang will be targeted at families who are looking to live in a home that embraces the latest technological advancements.

“Technology has become essential in our lives and has immense potential to positively impact our lifestyles even further. To build a smart home that supports the integration of technology to offer homeowners a seamless connection and greater convenience, we need to find out the lifestyle aspirations that they have for their dream homes,” said Li Jun, General Manager, Qingjian Realty.

The survey also aims to find out what features young couples would like to see in a smart EC.

For more details, go to: www.facebook.com/SGHilife/?fref=ts

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114408/new-survey-to-seek-input-on-smart-homes

Property agents turn to Uber amidst chilly housing market

Due to the slump in home sales and the difficulty in securing deals amidst fierce competition, some property agents in Singapore are driving for Uber, a tech firm that allows users to utilise the service of a taxi or private car via their smartphone, reported Bloomberg.

“The market is slow because of the cooling measures. We have no choice, we have to come up with means to make ends meet, said 50-year-old Billy Loh, who started working as a property agent in 2008, but began driving for Uber late last year.

By driving passengers around Singapore, he earns $3,000 per month on average, a far cry from the $30,000 commission he could get selling a unit during the market’s heyday.

Although property agents in other countries typically take on other jobs to supplement their income when the market is not doing so well, the situation in Singapore is very gloomy. Among the world’s major housing markets, it suffered the highest price drop in 2015 and total transaction levels have plummeted by 68 percent since 2012. In fact, developers only managed to move around 7,000 new homes last year, according to SLP International Property Consultants.

Making matters worse, the city-state has a relatively large number of property agents compared with the volume of deals. There are more than 30,000 registered estate agents, ten times the volume of monthly transactions. In comparison, there are only 1,840 agents in the state of New South Wales in Australia who handle an average of 8,160 monthly transactions, noted CoreLogic Inc.

To help agents cope with the weak residential market, the Institute of Estate Agents in Singapore is offering courses and helping agents to get trained in other jobs.

Teaching property agents other skills would enable them to “at least earn a fixed income rather than only rely on commissions in this market,” said its President Jeff Foo.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114389/property-agents-turn-to-uber-amidst-chilly-housing-market

08 February 2016

Luxury home prices to slide further in 2016

Prices of luxury homes in Singapore are expected to drop by 3.3 percent in 2016 compared to an estimated decline of 3.5 percent last year, according to Knight Frank’s Prime Cities Forecast Report.

However, the city-state is expected to fare better than Hong Kong, where prices of prime properties are predicted to fall by five percent versus an estimated growth of 1.5 percent in 2015.

As such, the property consultancy foresees that the territory will overtake Singapore as the weakest-performing luxury residential market this year among the ten global cities being tracked.

“Many of the Asia-Pacific prime residential markets will face existing and new headwinds in 2016, with our forecasts showing quite a range of price performances, including negative price growth in Hong Kong and Singapore. Despite that, there remain pockets of opportunity in these two markets, as prime supply is relatively limited,” said Nicholas Holt, Knight Frank’s Research Head for Asia Pacific.

Meanwhile, Sydney is expected to see the strongest price growth of 10 percent in 2016, albeit slower than the estimated 15 percent expansion last year due to Australia’s economic slowdown, weaker stock market performance in recent months, and the introduction of foreign investment fees.

This is followed by Monaco and New York with a forecasted price growth of five percent each. Shanghai is expected to post a gain of four percent, while Miami and London could each post growth of two percent. Conversely, prices in Geneva are likely to remain unchanged, while Paris could see a dip of three percent.

Picture Source: knight frank research
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114381/luxury-home-prices-to-slide-further-in-2016

Colliers Singapore appoints new business leaders

As part of its growth plans, Colliers International has announced two senior appointments to strengthen its Singapore team.

Duncan White will head up the Office Services team, while Anthea To (pictured) joined the firm in November last year to lead Research and Advisory.

White joined the team in June 2015 and has more than 10 years’ experience in corporate commercial real estate and workplace strategy. He will be responsible for driving Colliers’ Office Services business through an advisory-led approach and a commitment to best practices.

To, who relocated from the UK, has more than 10 years’ experience working with major real estate research houses in the European markets. She will focus on creating market-leading, forward-looking research and thought leadership to support clients and industry professionals.

Commenting, Tang Wei Leng, Managing Director of Colliers International, Singapore, said: “Our most important resource is our people. In building our business, we are always seeking to attract, grow and retain the best talent the market has to offer.

“We chose Duncan and Anthea because they are ambitious, passionate, driven and fit well into our collaborative and high performance culture. Duncan’s promotion demonstrates our commitment to accelerate the success of our people,” she added.

The new business leaders will report directly to Tang and work closely with the regional team.

Meanwhile, former Deputy Managing Director, Calvin Yeo, has left the company, while Grace Ng will continue to head up the Auction team and grow the local brokerage business, noted Colliers.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114322/colliers-singapore-appoints-new-business-leaders

6 resolutions for homeowners in 2016

The fireworks have gone off, the champagne has been drunk, the Auld Lang Synes have been sung. It’s officially 2016, and we’ve got out our (virtual) pens and papers, and we started making our list of resolutions, as homeowners.

We’re often so busy working to pay the mortgage on our homes that sometimes, we forget to actually live in our homes. So here are six resolutions we came up with, to be better people, and better homeowners.

1. Time to declutter.
Yup, those online sales are definitely tempting, and perhaps we went a little crazy during the Great Singapore Sale. But the fact of the matter is, the square footage in our home didn’t grow a single square centimeter in the past year, even if the closets are filled to bursting. So we’re going to get a head start on Chinese New Year Spring Cleaning, and really de-clutter. Good, usable items will be donated to the Salvation Army, or sold online.

2. Don’t buy stuff I don’t need.
And of course, after decluttering, we need to make a resolution not to buy more stuff than we need. We don’t really need photo frames for that gallery wall that won’t happen because I haven’t printed the photos off my phone from that vacation two years ago. Nor will we need a fancy noodle maker for my kitchen when we barely cook once a month. So no matter how tempting the sale, we will resist and keep from buying what we do not need.

3. Invest in greener appliances.
If we do need to buy something however, like a new washing machine to replace the current unit that only partially cleans our clothes, we’ll invest in appliances that consume less resources and energy. This helps us to conserve the environment, and helps us save money in the long run as well, by keeping our PUB bills down.

4. Have more plants.
Speaking of green, we think that we should have some plants in our home. Aside from cleaning the air, houseplants are supposed to affect productivity, fight indoor pollution, and help to prevent illnesses. And they have the added benefit of making our home look better. Now, if we only we can remember to water the plants regularly.

5. Creating a quiet place.
Since these resolutions are to help us really live in and enjoy our home, we think we should create a lovely quiet corner on the balcony, a place that we can sit, relax, and read a book. Sip at a cup of coffee. It’s important to have those quiet moments, to think and to re-center ourselves. Perhaps we could put a couple of plants there as well.

6. Do at least one DIY project.
We’ve seen the TV shows, the “hacks” and the magazines. Perhaps it’s time to try this ourselves? We’re not going to be over-ambitious, and build a new sofa or something, but something that we can show off to our friends when they come over. Perhaps one of those Edison bulb light fixtures that we see so often in cool cafes. Can’t be too hard, right? Right..?

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114347/6-resolutions-for-homeowners-in-2016

Grim 2016 for private housing market

The overall 2015 price fall of 3.7 percent is the lowest decline for private home prices for more than two years, revealed PropNex Realty citing latest flash estimates of the Urban Redevelopment Authority (URA) price index.

However, this still reflects the current languid market sentiment and the sustained impact of the cooling measures, noted the property firm.

Prices in the Core Central Region (CCR) dropped by 2.6 percent last year, lower than in the Rest of Central Region (RCR) and Outside Central Region (OCR), which saw overall prices decrease by 3.9 percent and 3.8 percent respectively.

According to PropNex, luxury prices in the CCR fell the least as wealthy buyers with greater holding power are taking their time to search for their next investment property whilst also looking out for overseas properties.

Meanwhile, the bigger price declines in the other regions is the result of the Total Debt Servicing Ratio (TDSR) framework, which impacts the mass market segment where the capacity to take up loans is critical for middle-income buyers.

Mohamed Ismail, CEO of PropNex, believes that it is becoming more difficult for potential buyers to invest in a private home with a price quantum over $1.3 million given the stricter lending conditions.

At the same time, sellers of resale homes face stiff competition from developers who are continuing to launch projects at more attractive prices and with incentives.

“As such, buyers will have more options – they will only commit if they perceive the property to be a good value proposition. This may put a fair bit of pressure on sellers in the resale market, who may have to lower prices in order to make a sale,” shared Ismail.

In 2016, Ismail maintains that home buyers will continue to look for reasonably-priced properties with desirable product and location attributes. Despite this, private home prices are set to decline further, with weak demand coming from the TDSR and Additional Buyer’s Stamp Duty (ABSD) restricting home buying.

“Buyers are now more discerning and are taking a longer time to decide on investing in private homes.

“Additionally, HDB resale flat prices have further softened, thus reducing the motivation for HDB owners to upgrade to mass market private properties as their purchasing power have been affected – due to a mix of abundant incoming supply, continued enforcement of cooling measures and public housing regulations such as the tighter MSR (Mortgage Servicing Ratio) on HDB loans,” explained Ismail.

He added: “With TDSR being a long-term instrument – and together with the ABSD, will continue to dampen any speculative activity. Under such an environment, we expect price weakness to persist into 2016, with possible negative growth of about 3.0 percent. The government has stated that it is not time to unwind the existing cooling measures yet; however, with nine consecutive quarters of price declines and lukewarm transaction volume, it is timely to look into tweaking some of the measures, namely the ABSD.”

Picture Source: URA
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114253/grim-2016-for-private-housing-market

Perennial hints at changes afoot at Capitol Singapore

In the face of a tough retail environment, landlord Perennial Real Estate says it will work on finding the right tenant and a “win-win” rental structure.

SINGAPORE: Some changes could be afoot at Capitol Singapore after it has been hit with a depressed retail environment. Landlord Perennial Real Estate on Friday (Feb 5) said it is looking at ways to help tenants.

CEO of Perennial Real Estate Holdings Pua Seck Guan, said: “The retail sector is not easy now, because a lot of retailers are faced with the problem of labour shortage and also in this volatile market.

“As a landlord, we therefore have to adopt a strategy to find the right tenant and a win-win rental structure, and some of the rentals we may have to get it on a turnover basis rather than insist on a very high base rent.”

The announcement comes as Capitol Singapore integrated development is edging closer to completion. The 157-room The Patina hotel has been completed, although it has not yet opened its doors. Meanwhile, the luxury Eden Residences expects to receive its Temporary Occupation License by end-February. The retail complex has been opening in phases since May 2015.

Concerns about Capitol’s retail tenants aside, Perennial presented a strong report card for the three months to December at a briefing on Friday, with net profit almost doubling up 93 per cent to S$41.1 million.

Property consultant, Chestertons, said Capitol could get a boost when the hotel starts operating. “One potential catalyst that might come out for Capitol’s retail centre would be the opening of Patina Hotel,” said managing director of Chestertons Donald Han.

“The Patina is almost ready to open its doors and it would welcome high-end or business tourists. So effectively, that could be a crowd puller to be able to support some of the high -end offering in Capitol. This year might potentially might see some footfall traffic. I think it might see higher occupancy settling in, as the year moves on. ”

Turning to its other Singapore properties, Perennial said it hopes to start selling office space and medical suites at TripleOne Somerset sometime in the second quarter, and it is awaiting final approval to do the same for AXA Tower.

Perennial’s other properties in Singapore include Chinatown Point and CHIJMES. The Singapore properties account for 21 per cent of the group’s total assets, behind China whichs accounts for around 73 per cent.

Source copied from: http://www.channelnewsasia.com/news/business/singapore/perennial-hints-at/2491836.html

05 February 2016

HDB resale prices to be flat in 2016

For the first time in 10 quarters, resale flat prices rose slightly by 0.2 percent in the fourth quarter of 2015, revealed latest data from the HDB.

According to property agency PropNex Realty, this comes after a 0.7 percent and 6.2 percent contraction in 2013 and 2014 respectively. Meanwhile, overall prices fell 1.5 percent last year.

“The potent combination of the measures has been effective at slowing down the price growth of HDB resale prices. Though we expect resale prices to be flat in 2016, it may have already reached a bottoming-out level in Q3 2015,” said Mohamed Ismail, CEO of PropNex.

He believes that the government will maintain measures to stabilise the public housing market such as the Mortgage Servicing Ratio (MSR) cap of 30 percent and the maximum loan term of 25 years for HDB mortgage loans, three-year wait for new PRs before they can buy resale HDB flats, and allowing singles to buy 2-room BTO flats in non-mature estates.

In addition, the Housing Board will launch 18,000 new Build-To-Order (BTO) flats this year, up from the 15,000 units launched in 2015, which will sap demand from the resale market, thereby stabilising prices, noted Ismail.

“HDB prices are going through a period of consolidation with marginal price movements as compared to 2014 when overall resale prices slid 6.2 percent. 2016 may spring a surprise as the current price points will entice more buyers to enter the market as it is attractive enough for young couples and upgraders – which could also be partly attributed to the non-existence of COV (Cash-Over-Valuation) across the board,” he added.

Ismail reckons that 2016 could see prices drop marginally by about one to two percent, with the sales volume exceeding 20,000 units due to the lower asking prices.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114220/hdb-resale-prices-to-be-flat-in-2016

S’pore GDP beats expectations, up 2.1% in 2015

The Singapore economy beat many analysts’ expectations, growing 2.1 percent in 2015, which is in line with government forecasts, based on advance GDP estimates from the Ministry of Trade and Industry (MTI) and reported Channel NewsAsia.

According to the central bank’s latest quarterly survey last month, private sector economists had expected full-year GDP growth to reach 1.9 percent, while the government had predicted growth of “close to two percent”.

In Q4 2015, the GDP expanded by two percent from the previous year, up slightly from the 1.8 percent growth registered in Q3 2015. On a quarter-on-quarter seasonally-adjusted annualised basis, the economy grew 5.7 percent in Q4, a significant increase from the 1.7 percent growth seen in the previous quarter.

The manufacturing sector contracted by six percent in Q4, making it the “weakest link” for the economy.

“Both cyclical and structural challenges are dampening the growth prospects of this sector. External competition, rising business costs and weak external demand were key challenges facing the manufacturing sector for the past years,” said DBS senior economist Irvin Seah.

The construction sector grew 2.2 percent, an improvement from the 1.1 percent growth posted during the previous quarter, while the services sector expanded by 3.2 percent.

Despite beating expectations, Seah noted that overall economic growth was at its slowest in six years.

Moreover, risks remain with the potential capital flight which may result from fears of further deceleration within the Chinese economy and from further US interest rate hikes.

“(The) growth outlook in the next six to nine months will remain tepid before an improvement in the later part of 2016 can be expected. This should bring overall GDP growth for 2016 to 2.1 percent,” added Seah.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114233/spore-gdp-beats-expectations-up-2-1-in-2015

Singapore still discussing HSR services with Malaysia

The plan to have two services – one direct service and another with transit stops – on the Kuala Lumpur-Singapore high-speed rail (HSR) route remains under discussion as both countries consider the commercial and operating models of the project, including the possibility of two different services, said Singapore’s Transport Ministry in response to a report by The Edge.

Mohd Nur Ismal Mohamed Kamal, Chief Executive of MyHSR Corp Sdn Bhd, mentioned about stakeholders “envisioning to start with two services — one that will go directly to Singapore, and another that will stop with transit services in Bandar Malaysia, Seremban, Malacca, Muar, Batu Pahat and Nusajaya, and then (across the Causeway to) Singapore”, reported TODAYonline.

According to a spokesperson from the Transport Ministry, “Singapore has proposed that the transit service, which will stop at several stations in Malaysia and hence primarily serve commuters travelling within Malaysia, be operated separately from the express non-stop HSR service. This will give Malaysia autonomy over the transit service to serve Malaysia’s domestic needs, while both countries work together on the cross-border HSR services.”

Mohd Nur Ismal also said that travel time on the non-stop service would take 90 minutes, while the other service with six transit stops would take around two hours.

On Mohd Nur Ismal’s statement that both parties have “come to a consensus on the alignment of the 330km high-speed rail”, Singapore explained that the issue is still under discussion and will be finalised following the completion of detailed engineering studies.

A few months ago, Singapore’s Land Transport Authority and Malaysia’s Land Public Transport Commission jointly launched a request for information (RFI) exercise to assess industry opinion, public perception as well as gauge market interest in the HSR project.

Singapore revealed that the exercise was already completed last month, with both countries studying the feedback, which will be used “to improve the project’s commercial and operating models and procurement approach”.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114223/singapore-still-discussing-hsr-services-with-malaysia

Private home prices down 3.7% in 2015

Prices of private residential properties fell 3.7 percent for the whole of 2015, compared with the 4.0 percent fall in 2014, according to flash estimates of the Urban Redevelopment Authority (URA) price index.

On a quarterly basis, prices declined 0.5 percent in Q3 2015, compared with the 1.3 percent decline in the previous quarter.

Specifically, prices of non-landed private units declined by 0.4 percent in the Core Central Region (CCR), compared with the 1.2 percent decline in the previous quarter. Prices in the Rest of Central Region (RCR) and Outside Central Region (OCR) remained unchanged, compared with the 1.6 percent decline in each segment in the previous quarter.

For the whole of 2015, prices in the CCR, RCR and OCR fell by 2.6 percent, 3.9 percent and 3.7 percent respectively. Prices of landed properties fell 2.1 percent, compared to the 0.4 percent decline in the previous quarter. For the whole of 2015, prices of landed properties fell by 4.4 percent.

The flash estimates are compiled based on transaction prices given in contracts submitted for stamp duty payment and survey data on new units sold by developers during the first ten weeks of the quarter. The full statistics will be updated by the URA four weeks later.

Picture Source: URA
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114127/private-home-prices-down-3-7-in-2015

HDB resale prices down 1.5% in 2015

Resale flat prices declined by 1.5 percent for the whole of 2015 compared with the previous year, according to HDB’s flash estimates.

In Q4 2015, prices in the resale public housing market increased by 0.2 percent, compared to the 0.3 percent decline in the previous quarter.

In a statement, HDB said more detailed public housing data for Q4 2015 will be released on 22 January.

In 2016, the government plans to launch about 18,000 new flats, up from the 15,100 units in 2015. This is to meet the expected demand due to recent policy changes.

Meanwhile, the first Build-To-Order (BTO) exercise will be held in February where about 4,150 flats will be launched in Bidadari, Bukit Batok and Sengkang.

Picture Source: HDB
Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114134/hdb-resale-prices-down-1-5-in-2015

01 February 2016

New flats are still affordable: HDB

New HDB flats have remained affordable over the past few years, said the Housing and Development Board (HDB) and reported Channel NewsAsia.

In fact, first-time home buyers used an average of less than 25 percent of their monthly income to pay for their housing loans in 2014, which is below the international benchmarks of 30 to 35 percent.

Moreover, around 80 percent of first-timers used their CPF savings to service their monthly instalments, with no cash outlay required.

As of November 2015, HDB has offered $1.6 billion in Additional CPF Housing Grants (AHG) since 2006 to almost 83,000 households, and $297.61 million in Special CPF Housing Grants (SHG) to nearly 20,000 households since 2011.

In an update, HDB revealed that eligible first-timers now enjoy up to $80,000 in housing grants – comprising up to $40,000 in SHG and up to $40,000 in AHG.

Enhancements to the SHG unveiled at the National Day Rally last year took effect from the Build-To-Order (BTO) and Sale of Balance Flats exercises held in November. This saw the SHG being extended to around 6,500 households earning up to $8,500 – an increase from the previous ceiling of $6,500 – to purchase new flats in non-mature estates.

HDB noted that all eligible families received a higher SHG amount that reached up to $20,000 and above in some cases. The income ceiling for singles and the maximum SHG amount received by them were half of that of households.

Meanwhile, those who benefitted from the AHG rose above 13,000 in 2011 and peaked in 2012 at 13,325. It then dwindled to 8,098 between January and November 2015.

“For 2011, HDB had launched the largest number of BTOs – up to 28,000 units. And in 2012, they launched about 25,000 units. With the large number of BTO launches and with the pent-up demand, obviously there are more people who will be applying and obviously the number of people applying for the grant would be highest,” explained PropNex Key Executive Officer Lim Yong Hock.

The easing of demand over the years, particularly during the past two years, resulted in fewer applicants for the grant and BTO flats, he added.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114153/new-flats-are-still-affordable-hdb

GCB sales on the rise

Despite softer prices, the Good Class Bungalow (GCB) market recorded 34 transactions in 2015 totalling $730 million, up from the 28 deals amounting to $626 million in the year before, reported The Business Times.

GCBs are considered the most prestigious type of landed housing in Singapore due to the planning constraints imposed by the Urban Redevelopment Authority (URA), which has designated 39 locations in mainland Singapore as GCB Areas.

The latest figure is the market’s best showing since 2012, when 54 GCBs were transacted for $1.17 billion.

William Wong, Managing Director at Realstar Premier Group, believes GCB prices fell by 10 to 15 percent last year.

“A good GCB in a location such as Dalvey/Holland which used to be able to sell at $30-32 million a year ago will probably be able to fetch $25-27 million at best now.”

The price drop is generally due to weaker economic sentiment globally and in Singapore, he said.

“Also owners are more realistic in their pricing especially for those who have not been able to find a buyer after putting their property in the market for more than a year. Coupled with the fact that there are quite a few GCBs transacted below $20 million, this has somehow brought the overall asking prices of GCBs a notch down,” he added.

Samuel Eyo, Managing Director of Singapore Christie’s International Real Estate, also acknowledged that prices fell by about 10 percent last year. Aside from deteriorating economic sentiment, he attributed the price drop to higher interest rates.

Although GCB prices declined in 2015, the year witnessed two record price transactions – the $91.7 million paid for 35 Ridout Road, or the biggest sale recorded on absolute quantum price basis within a GCB area, and the $33 million sale of a three-year-old bungalow in Bishopsgate, which marked a record psf land price at $2,190 psf within a GCB Area.

Looking ahead, Eyo expects GCB prices to dip by around five percent this year if the government does not ease the property cooling measures and interest rates continue to rise.

Wong, on the other hand, expects GCB prices to continue falling in the first half of 2016 in the absence of any positive stimulus – prior to stabilising in the second half.

“I expect to see a 10 percent increase in transaction volumes for the whole of 2016 amid a better matching of pricing expectations between buyers and sellers.”

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/114149/gcb-sales-on-the-rise

Top 10 stories of 2015

2015 has been a busy year for the property market, and as the year draws to a close, we take another look at the 10 most read stories on PropertyGuru this year.

10. The outlook for Singapore’s non-landed private housing market in the second half of 2015 was cautiously optimistic, with the cooling measures continuing to stabilise the market. Sales of condo units were expected to slip further despite the pick up in mass-market project launches in H2. Meanwhile, there were projections that prices could bottom out towards the end of the year.

9. In April, a DBS report stated that Singapore’s government could relax the property cooling measures at the end of this year. Any policy action would likely be targeted at the mass market where more supply is coming in. However, private home prices would need to drop significantly before warranting any government intervention.

8. A report released by Square Foot Research in January revealed there were at least five private residential projects that ran the risk of incurring hefty fines under the Qualifying Certificate (QC) rules due to the high number of unsold units. At the time, The Interlace by CapitaLand was leading with 168 unsold units.

7. At a Credit Suisse luncheon held earlier this month, one property expert predicted that the property cooling measures could be tweaked sometime in the second half of 2016. A price drop of about 15 percent would likely trigger this, with the Additional Buyer’s Stamp Duty (ABSD) and Seller’s Stamp Duty (SSD) likely to be revised.

6. For borrowers looking to refinance their property, one question they’ll have is whether to obtain a bank loan or get a HDB loan. Published in July, this article compares the differences between both loan types, their merits, and what homeowners need to look at before choosing a refinancing package.

5. Although sentiment in the private residential market remains weak, some condo projects launched in 2015 attracted healthy interest from prospective buyers, with crowds showing up at the showflats. Notably, location and pricing were two major factors which contributed to their popularity. In November, PropertyGuru reviewed seven of them to see what all the hype was about.

4. More private homes in Singapore are sitting empty as buyers continue to adopt a cautious approach, with over 24,000 vacant units recorded in Q4 2014, according to data released in January by the Urban Redevelopment Authority (URA). The vacancy rate was the highest recorded since Q4 2005. Meanwhile, the completion of over 20,000 private units in 2015 will likely worsen the situation.

3. Property consultancy Savills predicted at the start of this year that there would be 10 major private residential launches in 2015. Most of the projects would be located in the suburbs, with the biggest one being the 1,165-unit Kingsford Waterbay in Upper Serangoon. Meanwhile, analysts were of the opinion that developers would need to price units more affordably to drive sales.

2. With more MRT lines being completed, more properties in Singapore will be located close to an MRT station, which should increase their value. However, there can be negative side-effects such as noise pollution, which can adversely affect the desirability of the property. This article published in February looks at how the MRT effect can affect your property’s value.

1. Malaysia’s property market is expected to slow down further in 2016 due to lesser demand and a weakened economy, putting additional pressure on home prices, warned industry expert Datuk Gavin Tee in December. However, the drop in prices is not expected to translate to more sales for developers due to a drop in foreign investment and lower purchasing ability from Malaysians. High loan rejection rates are also being seen, especially for properties in the Iskandar region.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/113998/top-10-stories-of-2015

Indonesia struggles with 13.5m housing backlog

Indonesia’s government is struggling to tackle the country’s housing backlog of 13.5 million units as it has only been able to supply 50 to 62.5 percent of the total annual demand, reported the Jakarta Globe.

After President Joko Widodo was elected in October 2014, he promised to build one million homes to address the yearly demand of about 800,000 new units arising from urbanisation and population growth.

However, the authorities have only been able to provide 400,000 to 500,000 units every year since Mr Widodo came into power, according to Public Works and Housing Minister Basuki Hadimuljono.

“There’s still a gap of 400,000 units every year, which, if we don’t take care of the issue quickly, will cause the backlog to increase more and more,” he said.

Another issue is that 64 million Indonesians are categorised as belonging to low-income families, meaning they cannot afford to purchase their own homes. Even though 20 percent of them can purchase a house outright, 40 percent require government subsidies to buy a house, while the remaining 40 percent need to take out mortgages.

“Still, even the government’s budget for housing is not enough to cover (the requisite amount) as it only encompasses one percent of total government spending,” noted Basuki.

Making matters worse is that most of the population works in the informal sector with low financial literacy and limited access to financing. “The relatively high interest rate is also a stumbling block as mortgages have become more expensive,” he added.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/114011/indonesia-struggles-with-13-5m-housing-backlog

Empty offices and falling rents spell further gloom for landlords

TODAY reports: Office buildings in the city fringes may be increasingly left empty as tenants move into Grade A premises in the Central Business District amid weakening rents.

SINGAPORE: Office buildings in the city fringes may be increasingly left vacant as tenants seek the opportunity to move into Grade A premises in the Central Business District (CBD) with rents weakening amid an onslaught of incoming supply.

Pundits, such as Bloomberg columnist Andy Mukherjee, have blamed the weak office market here on a “fundamental miscalculation” on the part of some Singapore developers that had “misplaced optimism” that China would sustain its rapid pace of its growth and pull the rest of Asia along.

With another 7 million square feet of new office space under construction at a time when businesses are holding back expansion plans, rents in Singapore will continue to tumble, analysts warned. Mr Nicholas Mak, executive director at SLP International Property Consultants, has forecast a 10 to 15 per cent fall in rents this year, accelerating from the 6.5 per cent decline last year.

“In the past six months, we have already seen a noticeable slowdown in demand (for offices). The financial services industry has been the main demand driver but that has been the biggest weakness in the last few years,” said Mr Desmond Sim, head of CBRE Research in Singapore and Southeast Asia.

As of the end of last year, Grade A office rents in the CBD cost between S$8.00 and S$12.80 psf, according to a report by property firm Knight Frank Singapore. Those outside the CBD but still within Singapore’s central areas fetched S$7.50 to S$11.90 psf, while rents for offices in the city fringes and suburbs ranged from S$4.40-S$8.10 psf.

Competition for tenants is intensifying, with landlords offering attractive renewal terms to retain existing tenants, said Ms Louise Toovey, director of office agency at Knight Frank.

They are also more willing to extend competitive rental rates to new tenants and offer additional incentives such as a rent-free period within the lease, she added.

The landlords’ willingness to lower rents have already resulted in several flight-to-quality cases. Online travel company Expedia vacated its Hong Kong Street premises for space in the recently-completed South Beach Tower. Immigration services provider Fragomen also moved into South Beach Tower from Haw Par Glass Tower, real estate consultancies Colliers International and Knight Frank reported. But with fewer companies expanding and fewer new companies being set up, this phenomenon comes at the expense of older, less attractive buildings.

“Flight-to-quality will definitely leave voids in other markets. The non-beneficiaries are buildings that are functionally-challenged – smaller floor plates, pencil-thin buildings or very, very aged buildings. This might encourage some sort of regeneration to keep these buildings up-to-scratch. Regeneration could even come in a change of use,” Mr Sim said.

This also means that islandwide office vacancy rates will likely soar past the current 9.5 per cent, as almost 4 million sq ft of the estimated 7 million sq ft of supply is due for completion in the second half of this year.

Signs of rising vacancy are clear, analysts said, citing Tanjong Pagar Centre as an example of slower demand for offices. At 290 metres, the prestigious mixed-use development will be Singapore’s tallest building when completed later this year, but it has secured barely 10 per cent of lease commitments for its 890,000 sq ft of office space. Other major developments set to enter the market include Marina One and DUO Tower, which will add more than 2 million sq ft of office space.

In response to TODAY’s query on the take-up rates of Marina One and DUO, developer M+S would only say that it is seeing “healthy interest” and “various tenants have pre-committed” to both projects.

Property analysts said that the days of quick supply absorption are well over and the current weak market could take as long as five years to recover even as land supply for commercial development has been scaled back.

“It is bad enough. Supply is at record high this year at a time when companies are downsizing and merging,” said Mr Ku Swee Yong, chief executive of property firm Century 21.

“Good or bad market, there should have been a controlled but steady supply of land. Controlled, meaning the developers shouldn’t have been so excessive. The Government may have been excessive in releasing land through GLS (Government Land Sales programme), but its premise is that with more land, there can be better control of prices,” he added.

CIMB Private Banking economist Song Seng Wun said that regardless of macroeconomic conditions, the Government has taken a deliberate approach to have supply exceed potential take-up.

“Today’s demand may be softer than earlier projected, but this is part and parcel of any cyclical market. It’s always difficult to predict,” he said.

Picture Source: File photo of buildings in Singapore’s Central Business District. (Photo: Calvin Oh)
Source copied from: http://www.channelnewsasia.com/news/business/singapore/empty-offices-and-falling/2476470.html

31 January 2016

Hong Kong to exceed housing supply target

The Hong Kong government is set to surpass its target of providing land yielding 19,000 new private homes for the 2015/2016 fiscal year, reported The South China Morning Post.

In its last land sales programme for the financial year, the authorities on Wednesday launched four more plots to be sold over the next three months. Offering a total of 1,550 housing units, these sites are located in Stanley, Ho Man Tin, Sha Tin and Tuen Mun.

Together with the flats sited on other plots sold this year and the 1,100 units to be developed by MTR Corporation at Lohas Park, the overall figure is expected to reach 20,300 units at the end of the fiscal year.

“We are pretty confident that the private housing land supply target for this year will be met,” said Development Minister Paul Chan Mo-po, adding that the existing property cooling measures will remain in place.

“We have observed softening in the property market, but in terms of (the) government’s determination to supply private residential land to the market, there is no change in our policy or position.”

Meanwhile, Centaline Property Agency’s Managing Director Louis Chan Wing-kit said the government’s housing supply announcement would negatively affect buying sentiment.

“Why buy today if abundant supply is coming and prices will be lower tomorrow and the day after tomorrow?” he said. “When home prices are falling, people will stay away from buying.”

The Centa-City Leading Index, which monitors resale home prices, dipped by 0.32 percent week-on-week to 136.86 for the week ended 20 December. It also reflects a 6.8 percent decline in residential prices since it peaked in September.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/114007/hong-kong-to-exceed-housing-supply-target

18,000 new flats to be launched in 2016

The Housing and Development Board (HDB) is planning to launch about 18,000 new Build-To-Order (BTO) flats in 2016, more than the 15,000 units launched this year, said National Development Minister, Lawrence Wong, in a blog post.

The new flats will be spread across different locations, catering for every budget and need.

“While the 2016 flat supply will be increased to meet new demand from the recent policy changes, the broader plan remains to keep supply at a more sustainable level over the long-term,” said Wong.

This year will see around 26,000 BTO flats being completed, noted the Minister, after visiting a few families who recently moved into their new flats in the Tampines Greenlace BTO project.

He revealed that the BTO application rate for first-timer families (applying for 3-room and bigger flats in non-mature estates) has stabilised to about 1.6 times. “This means that most of these families would have been able to book their flats in their first attempt.”

“Over the coming year, we will continue to monitor the market closely and adjust our building programme when necessary,” he shared.

Meanwhile, the HDB resale market is on track for a soft-landing, with prices moderating to 2011 levels, and more than half of resale flats are now transacting close to their market value.

The stabilisation of the market has allowed the government to focus on enhancing the housing policies to benefit more Singaporeans. These include new 2-room Flexi flats, higher income ceilings, and additional grants, like the new Proximity Housing Grant and the enhanced Special CPF Housing Grant.

“We’ve had a very good response to these new policies. We will focus on making our housing policies more inclusive and build even better homes for all Singaporeans,” added Wong.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/113906/18000-new-flats-to-be-launched-in-2016

HDB launches tenders for EC sites at Yio Chu Kang Road, Sumang Walk

The Housing and Development Board (HDB) on Tuesday, 29 December, launched an executive condominium (EC) site at Yio Chu Kang Road for sale under the confirmed list of the second half 2015 Government Land Sales (GLS) Programme.

Another EC site at Sumang Walk in Punggol was also released for application under the reserve list. According to the HDB, both sites could yield about 1,300 homes.

The 99-year leasehold Yio Chu Kang Road site has a land area of 18,422.9 sqm and a maximum gross floor area of 51,584.12 sqm, with a gross plot ratio of 2.8. The area is served by the Hougang, Buangkok and Kovan MRT stations, while nearby amenities include the Hougang 1 shopping mall, Hougang Sports Centre and Nanyang Polytechnic.

Meanwhile, the 27,056.4 sqm site at Sumang Walk has a maximum gross floor area of 81,169.2 sqm and a gross plot ratio of 3.0. Offered on a 99-year lease, the land parcel is within proximity to the Punggol MRT and LRT station, My Waterway@Punggol and the Waterway Point Shopping Centre. Many primary and secondary schools are also located in the vicinity.

The tender for the site at Yio Chu Kang Road will close on 18 February 2016.

Picture Source: Map of the Yio Chu Kang Road residential site. Source: HDB
Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/113887/hdb-launches-tenders-for-ec-sites-at-yio-chu-kang-road-sumang-walk

Experts forecast lower loan growth

Loan growth in Singapore is expected to fall to five percent for the whole of 2015, but this could decline further next year, reported Channel NewsAsia citing experts.

“Between 2013 and 2015, while domestic growth has slowed down, overseas growth was able to compensate for slowness in domestic growth. But now, with China-led regional slowdown, even the overseas loan expansion has come down as well. So on the whole, we’ll be seeing slower loans growth of between 3 and 5 percent for 2016,” said Standard & Poor’s Financial Services Ratings Director, Ivan Tan.

The slower loan growth in the region is also expected to drag down asset quality. In Q3 2015, the central bank’s Financial Stability report revealed that non-performing loans accounted for around 1.5 percent of the total loans granted by Singapore banks compared to 1.1 percent a year ago.

In addition, the forecasted weaker loan growth would impact the earnings of Singapore financial institutions as interest income represents a major source of income for banks, noted Tan.

Other issues that lenders are facing include the fallout in commodity prices and the interest rate hike in the US.

Despite these headwinds, experts believe Singapore banks remain resilient due to their ample capital and liquidity buffers. Nevertheless, next year is expected to be a challenging year for them, as they adopt a more cautious stance and focus on maintaining loan quality while keeping expenses down.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/113899/experts-forecast-lower-loan-growth

London buyers fazed by higher stamp duty

Wealthy home buyers in London are rattled over additional costs arising from the new stamp duty rules, according to The Daily Mail citing a Knight Frank report.

As the UK housing market enters what is traditionally its busiest time of the year just days before the New Year, the consultancy warned that most players in the market have adopted a cautious stance, with uncertainty lingering in the minds of both buyers and sellers.

In autumn, the government announced plans to impose a three percent surcharge on buy-to-let landlords and second homeowners. This move followed a revision of the stamp duty system in 2014 that raised the property tax of homes costing more than £937,000.

These new measures are intended to deter wealthy buyers from purchasing second homes so that cash-strapped first-timers would have a higher chance of getting on the property ladder. And they appear to be working as residential transactions in the priciest parts of London have fallen by 20 percent year-on-year, revealed Knight Frank earlier this month.

In its most recent report, the consultancy said home prices are starting to take into account the higher stamp duty for luxury homes. “Higher transactional costs at the top end of the market are increasingly being factored into pricing,” it said.

But due to the heftier price tag, buyers are more mindful of the cost. In fact, the number of withdrawn transactions rose 12 percent on an annual basis between April and November 2015.

“The prime central London market remains fragile and price-sensitive. Buyer caution is related to high transaction costs and decisions are increasingly taken on a longer-term basis, producing a flight to quality for the best property and addresses,” added Knight Frank.

In spite of this, it believes home prices will increase by three percent next year.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/12/113893/london-buyers-fazed-by-higher-stamp-duty