singapore property weekly issue 184

8/10/2019 Singapore Property Weekly Issue 184

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Issue 184Copyright 2011-2014 www.Propwise.sg. All Rights Reserved.
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CONTENTS

p2 What is a MeaningfulCorrection of

Property Prices?

p7 Singapore Property News This Week

p12 Resale Property Transactions

(November 12 November 18 )

Welcome to the 184th edition of the

Singapore Property Weekly.

Hope you like it!

Mr. Propwise

FROM THE

EDITOR
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SINGAPORE PROPERTY WEEKLY Issue 184

Page | 2Back to Contents

By Property Soul (Guest Contributor)

Deputy Prime Minister and Finance Minister

TharmanShanmugaratnam recently told the

press that there is "some distance to go in

achieving a meaningful correction, hinting

that the property cooling measures are here

to stay.

I am surprised byMrTharmanscreative use

of the wordmeaningful. It is an adjective or a

descriptive word that leaves much room for

imagination. It is up to the target audience tofigure out the real meaning behind it.

What is a MeaningfulCorrectionof Property Prices?


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When the government replies with a definite

yes or no answer, you are certain what is

next.

When the government replies with a vague

answer, you are confused what to do next.

When the government replies with a

descriptive answer, you are fearful of what will

happen next.

- Property Soul

How to define meaningful?

The word meaningful means significant or

serious, meaning to say that the government

would like to see a sizable market correction

before they consider reversing any of the

cooling measures.

So, what does meaningful mean? Is it a

major correction in price level? A massive

slump in transaction volumes? A prolonged

depressed market? A big drop in the number

of first-time or multiple-property buyers? Is it

more meaningful to measure in percentage,

values, dollars or length of time?

Waiting for the meaningful time

When the Singapore government will call for

an election iseveryonesguess. The timing of

the next election also gives any lifting of the

cooling measures a whole new meaning.

When many voters find private properties

unattainable or overpriced, it is meaningful to

sacrifice the interests of a comparatively

smaller group namely the stakeholders in

the real estate industry, including the

developers, agents and consultants. After all,it is a great opportunity to narrow the

widening gap between the haves and have

not sin society.


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On the other hand, if the relaxation of cooling

measures comes too late, and the property

market continues to correct, it can make the

final withdrawal meaningless.

I'm afraid that if you look at a thing long

enough, it loses all of its meaning.

- Andy Warhol, American artist

Take the example of a primary school student

who needs to do corrections for a wrong

answer. There are still mistakes after thecorrection and he is asked to redo the

correction again. But there is still room for

improvement so the teacher asks the student

to redo it again and again. When the teacher

finally puts that long-awaited tick there, the

whole thing has long become meaningless in

the eyes of the student.

From 1998 to 1999 and 2001 to 2005, there

were countless introductions of property

purchase incentives suspension of land

sales, lifting of capital gains tax, property tax

rebates, lower cash deposits, higher loan-to-

value limits up to 90 percent, cash rebates

and interest-free loans from the banks, etc.

But the market responded with a lower PPI

(Property Price Index) and transaction volume

compared with the last quarter.

Property, like comedy, is all about timing.Action is futile when it comes too early or too

late.

What it means for different parties

We all have our own vested interest. Every

time there is a new policy, we give it thumbs

up or down depending on how we can benefit

from it.


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The contradicting comments are confusing

investors who are holding their horses.

5. More owners will end up with a

meaningless investment.

With the impact of falling rental demand

starting to surface, more landlords are feeling

the pain of their already humble return of

under 3 percent. It is meaningless to hold

onto an investment that cant generate a

positive return.

Owners are also under the constant threat

from the continuing softening of the market,

inevitable hike in interest rates, and the

potential onset of another recession. Those

with little holding power are just hoping to

survive a meaningful correction with their

meaningless investment.

By guest contributor Property Soul, a

successful property investor, blogger, and

author of the No B.S. Guide to Property

Investment.

SINGAPORE PROPERTY WEEKLY I 184
http://propertysoul.com/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://propertymarketinsights.com/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://aktive.com.sg/store/no-b-s-guide-to-property-investment/http://propertysoul.com/


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Singapore Property This Week


Residential

H S R : H D B r e s a l e f l a t p r i c e s m a y d r o p t o

2008 aff ordabi l i t y levels b y 3Q2015

According to HSR Research, if HDB resale

prices continue to fall, it may soon reach the

affordability levels in 2008 by Q3 next year.

This suggests that cooling measures may be

lifted by Q3 2015, said market experts. HDB

resale prices need to fall by another 6 percent

in order for it to reach the affordability levels

in 2008, before significant increases took

place in 2009, said HSR. Affordability has

been defined by HSR as the ratio of the

average annual household income to the

prices of HDB or private non-landed

residential units. The calculations were made

based on the perspective of a first-time buyer.

HSR said that currently, a typical 1,000 sqft

resale HDB flat would cost about five times

the average annual household income of

HDB dwellers. On the other hand, private

resale condos of 1,000 sqft cost about 4.9

times the average annual household income

of apartment dwellers. HSR added that HDB

resale prices have decreased at a compound

monthly rate of 0.6 percent while resale

condo prices have fallen by 0.4 percent.

(Source: Business Times)

SINGAPORE PROPERTY WEEKLY I 184


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R ed as : i n ter v en t io n n eed ed t o p r ev en t

m a r k e t f r o m s l o w i n g d o w n

Chia Boon Kuah from the Real Estate

DevelopersAssociation of Singapore (Redas)

said that the government needs to intervene

with supportive measures when the property

market spirals downhill. He added that since

the implementation of the total debt servicing

ratio framework, developers have been

concerned about the shrinking market. Chiaargued that the residential market will suffer

from additional pressure when 68,000 new

residential units are completed in the

subsequent few years. The implementation of

the cooling measures has also lead to the

adoption of a wait-and-see attitude inpotential buyers, said Chia. Chong Chou Yen

from Tuan Sing group suggested that the

government could look into lifting the cooling

measures for mass-market mid-end homes to

maintain their affordability.


Commercial

Gr ad e A CB D o ff ic e r en t i nc reas ed b y

19.8% this year

Moray Armstrong from CBRE said that the

increase in office rentals may have been

driven by tight supply rather than increased

demand. Chris Archibold from JLL said thatfinancial institutions are choosing not to

expand thus demand for office space has

fallen. According to the Business Times, CBD

office rents have increased by 19.8 percent

this year and it is expected to increase by

another 7 percent in 2015. JLL estimated thatthere will be a 4.2 percent quarter-on-quarter

increase in average gross monthly rental

value for Prime Grade A CBD office space in

the fourth quarter of this year.



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Nonetheless, as the economy slows,

occupancy rates are also expected to fall,

said Armstrong.


S in g ap o r e G r ad e A o f fi c e r en t al g r o w t h

highest in Asia-Pacif ic region

According to Cushman & Wakefield, rental

growth for Grade A office space is the highest

among 13 countries in Asia- Pacific.

Cushman had estimated Singapores office

rental growth to be 10.88 percent by the end

of the year. This is significantly higher than

the 7.69 percent for Tokyo and 3.02 percent

for Hong Kong. Cushman believes that at the

end of 2014, Grade A monthly rental value will

be as high as $10.45 psf, and it will increase

to $11.04 psf by end-2015. Sigrid Zialcita

from Cushman said that the strong economic

sentiments in Singapore have increased its

competitiveness compared to the other

markets in Asia. Zialcita also predicts that the

vacancy rates will fall greater in Singapore

than in other core markets in Asia.


D erby C ourt re leased f or en bloc sale

Derby Court, which is a condominium that is

located at Novena has been put up for en

bloc sale. The 12-storey condominium

comprises of 20 apartments and has an

allowable gross floor area of 53,094 sq ft. Its

tender will close on Jan 20, 2015. The site

has been zoned for residential use and it has

a plot ratio of 2.8 under the 2014 Master

Plan. According to Savills Singapore, the site

can be developed into 70 apartments of about

753 sqft each. The site has been given an

indicative price of $68.28 million or $1,286

psfppr. Suzie Mok from Savills Singapore



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expects that investors would be attracted to

DerbyCourtsprime location.


U R A : a t l e a s t 7 0 % o f s i t e a t B e a c h R o a d m u s t b e f o r o f f i c es

A commercial site at Beach Road, which has

a 99-year leasehold, will not be allowed to be

developed into small strata units or retail

units. 70 percent of the site has to be for

offices according to the Urban

Redevelopment Authority (URA). The site will

be launched in H2 2014 under the

Government Land Sales Programme. The

land parcel is 2.1 ha and can be developed

into a gross floor area of 950,592 sq ft.

665,424 sqft has to be set out for office use

while 86,111 sqft could be used for retail

purposes. Not more than three strata units

can be developed from this site said URA.

Chua Yang Liang from JLL predicts that the

site will attract bids between $1,300 and

$1,500 psfppr.


T e n d e r f o r S e r a n g o o n s i t e w o n a t $ 2 7 6 . 8

m i l l i o n

Since the implementation of new productivity

regulations, a 99-year leasehold mixed-use

site at Upper Serangoon Road has had the

highest tender bid price. According to the

Urban Redevelopment Authority, ASSET

Legend had offered $276.8 million or $848.84

psfppr for the site. This was higher than

expertspredicted bid price of between $670

to 750 psfppr. Not only so, the winning bid

was 15 percent higher than the next highest

bid of $240 million. Chua Yang Liang from

JLL is surprised by the winning margin given

the current market sentiments.



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Other market experts have expected

developers to be more cautious with their bids

due to the prefabrication requirements

implemented by the government, which would

push construction costs up. Nonetheless,

Ong Kah Seng fromRSTResearch said that

foreign developers tend to place higher bids.


http://www.moneymatters.sg/


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Non-Landed Residential Resale Property Transactions for the Week of Nov 12 Nov 18

NOTE: This data only covers non-landed residential resale propertytransactions with caveats lodged with the Singapore Land Authority.Typically, caveats are lodged at least 2-3 weeks after a purchaser

signs an OTP, hence the lagged nature of the data.

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

3 TANGLIN VIEW 1,249 1,500,000 1,201 99

4 THE INTERLACE 2,357 2,941,510 1,248 99

5 DOVER PARKVIEW 969 1,010,000 1,043 99

8 KERRISDALE 1,485 1,690,000 1,138 99

9 THE METZ 570 1,550,000 2,717 FH

9 THE SUITES AT CENTRAL 1,001 2,300,000 2,298 FH

9 TRIBECA 3,563 5,350,000 1,502 FH

10 GRANGE RESIDENCES 2,852 7,450,000 2,612 FH

10 PALM SPRING 1,485 2,450,000 1,649 FH

11 VILLA CHANCERY 2,659 4,100,000 1,542 FH

11 THE ANSLEY 1,302 1,718,000 1,319 FH

12 8 RAJA 2,024 2,800,000 1,384 FH

12 SUNVILLE 1,130 1,220,000 1,079 FH

14 ASTON MANSIONS 1,195 1,000,000 837 99

15 SIGLAP V 581 900,000 1,548 FH

15 THE ESTA 1,399 2,150,000 1,536 FH

15 PARC ELEGANCE 398 600,000 1,507 FH

15 PRESTIGE LOFT 527 725,000 1,375 FH

15 TESSA LODGE 936 1,200,000 1,281 FH

15 SUNSHINE MANSIONS 786 870,000 1,107 FH

15 MANDARIN GARDEN CONDOMINIUM 732 780,000 1,066 99

15 OCEAN PARK 2,110 2,225,000 1,055 FH

15 HUA XIN COURT 1,970 2,000,000 1,015 FH

15 RISING COURT 1,432 1,200,000 838 FH

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

15 KATONG PARK TOWERS 3,391 2,640,000 779 99

16 OPTIMA @ TANAH MERAH 1,098 1,230,000 1,120 99

17 FERRARIA PARK CONDOMINIUM 958 910,000 950 FH

17 ESTELLA GARDENS 969 770,000 795 FH

18 MELVILLE PARK 1,345 950,000 706 99

18 TAMPINES COURT 1,722 890,000 517 101

19 EVERGREEN PARK 1,044 805,000 771 99

20 FLAME TREE PARK 1,593 1,808,000 1,135 FH

20 FAR HORIZON GARDENS 1,292 900,000 697 99

21 ASTOR GREEN 1,485 1,450,000 976 99

23 HILLINGTON GREEN 1,528 1,650,000 1,079 999

23 HAZEL PARK CONDOMINIUM 1,389 1,450,000 1 ,044 999

23 HILLVIEW PARK 1,227 1,170,000 953 FH

23 THE MADEIRA 1,238 1,130,000 913 99

28 GRANDE VISTA 2,024 1,698,888 840 999

singapore property weekly issue 184

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