Property News!

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Mar 16, 2011
Jurong Lake site may fetch up to $770m
Experts say interest stems from government plans to develop area
By Esther Teo, Property Reporter
DEVELOPERS will be out in force to bid for a mixed-use site in Jurong Lake District despite the minimum $510 million price tag, according to analysts.

They are predicting up to 10 bids for the 99-year leasehold site in Boon Lay Way, next to Jurong East MRT station, with offers going as high as $770 million.

That works out to about $804 per sq ft per plot ratio (psf ppr) for the 1.8ha site.

The plot, which will be launched for tender in about two weeks, can be put to commercial, residential or hotel use.

At least 40 per cent of the maximum permissible gross floor area of about 958,000 sq ft must be used for offices. Doubling the space for residential use, such as for small office, home office (or Soho) units, will not be allowed.

The Urban Redevelopment Authority said yesterday that a developer had committed to bid at least $510 million - or $532 psf ppr - for the site, which was made available for sale through the reserve list in October.

Experts said developers will be keen to ride on the plans for Jurong Lake District, which the Government has earmarked to become a major regional centre and leisure destination.

This will give firms more opportunity to operate outside the central business district at cheaper rents, said Credo Real Estate's head of research and consultancy, Mr Ong Teck Hui.

Last June, Australian developer Lend Lease beat five other offers with a bid of $749 million, or $650 psf ppr, for a 1.9ha mixed-use site in the same area.

Last month, a 3ha mixed-use site in Punggol was sold for a record price of $1.02 billion, or $753 psf ppr.

Mr Ong said the tender for the latest site is seen as part of the Government's strategy to build up the suburban commercial market.

'Over the last year, we've seen the first Jurong Lake District and Buona Vista sites awarded. Come April, the tender for a Paya Lebar site will close, followed by (this) site, probably in May,' he added.

Mr Nicholas Mak, head of research at SLP International, said the site's proximity to the Jurong East MRT station and bus interchange makes it attractive.

Although a hotel can be built on the land, the new development is likely to consist of office, retail and residential space, he added.

'Jurong East is an untested market for hotel development. Therefore, some developers may use a more proven development mix to plan their tender bid,' Mr Mak said.

He expects about five to 10 bids, with the top ones ranging from $700 million to $770 million.

Mr Png Poh Soon, Knight Frank's head of research and consultancy, added that the higher bid expected for this site compared with a neighbouring plot is due to the continued recovery in office rents, strong and stable economic growth, and the resilience of suburban malls in good and bad times.

Jurong Lake District consists of Jurong Gateway and Lakeside, and occupies 360ha - about the size of Marina Bay.

Several government agencies, including the Ministry of National Development, have announced that they will move to Jurong Lake District in the future.

 

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Mar 16, 2011
Keppel Land puts in top bid of $286.8m for Sengkang site
By Cheryl Lim
PROPERTY giant Keppel Land trumped eight other developers to lodge the top bid for a plot in Sengkang.

The firm offered $286.8 million for the government-owned land at the junction of Sengkang Square and Compassvale Road.

Its bid works out to $502 per sq ft per plot ratio (psf ppr).

A City Developments consortium was next with a bid of $274.4 million for the 99-year leasehold site. Qingdao Construction submitted a bid of $271.7 million while a joint venture between Frasers Centrepoint and Far East Organization tendered $255 million.

Hongkong Land's MCL Land, Allgreen Properties, Sim Lian Land, GuocoLand and a Hiap Hoe subsidiary, which lodged the lowest bid of $192.5 million, were also in the running.

The 190,521 sq ft site can yield about 530 units.

Mr Ong Teck Hui, head of research and consultancy at Credo Real Estate, said the top bid and tender participation came within expectations.

'So far, after the Jan 14 (property cooling) measures, we've had good residential sites coming on the market under the Government Land Sales programme,' said Mr Ong.

'Their favourable responses show that demand for such sites is undeterred by market cooling measures.'

Mr Nicholas Mak, head of research at SLP International, expects a break-even price of between $860 and $915 psf.

A majority of market watchers estimated a selling price of $1,000 psf for the new development - significantly higher than recently transacted properties in the neighbourhood.

Mr Mak said units at The Quartz have sold for an average of $840 psf while homes in Compass Heights are going for about $770 psf.

CBRE Research executive director Li Hiaw Ho noted that new launches in the area have also performed well. City Development's H2O Residences at Fernvale Link has sold more than 200 units since it was launched last weekend.

Mr Li said the site was near Sengkang MRT station, Compass Point shopping mall and Sengkang Polyclinic and Nan Chiau Primary School.

He added that these neighbourhood facilities were likely instrumental in the site attracting nine bids.

Upgraders in Sengkang, Hougang and Punggol new towns will also be attracted to the upcoming project, said Mr Li.

This tender exercise comes after a mixed-use site near Punggol MRT attracted a top bid of $1.02 billion, or $753 psf ppr.

 

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Mar 16, 2011
Ruling on $37m bungalow appeal pending
Firm claims there was no sham in deal to buy the property for $20m
By Cheryl Lim

The Ridout Road bungalow at the centre of the dispute was bought by Indonesia-born businessman Agus Anwar for $28 million in 2006. -- ST FILE PHOTO

THE Supreme Court has reserved its judgment on an appeal in a high-profile case involving the controversial sale of a $37 million bungalow.

At the centre of the case is a dispute between EC Investment and the bungalow's former owner, Indonesia-born businessman Agus Anwar, over the sale of the home at 39A Ridout Road.

EC Investment, owned by businessmen Tan Koo Chuan and Melvin Poh, claims it made a deal in 2009 with Mr Anwar. The duo say they were granted an option to buy the property for $20 million in exchange for a $1.5 million option fee.

Former Goldman Sachs banker Thomas Chan had also obtained an option to buy it for $37 million the same year.

Last September, the court ordered the sale of the property to Mr Chan.

EC Investment's appeal was heard in court yesterday, with debate between the firm and Mr Agus over the structure of the transaction.

Judge of Appeal Justice Chao Hick Tin noted that both parties had structured the deal to meet their separate intentions.

EC Investment, represented by Senior Counsel Lee Eng Beng of Rajah & Tann, said the contract was structured to 'facilitate a commercial transaction'.

In his judgment last September, Justice Quentin Loh noted that EC Investment knew Mr Agus was desperate for a short-term loan. Mr Agus' lawyer, Senior Counsel Tan Cheng Han, raised that point again yesterday. He noted that both Mr Tan and Mr Poh were fully aware that his client had no intention to sell his property and was looking only for a loan.

EC Investment told the court yesterday that there was no sham or disguise involved in the deal. It said the documentation was prepared by lawyers and both it and Mr Agus had entered into negotiations with their legal representatives.

The bungalow on a 40,600 sq ft plot was bought by Mr Agus for $28 million in 2006. He paid $11 million plus stamp duty of over $744,000 from his own funds. The $17 million balance was taken from a $30 million facility extended by Hong Leong Finance. In May 2008, Hong Leong Finance recalled the loan and terminated the facility after Mr Agus defaulted on his loan payments.

No indication has been given on when the court will give its ruling, but lawyers familiar with the case say it could be weeks or months.

 

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Mar 16, 2011
Private home sales stay healthy
Feb sales breach 1,000 mark to hit 1,101; but more deals closed with discounts or perks
By Esther Teo, Property Reporter

SALES of new private homes in Singapore came in at a healthy 1,101 units last month, down just 9 per cent on January's buoyant figures.

While this was the lowest level of sales in four months, analysts said breaching the 1,000 mark proved the market's resilience. February was the first full month since the Government's latest round of property cooling measures on Jan 13.

But the market outlook is now less certain with growing worries about how the earthquake and nuclear crisis in Japan could hit the global economy.

Some experts said that if the crisis escalates and is prolonged, with regional stock markets remaining volatile, this might affect buying sentiment and lead to lower sales in the short term.

Ms Christine Sun, senior manager at Savills Research and Consultancy, said sales could also be dampened by other factors such as a rise in housing supply here and concerns over Arab world unrest.

Experts expect sales this month to range between 800 and 1,200 units. Already, more than 300 have been sold in the first half of the month. It is, however, too early to look beyond that, they said.

The cooling measures and Chinese New Year festivities seem to have dented sales only slightly last month as developers kept releasing new projects.

The figure, released yesterday by the Urban Redevelopment Authority (URA), is a little less impressive when executive condos, a hybrid between public and private housing, are included. That gives a total of 1,228, a 21 per cent fall from January.

About two-thirds of sales last month were suburban homes. Prices at these projects continued to break the $1,000 per sq ft (psf) threshold.

For instance, the 99-year leasehold project My Manhattan in Simei sold 69 units at a median price of $1,219 psf - a benchmark price for the area.

Experts said sales last month would have been slower anyway with a shorter month and Chinese New Year.

Jones Lang LaSalle's (JLL) South-east Asia research head, Dr Chua Yang Liang, said volumes typically drop by about 10 per cent during this period.

Ms Tay Huey Ying, Colliers International director of research and advisory, said: 'The fact that sales volume stayed at the healthy level of above 1,000 units in February even when the full impact of the cooling measures is likely to have set in, is an indication of the resilience of the market.'

PropNex chief executive Mohamed Ismail said the 'healthy' sales reflect strong buyer demand.

Still, experts cited early signs of buyers' exuberance settling down and giving way to greater prudence and price sensitivity. Most new projects sold fewer than 50 per cent of launched units in the first month of launch, JLL's Dr Chua noted, suggesting that bullish demand has cooled.

Colliers' Ms Tay said the cooling measures also seemed to be steering demand to mass market homes.

This segment won the lion's share of last month's market with 82 per cent of non-landed home sales done at $1,500 psf and below, she said.

However, experts said developers are set to keep pushing out new launches in the coming months.

They said current sales numbers are healthy and sustainable and should they stabilise at this level, further cooling measures should not be needed.

The URA data also shows a rising number of launched but unsold homes, with February's numbers up 49 per cent on September to 5,399 units.

Savills' Ms Sun also noted that a rising number of sales have been closed with some form of discount or sales perk, signalling a willingness by some developers to adjust prices subtly and selectively.

esthert@sph.com.sg

 

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Mar 22, 2011
Couple sue developer over home defects
By Cheryl Lim

A couple living in a unit in Oasis Garden claimed they found several defects that made the $1.08 million apartment unfit for habitation when it was delivered to them. --ST PHOTO: LAU FOOK KONG

A COUPLE have sued a unit of property developer Kheng Leong, claiming the apartment the firm delivered to them was unfit for occupation.

Mr Benson Tan and his wife Amelia, who bought a unit at Oasis Garden condominium, have sued Peak Homes Development, seeking compensation for various costs, such as the rental for another house while the unit was being repaired and the moving charges involved.

They are claiming $12,146.73 in direct losses, plus interest as well as unspecified damages for being sold a unit unfit for habitation at the time of delivery, including for the alleged distress and inconvenience they suffered.

The case got under way in the Subordinate Courts yesterday.

In the suit, the couple claimed they found several defects when the apartment was first inspected after the keys were collected from the developer.

The couple bought the 1,519 sq ft three-bedroom unit for $1.08 million in October 2007.

The Tans, represented by lawyer P. Padman of KSCGP Juris, told the court yesterday that when the ground-floor unit was handed over in November 2009, it was in an 'uninhabitable' state.

According to court documents, substantial defects were present throughout the apartment, including plumbing, flooring and carpentry problems.

Mr Tan said the couple were forced to rent another home for six months while extensive repair work was carried out by Peak Homes' contractors.

The apartment, currently occupied by Mr Tan and his wife, is among 134 units at Oasis Garden, located in Jalan Bunga Rampai, off Upper Paya Lebar Road.

Peak Homes, through its lawyer Melvin Lum of WongPartnership, responded in a court-filed document, claiming the couple were unrealistic in their demands.

The couple's expectations, it said, far exceeded the industry standards laid out in the Building and Construction Authority's guidelines.

Peak Homes has argued that most of the defects set out by the couple were minor ones, consisting mostly of stains. They said these would not have rendered the unit unsafe or impossible to occupy.

The firm argued that it had carried out the work to rectify the defects and covered the costs.

It added that on top of these rectifications, the couple had asked Peak Homes' main contractor to carry out more renovation and upgrading work on their unit.

This is not the first time a developer has been sued by residents. Last month, residents of Emery Point, a project in Tanjong Katong, sued City Developments, the main contractor, five sub-contractors and the architect over numerous building defects.

The case was ultimately resolved amicably out of court.

The Kheng Leong group has real estate developments across the region in Singapore, Hong Kong, Shanghai and Australia.

Its projects here include the 1,145-unit The Minton in Lorong Ah Soo.

The hearing is expected to continue on May 11.

 

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Mar 22, 2011
Sheng Siong tenancy row goes to court
SUPERMARKET chain Sheng Siong is locked in a tenancy dispute with a landlord at the High Court.

The disagreement began after the Housing Board rejected its plans to set up a supermarket in a building at 535 Kallang Bahru, the site of the former Mandarin Theatre.

However, the chain had already signed an eight-year tenancy agreement with landlord Carilla. Hence, Sheng Siong is demanding the return of the four-month security deposit of $450,000 and the legal fees of $3,210 for the lease of the three-storey building.

The court was told at the hearing, which began yesterday, that Sheng Siong's plans for a supermarket were rejected by the HDB, which said they would 'generate disamenity and intensify competition for the existing supermarket and provision shops and minimarts'.

In his opening statement, the chain's lawyer Willie Yeo Siew Keng argued that Carilla was aware that the deal would proceed only if HDB granted permission for a supermarket to be included in the building.

He pointed out that two days before an agreement was reached on Jan 14, 2009, Sheng Siong sent an e-mail to Carilla, stating that it intended to use the premises only as a supermarket, air-conditioned wet market and food court.

The e-mail went on to say that if the change in the building's use was not approved, the chain would not be interested in renting it.

Mr Yeo said the landlord did not reply or object to the e-mail, so his client believed that there was no dispute.

The landlord's lawyer Marina Chin denies this, saying Sheng Siong was well aware that it had to conform to the requirements set by the authorities.

She quoted newspaper reports of Sheng Siong backing down, after objections by the authorities, to its plans to turn a wet market into an air-conditioned supermarket, for example.

Carilla has filed a counter-claim for damages, including loss of rental income, that arose from this dispute.

The rent for the first year is believed to be $112,000 a month.

The hearing continues today. It is scheduled to last until Monday.

 

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Mar 25, 2011
$36m Sentosa home sale still valid
Checks show Chinese national did not forfeit deposit, as speculated
By Esther Teo, Property Reporter

Rumours that Mr Shen Bin forfeited the $500,000 deposit for the bungalow in Paradise Island on Sentosa Cove (above), due to the hefty price tag, appear to be unfounded. --ST FILE PHOTO

RUMOURS that a buyer walked away from his $500,000 deposit for a posh bungalow after he got cold feet over the $36 million price tag appear unfounded.

The title deed shows that Mr Shen Bin - a Chinese national and a Singapore permanent resident - remains the owner of the 14,983 sq ft plot on Paradise Island in the northern part of Sentosa Cove.

There was a great deal of media coverage when Mr Shen was reported to have offered $2,403 per sq ft (psf) for the home last May. This far outstripped market prices and set a benchmark price for the area.

The average psf price for the 10 detached homes sold in Sentosa Cove last April and May was $1,976.

Rumours arose in December that Mr Shen had baulked at the deal after learning that his offer far exceeded prevailing market rates. He was said to have forfeited more than $500,000 - including the deposit, commission, lawyers' fees and administrative charges - when he backed out of the deal.

However, a property title information search by The Straits Times found that Mr Shen remains the owner of the 99-year leasehold bungalow.

He is believed to be the son of billionaire entrepreneur Shen Wenrong, chairman of China-based steel manufacturer Shagang Group. China's Hurun Wealth Report ranked the elder Mr Shen as the 13th richest individual in China last year.

The 2-1/2 storey bungalow faces a waterway, with a berth for a yacht. It also has a private pool and a total built-up area of about 17,000 sq ft.

The house was first sold by developer Ho Bee in April 2007 for $18.1 million, and resold for $20.18 million in September 2009. It received a temporary occupation permit in May 2009.

Interest in landed homes in Sentosa remains strong, with property agents saying there has been a healthy number of viewing requests with genuine offers being tabled.

Prices have also continued to inch upwards, with the sale of a bungalow in Ocean Drive in October fetching a record $2,988 psf - or $28.2 million - on its land area of 9,436 sq ft.

Sentosa Cove is a gated community comprising more than 2,000 homes, of which 400 are landed. The rest are condominium units. The landed houses in Sentosa Cove appeal to a wider market, as foreigners who do not have permanent resident status are allowed to buy them.

Paradise Island is in the northern part of the cove.

 

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Mar 25, 2011
Home price updates 'could affect market'
But proposed changes would give buyers better perspective: Analysts
By Cheryl Lim
PROPERTY insiders are warning that proposals to give buyers the latest prices of new home sales more quickly could cause exaggerated price rises and falls.

But with that caveat, they are broadly in favour of the proposals unveiled by the Urban Redevelopment Authority (URA) last week.

The moves include requiring developers to release the price list of a new project two days before it is launched.

Developers would also have to give weekly updates on the URA website of the prices of new homes that have been sold. Currently, such prices are updated once a month.

Property insiders caution that the prompt release of such information could heat up prices in a fast-rising market.

'In that kind of a market where prices are high, seeing those prices climbing might prompt people to buy in case they get priced out,' said Knight Frank's head of consultancy and research, Mr Png Poh Soon.

Jones Lang LaSalle's head of research, Dr Chua Yang Liang, agreed.

'It works both ways. If the market is feeling negative, it might lead to a further downward spiral of prices as more people hold back on buying property,' he said.

But ultimately, analysts gave the proposed revisions the thumbs-up.

The URA is seeking public feedback on the proposals until April 18.

The changes, if implemented, would allow buyers to gain a more complete perspective of what they are buying into, which would empower them to make more informed decisions.

Mr Png said: 'Rather than going down to the showflat and feeling pressured by agents, buyers can sit down and gather the information in a cool-headed manner.'

Mr Jason Huang, 24, is a potential home buyer who works in the property management sector. He said the release of such pricing details would help to address many of the questions he would face when considering whether to buy an apartment.

'We can't rely solely on agents to give us all the information, (buyers) also have a responsibility to find out if they are getting a good deal. Making the prices readily available within such a short time makes it easier for us,' he said.

Dennis Wee Group director Chris Koh backed the thinking that the proposed changes would give buyers more confidence in marketing agents, especially since withholding pricing details can sometimes result in accusations of mis-selling.

'(Our agency) once received a complaint after a buyer found out the neighbouring unit was sold for less. He was upset because he thought he could have obtained a better deal and we had to explain that factors like a better view and layout affected the price,' said Mr Koh.

'Confidentiality prevents us from disclosing the full list of prices but the situation could have been avoided if there were figures to show right from the start.'

 

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Mar 25, 2011
Clementi mall's retail space all leased
THE Clementi Mall has seen a 100 per cent take-up of its retail space ahead of its completion date next month.

The retail project is the latest property development by Singapore Press Holdings (SPH).

SPH said almost half of the mall's tenants will start operations today. The rest will follow suit soon after.

Anchor tenant BHG, as well as the third-storey bridge connecting the mall to the Clementi MRT station, will also open to the public today.

Foodfare food court, another of the mall's anchor tenants, will start business tomorrow. Clementi Public Library, which will be housed in the mall, will open its doors on April 23.

Other anchor tenants, including Best Denki and Popular Bookstore, are slated to open in mid-April.

Located at Clementi Town Centre, the mall is already partially open.

Cash registers are already ringing at shops located in Basement 1 and Level 1, after the mall obtained its first Temporary Occupancy Permit (TOP) in January.

The Clementi Mall is a six-storey retail development with about 190,000 sq ft of retail space. This includes a basement shopping level and an underground carpark able to accommodate 160 vehicles.

The mall is owned by CM Domain, a joint venture between SPH subsidiary Times Properties, NTUC Income Insurance Co-operative and NTUC FairPrice Co-operative.

 

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Mar 31, 2011
Bartley condo site sees 8 bids
Mix of confident and cautious bidding: Analyst
By Cheryl Lim

A CONSORTIUM that includes big hitters Hong Leong Group and City Developments trumped seven other bidders to lodge the top offer of $413 million for a Bartley Road site.

The offer by the consortium, which also includes TID Residential, works out to $621 per square foot per plot ratio (psf ppr).

It was less than 1 per cent higher than the $410 million offered by a Keppel Land unit, but almost double the bid that triggered the tender for the reserve list site.

A Qingdao Construction joint venture came in third with $386 million.

MCL Land, Allgreen Properties, and a joint venture of Far East Organization and Frasers Centrepoint were also among the bidders.

Hong Leong Group said it plans a development of about 700 units aimed at young families, professionals and upgraders for the 99-year leasehold site.

The 237,822-sq-ft site is zoned for condominium development and can be built up to a maximum gross floor area of 665,909 sq ft.

Property observers said the number of bids and the level of participation were within expectations.

Credo Real Estate's head of research and consultancy, Mr Ong Teck Hui, described the tender's results as a 'mix of confident and cautious bidding'.

'The top few bidders reflect confidence on market outlook and selling price, while the lower bidders were obviously more cautious.'

The site's proximity to Maris Stella High and Paya Lebar Methodist Girls' Primary, both popular schools, would make a development there an attractive option for families, said analysts.

The land is also near Bartley Circle Line MRT station, connecting it to shopping malls like Nex and Junction 8.

Nearby land that has been developed into Nin Residences was sold for $607 psf ppr. The project was launched at about $1,250 psf last December.

Analysts estimate the break-even price for the new condominium on the Bartley site to hover around $990 to $1,030 psf.

 

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Apr 1, 2011
Housing loans grow at slowest rate in a year
Bigger dip expected once fuller impact of property cooling measures is felt
By Gabriel Chen, Finance Correspondent


Slower home loans growth

THE growth of housing loans has sunk to its lowest level in 12 months.

But analysts say a bigger dip may be on the way as they believe the full impact of January's property cooling measures is yet to be reflected in the latest numbers.

The total value of outstanding mortgages as at the end of February rose 0.95 per cent to an estimated $115.3 billion, from $114.2 billion as at the end of January.

This was the lowest month-on-month growth rate since February last year. The highest growth rate in recent times was 2.62 per cent in June last year.

It is also quite a bit slower than January's 1.61 per cent monthly growth.

CIMB analyst Kenneth Ng said most of the effects of the January market cooling measures on mortgage numbers are likely to be seen only next year.

HSBC Singapore head of personal financial services Greg Zeeman said: 'The effect of the cooling measures may be evident only later as the data captures home loans booked two to three months ago.'

These monthly loan numbers could also be hit by seasonal factors in Chinese New Year. In February last year, month-on-month growth was 0.93 per cent.

Total bank lending rose a stronger 1.6 per cent to $334.2 billion in February from $328.8 billion in January, according to Monetary Authority of Singapore (MAS) figures released yesterday.

Analysts believe one factor in the slowing rate of home loans' growth is an easing in the number of resale transactions as a result of the latest round of property cooling measures unveiled on Jan 13.

Only months after an earlier round of measures in August, the Government introduced fresh measures including a raising of seller's stamp duty on properties to as much as 16 per cent of the sale price if the home is offloaded within a year.

The measures appear to have cooled the previously red-hot market.

Sales of new private homes in February fell 9 per cent from January to 1,101 units, according to the Urban Redevelopment Authority. The data showed that when executive condos - a public and private housing hybrid - were included, February sales came in at 1,228, a 21 per cent fall from January.

Singapore's three local banks, with a combined 60 per cent share of the home loans market, all said at recent full-year results briefings that the number of new home loan applications has fallen.

Other big mortgage players here like Standard Chartered Bank (Stanchart) are also seeing the housing market soften.

'Many buyers have adopted a 'wait and see' attitude, especially since the new rules, in anticipation of declining property prices,' said Mr Alvin Lee, Stanchart Singapore's head of mortgages.

Analysts say the latest housing loans growth figure is still in positive territory, mainly thanks to continued strong draw-downs on loans granted by banks prior to the latest cooling measures.

In other words, the number of new mortgages may have declined but there is a 'lag effect' before the paying down of existing loans outpaces the disbursements of new ones. When that happens, the total figure will become weaker.

'The fact that home loans are still rising reflects the strength of the housing market in the last two years,' said Kim Eng analyst James Koh.

Market watchers say the rock-bottom mortgage rates offered by many banks are helping to support the market.

United Overseas Bank, for example, has just launched a new promotional package pegged against its board rate with first-year rates at 0.68 per cent and second-year rates at 1.38 per cent. It has a two-year lock-in period penalising any premature exit from the package.

The 0.68 per cent figure is said to be the lowest in the industry.

 

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Apr 2, 2011
Property price rises slow down in Q1
By Jessica Cheam, Housing Correspondent
SINGAPORE'S property market continued to cool its heels in the first quarter of this year, with latest figures showing price rises moderating across the board.

Fresh estimates released yesterday showed that resale Housing Board (HDB) prices rose 1.6 per cent in the first quarter of the year compared to the previous quarter, down from the rise of 2.5 per cent seen in the fourth quarter of last year.

Private property prices also rose a slower 2.1 per cent, compared to the 2.7 per cent increase the previous quarter.

Analysts told The Straits Times that the price rises have slowed primarily due to stronger market cooling measures introduced by the Government in January, as well as growing uncertainty in the global economic outlook following unrest in the Middle East.

The government measures included a punitive 16 per cent stamp duty for sellers who offload their private property within a year of purchase. The amount banks can lend on a second mortgage was also lowered from 70 per cent to 60 per cent of the home's value.

The 1.6 per cent rise in HDB resale flat prices is the lowest quarterly increase since the second quarter of 2009, while private home prices have now seen six consecutive quarters of moderation in price growth.

Colliers International director of research and advisory Chia Siew Chuin also noted that the moderation in price growth came on the back of a sharp fall in the volume of private homes sold. It almost halved in the first quarter of this year, compared to the previous quarter.

'This indicates that recent government cooling measures and the ramped-up residential state land supply have, to some extent, taken some exuberance off the market,' she said.

The Government has released a bumper crop of land parcels in the past year, offering 17 residential sites with a potential 8,100 private and executive condominium units under the confirmed list of its Government Land Sales Programme for the first half of the year. This is close to the record 8,135 units offered under confirmed list sites in the second half of last year.

Looking ahead, the uncertainties in the global economy, which have been worsened by the effects of the recent tsunami in Japan, are likely to temper prices further, Ms Chia added.

PropNex chief executive Mohamed Ismail said higher prices and lower sales volume, particularly in cheaper suburban condos, could signal that HDB upgraders are deciding against buying private homes and returning to the HDB resale market for their home purchases.

If this trend is strong, it may put upward pressure on HDB resale prices in the coming months, he warned. This could counteract the impact of government moves last August to restrict financing and home ownership for the HDB market.

PropNex and ERA Realty both said they are already starting to see an increase in HDB resale flat sales volume.

The median cash premium paid for a resale flat on top of its valuation - also known as cash-over-valuation (COV) - has, however, stabilised at $20,000 for the first quarter, according to sales data by both agencies.

HDB yesterday did not release estimates for median COV for the quarter, though it did so the previous quarter.

When asked why, HDB said it would release the figures on April 25 when it publishes the full set of public housing data for the quarter.

The steady rise of HDB resale flat prices has become a political hot potato for the Government in the run-up to the general election which is expected to be called within the next two months.

ERA Realty key executive officer Eugene Lim said that at the current pace, HDB resale prices could rise 6 per cent to 9 per cent this year, compared to 14.1 per cent last year.

But price rises of private homes will probably taper off and stay muted for the rest of the year, reckoned Cushman & Wakefield senior manager for Asia-Pacific research Ong Kah Seng.

Still, home buyer sentiment is likely to remain positive overall, he added. This is because amid the global uncertainty, countries which are physically safe and politically stable will appeal to foreign property buyers and investors.

 

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Apr 11, 2011
Foreign buyers
'Put in policy safeguards to protect the interests of Singaporeans who aspire to live in mass-market private homes.'

MR ALBERT TYE: 'Foreigners were reported to have bought 32 per cent of the non-landed homes sold last quarter ('Chinese are top foreign buyers of homes here'; March 31). We must put in policy safeguards to protect the long-term interests of Singaporeans who aspire to live in mass-market private homes. I had previously suggested restricting the purchase of homes valued at less than $1.5 million to only citizens and qualified permanent residents. Such steps seem necessary to prevent Singaporeans from being priced out of the market. Fast and unusual steps are needed, albeit temporary, to rein in prices.'

 

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Apr 11, 2011
Amber Towers sold for $162m
It is biggest residential collective sale in 3 years, says broker; owners can get up to $4.4m each
By Cheryl Lim

The 35-year-old condo can be redeveloped into a high-rise condo with a gross floor area of 145,813 sq ft. -- PHOTO: SAVILLS SINGAPORE

AMBER Towers, a 35-year-old residential project in the Katong area, has been sold to Resource International Holdings, a unit of China Sonangol Land, for $161.6 million.

This works out to a price of $1,118 per sq ft of gross floor area, also known as per plot ratio (ppr), said Savills Singapore, the agency that brokered the deal.

Each owner will potentially receive up to $4.4 million, depending on the size of his unit.

Savills Singapore brokered the deal through a tender exercise that closed on March 28.

The Straits Times understands that while the final sale price is lower than the previous indicative guide price of $168 million to $172 million, it is higher than the owners' reserve price.

The District 15 site, which currently contains 54 apartments, is 40,708 sq ft.

It can be redeveloped into a high-rise condominium with a gross floor area of 145,813 sq ft.

The plot could yield about 110 units, each about 1,200 sq ft in size.

'(The sale of Amber Towers) is also the biggest transacted residential collective sale site in dollar terms over the past three years,' said Ms Suzie Mok, director of investment sales at Savills Singapore.

Amber Towers is near Parkway Parade, Playground @ Big Splash and the upcoming mall in Katong.

It is also in the vicinity of several schools such as Tao Nan School, Tanjong Katong Girls' School and the Canadian International School (Tanjong Katong Campus).

Ms Mok added that any development on the site will command a good sea view as well as unobstructed views of a landed housing estate in the Meyer Road area.

Last month, the freehold Fortredale at Tanjong Rhu was reportedly sold at about $65 million, which works out to about $1,342 psf ppr.

Amber Glades, a development near Amber Towers, was also sold last month to Far East Organization for $118 million, which translates to $1,066 psf ppr.

CapitaLand acquired Marine Point, another site nearby, in January for $101 million, or $1,056 psf ppr.

Analysts say District 15 is now considered an alternative to the prime property districts of 9, 10 and 11, with some units at new project launches commanding prices of above $2,000 psf.

Mr Tan Kok Keong, head of research and consultancy at OrangeTee, said: 'Foreign buyers, especially those from China and India, like the location because there's a big park and it's near the sea. Attributes like that are quite rare in their home countries

 

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Apr 3, 2011
YOUR LETTERS
Are high-rises in S'pore quake-proof?
Last Sunday's article, '1,200 buildings in Bangkok 'at risk'', made me wonder how safe Singapore's high-rise buildings are, especially in the light of recent earthquakes in Japan, New Zealand and Myanmar.

I am curious to know if the Government has looked into and evaluated the robustness of the structures of the many high-rise buildings here.

Are these quake-proof?

Singapore has experienced light tremors arising from quakes in Indonesia in the past, and although it has no record of natural disasters, nothing is certain now.

If a natural disaster were to occur unexpectedly, will Singapore be ready? I worry that we may be taking our safety for granted.

Sharon Lo (Miss)

 

[jq75]

Apr 4, 2011
More shopping for shophouses
Demand rises in the wake of govt measures for residential sector
By Cheryl Lim



IT WAS the Asian financial crisis in 1997 that got investor Anil Thadani interested in the seemingly unglamorous idea of putting money into shophouses.

Property prices then were at an all-time low and Mr Thadani, 46, used his savings to snap up three adjoining units in Dunlop Street.

'Back then we paid $1.65 million for those units,' he said. 'Now, the value is almost three times what it was.'

Mr Thadani has since bought more than 10 shophouses and is part of a small but growing number of investors ploughing cash into the sector.

Shophouses have become an increasingly attractive option for seasoned property investors, especially in the wake of government measures to cool the housing market, said Mr Ong Kah Seng, property consultancy Cushman and Wakefield's senior manager for Asia-Pacific research.

He said there is less risk of government intervention in commercial properties such as shophouses, unlike for residential properties, where affordability remains a key concern.

Rising office rents have also prompted small businesses to look for cheaper space, creating greater demand for alternative properties including shophouses.

'Two years ago, there were fewer buyers (of shophouses). But since the improvement in office rents last year, more investors have come forward eager to buy such properties,' said Ms Grace Ng, managing director of real estate firm Colliers International.

Ms Ng believes shophouse demand will improve further this year, in line with Singapore's economic growth.

Cushman and Wakefield's analysis of Urban Redevelopment Authority (URA) data shows that there were 380 shophouse transactions last year, up 44 per cent on the 263 sales in 2009.

There were 53 shophouse deals in the first quarter of this year, compared with 78 in the same period last year, according to URA data. But analysts say this year's figure is likely to rise as not all the transactions have been captured yet.

Prices are rising in line with demand. Mr Ong said prices of shophouses went up 10 per cent last year, with rental yields at about 4 per cent.

Median rents of centrally located shophouses grew to $4.07 per sq ft (psf) per month in February, 4 per cent more than that for the same month last year, according to URA data.

'Rents of shophouses have held steadier in comparison to strata shops in malls, as shophouses are generally unique and the supply is limited,' Mr Ong said.

Mr J. Chen, an investor in his 40s, said his shophouses are better investments than homes in the same area. He owns a portfolio of conservation shophouses, many in Tanjong Pagar.

Newly launched homes in Tanjong Pagar are selling at above $2,000 per sq ft (psf) with a rental yield of up to 3 per cent, he said.

In contrast, a 99-year leasehold conservation shophouse in the same area would go for about $1,200 psf and have a rental yield of up to 4.5 per cent.

But conservation shophouses in the central district, which includes Chinatown and Tanjong Pager, do not come cheap. CBRE Research figures show that a 2,971 sq ft shophouse in Tanjong Pagar Road sold for $9.38 million in December.

In city fringe areas like Serangoon, Kallang and Geylang, however, smaller shophouses can be bought for under $2 million, said Mr Ong.

HDB shophouses also tend to be more affordable, added Colliers' Ms Ng. Single-storey properties are typically priced below $1 million, while two-storey units with residential quarters upstairs go for around $1.2 million to $1.5 million.

Ms Ng said suburban shophouses can have rental yields of 5 per cent to 6 per cent, and may offer good value to investors as they come with existing tenants.

Investors The Straits Times spoke to say first-floor tenants of shophouses are almost always retail businesses. The upper floors are typically taken up by offices, but can be leased out to residential tenants if the shophouse is not zoned for commercial use.

But potential shophouse investors should take note that these properties come with their own set of risks and considerations. Central Provident Fund savings, for instance, cannot be used to buy non-residential properties.

Ms Ng also said investments in commercial property are not as straightforward as those in homes.

To gauge whether a shophouse is investment-worthy, buyers need to take into account the property's location, age, maintenance costs and even the attractiveness of the shop frontage.

cherlim@sph.com.sg

Why investors like shophouses

Rental yields are less prone to fluctuations
Prices rose 10 per cent last year; demand is still climbing
There is less risk of government intervention

 

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Apr 5, 2011
Mum sues daughter over flat sale money
She claims they had verbal deal to split proceeds, which daughter denies
By Kimberly Spykerman

Madam Lim is suing for slightly more than $308,800. The sale of the apartment in 2007 fetched $617,737. -- PHOTO: LIANHE ZAOBAO

A MOTHER and her daughter are locked in a bitter suit over the proceeds from the sale of an apartment two years ago.

Madam Lim Geok Swan, 76, is suing her daughter, Ms Lim Shook Luan, 49, for half the $600,000 from the sale of their Minton Rise apartment.

The older woman claimed she had a verbal agreement with her daughter that, as joint tenants, the sale proceeds would be shared equally if the property was sold.

She said her daughter did not honour her end of the bargain.

The privatised Housing and Urban Development Company apartment, which is in Hougang Street 11, was part of a collective sale in 2007, and fetched $617,737. Madam Lim is suing for slightly more than $308,800.

Her daughter is contesting the suit on the grounds that there was no verbal agreement between them to split the sale proceeds, nor any discussion as to what the rights of both parties were.

Also in dispute is the amount of money Madam Lim said she paid for her share of the property when they bought it in 1991.

Back then, they had paid $280,000 for the apartment.

Madam Lim added that she had paid more than $87,700 between 1991 and 2009 to upkeep the property. This included paying for conservancy charges, utilities and property tax.

However, her daughter insisted that she had made all the mortgage payments on a $200,000 loan they had taken to buy the property.

Madam Lim said she had been 'persuaded' by her daughter to buy the property. It meant that she had to sell her three-room Housing Board flat in Ang Mo Kio, where she was living at the time, so that money from that sale could be used for the down payment on the Minton Rise property.

At the start of the trial yesterday, she said in her opening statement that she had been reluctant to buy the apartment with her daughter as she felt that her Ang Mo Kio flat was sufficient for her needs.

She also did not want additional financial commitments as her flat was fully paid for, and none of her six children was supporting her. She said she eventually gave in 'after much persuasion', assurances and promises by her daughter.

These included promises that she was an equal owner and that her daughter would buy her a three-room HDB flat if she wanted to keep the Minton Rise apartment for herself.

Ms Lim, however, said in her statement that her mother's actions were nothing but a 'contrived ruse' to get what she wanted.

The statements tendered in court showed that the relationship between the mother and her six children was strained. This was due, said her daughter, to Madam Lim's drinking habit, which led to frequent violent outbursts.

In 1997, Ms Lim was believed to have moved out of the Minton Rise apartment after her mother 'attacked' her during a quarrel.

Madam Lim, who divorced in 1982, denied that she drank frequently and said in Hokkien through an interpreter: 'I had only one or two cans of ABC Stout after I became very tired at work.'

According to Ms Lim's statement, she and her siblings also detested their mother's partner, who would stay at her Ang Mo Kio flat regularly. Both of them ran a roasted meat business. The partner also lived in the Minton Rise apartment.

Yesterday in court, the women were frosty towards each other, sitting far apart and not speaking.

The trial is expected to last until Friday.

 

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Apr 5, 2011
Residents at odds over covered patios
Some owners say trellises are for safety, but trash on top upsets others
By Kon Xin Hua

A toilet rug fell onto an umbrella covering the patio of a ground-floor unit without a trellis. -- ST PHOTO: CHEW SENG KIM

View more photos

THE ground-floor residents of Tampines condominium The Tropica said they installed trellises with polycarbonate covers on their patios literally to take cover.

They added that their families' safety was at stake because upper-floor residents threw litter onto their patios.

But because the rubbish then landed on the covers, this mess also made the higher-floor residents upset.

A deadline of last Thursday set by the management committee to remove these covers went unheeded by 21 owners of the ground-floor units in the 10-year-old condo.

Out of the 26 ground-floor units, the owners of 21 had set up the trellises - wooden structures attached to the exterior walls - over the past five years. They cover the entire patio area of about 450 sq ft, and extend out by about 4m.

The ground-floor residents of the 540-unit estate said items like books, toys and even window handles have fallen onto their patios.

But higher-floor residents noted that the covers flout Urban Redevelopment Authority (URA) guidelines which stipulate that private enclosed spaces are allowed covers that extend only up to 2m.

The management committee had given approval for the trellises to be built.

But it also told the owners that the covers have to go if there are any complaints, and the dismantling cost has to be borne by the owners.

When upper-floor residents asked the committee to enforce the URA ruling, the deadline of last Thursday was set.

A circular was sent to the ground-floor residents, who were given a month's notice to act.

A ground-floor resident, who wanted to be known as Mr Chan, said he was lucky he kept the cover. Last Thursday, a glass window on the sixth floor shattered and pieces fell down.

Mr Chan, 38, who has lived in the condo for two years with his mother and two daughters aged three and six, said: 'Had it not been for my polycarbonate cover, my mother, who was in the patio gardening, would have been injured.'

He and his ground-floor neighbours want to be granted an exemption from the private enclosed spaces guidelines. 'We paid for the private enclosed space so we own the right to use it without fear. My kids are constantly running around the area as well. Who is going to be responsible if something falls onto them?'

Erecting a covered trellis costs about $10,000 to $15,000.

The ground-floor residents said they have offered to pay for a contractor to clear the rubbish on the covers.

While noting that it would be unhealthy if the rubbish accumulated, higher-floor resident Matthew Chua, 34, felt that the problem was also sometimes beyond the control of the ground-floor residents, and that higher-floor residents should not litter.

The self-employed Mr Chua added that the management committee could perhaps absorb the maintenance cost and residents could also regularly check their windows to ensure safety.

'If not, there'll be no end to this disagreement,' he said.

Chairman of the management committee E.H. Lim, a senior manager in his 50s, said the committee hopes for 'everyone to live harmoniously' and that it is working to 'help find a balanced solution'.

 

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Apr 5, 2011
Private home sales still strong
But dip likely in coming months as property cooling steps take effect
By Cheryl Lim

SALES of new private homes have held steady in recent weeks, according to the latest figures, despite global turmoil including Japan's earthquake crisis and unrest in the Arab world.

However, some analysts predict that volumes will begin to ease in the months ahead, as the Government's property cooling measures take full effect.

For now, buyers appear eager to sign up. For instance, more than 70 per cent of the 115 apartments at the 30-storey Sky Suites 17 project in Jalan Rajah have been sold since its soft launch last Tuesday.

Apartments there achieved an average selling price of $1,450 per sq ft (psf). The smallest 355 sq ft unit cost $499,000.

Oxley Holdings' Devonshire Residences project in Devonshire Road has performed equally strongly. The development has moved about 70 per cent of its 84 apartments since sales started on Thursday.

According to marketing agents The Straits Times spoke to, almost half of the 44 units at Harbour Suites in Kampong Bahru Road have been snapped up.

They went on sale on Monday last week.

Prices of the smallest 419 sq ft one-bedroom unit sold for about $724,900, with the one-bedroom units proving the most popular.

Buyers have bought about 33 of the 120 apartments in the 38 iSuites project in Ipoh Lane, off Tanjong Katong Road.

The smallest 452 sq ft one-bedroom plus study unit is going for about $641,900. The project's developer Sustained Land said sales of the project started last Thursday, with prices for units sold averaging about $1,397 psf.

These various sales figures post-date the latest first-quarter flash estimates from the Urban Redevelopment Authority, which cover mainly January and February.

Those figures indicated that private home prices climbed 2.1 per cent in the first 10 weeks of the year. Suburban homes led the pack with 3.1 per cent gains.

The latest sales since then help to flesh out the full picture in the first quarter.

Mr Nicholas Mak, head of research at SLP International, said that while prices will not waver, transaction volumes for March could drop, compared to February, in a reflection that the latest round of property cooling measures, taken in mid-January, have taken full effect.

He also suggested that the level of sales at these projects may not be reflected across the wider market in March.

'These sales figures from these sub-urban projects may not be an accurate reflection of the number of property transactions for this month, because they consist of many small units which are usually quite popular with investors,' he said.

International Property Advisor chief executive Ku Swee Yong is more upbeat about the outlook.

He said factors such as strong employment and wages, as well as a growing economy, will continue to support enthusiasm in the property market.

He said the crisis in Japan may even have spurred people to buy now.

Property observers told The Straits Times that some agents have been urging buyers to close deals now, saying construction costs are likely to soar when Japan's rebuilding efforts begin.

'Generally, whatever affects the stock market will also affect buying sentiment, but the stock market has been doing well,' said ERA Realty key executive officer Eugene Lim.

However, he said it is possible the market is in cautious buying mode.

'While luxury developments won't be moving so quickly, mass and mid-market projects should continue to do well,' he said.

But he added that there is an absence of 'anything that will boost the market', saying many buyers are waiting it out to see if there are more government cooling measures to come.

cherlim@sph.com.sg

NOT THE WHOLE PICTURE

'These sales figures from these suburban projects may not be an accurate reflection of the number of property transactions for this month, because they consist of many small units which are usually quite popular with investors.'

Mr Nicholas Mak, head of research at SLP International

What it should have been

ON TUESDAY, our report, 'Private home sales still strong', stated that 70 per cent of the 84 units in Devonshire Residences had been sold since the homes went on sale last Thursday.

The project's developer Oxley Holdings has clarified that sales of the units in the development began a fortnight earlier, on March 17.

 

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Apr 5, 2011
Three smaller freehold sites up for sale
It shows property firms' confidence in demand, say analysts
By Aaron Low

Two of the developments are less than 30,000 sq ft in size - like this site in Lim Tua Tow Road, off Upper Serangoon Road. The third is 70,000 sq ft in size. -- PHOTO: SAVILLS (SPORE)

THREE small- to mid-sized developments were put up for sale yesterday.

Analysts say this indicates property firms are confident that demand remains strong among boutique developers seeking smaller-sized plots.

Two of the three developments are less than 30,000 sq ft in size; the other has a size of about 70,000 sq ft.

Credo Real Estate executive director Yong Choon Fah said many big developers prefer government land sales to the collective sale market, leaving the latter open to smaller firms.

'Boutique firms are still on the hunt for smaller developments which they can handle on their own, so demand is still there,' she said.

Yesterday, Credo put the 20,226 sq ft Haig Mansions in Haig Road up for collective sale. The freehold site has a gross floor area of 28,317 sq ft and can be redeveloped to house 45 apartments of an average of 600 sq ft each.

Ms Yong said the break-even price is about $1,150 per sq ft (psf), given the reserve price of $21 million. The tender closes on May 11.

Savills launched a 28,676 sq ft freehold site in Lim Tua Tow Road, off Upper Serangoon Road. The site, which currently accommodates three single-storey houses, can be developed into a five-storey development with 43 apartments of about 850 sq ft each.

Savills director Suzie Mok said the indicative price is $26 million, with a break-even price of $1,250 psf.

'The good thing about this is that it's not an en bloc but sold by a family which owns the entire site. So there is less hassle than an en bloc sale process,' she said.

The biggest of the trio is Pelikat Mansions, a freehold three-storey commercial cum residential block in Jalan Pelikat, off Hougang Avenue 1.

Marketing agent ERA Realty Network said the 69,552.66 sq ft site has an achievable gross floor area of 208,657.9 sq ft and can be redeveloped into three-and-a-half-storey blocks. It said 80 per cent of the owners have signed the agreement to sell and are looking for at least $70 million. The tender closes on May 5.

In a report, Nomura analysts said the appetite for residential sites remains strong, citing a collective sale site in Tanjong Rhu being snapped up by a small Chinese developer.

The 23,020 sq ft freehold site called Fortredale cost about $65 million.

'We think the Fortredale developer will try to achieve a higher unit price by offering smaller units,' said Nomura, which estimates that the break-even price for the site is between $1,858 psf and $1,971 psf.