Latest Posts

Echelon: 80% of launched units sold on first day of preview!

- December 28, 2012 No Comments

A new private condominium project located in Alexandra View, called Echelon, has seen strong sales.

Its developer City Developments Limited (CDL) said 80% of the units launched have been snapped up on the first day preview of the project.

In a statement, CDL said that as at 4pm on Friday, 200 out of 250 launched units have been sold.

The 508-unit development is jointly developed by CDL, Hong Leong Holdings Limited and Hong Realty.

Located near the Redhill MRT Station, Echelon offers a range of one- to four-bedroom units, loft units and penthouses spread over two 43-storey towers.

CDL said the "early bird" prices for the units average $1,700psf.

It added that a one-bedroom unit costs about $800,000, while the two- and three-bedroom units are priced from $1.19 million and $1.34 million respectively.

Larger apartments such as a four-bedroom suite will cost at least $2.13 million, and a penthouse will come with a price tag of $7.15 million.
Source: Channel News Asia

The news article above caught our attention even while we are vacationing in Taiwan this week. And those who have bought into Ascentia Sky earlier must be rubbing their hands with glee after reading the report..

November private home prices up 1.9%!

- No Comments

Prices of completed private apartments and condominiums picked up pace in November, with those in the central region leading the gains.

According to the National University of Singapore (NUS) Singapore Residential Price Index (SRPI), prices of private non-landed homes climbed 1.9% in November.

This follows a 0.8 per cent increase in the previous month.

In particular, prices of private non-landed homes in the central area (excluding small units) advanced by 2.6% in November, compared with a 0.4% rise in October.

NUS' Institute of Real Estate Studies, which published the SRPI flash estimates, said the sharp rise in prices of private non-landed homes (excluding small units) in the central area was driven by strong resale activity. Units in the central region made up about 35% of the total volume of transactions in October and November compared to 25% in January .

Associate Professor Lum Sau Kim of the NUS Institute of Real Estate Studies added that the housing market is still enjoying "favourable demand conditions with low nominal interest rates and low unemployment".

Meanwhile, prices of resale private homes in the non-central regions (excluding small units) edged up 1.3%, compared to a 1.2% increase a month earlier.

Prices for small units with a floor area of 506sqft or below rose 1.7%.

HSR Property Consultants' special advisor, Donald Han, said: "Developers launched less units for sale but instead focused on sales of existing projects that have been completed.

"For example, Reflections at Keppel Bay saw sales of six units in the month of November. The lack of new projects also caused investors to turn to the secondary market."

He added that centrally-located projects have also been re-rated by investors, given that their price increases have lagged behind those in the suburban area.
Source: Channel News Asia

Pre-Christmas Folly

- December 24, 2012 No Comments

While trying to clean up some of the spam on our comments page, the wife and I (more "I" than the wife actually) have accidentally deleted some of the recent comments made by our readers and our responses over the past month.

So if your contribution has gone missing, please be reassured that it is not a case of we don't like  what you wrote (or you, for that matter).

And in the spirit of the season,

The Real Deals (20-12-2013)

- December 22, 2012 No Comments

In this latest issue, the good folks at Maybank-Kim Eng Research have provided us with their take on the private home market scene in 2013.

And for those who are sussing out the Tanah Merah and Farrer Road area, this is definitely one report for you!

Click on the link below to read the full report:

Property Spotlight: District 4

- December 19, 2012 3 Comments

Investors are turning their attention again to developments in District 4, especially the Telok Blangah and Keppel Bayneighborhoods. With the construction of the 1,040-unit The Interlace at an advanced stage, buying interest has also picked up. Developed by a CapitaLand-led consortium and designed by world-class architect Ole Scheeren, the project is a redevelopment of the former Gillman Heights, a privatized HUDC estate in Telok Blangah. The project is pitched at the mid- to upper-end of the condominium market, and contains a mix of two- to four-bedroom apartments and penthouses. The 99-year leasehold condo is scheduled for completion sometime next year.

Only mainly large units are left for sale at The Interlace, according to David Neubronner, head of residential project sales at Jones Lang LaSalle (JLL), and the developer is pricing them at an average of $1,500psf. As at end-October, 737 units or 70,9% of the units have been sold by the developer, with the latest median price achieved at $1,294psf.

Meanwhile, those who bought units when the project was launched in late-2009/early 2010 at prices from $900 to $1,000psf are offloading them on the secondary market as it approaches completion. Sub-sale prices achieved over the last two months have ranged from $1,096to $1,353psf, according to caveats lodged in October and November. For instance, a 1,464sqft, three-bedroom unit on the seventh floor was sold in a sub-sale for $1.98 million ($1,353psf). according to a caveat lodged with URA Realis in November. The original owner purchased it from the developer in April 2010 for $1.5 million ($1,024psf), thus realizing a capital appreciation of 32%.

Meanwhile, a 1,550sqft, three-bedroom unit on the eighth floor in another block recently changed hands in a sub-sale for $1.89 million ($1,218psf). The seller purchased it for just $1,003psf two years ago, thus enjoying a capital appreciation of 21.4%. Owners who bought their units two years ago are now putting them on the secondary market with price tags of $1,300 to $1,400psf, says Neubronner. At such prices, they still get a capital upside of 20% to 30%, he estimates.

However, for those who plan to hold on to their units at The Interlace, Neubronner reckons that, based on an estimated rental rate of $4psf per month, they are likely to achieve rental yields of about 5%, relative to the more recent buyers where the yields for their units will likely be 3% to 4%.

Meanwhile, at the 969-unit Caribbean at Keppel Bay, a handful of units have been sold in November at prices ranging from $1,561 to $1,735psf based on caveats lodged to date. The 99-year leasehold condo project was completed in 2004.

The most recent caveat registered with URA Realis was for the sale of an 893sqft, two-bedroom unit on the sixth floor of one of the blocks for $1.55 million ($1,735psf). The previous owner paid just $671,175 ($751psf) for the unit seven year ago, hence seeing its price increase by 2.3 times over that period.
Elsewhere at Caribbean at Keppel Bay, a 1,227sqft, three-bedroom unit on the eighth floor of another tower recently changed hands for $1.86 million ($1,516psf). Three years ago, the same unit was sold for $1.73 million ($1,410psf), according to a caveat lodged with URA Realis.

Caribbean at Keppel Bayis popular with expatriate tenants and investors, with rental rates hovering from $5 to $6psf per month, according to JLL's Neubronner. This means, based on today's selling prices, the gross rental yield is likely to be compressed to 3% to 3.5% per annum.

Meanwhile, also in the Telok Blangah neighborhood, Bukit Sembawang Estates has substantially sold its freehold Skyline Residences, which is still under construction. To date, around 80% of the 283 units at the high-end condo project have been sold at an average price of $2,000psf. The last recorded transaction captured by URA Realis was in August - a 1,346sqft, three-bedroom unit on the 22nd level was sold for $2.82 million, or $2,096psf. "Skyline Residences stands out for its freehold status and hence it commands a premium," says Neubronner.

The wife and I first visited The Interlace's sales gallery around this time of the year back in 2009, when the average price for this project was around $1,000psf. We were not particularly impressed by the furnishing (homogenous-tile flooring for a supposedly upper-end project) and the fully-enclosed bathroom (no ventilation). But looking at the current median price of about $1,300psf, what a difference 3 years make!

Click on links below to read our review of The Interlace:

Click on link below to read our previous review of Skyline Residences:


Singapore Property Update (17-12-2012)

- December 17, 2012 No Comments

The latest report by Maybank-Kim Eng Research provides more insight into the November private home sales figures, and what to make of this going forward.

Click on the link below to read the report:

November home sales drop 44%, school holidays to blame.

- No Comments

According to an online report, home buyers snapped up 1,087 new private homes last month. This is 44% down from the close to 2,000 homes sold in October as the school holiday period dampened sales momentum.

Including executive condominiums (ECs), 1,266 homes were sold. Last month, the figure was 2,624 units.

Top selling projects for November include Eco Sanctuary which moved 140 units at a median price of $1,050psf, d'Leedon which sold 133 units at $1,431psf and Bartley Residences where buyers picked up 43 units at $1,230psf.

New Project Info: The Whitley Residences

- December 11, 2012 No Comments

It was reported in our de facto business newspaper today that Hoi Hup have sold 19 freehold cluster homes at The Whitley Residences at about $5 million each during a preview on Sunday. The average price is about $850psf on strata area - after a 12% discount and absorption of the standard 3% buyer's stamp duty.

All  the buyers were Singaporeans. Non-Singapore citizens need permission from the Land Dealings (Approval) Unit to buy units in the development, as it is a form of landed housing.

The units sold comprise a corner terrace and 18 semi-detached houses. The semi-Ds fetched $4.9 million (for a unit with a strata area of 6,125sqft) to $5.12 million (for a 6,071sqft unit). The 6,620sqft corner terrace sold for $4.85 million.

Cluster housing developments are landed homes that have shared condo-like facilities. At The Whitley Residences, these will include a clubhouse, pool, gym, hot spa and playground.

The District 11 project is near the upcoming Mount Pleasant MRT Station under the Thomson Line. All 61 units in the development span four levels, including a basement and attic, and each has its own lift.

The project comprises 58 semi-Ds and three terrace homes - all with five bedrooms.

Strata areas of the semi-Ds are 5,156sqft to 7,190sft. Following the sale of a corner terrace unit, the remaining corner unit of 6,448sqft (priced at $4.8 million) and a 4,801sqft intermediate terrace house costing $4.3 million are available.

Strata area includes car parking area, private enclosed space lift, void areas and roof terrace.

For its preview, Hoi Hup released 27 semi-Ds and all three terrace units.

This is definitely one project that the wife and I are interested to go have a look-see. For the uninitiated, the site that The Whitley Residences sit on is supposedly the largest freehold land site in District 9, 10 and 11 since the 1950s, with grounds exceeding 130,000sqft. The project also has the honor of being the first ever landed housing estate in Singapore to achieve the top-tier Building and Construction Authority (BCA) Green Mark Platinum Award.

Here are more details about The Whitley Residences for those who are interested:

Name:            The Whitley Residences
Location:       141 Whitley Road
Developer:     Hoi Hup Realty Pte Ltd
Tenure:          Freehold
District:         11
Est. TOP:      31 Dec 2017
Total Units:   58 strata Semi-Detached & 3 Strata Terraces
Car Park:      Basement Parking (private & visitor parking lots)

MRT Stations & Schools:
0.4 km: Mt Pleasant MRT Thomson Line (Due 2021)
0.87 km: Novena MRT
0.99 km: Bukit Brown MRT Circle Line U/C 


Schools & Institutions
0.80 km: Anglo-Chinese School (Primary)
0.77 km: Balestier Hill Primary School
0.97 km: CHIJ Primary (Toa Payoh)
1.17 km: Singapore Chinese Girls' School (SCGS)
1.17 km: Singapore Chinese Girls' Primary School (SCGPS)
1.65 km: Marymount Convent School
1.74 km: Kheng Cheng School
1.85 km: Anglo-Chinese School (Junior) 


Private home sales climb but rental is softening!

- December 7, 2012 No Comments

Resale home prices of both non-landed private residential units and HDB flats continued to climb to new highs in October and November against the third quarter 2012.

But according to data released by the Singapore Real Estate Exchange (SRX), the rental market for private homes is showing signs of softening.

As a result, overall gross rental yield dropped to a six-year historic low of 3.77% in the first two months of the fourth quarter.

Meanwhile, prices of private resale homes rose to $1,222 per square foot (psf) in the first two months of the fourth quarter, up 5.4% from the previous quarter's average of $1,159 psf.

The report found that resale prices of private homes rose across all regions, with non-landed homes in the suburban region seeing the sharpest increase at 4.5%, compared to the third quarter of 2012.

This is followed by a 3.3% increase in the city fringes and a 2.8% increase in the core central region.

Compared with the first two months of the third quarter this year, transaction volume rose by 6% to reach 2,483 resale transactions in the October to November period.

Meanwhile, the average unit monthly rent of private homes dropped by 1.0%, from $3.88 psf in the third quarter to $3.84 in the first two months of fourth quarter.

Leading the drop is non-landed homes in the city fringe where prices fell by 2.5% to $3.91 after rising for the first three consecutive quarters in this year.

The other regions remained relatively stable compared to the previous quarter.

Meanwhile, the report included for the first time data about the sales of small private apartments, commonly known as shoebox units in Singapore.

Year-to-date, just 198 shoebox units changed hands in the resale market.

But the report said there was strong demand for rentals of shoebox units, with 1,328 rental contracts signed this year. This represents 6.7 times more rentals than resales for shoebox units year-to-date. In contrast, the average is 2.4 times more rentals than resales for other types of units.

As a result, shoebox units continue to draw higher rental offers in the fourth quarter.
Source: Channel News Asia

So what's our public perception of property agents?

- November 26, 2012 1 Comment

The first Public Perception Survey by the Council for Estate Agencies (CEA) has found that most consumers are satisfied with their property agents.

Eight out of 10 said they were satisfied with the conduct and services provided.

Seven out of 10 planned to recommend their agents to others. 

Top of the list was service excellence with agents being contactable, responsive to queries and courteous at all times.

Bottom of the list was knowledge and expertise about the real estate industry.

Consumers felt that the agents should improve their knowledge so that they can advise customers on property transactions.

These include financial matters and accurate and up-to-date information related to the property.

Most consumers, more than 70%, were also aware of key industry practices and regulations.

The awareness level among potential consumers came in lower, averaging about 60%.

The survey also looked at feedback from the industry.

Most were supportive of the initiatives implemented by CEA to enhance professionalism in the sector.

Eighty per cent indicated that the regulatory measures and enforcement of minimum eligibility criteria for agents has helped raise the professionalism of the industry.

More than 90% of agents found that the training that they received in the last 12 months, was effective in raising their professionalism.

The majority of them also indicated that they would require additional training on government rules and regulations and market information.

The survey was conducted between March and July this year.

Face-to-face interviews were conducted with more than 2,200 consumers and potential consumers.

An online survey was conducted with more than 1,700 property agents and key executive officers.

The findings will set the baseline for CEA to measure the progress of the industry in delivering professional service to consumers.
Source: Channel News Asia

The wife and I have lost count of the number of property agents we have met over the past few years. While most of these encounters were generally positive, we did come across several that "cannot quite make it".

Our pet peeves are those who are excessively pushy, who do not know the facts about the development that they are marketing and worse of all, pre-judge you on your "affordability" based on appearances.

So what's your best/worst experience with a property agent?

Private home market reaching equilibrium?

- November 23, 2012 1 Comment
Another proponent of impending price easing in the private property market.

But the (two) million dollar questions remain: how soon and by how much?

Author: Ong Kah Seng

It has been a pulsating year for Singapore's private housing sector, with homebuyers' aspirations remaining firm even as prices and volumes defy conventional market cycles to hit record highs, but there are signs that the market is now heading towards equilibrium.

In today's market, speculation no longer drives the property buyer following the implementation of sellers' stamp duty in January last year for sales that take place within four years of the home purchase. The purchase decision largely comes from a desire to seek out investment opportunities and fulfil ownership aspirations.

These behavioural drivers will have to be managed by the authorities if they want to ease the rate of increase of home prices. Indeed, the current measures may be more effective than previous ones as they target underlying economic, social and homebuying fundamentals.

By now, the lack of investment alternatives due to the persistent low interest rate environment has become the oft-heard explanation for the continued preference for property purchases. A private home will still be a more familiar and safer choice among many property investors, compared to strata offices, shops and factories. Notwithstanding the record high prices, private homes are still perceived to be a good long-term investment.

The easy access to loans with longer tenures often encourages buyers, even those with affordability issues, to satisfy their need for instant gratification. So the curbs introduced last month to cap mortgages at 35 years and reduce the loan-to-value ratio for those that exceed 30 years or extend beyond the borrower's retirement age of 65 years can help mitigate the risks of defaults and failures in property investments, especially if interest rates eventually rise.

Private home prices, especially those of suburban housing, ran up during the periods following the implementation of the United States Federal Reserve's first round of quantitative easing (QE1) in end-2008 and the second round (QE2) in end-2010, but the market contexts were materially different from the present situation.

In 2009, private home prices fell by an average of 15% in the first quarter, hit by the fallout of the Lehman Brothers collapse. The severe drop and the subsequent economic stabilisation and stock market recovery, partly driven by QE1, provided the platform for the strong rebound of 16% in 3Q 2009, as opportunistic investors, including speculators, resurfaced.

The market also jumped in the last quarter of 2010 following QE2 implementation, with prices largely shrugging off the cooling measures effected from September that year.

Against that backdrop, many buyers are now conditioned to believe that property prices will surely rise following the Fed's third round of quantitative easing (QE3). Indeed, in September, when the US central bank announced the measures, there was a strong showing here in both the developer and resale market.

Typically, these buyers believe the ample liquidity will raise home prices next year, and although the high sellers' stamp duty will restrict reselling in the first four years of purchase, paper gains are still psychologically uplifting for owners and investors.

The market has also become more innovative and vibrant, as developers come up with new offerings or incentives to woo homebuyers in the face of fresh tightening measures and new supply.

Still, with Singapore's subdued economic prospects and with Asia increasingly losing its resilience, homebuyers are now expected to be more restrained. This will translate into a more stable market amid more competitive pricing next year.

The private home market rose 0.6% in the third quarter to hit a new all-time high and this has also led to more buyer resistance, especially as new cooling measures target specific demand fundamentals.

The current price levels have also almost fully stretched buyers' affordability, with suburban developer sales averaging $1,000 to $1,300psf, compared against lukewarm demand for resale properties in city fringes going for $1,200 to $1,400psf.

Although resale property requires immediate financing and HDB upgraders often like to be in the same locality, an investment-savvy individual should choose the latter, unless it exceeds his or her affordability. The current pricing is thus the limit for suburban condominiums and any further increase, even driven by low interest rates and QE3, is likely to meet with buyer resistance.

While the lack of investment alternatives and low interest rates drive the housing market, what really underpins the property's potential is beyond the mere low cost of funds. These include the tenant demand base, the property's inherent characteristics, as well as long-term infrastructural improvements and enhancements.

Homeseekers who did not purchase during the 2010 to 2012 market frenzy are generally more risk averse and prudent, and are thus expected to critically evaluate their buying options in the context of ample choices next year. This will curtail further price increases and very likely, prices will ease as competition intensifies.

      Ong Kah Seng is Director of Research at R'ST, an independent property market research company in Singapore.

Source: TODAY Online

The Real Deals (22-11-2012)

- November 22, 2012 No Comments

This latest issue by Maybank-Kim Eng Research is all about the Bartley area. So for those who are eyeing the two new projects along Bartley Road (i.e. Bartley Residences and Gambir Ridge) or wish to know what else is slated to happen around the area, this one for you!

Click on the link below to read the full report:

Q3 foreign purchases at 7%: Still blaming the high prices on foreigners?

- November 19, 2012 No Comments

Foreign buyers of Singapore properties accounted for 7% of the market in the third quarter this year.

The proportion had remained unchanged from the previous second quarter.

However, for the first three quarters of the year, foreign purchases averaged about 6%.

This is according to the latest report on demand for Singapore's residential properties in Q3 by property consultant DTZ.

The report also said that demand for luxury landed homes remained strong in the same quarter.

There were altogether 14 Good Class Bungalows (GCBs) transacted in Q3, compared to 12 GCBs in the previous quarter.

Interest in the landed segment was also strong in Sentosa Cove with 6 units sold in Q3 compared to 5 in Q2 and two units in Q1.

These are for purchases worth more than $10 million.

Notably, purchases by US nationals and Norwegians in Sentosa Cove have increased since the implementation of the Additional Buyer's Stamp Duty (ABSD).

The 10%  additional stamp duty does not apply to them.

Year-to-date, US nationals have bought a total of 126 private homes in Sentosa Cove, making them the top non-SIngaporean buyer group of private homes there.

This is a huge contrast to only 3 and 1 purchases by Americans in 2010 and 2011 respectively.

DTZ Research expects the market to continue to gain support from local buyers despite the cooling measures on loan tenure and loan-to-value limit implemented in October 2012.

It also expects limited impact on the high-end segment of above $5 million since the buyers have deeper pockets.

Meanwhile in other segments, it expects demand to shift to smaller and more affordable units as buyers with tight budgets may move one notch lower.

Source: Channel News Asia

Property Spotlight: Tanah Merah vicinity (Part 2)

- November 18, 2012 No Comments

Soon is concerned that, based on the three new parcels sold this year (including eCO), there will be about 1,900 new homes coming up over the next few years in the neighborhood around the Tanah Merah MRT station. In addition, more supply is in the pipeline. For instance, next to eCO is another land parcel (Parcel B), located at the junction of New Upper Changi Road and Bedok South Avenue 3, that is earmarked for a 595-unit residential project sitting on the Reserve List of the government land sales programme. Adjacent to it, where the Tanah Merah MRT station is located, is a parcel designated for "future development".

Even though prices have been stable, and the take-up rate at new launches have been healthy, Soon is concerned that there could be an oversupply in the next few years when these new condos are completed.

David See, senior associate director of OrangeTee, who specializes in marketing units in District 16, is more sanguine. He reckons that, based on the bid prices by the developers, the new projects will be launched at higher prices.

For instance, the 343,171sqft Land Parcel A, located on New Upper Changi Road and Bedok Road, was put up for sale in August and won by Keppel Land last month with a bid of $434.55 million($791psf ppr). The price for the 99-year leasehold site paid by KeppelLand was just 7.1% higher than the second-highest bidder, a joint venture between Fragrance Group and World Class Land.

Incidentally, in August, Fragrance and World Class Land won the tender for a smaller parcel of around 150,700sqft across New Upper Changi Road, with a bid of $285.22 million ($676psf ppr). It is estimated that the new condo, called Urban Vista, will have 550 units, and it is expected to be launched in the coming months.

Keppel Land's bid price of $791psf ppr was a record price paid for a residential development land parcel in the suburbs, and is at a 48% premium to the price the Far East-Frasers Centrepoint-Seikisui House consortium paid for eCO's site in February.

Following the close of the tender for the site on New Upper Changi Roadon Oct 16, Joseph Tan, CBRE's executive director of residential services, commented: " The 11 bids garnered for the site and the quantum of the bids show that developers are confident that this residential project will be well received when launched."

Tan estimates Keppel Land's breakeven at $1,200psf, with the selling price of the new project pegged around $1,400psf, which is slightly higher than the average $1,300psf achieved at eCO so far. Keppel Landintends to develop a residential project with about 700 units on the site, with sizes ranging from 500 to 1,400sqft.

October home sales fall 25.7%

- November 15, 2012 No Comments

Sales of new private homes in Singapore declined by about 25.7% to 1,948 units in October, from 2,621 units in September, according to data released by the Urban Redevelopment Authority (URA).

URA said October's sales were led by the mass market segment which sold a total of 1,482 units.

Meanwhile, 144 new homes in the core central region and 322 new units in the city fringe were sold.

The top three best-selling private condominium projects in October were Skies Miltonia which sold 309 units, followed by Riversails with 271 units sold and eCO with 149 units sold.

Including Executive Condominiums (EC), 2,624 units were sold in October - down from 2,771 units in the previous month.

The star performers in the EC segment included Heron Bay at Upper Serangoon with 354 units sold and Waterbay at Edgefield Plains which moved 221 units.

Developers launched a total of 2,410 units of private homes and ECs in October.
Source: Channel News Asia

The new private home sales for August was down 3.6% while September sales was up 84%. And now October sales showed a 25.7% decline. This makes the wife and I wonder if the "see-saw" pattern will persist or will November buck the trend?
Click on links below to read our previous posting on the August & September sales data:

Property Spotlight: Tanah Merah vicinity (Part 1)

- November 14, 2012 No Comments

The District 16 neighbourhood in the vicinity of Tanah Merah MRT station has seen a surge in activity, owing partly to the sale of three government land parcels and the launch of eCOon Bedok South Avenue 3.

The developers of eCO are a consortium made up of Far East Organization, Frasers Centrepoint and Sekisui House, which won the 308,330sqft, 99-year leasehold site with a bid of $345.9 million ($534psf ppr) in February. The consortium launched eCO in late September and, as at Nov 6, 547 units of the 620 released in the project had been sold at an average price of $1,300psf. eCO comprises a mix of five residential types, with 244 condo units, 237 suites, 220 SOHOs, 17 lofts and 34 townhouses.

The take-up in eCO has been strong, and prices achieved have also set new benchmarks for the area. Based on caveats lodged between Oct 19 and 25, transaction prices had ranged from $1,172 to $1,491psf.

Most potential buyers of eCOhad initially compared the project with Optima @Tanah Merah, which was completed earlier this year and is adjacent to Fragrance and World Class Land's Urban Vista. The 297-unit Optima was launched for sale in 2009, and most of the units were snapped up within three days at an average of $810psf. The project is developed by TID, a joint venture between Mitsui Fudosan and Hong Leong Group. In recent sub-sales done in October, prices of units ranged from $1,027 to $1,350psf.

Most recently, on Oct 23, an 850sqft, two-bedroom apartment on the sixth floor changed hands for $1.1 million ($1,294psf). The previous owner had paid $748,000 ($880psf) for the unit at launch and had enjoyed a price gain of 47% over the last three years. A similar-sized unit on the 11th floor was sold for $1.02 million ($1,199psf), compared with the original purchase price of $804,800 ($946psf).

Meanwhile, two larger units at Optimawere also transacted recently in the secondary market. According to Dan Soon, associate branch manager of PropNex Realty, which brokered the sale of the units, sellers are pegging their asking price to those achieved at eCO. For instance, Soon had brokered the recent sale of a 1,259sqft three-bedroom unit on the sixth floor of one of the blocks at Optima for $1.7 million ($1,350psf). The original owner paid $1.04 million ($828psf) for the unit three years ago, thus seeing a capital appreciation of 63%. The other one sold was a slightly smaller three-bedroom unit of 1,195sqft located on the third floor of another block. It went for $1.5 million ($1,255psf). The previous owner purchased it for $955,200 ($799psf) in 2009, so his capital appreciation was 57%.

"Increasingly, more young couples are looking for small units below $1.2 million in the East,"  observes Soon. The area has also attracted more expatriates, as it is near Changi Business Park, where banks such as Citi, DBS, Standard Chartered and Credit Suisse have their global support and backroom services. The Singapore University of Technology and Design coming up near Changi Business Parkis also a draw. With amenities such as the upcoming Bedok Mall, the new Changi City Point mall and the proximity to MRT station, the area has become a more desirable neighbourhood to live in, adds Soon, with cheaper rents relative to the CBD.

Older condos in District 16 have also seen their prices being driven up by the new launches. PropNex's Soon observes, however, that there have been fewer transactions in these older developments, as many owners are reluctant to sell. "Once they sell their unit, it is difficult for them to find a replacement property in the same neighbourhood, as the newer units cost more and are generally more compact in size,"  he says. Besides, most of them are owner-occupiers, so there are also few units for rent in the older condos.

Most of these older condos are trading in the $1,000psf range or lower. For instance, at the eight-year-old Tanamera Crest, a 288-unit, 99-year leasehold condominium developed by CapitaLand, a 1,173sqft three-bedroom unit on the 10th floor changed hands at $1.09 million ($927psf) on Oct 19. It last changed hands in February 2010, for $735,000 ($626psf). Prior to that, it was sold for $460,000 ($392psf) in 2006. The original buyer paid $593,800 ($506psf) for the unit in late 2001.

At the 1,038-unit The Bayshore, developed by Far East Organization 13 years ago, a 1,184sqft three-bedroom unit on the 10th floor was sold for $1.16 million ($980psf). Also, a 1,012sqft two-bedroom unit on the 28th floor of another block was sold for $1.1 million ($1,087psf).
{To be continued...}


So how many private properties were bought in 1H2012?

- November 12, 2012 No Comments

The total number of private residential properties bought was about 22,000 in the first half of 2012, as compared to 19,000 in the first half of 2011 and 17,000 in the second half of 2011.

National Development Minister Khaw Boon Wan said this in a written parliamentary response to a question by MP for Pasir Ris-Punggol GRC, Gan Thiam Poh.

He said cooling measures introduced in January last year aimed to eliminate speculative demand and are complemented with an aggressive supply ramp up.

Over the next five years, about 94,000 housing units will be completed.

This is about one-third of the current stock of private housing.

Altogether, the measures have resulted in the increase in the Property Price Index to fall from 18% in 2010 to 6% last year.

And it has gone down even further to just 1% in the first three quarters of 2012.

Mr Khaw said the proportion of properties bought by foreigners also fell from 18% last year to six 6% in the first three quarters of this year.

He added that the proportion of sub-sales, a proxy of the level of speculation in the housing market, remained low at about 6% in the first three quarters of 2012, down from the 8% last year.

However, Mr Khaw said prices remained firm and he attributed this to contributory factors including ample global liquidity and the current low interest rate environment which are likely to persist for a while.

He said his ministry is ready to act when necessary.
Source: Channel News Asia

Resale home prices continue to rise in Oct 2012!

- November 9, 2012 No Comments

Resale home prices of  non-landed private residential units  continued to climb in October against the third quarter 2012.

Data released by the Singapore Real Estate Exchange (SRX) showed that the unit resale price for non-landed private residential rose 4.1% in October to $1,209psf.

SRX compiles data from 11 top property agencies in Singapore.

The report found that resale prices of private homes rose across all regions, with non-landed homes in the city fringe seeing the sharpest increase at 4.5%, compared to the third quarter of 2012.

This is followed by a 4.2% increase in the suburban areas, and a 1.8% increase in the core central region.

SRX noted that the price gap between non-landed private homes in the suburban areas and those in the city has narrowed to a new low of 84.8%.

"I think the price premium between the CCR and OCR will continue to narrow in the next one year," said Eric Tan, the CEO of GSK Global.

"Subsequently, I think it will remain relatively stable at around 70% in the medium term."
Source: Channel News Asia

Reverse mortgage for better retirement?

- November 8, 2012 6 Comments

The TODAY paper ran an article today about how the very loans that are supposed to help seniors in the United States to stay in their homes are in many cases pushing them out.

Reverse mortgages, which allow homeowners aged 62 and older to borrow money against the value of their homes and not pay it back until they move out or die, have long been fraught with problems.

But federal and state regulators are documenting new instances of abuse as smaller mortgage brokers, including former subprime lenders, flood the market after the recent exit of big banks and as defaults on the loan hit record rates.

Some lenders are aggressively pitching loans to seniors who cannot afford the fees associated with them, not to mention the property taxes and maintenance. Others are wooing seniors with promises that the loans are free money that can be used to finance long-coveted cruises, without clearly explaining the risks.

Concerns about the multibillion-dollar reverse mortgage market echo those raised in the lead-up to the financial crisis when consumers were marketed loans - often carrying hidden risks - that they could not afford.

Although the numbers of reverse mortgages have declined in recent years, the rate of default is at a record high - roughly 9.4% of loans, according to the consumer protection bureau, up from around 2% a decade earlier.

Used correctly, reverse mortgages can be a valuable tool for seniors to stay in their homes and gain access to money needed for retirement. But since the financial crisis, the reverse mortgage market has been in flux, dampened by a drop in property values, complaints about the loans and the recent departure of big lenders. Into the void left by the big banks have moved smaller mortgage brokers and lenders. Some, steer seniors into expensive, risky loans with deceptive sales pitches and high-pressure tactics. Reverse mortgages also have troublesome incentive structures that might encourage brokers to steer seniors toward lump-sum loans, which carry a fixed interest rate, rather than a line of credit with a variable interest rate, the bureau found.

In a lump-sum arrangement, the interest charges are added each month, and over time the total debt owned can far surpass the original loan.

The newspaper report has gotten us curious about reverse mortgage in Singapore, so the wife and I decided to do some digging. The product was first available in Singapore in 1994 when NTUC Income introduced the scheme for private property owners. Shortly after HDB relaxed its regulations in March 2006 to allow elderly HDB home owners to take up reverse mortgages on commercial terms offered by banks and financial institutions in Singapore, NTUC Income also launched reverse mortgages on HDB flats.

Despite the supposed merits of such loan, reverse mortgage has also been known to go very wrong. One such example was a lawsuit brought against NTUC Income in 2009 by a couple over a reverse mortgage deal in which their property was sold amidst falling property prices. NTUC Income demanded repayment of a loan procured in 1997 under a reverse mortgage, and the couple claimed they had to sell their home to repay it.

The couple claimed that the 1997 reverse mortgage valued their house at $2.1 million, and based on a loan to valuation ratio of at most 80%, they were given $495,000 cash to pay off their previous mortgage and payments of up to $2,000 a month.

In May 2004, the couple were told the value of their house had dropped to $1.1 million and they were in breach of the 80% loan to valuation limit, based on the outstanding loan amount of $926,000.
According to the couple, they were told to top up $46,400 to bring the ratio down to the 80% limit, and their monthly payments of $2,000 were reduced in steps to $1,500 from October that year.

A year later, in October 2005, NTUC Income said the outstanding loan, at $1.014 million, exceeded the 80% limit based on the property value of $1.15 million. The couple were told they would get just $300 a month until June 2006, after which the company would 'exercise (its) right to recall the property for auction sale'. The couple could also procure a buyer on their own or find another place to stay, according to a letter from NTUC Income, the couple said.

By then, the couple had owed $1,045,802.91. On June 2006, solicitors for NTUC Income sent the couple a letter demanding repayment or else face legal proceedings.
The couple handed over possession of their property on Aug 2006. The property was later sold for just over $1 million, leaving an alleged shortfall of about $55,000, which the couple were asked to pay. They claimed that if not for NTUC Income's letter, they would not have sold the property - which in 2008 was again sold for about $1.5 million.

The case mentioned is probably a good reference for those who are thinking of taking up a reverse mortgage. If such loan is taken when the property market is buoyant, the borrower may risk having to "force sell" their property when the market turns sour. For a product touted as a retirement tool, the wife and I definitely do not think it's as safe as they are made out to be. It may well be better off for seniors to fund their retirements through proceeds from "downgrading" to a smaller/less expensive property.  

As to the outcome of the lawsuit between NTUC and the couple, we are unable to find any verdict on the case. So if any of our readers know, do share!

New versus resale prices narrowed but trend expects to reverse!

- November 6, 2012 4 Comments

New private homes typically cost 20% more than resale homes, but analysts say this price gap has since narrowed.

Entering into the fourth quarter, new private developments now command just a 4% premium over resale private units, according to data compiled by the Singapore Real Estate Exchange (SRX) which collates transactions by major property agencies accounting for 80% of the private sales market.

This premium is expected to increase as developers price in the higher cost of land in their new launches.

When it comes to new private homes, analysts say it's a buyers' market.

And that's why developers have been pricing new private homes "competitively" with marginal increases.

As a result, prices of resale units started catching up earlier this year.

By the third quarter, the median prices of resale homes reached $1,163.45psf, 1% higher than new homes.

According to experts, resale units are usually near well-established amenities because they are in well-established estates. They are also bigger, in better locations and possibly have ready rental income from existing tenants.

Going into the fourth quarter, some analysts say prices of new private homes have recorded a premium of 4%. This works out to a median price of $1,261.24psf for new private homes, compared to a median price of resale homes at $1,204.50psf.

Lee Sze Teck, Senior Research Manager at DWG, said: "The price gap is likely to widen. We think that the new home prices, perhaps the situation could be reversed. Now you can see a gap between new home prices and resale prices."

Going into 2013, industry observers expect new private home prices to be some 5 to 20% higher than resale units, as developers pass on higher costs.

Mohd Ismail, CEO of PropNex, said: "Based on the recent land bids, we have witnessed areas like Jurong and Tanah Merah - prices psf ppr by developer bidding exceeding $700. Which means that it will translate to sale prices next year, it will translate to $1,400psf - minimum. Though today's median's prices are only about $1,200 for new launches. It is expected to move upwards."

Still, higher prices of new homes are expected to boost the value of existing private developments in the same area. And while resale homes come with shorter land leases, the waiting time to move in is also shorter.
Source: Channel News Asia

Of the 5 or so properties that the wife and I have bought over the past 7 years, only one was brand new - we subsequently sold this a few months after the purchase for a small profit and are still kicking ourselves for doing so.

Other than the shorter waiting time to move in, one other advantage of buying resale versus brand new is the fact that you can really "see" what you are buying into, as opposed to buying purely via floor-plan or showflat, which can sometime go very wrong.

Property Spotlight: Novena area

- November 5, 2012 1 Comment

Subsale transactions are picking up at Viva. Located at Suffolk Walk, the freehold 235-unit condominium developed by Allgreen Properties recently obtained its Temporary Occupation Permit (TOP). The development consists of three 30-storey blocks of two- to four-bedroom units.
On Oct 5, a 1,346sqft three-bedroom unit on the seventh floor changed hands at $2.58 million ($1,918psf). The original owner bought it in September 2009 for $1.95 million ($1,449psf), thus realizing capital appreciation of 32% in three years. On Oct 8, a 1,324sqft three-bedroom unit on the 18th floor transacted at $2.84 million ($2,148psf). The original owner had purchased the unit for $2.08 million ($1,572psf) when it was launched in August 2009. The unit thus saw a capital appreciation of 36.6%. The price achieved on Oct 8 is also the highest psf price so far for a unit at Viva.

According to caveats lodged with URA, when Viva was launched, units were going for an average of $1,500psf. Nearby, at Khiang Guan Avenue, Lincoln Suites was launched in October 2009 at $2,800psf. The freehold 175-unit Lincoln Suites was developed by a consortium made up of Koh Brothers Group, Lian Beng Group, KSH Holdings and Heeton Holdings, and is expected to be completed in 2014.

Phylicia Ang, Savills' executive director, feels that both transaction at Viva are reasonable, considering that the units are freehold, located in prime District 11 and within walking distance from the Novena MRT station as well as shopping malls such as United Square, Velocity and Square 2. Vivais also the only freehold development in the Novena neighborhood that has been completed. Buyers generally prefer new developments, Ang says, adding that there is a good mix of local and foreign buyers looking for units in Novena for investment and personal use. The other significant freehold development is the 486-unit Park Infinia, developed by Keppel Land and completed in 2008.

With Viva newly completed, Ang expects to see renewed interest from buyers, and secondary market activity to pick up. She notes that the price achieved on Oct 8 is also a good deal compared with other developments in the Novena area that have a 99-year leasehold tenure. Soleil@Sinaran, for example, has been selling at $1,900psf, with some units surpassing the $2,000psf. Developed by Frasers Centrepoint, the 417-unit, high-end condo was completed early last year. Ang predicts that, when Lincoln Suites is completed, owners at Vivawill start pegging their selling prices closer to those of Lincoln Suites, which was launched later and priced higher, especially as the project contains compact apartments, which generally command a higher price psf.

Edward Lim, head of business unit at KF Property Network, who specializes in marketing units in Districts 9, 10 and 11, says in terms of location, Lincoln Suites is unmatched, as it is right next to United Square. Viva, on the other hand, distinguishes itself with its facilities, water features and quality finishing, he adds.

Units in the Novena area have seen good rental rates, says Savills' Ang. Units at Soleil@Sinaran, for instance, have been able to achieve rentals of between $5 and $5.50psf, and is popular with expatriate families because of its quality facilities and landscaping. She expects Viva to achieve a similar rental rate.

KF Property's Lim notes that rental yield in Novena, Newtonand Orchard has been hovering around 3%. "The rental yield is not very high, as there are many condos in the area competing for tenants,"  he says. He adds that buyers who are looking to invest in these areas should expect to hold them for the medium to long term to reap the returns of capital appreciation. Compared with Newton, Novena has also been more popular among buyers, as it has more amenities, says Lim.
Unfortunately the wife and I did not visit the showflats of Lincoln Suites and Viva. But we did see Soleil @Sinaran. You can click on the link below to read our review on Soleil:

Project Spotlight: Kovan Regency

- November 2, 2012 No Comments

Hoi Hup's Kovan Regency, consisting of 393 mixed condominium and strata-landed housing units, were among the top five best-selling projects in September.

The 99-year leasehold Kovan Regency has a wide range of unit types: one-bedroom (506 to 700sqft), two-bedroom  (624 to 775sqft), three-bedroom (893 to 1,389sqft), four-bedroom (1,281 to 1,507sqft) units, penthouses (689 to 2,260sqft) and strata terraces (3,692sqft to 3,864sqft). During its launch last month, it sold 369 units at a median price of $1,275sqft. In fact, over 90% of the units sold were done in the first weekend of private previews.
2-bedroom (624sqft)
3-bedroom (893sqft)
4-bedroom (1,281sqft)
According to Lisa Goh, property development manager of Hoi Hup, Kovan Regency's smaller units sold the fastest. Most of the buyers are locals who already own a landed property in the Simon Road area, observes Goh. She notes that there have been families who purchased several units on the same floor in order to live close to one another. While there have been a few investors, Goh says most of the buyers are getting the units for their own use.

The main attraction among buyers is Kovan Regency's proximity to the Kovan MRT Station. It's also located within walking distance to Heartland Mall and Kovan Hougang Market and Food Centre. Schools such as Paya Lebar Methodist Girls, XinminPrimary School, and Yuying Secondary Schoolare also nearby. The development will be completed in 2016.
The units still available at Kovan Regencyare five 4-bedroom penthouses (1,744 to 2,142sqft), one corner strata-titled terraced house (3,875sqft) and 11 other intermediate strata-titled terraced units (3,703sqft). There are a total of 15 strata terraced houses in the development, and they are all provided with a home lift. Goh believes that the terraces will appeal to foreign buyers. This is because URA has announced in April that it will no longer grant condominium status to developments containing a mix of strata-landed homes and apartments within the same development. This move was designed to close the loophole that has enabled foreigners to buy strata landed homes in such projects without gaining approval from the Land Dealings Approval Unit. Kovan Regency is one of the last few condos with strata-landed homes that foreigners are eligible to buy as it was one of the last few to secure planning permission before the new measure was introduced.

Kovan Regency is Hoi Hup's second launch this year. It launched the 99-year leasehold, 376-unit Sea Esta in Pasir Ris earlier this year. The development consists of one- to four-bedroom units and penthouses and is located close to White Sands shopping centre, Loyang Point and E!Hub Downtown East. According to Goh, there are 16 units left for sale at Sea Esta.

Singapore Residential Update (30-10-2012)

- October 31, 2012 No Comments

The good folks at Maybank-Kim Eng Research has published an update detailing the latest 3Q 2012 private homes statistics released by the URA. It also provided a rundown of the 6 rounds of property cooling measures that the Government have rolled out since September 2009 - a good summary for those who wish to know exactly what was implemented when.

Another interesting bit of information is the comparison of Additional Buyers' and Sellers' stamp duties that are currently being imposed in both Singapore and Hong Kong. It looks like our ABSD and SSD are getting some traction in other cities as well.

Click on the link below to read the full report:

3Q 2012 private home prices rose 0.6%

- October 29, 2012 No Comments

Singapore's private home prices in the third quarter rose 0.6% from the previous quarter.

This is the highest rate of increase this year compared to the 0.1% drop in the first quarter and the 0.4% increase in the second quarter.

It was also higher than the flash estimate of 0.5% released earlier this month.

Meanwhile, resale prices of Housing & Development Board (HDB) flats in Singapore hit a record high.

HDB's Resale Price Index (RPI) rose from 194 in the second quarter of this year to 197.9 in the third quarter.

This represents an increase of 2% over the previous quarter, the same as that of the flash estimate released on 1 October.

Growth for the first three quarters of this year is 3.9%. 

This is lower than the annual RPI growth of 14.1% in 2010, and 10.7% last year.

"With private property prices still rising, it's no surprise that HDB prices will follow suit," said Mr Chris Koh, housing analyst and director of Chris International.

"We saw quite a number of people who wanted to buy a property, aspired to own one, but when they could not afford it anymore, they instead decided to buy in the HDB resale market. They chose particularly larger flats: five-room flats, executive flats, and this could have pushed percentage prices up."

The volume of resale transactions also fell for the first time in 12 months. Resale transactions also fell by about 6% from 7,011 cases in second quarter to 6,560 cases in the third.

The last fall in resale transactions was in the third quarter of last year when transactions fell from 6,581 in the second quarter, to 5,903 in the third.

In the rental market, subletting transactions rose by about 4%.

The number of cases increased from 6,891 in the second quarter to 7,142 cases in the third quarter.
Source: Channel News Asia

The Real Deals (25-10-2012)

- October 26, 2012 3 Comments

It's all about HUDC in the latest issue of "The Real Deals" by Maybank-Kim Eng Research.

The report also highlighted Lakeview Estate, which should be a good candidate for redevelopment... technically that is.

It may surprise many that Lakeview is currently transacting at a discount of only 9.4% compared to the other private estates around the area. This is especially when Lakeview has no facilities other than a small playground. However, the estate is located near to (but far enough away from all the traffic noise) the main Upper Thomson Road and within walking distance to Marymount MRT station. There is also unconfirmed report that an access to the new Thomson Line will be built relatively close to the estate.

But what is most appealing about Lakeview (at least in our opinion) is its proximity to FOOD - there are options aplenty that are almost at your doorsteps so you will never ever go hungry. Families with school kids will also appreciate the various enrichment schools that are located along Upper Thomson Road. And for those who loves greenery and nature, Lakeview is situated right next to the Macritchie Reservoir and its forest trails. Matter of fact, one can access these directly from within the estate!

Given the supposed excellent location, why did the wife and I say that the en bloc potential of Lakeview is only "technically" good? We understand from very reliable sources that the bulk of the residents within the estate are elderly folks who have lived in Lakeview for tens of years. Many are even first owners! As such, it will be extremely challeneging to entice these group of people to vacate the estate. And one cannot underestimate the power of sentimental values especially with the older generation.

However, we feel that it may not be all bad if Lakeview does not go en bloc within this boom cycle (or whatever's left of this boom cycle, that is). There are no that many plots of vacant land left around the area that the Government can put out for sale. One such is a plot directly in front of Lakeview, which should be considered prime land (given its location). And if this plot is sold and a new condo project is built at this site, it should benefit residents of Lakeview as the values of their apartments will most definitely appreciate (remember Sky Habitat?). And once the supposed "nearby access" to the Thomson Line is confirmed, the site that Lakeview currently sits on will definitely be worth more than what it can fetch currently (think Thomson View Condo).

So we reckon Lakeview will probably be better off waiting a couple more years before they decide to do a collective sale... in our humble opinion, of course.

Click on below to read the Maybank-Kim Eng report:

New project sales status: eCO & Sky Green

- October 24, 2012 4 Comments

According to a Channel News Asia report, 515 units out of the 603 units released at eCO condominium project have been sold within a month. They were launched for sale on September 22.

The 748-unit development, located at Bedok South is a joint venture between Far East Organization, Frasers Centrepoint and Sekisui House.

The developers said all 240 two- and three-bedroom condominium units have been sold out.

Meanwhile, about half of the SOHO and suite units were snapped up, mostly by buyers aged 30 to 49 years.

In a joint statement released on Tuesday, the developers added that over 90% of the buyers were Singaporeans or Singapore Permanent Residents.

And majority of the buyers are living in the Bedok, Chai Chee, Marine Parade, and East Coast districts.

Prices for units at eCo start from $810,000 for a one-bedroom suite.

The project is estimated to be completed in 2017.

And in a separate report, Sky Green condominium, located along MacPherson Road, has seen strong buying demand.

About 80% of the 176 units available at the freehold development have been sold during its soft launch, according to the consortium behind the project.
The consortium comprises Heeton Holdings, KSH Holdings, TEE International and Zap Piling.

In a statement, the consortium said the units were sold at an average price of $1,502psf and the buyers were mainly Singaporeans.

The official launch of the development will take place next weekend.

Sky Green is expected to be completed in 2016.

Below are the project details for Sky Green for those who are interested:

Project:                    SKY GREEN
District:                   13
Address:                  570 MacPherson Road
Tenure:                   Freehold
Site Area:               66,928sqft
No. of Units:          176
Expected T.O.P:    2016

Unit Type                         Floor Area (sqft)
1-Bedroom                           441 - 624
1+Study                                474 - 721
2-Bedroom                           614 - 990
3-Bedroom                        1,152 - 1,163
4-Bedroom (dual key)             1,496
3-Bedroom (penthouse)    2,207 & 2,293
4-Bedroom (penthouse)          2,906

Shoeboxes: Challenging times ahead..?

- October 23, 2012 No Comments

Sales of small private apartments, commonly known as shoebox units in Singapore, have taken a downward turn. Data compiled by analysts show that new sales fell about 57% in September from the previous month to 99 units.

The fall in the sale of shoebox units occured after the government announced that it will moderate the number of shoebox apartments entering the market.

Analysts said buyers are now taking a "wait-and-see" approach in response to the measures. This caused new sales of shoebox units to drop across the board last month.

Vicinities under the "Outside Central Region" category were hit the hardest, with sales falling some 80% to only 24 units sold in September. This is also the region where the new government regulations apply.

On September 4, the Urban Redevelopment Authority (URA) issued new guidelines that capped the total number of units that can be built on a site for non-landed private residential developments outside the Central Area. The new rules are to curb developers' enthusiasm to build shoebox units in 'suburban neighbourhoods' which are largely designated for families.

But analysts said the impact on buyers' appetites are only temporary. They said shoebox unit buyers are largely investors, and they may bounce back more quickly after each round of cooling measures introduced by the authorities.

Alan Cheong, director of research and consultancy at Savills, said: "Although we have one or two stories where people have decided to put off their purchases, we believe the market will revert to some sense of normalcy in a shorter period of time than it had been for the past five rounds of cooling measures.

"People have now got used to measures being thrown into the market, every year probably two or so."

Analysts added that recent launches in the last three months like Sky Green, Parc Centros and Skies Miltonia, still reflect "brisk" demand.

Sky Green, located in McPherson, sold all 68 studio units within a single day during its pre-launch last week. Parc Centros in Punggol and Skies Miltonia in Yishun, have sold out 88% and 75% of their units respectively.

They added that this trend is unlikely to change as long as investors hold enough cash to splash around.

Mohamed Ismail, CEO of PropNex, said: "They sell mainly because of two reasons. One being the fact that the quantum of such properties are relatively low, coupled with today's liquidity and low interest rate."

Moving forward however, analysts said the appeal of holding a shoebox unit as an investment is likely to wane.

Eugene Lim, key executive officer of the ERA Realty Network, said: "I think buyers are becoming more aware that there is actually a huge supply that is going to be completed in 2014, 2015. And that would mean this would put pressure on rental. It is this type of investments that is actually losing flavour."

About 11,000 shoebox units are expected to hit the market by 2015.
Source: Channel News Asia

Property spotlight: Toa Payoh

- October 21, 2012 No Comments

Located close to the Toa Payoh MRT station and within a 15-minute drive to Orchard Road, two private condominiums, Oleander Towers and Trellis Towers, both of which are located along Lorong 1 Toa Payoh, have seen a pick-up in buyer interest.
Oleander Towers is a 318-unit, 99-year leasehold condo developed by Wing Tai Holdings and completed in 1998. The project contains a mix of two- to four-bedroom units and penthouses. A 1,464sqft, four-bedroom unit on the 21st floor of the development changed hands at $1.55 million ($1,059psf) in late September. The original owner had purchased the unit in 1998 at $1.19 million ($815psf).

When Oleander Towers was launched in the peak of the property boom of 1995/96, prices had averaged $800psf, says Kelly Ye, executive advisor, Knight Frank Property Network. Although the price was considered high at the time, the units were quickly snapped up as it was the first private condo launched in Toa Payoh, an established HDB state located in the city fringe, recalls Ye. In the last two years, she has brokered the sale of 10 units in Oleander Towers on the resale market, and she sees a good mix of investors and end users.

Given the strong reception to OleanderTowers, property giant City Developments Ltd (CDL) launched Trellis Towers towards end-1996. The 384-unit freehold Trellis Towers is located just across the street from Oleander Towers. Given its freehold tenure, the condo was launched at an average price of $900psf, although there were some high-floor units that crossed the $1,000psf level.

The launch of Trellis Towers took place just a few months after the government introduced anti-speculative measures on May 15, 1996. These included stamp duty, capital gain tax for those who sold within the first three years of purchase and a cap on the borrowing limit of up to 80% loan-to-value ratio.
Completed in 2000, Trellis Towerscontains a mix of studios, two- to four bedroom units and penthouses. Most recently, an 840sqft, two-bedroom unit on the 27th floor of Trellis Towerschanged hands for $1.22 million ($1,453psf). The unit was transacted twice prior to this. The first time was in December 1996, when the original owner bought the unit from the developer for $882,570 ($1,051psf). It was sold in March 2006 for $638,000 ($760psf).

While Trellis Towers appeals to both investors and owner occupiers, interest is tilted towards investors because of its freehold tenure, says Ethan Ang, senior associate manager, C&H Properties, who specialises in marketing units in District 12. Oleander Towers, on the other hand, appeals mainly to young families with school going children, given its proximity to CHIJ Toa Payoh Primary and Secondary School. Pei Chun Public School, located in Lorong 7, is also nearby.

The latest private condo in Toa Payoh is the 99-year leasehold Trevista, launched in August 2009 - a good 13 years after the first two were launched. The condo is made up of three 39-storey towers and has a total of 590 units. The development is located at the junction of Lorong 2 and Lorong 3 Toa Payoh, and is a little further from the Toa Payoh Hub and Toa Payoh MRT station compared with OleanderTowers and Trellis Towers.

However, there was strong interest when Trevista was launched due to pent-up demand. At the preview, 410 of a total of 460 units were snapped up at prices averaging $898psf, which were then adjusted to $920psf as higher floor units were released.

"We were afraid that response at Trevista would be poor as the preview coincided with the Hungry Ghost Festival," recounts Ye, who was one of the marketing agents of Trevista when it was launched.

Singaporeans made up the majority of the buyers at Trevista. The project was developed by NTUC Choice Homes and completed last year. Resale transactions last month saw units changing hands at prices ranging from $1,227psf for a 1,141sqft second level unit to $1,631psf for a 463sqft studio unit on the sixth floor.

Given that it's the newest private condo in Toa Payoh, Trevista is said to have the most up-to-date facilities among the three, says C&H's Ang. The development contains three swimming pools, sauna, steam room, putting green and rock-climbing wall.

With only three private condos in the area, demand for units has so far outstripped supply, observes Knight Frank's Ye. She adds that most investors prefer smaller units as it is easier to rent out. Most of the enquiries from investors are for the two-bedroom apartments.

Toa Payoh these days sees a good mix of local and foreign investors. Most of the foreign investors come from Chinaand Indonesia. Anecdotal evidence is that an Indonesian national turned Singapore Permanent Resident is one of the most active investors in Trellis Towers, having accumulated units as and when they come on the market. She is said to invest exclusively in Trellis Towers when it comes to Toa Payoh given the good layout of the units, notes Ang.

Rental yields of private condos in Toa Payoh today are hovering around 4%, he estimates.

The area has been on investors' radar of late as the mature estate is located right at the city fringe, and is within a short distance of Orchard Road and the CBD. "Renting a studio apartment in the Orchard area is around $5,000 a month," says Ang. "For the same rent, you can get a three-bedroom unit in Toa Payoh."

The wife and I had actually seen several 4-bedder units at Trevista after the development received its TOP. While we quite liked the apartment layout and finishing, we found the bedrooms too small for our liking. In addition, we found the bay windows within the master bathroom a tad too exposed especially for those facing opposite units (unless you enjoy being the exhibitionist). So window-blind makers should have a field day at Trevista.

Click on link below to read our review on Trevista: