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New project sales status: Watertown, The Hilier & Parc Rosewood

- January 31, 2012 4 Comments

Far East Organization, Fraser Centrepoint and Sekisui House continue to achieve impressive sales at Watertown in Punggol, moving 148 more units over the weekend. They have now sold 744 units in the project since Jan 18.

Transacted prices range from $980 to $1,500psf.

So far, 901 of the project's 992 units have been released. The most popular are the one and two-bedroom suites (527 - 646sqft) and the two- and three-bedroom units (904 - 1,259sqft). All 385 suites have been sold. 90% of the project's buyers are Singaporean.

Market watchers credit strong sales to the developers' marketing strategy, offering much-coveted waterfront living integrated with a mall (Waterway Point) and the Punggol MRT Station.

The Hillier
Far East Organization found buyers for another 26 residential units over the weekend, taking total sales to 386 units. It has released 479 of the project's 528 units. The most popular are one-bedroom Soho-style apartments (506 - 624sqft). Singaporeans account for over 80% of buyers.

Parc Rosewood
Fragrance Group and World Class Land have sold 181 units at Parc Rosewood condo in Woodlands since Saturday. The average price is $960psf. The five-storey, 99-year leasehold project will have 689 apartments.

A good mix of units - one, two and three bedders - have been taken up. Singaporean are believed to account for 80 - 85% of buyers, with permanent residents making up the rest. Buyers comprise singles, young couples, families and investors - some living in the surrounding Woodlands area.
Source: The Business Times

So whose afraid of the (supposed) impending private-home market slowdown..?

And speaking of "pent-up demand"...

- No Comments

Reference: "Why property prices will remain high"- The Straits Times Forum, 31st Jan 2012

The wife and I have a slightly different take on the matter:  According to the data provided, some 128,896 private homes were available for sale duirng the period of 1995 to 2010. And since population of citizens and permanent residents during the same period had supposedly expanded by some 216,628 households, the resulting "pent-up demand" for private home ownership should easily have absorbed all private homes available during the period. But reality of the matter is that 39,184 homes remained unsold as at end of last year.

Some may attribute the unsold units to "apartment type mismatch" or "pickiness of home buyers", but perhaps a fairly significant percentage of the increased households between 1995 - 2010 are not really in the market for a new home or prefer to go on rental instead?

So the question really becomes: Is the high property prices seen over the past 2 or so years really due to genuine pent-up demand (i.e. new households that need to buy a home to live in) or is it more a function of greed (i.e. despite the already high prices and cooling measures, there's still money to be made in the property market)?

We could jolly well be wrong of course...


So is stamp duty rebate legal..?

- January 30, 2012 6 Comments
This article appeared in The Straits Times forum page today.

Reference: "Is stamp duty reimbursement by property developer legal?" - The Straits Times Forum, 30 Jan 2012

While pondering over the questions raised by Samuel, the wife and I also wondered about "Free COE" offered by some car dealers and "GST Rebate" by retailers. Should these practices be deemed illegal as well?

And in all fairness, the stamp duty reimbursement by FEO (as we understand it) is offered not just to foreigners but for all buyers. However, we are unsure if foreigner gets a larger stamp duty rebate so maybe Sanuel knows something that we don't. (* would anyone from/marketing for FEO care to comment? *)

Here's our "2 cents" on the matter: Rebates that allow sellers (irrespective of product) to prop up their prices artifically should be prohibited. Any discount given should be straight off the selling price so that it is transparent to all parties concerned.


End of the private property "bull run"? (Part 2)

- January 29, 2012 1 Comment

Price declines could be exacerbated by the secondary market, where volumes have slowed down more sharply than in the primary market (that is, developer sales). The number of units (excluding executive condos, or ECs) sold by developers fell 2.4% from 16,292 units in 2010 to 15,904 units in 2011. However, the number of homes sold in the secondary market (resales and subsales combined) slipped 27.6%, from 22,608 in 2010 to 16,357 in 2011.

Developers are wooing buyers with nice showflats and appealing ad pitches. The ease of stretching out progress payments over a few years - compared with having to pay the full price upfront when buying a completed home in the secondary market - is another reason to buy a home directly from a developer.

DTZ's Asia Pacific research head Chua Chor Hoon said: "When secondary volumes come down, eventually it will affect prices. If demand slows down and sellers find it hard to sell after a few months hanging on to their prices, some owners will start to reduce prices. There will be more bargaining power for buyers as well as occupiers as rent start to ease."

URA stats also show that developers completed 12,469 private homes (excluding ECs), up 19.9% from the 10,399 in 2010. This has begun to weigh on residential rents, which are rising at a slower rate.

Savills Singapore expects a "mild correction" of 5% in rentals this year as more new apartments come on stream in the months ahead. It also expects the number of private residential leasing deals (excluding ECs) to hover around 45,000 in 2012, after hitting an all-time high of 45,062 leases last year. The figure for 2010 was 41,573.

"The strong 2011 showing may be attributed to Singapore becoming the preferred location among MNCs for their regional HQs. This has also attracted more senior and top executives to relocate here," said Savills' residential leasing head Patrick Lai.

DTZ's Ms Chua said rental pressure is greater in Core Central Region but this is likely to shift to Outside Central Region in three to four years due to expected completion of projects in suburban areas arising from the ramp-up in Government Land sales since the second half of 2010.
Source: The Business Times

End of the private property "bull run"? (Part 1)

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Prices rises for private homes almost ground to a halt last quarter while rental increases also tapered off. The latest official data has sparked a discussion in property circles on whether the market has peaked.

Most observers say that either the peak has already been touched, or will be touched very soon.

The Urban Redevelopment Authority's benchmark private home price index inched up just 0.2% quarter-on-quarter (q-o-q) in Q4 last year, its ninth consecutive quarter of moderation. For the full year, the index's 5.9% rise was a third of the 17.6% gain registered in 2010. The figures were identical to flash estimates released on Jan 3.

And for the first time since Q3 2009, the increase in URA's landed property sub-index was lower than that for the non-landed property sub-index. The landed sub-index rose just 0.1% q-o-q in Q4 2011, compared with 0.3% for the non-landed sub-index. In fact, for semi-detached houses, the price index actually fell 0.6% q-o-q in Q4.

" In that quarter, prices of semi-detached houses in the east fell 1.6% while those in the north-east softened by 1.3%. This shows that some segments of the landed market are facing stronger price resistance," says Credo Real Estate executive director Ong Teck Hui. " However, landed prices have risen 80% from the market trough in Q2 2009, outperforming the 48% increase for non-landed for the same period."

URA's overall rental index for private homes rose 0.4% q-o-q in Q4, or half the 0.8% rise it had posted in Q3. Full year 2011, the index was up 3.8% - a fraction of the 17.9% gain it had put on in 2010.

The outlook for private home prices look bleak. CBRE predicts a price drop of 5 - 15% this year, with luxury/prime properties taking the bigger hit and mass-market homes being the least affected.

Credo's Mr Ong says: " It's difficult for prices to regain momentum as the recently imposed ABSD (additional buyer's stamp duty) and the economic slowdown could ease demand. Sustained supply and competition among sellers will also keep a lid on prices."

Giving a different take, Savills Singapore research head Alan Cheong said: " We still believe it's difficult to conclude if we've reached an inflexion point, if any at all."

Mr Cheong cites the oligopolistic nature of the Singapore residential property market, with large developers with deep pocket who're likely to resist any price cut. " A cocktail of low interest rates till at least late-2014 (as pledged by the US Federal Reserve) and higher inflation will in due course reignite another round of interest in the residential market as it's deemed a good hedge against inflation," he said.

Credo's Mr Ong paints two scenarios. "In the best-case scenario, if the economic slowdown is milder than expected, then buying sentiment may remain positive, translating to sustained buying activity which will help to keep prices stable amid the build-up in supply. In the worst-case scenario, if there's a recession, we can expect demand to slacken, creating downward pressure on prices."

Lamenting the difficulty in making accurate predictions, Knight Frank chairman Tan Tiong Cheng said: "Each time after the government has announced cooling measures in the past two years, I thought the measures would be sufficient to cool the market. But things have turned out to be otherwise."

He admits the ABSD will have some effect in curbing investment and foreign demand for private homes. " Prices will come down - but to what degree before they go up again? What's the alternative for people with savings? Where should they put their money? If you believe in the longer term, property is as good a bet as any. After all, interest rates are expected to stay low for the next couple of years."
Source: The Business Times

{to be continued}

Tampines Trilliant: Another sell-out EC in the making..?

- January 27, 2012 No Comments

Large crowds turned up at the launch of the latest executive condominium (EC) on Friday.

Property developer Sim Lian Group said it hopes Tampines Trilliant, which is located in a mature estate, will attract couples who want to live near their parents.

But with prices as high as $971,000 for a four-room unit, will home-buyers be turned away?

The launch of Tampines Trilliant saw a large lunch-time crowd - most of whom were upgraders.

The 12-block executive condominium has 670 units for sale, comprising mostly three-bedroom units.

Prices start from $682,000 for a three-room unit and a whopping $971,000 for a four-bedroom unit.

Home buyers were mixed in their responses over the prices.

One said it was "a bit expensive", while another said: "For new launches, I believe the price is quite expected."

The property is located in the heart of Tampines, in the eastern part of Singapore, with amenities like malls, bus and train stations and even offices, nearby.

Orange Tee managing director Steven Tan said: "We expect the demand for the Tampines Trilliant to be very strong. The existing regional centre and MRT station are already strong pulling factors."

One real estate company said prices of executive condominiums are usually about 20% below those of mass market condominiums in the vicinity.

ECs were introduced to cater to Singaporeans, especially young graduates and professionals, who can afford more than an HDB flat but find private property to be out of their reach.

ECs are comparable in design and facilities to private condominiums as they are developed and sold by private developers.

ERA Realty group director Mark Teo said: "Although there will be a lot more supply of ECs coming into the market in the next six months to one year, we think that the demand for ECs will still be very strong.

"Many of us have the aspiration to live in a condominium that has facilities, so ECs actually fill this void."

A check shows that prices for the Trilliant are comparable to the Arc at Tampines, another EC in the area, which was launched late last year.

Prices there range from $700 to $800 psf.

Application for Tampines Trilliant ends on 31 January.
Source: Channel News Asia

Kim Eng Research: Price correction by mid-2012?

The rapid sales at developers' launches in recent weeks will not last, Kim Eng Research said in a report released yesterday, citing the potential supply of units coming on board and wider economic uncertainty.

These factors could lead to a correction in both average selling price and sales volumes by the middle of the year, it said.

Based on the sites sold under the Government Land Sales programme (GLS) that have yet to be launched, the brokerage estimates that the potential supply coming onto the market over the next 12 months stands at 12,248 condominium units, and 2,495 executive condominium units.

Coupled with a "daunting income and employment outlook" due to economic concerns, this could make upgraders more wary come mid-2012.

"That may then lead to the precipitation of mass market prices of up to 20% by end-2013. We also expect primary market sales to be reduced to 11,000 units per annum for 2012 and 2013," said Kim Eng.

In the meantime, home buyers and property developers are back in the market with a vengeance, just one month after the introduction of the additional buyer's stamp duty (ABSD).

Watertown, in Punggol Central, for instance, has sold more than 550 units of its 992-unit mixed-development project since its preview last week. The Hillier at Hillview, too, attracted strong demand, with units transacting at an average of $1,200psf.

"In the near term, demand for attractive suburban projects may continue to be supported by the benign interest rate environment, and our economists are not expecting interest rates to hike up markedly before 2H13," said Kim Eng.

Developers were also active in vying for well-located sites during GLS tenders: in particular, the two most recent tenders at Clementi Avenue 6 and Simon Road attracted eight and 11 bids, respectively.

The top bidder for the 99-year leasehold condominium site at Clementi Avenue 6 was IOI's property unit, Multi Wealth (Singapore), at $554.4psf ppr, while the site at Kovan Road/Simon Road was awarded to a consortium comprising Hoi Hup Realty, Investment Focus and Oriental Worldwide Investments, at $506.6psf ppr.

Industry players said that bids were within the current land price range for good suburban residential sites, and that attractively located sites will probably continue to draw strong participation from developers despite the uncertain market conditions and cooling measures.
Source: The Business Times

Click on link below to read the full report by Kim Eng Research:

The wife and I wonder if the recent hoo-ha about "strong take-up rate" (post ABSD) at selected  launches are boosted by the fact that developers have been rolling out projects in prime suburban locations (i.e. with integrated malls, near to Town Centre and MRT Stations etc).

If we are property developer ourselves (one can always dream!), we will also milk the current market to the last drop with our best sites. These then set a benchmark for other "less attractive" sites that we intend to launch around the area. And even if we have to sell at a bigger discount on the later projects when the market turns for the worse, we would have already made a killing on our earlier "prime" launches... not to mention the super-normal profits that we have accrued over the past years!

And while reading the Kim Eng report, the wife and I cannot help but notice the interest rate projections for this and next year. Some may call it "benign" but we rather see it as a false sense of security with deterimental consequences...

Below is an entry that we have posted earlier this month on the likelihood of mortgage rate increases in 2012 and its implications:

More new launches coming our way!

- January 26, 2012 2 Comments

A string of property launches are just around the corner as developers cash in on the current strong home buying momentum created by the release of Watertown condo in Punggol.

These include Parc Rosewood in Woodlands and The Tampines Trilliant executive condo (EC), which are scheduled to be rolled out later this week.

Another EC project, Twin Waterfalls near Punggol MRT Station, is expected to go on the market next month. Market watchers are also awaiting the release of The Bartley Residences, a 702-unit, 99-year leasehold private condo next to Bartley MRT Station.

Parc Rosewood
This week, Fragrance and World Class Land are slated to release Parc Rosewood along Woodlands Avenue 2/Rosewood Drive. The average price for the five-storey, 99-year private condo is expected to be slightly above $1,000psf. The project's 689 units will be mostly one and two-bedders, although the condo will also include some three bedders. One-bedders start from 431sqft.

Word on the street is that starting prices will be nearly $400,000 for one-bedders, close to $570,000 for two-bedders and slightly below $800,000 for three bedders.

The Tampines Trilliant

Sim Lian's EC project The Tampines Trilliant is a stone's throw away from the upcoming Tampines Station on the Downtown Line. It will have 670 units in 12 blocks of 15 and 16 storeys. Sources suggest e-applications could begin as early as tomorrow. Pricing has yet to be finalised.

The majority of units will be either three bedders (127 units of between 872sqft and 1,141sqft) or three-bedroom-plus-utility units (397 units of 1,001 - 1,378sqft). remaining units are either four bedders (1,302 - 1,593sqft) or penthouses.

Twin Waterfalls
Frasers Centrepoint's Twin Waterfalls EC in Punggol will comprise 728 apartments in 17-storey blocks. Market watchers expect the average price to be slightly more than $700psf. Apartment sizes range from 914sqft for a three-bedroom compact to 1,378sqft for a four-bedroom dual key unit. There will also be penthouses of up to 1,928sqft.

Palm Isles
Frasers Centrepoint also has a 99-year private condo slated for release later this quarter or in early Q2 - Palm Isles at Flora Drive in the Upper Changi area. The seven-storey development will have about 450 units. Analysts reckon the average price could be around $900-950psf.
Source: The Business Times

So all we need now are more Singaporean buyers...

Relatives can wait, must make CNY visit to Watertown showflat first!

- January 25, 2012 2 Comments

It's the second day of the Lunar New Year and while most were out and about visiting friends and relatives, hundreds flocked to the Watertown showflat in Punggol Central.

The $1.6 billion project has attracted brisk sales since the launch on January 20, and 500 units out of 596 released have been snapped up (as at Tuesday 9pm).

Buyers made sure they took time off from visiting relatives and friends to check out the showflats.

A lady said: "We've done visiting already. So we wanted to do some shopping around for a house. The units have already been sold pretty fast, so we are trying to grab some opportunity and see if we can get some good deals before it gets fully sold."

A man said: "This Chinese New Year, we had some spare time and I think the Watertown project is exciting. Punggol is an up and coming town to be in. Look at the vibrancy here! It's a great place to be here on Chinese New Year!"

Another shared similar sentiments: "We took some time off from visiting friends and relatives just to take a look at Watertown because we thought we just come by and look at the showflat, and of course to check out the pricing as well."

Watertown is the first integrated waterfront development in Singapore.

It is situated directly above Waterway Point that will host popular shops, boutiques and Singapore's first basement cinema.

The 992-unit development comprises Suites, SOHO apartments, Sky Patios and Residences and the price ranges from $980 to $1,500psf.
Source: Channel News Asia

Looks like FEO is the first company to "Huat" in the year of the Dragon. Then again, it is supposedly a WATER dragon this year so go figure...

Minister Khaw: En-bloc Fever Receding?

- January 22, 2012 No Comments

The en-bloc fever seen in the housing market a few years ago appears to be receding and Minister for National Development Khaw Boon Wan said it could be a sign of a more stable property market.

In his latest blog post -- entitled "En-Bloc Fever Receding?" -- made on Saturday, he said this will be a good development for Singapore in the Year of the Dragon.

An en-bloc sale refers to the collective sale of units in a private development, by way of majority consent.

En-bloc was a major buzzword in the housing market six years ago.

But last year, only some 1,400 private housing units were sold en-bloc, a low number compared to the peak in 2007 when 5,860 units were sold.

Mr Khaw said such sales reached "feverish heights" in 2006 and 2007.

Then, a wave of collective sales swept through the market, peaking during the two years, when some 10,200 units were sold.

Mr Khaw said "this added stress to an already hot property market as housing units were removed.

"Displaced owners or tenants had to look for replacement properties to stay and invest in, pushing up property and rental prices."

Mr Khaw added en-bloc sales have their "pluses and minuses".

They can rejuvenate the city by removing old and dilapidated buildings but if done excessively, en-bloc activity can waste resources, if relatively new buildings are prematurely demolished.

One property watcher agrees the en-bloc market has been relatively quiet in the past two years.

He said one reason is a slowdown in the sale of high-end developments, which are typically built on freehold land acquired through en-bloc activity.

Another reason - the strong supply of government land for mass market properties.

SLP International executive director Nicholas Mak said: "Since a lot of the housing demand is in the suburban region, developers are actually earning fairly decent profits through some of these suburban condominiums, (so) land sales in the suburban region have actually taken away some of the developers' demand for land from the en-bloc sale market."

En-bloc sales of apartments usually spell huge windfalls for their owners.

For example, Henry Park Apartments were sold last month, and each apartment owner stands to gain $2.3 to $2.9 million in profit.

But the road to a successful en-bloc deal is often long and difficult.

In some instances, neighbours have turned against one another to get the requisite 80% signatories.
Source:  Channel News Asia

Gong Xi, Gong Xi, Gong Xi Ni..!

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The wife and I will be taking a short break to celebrate the festivities and partake in other leisurely persuits... OD-ing on Bak Gua and pineapple tarts, making some money (hopefully) from our friends at mahjong and blackjack etc...

We will resume posting next Wednesday (Jan 25th). Meantime, we wish all our readers an excellent Year of the Dragon ahead!


SSD: So who had taken the hit and bailed?

- January 21, 2012 No Comments
The latest issue of The Real Deals has provided some interesting insights on how the imposition of Seller's Stamp Duty (SSD) and its subsequent revisions have affected sellers who sold within a year of purchase.

And going by Kim Eng's figures, the total number of developers' unsold units has risen by over 1,100 in just one week!

The Real Deals (19-01-2012)

Mixed-use developments, anyone?

- January 20, 2012 No Comments
While the wife and I agree that having a mall and/or integrated access to Bus Terminal/MRT Station right below your apartment is definitely an attraction, we cannot help but wonder if such mixed-use development concept is sustainable.

If more developers latch on to the idea of  integrating a mall within their residential developments, the challenge is one of how to continually attract and retain the "right" retail tenant-mix to maintain the "attractiveness" of the projects. And not every new development can possibly be integrated with a Bus Terminal or MRT Station...

Reference: "Hot property: Mixed-use developments" - The Straits Times.


More on the December private home sales figures...

- January 17, 2012 No Comments
Notice how sales in 2008 dropped to 4,200+ units from the peak of 14,800+ units in 2007?

But it won't happen again, some said... The wife and I certainly hope they are right!

Reference: "Private home sales slide in December" - The Straits Times, 17 Jan 2012


Big slide in private home sales in December 2011!

- January 16, 2012 No Comments
Sales of new private homes in Singapore fell 62.9 per cent in December, based on latest data released on Monday.

The Urban Redevelopment Authority (URA) said a total of 632 units were sold last month excluding executive condominiums.

That's significantly lower than the 1,702 private homes sold in November.

Around 489 units were sold in the outlying areas or outside central region while 108 private homes were sold in city fringes.

Only 35 units were sold in the prime district.

The best selling projects were all located outside the central region: The Archipelago with 103 units sold, The Nautical with 84 units and The Palette with 61 units sold.

In December, developers placed 937 units of new homes for sale, compared to 1,967 units launched the previous month.
Source: Channel News Asia
The drop in December sales is hardly unexpected but the magnitude of the fall is somewhat a surprise. And given last month's dismal sales figure, it brought the total tally for 2011 to 16,025 - a tad shy of the 16,292 achieved in 2010 but still impressive nonetheless, considering the number of cooling measures that were introduced last year...

Click on below to read our previous post on the November 2011 sales figure:


Project Sales status: Riversound Residence, The Nautical & The Hillier

- No Comments

It's another weekend of "steady crowd, few buyers" again.

Riversound Residence
At Qianjian Realty's 590-unit Riversound Residence in Sengkang East Avenue, about 10 apartments were sold at an average price of $850psf, bringing total sales to more than 60 units since the project was launched the previous weekend.

Mr Zuo Haibin, teh firm's managing director, said the effect of the cooling measures had been keenly felt. Even though many people have expressed interest, few have made a firm committment.

"Our aim now is to sell about 60 to 70% of the 200 units that make up the project's first phase within three months. Had the measures not been implemented, we would probably have sold that many within a month," he said.

The Nautical
Hao Yuan Investment's 435-unit project in Sembawang Road, sold about 15 more units at an average price of $850psf over the weekend. Total sales thus came to about 150 units.

The Hillier
Far East Organization moved another 36 units at The Hillier, its 528-unit project in Upper Bukit Timah. The overall sales tally rose to 332 units, with the price averaging $1,205psf.

Source: The Straits Times

ABSD: More questions than answers...?

- January 15, 2012 6 Comments

Below appeared in Friday's copy of The Business Times.

Reference: ABSD: Questions that beg for answers

Those who follow our blog will probably know our stand on ABSD.

So after reading Mr Ku's article (which posed some rather valid questions), the wife and I have a few questions of our own:

1. Does having "the most open economy for international trade and investment" necessarily mean investment inflow/outflow should not be moderated, even if the market warrants it? Or does it actually points to the fact that Singapore still has the least barriers to entry (ABSD notwithstanding) and one of the most transparent market around the world?

2. Would the "crash" in 2008-2009 be less severe if the Government had acted in 2007 to moderate foreign purchases of private residential properties, possibly with the implementation of ABSD?

3. And given the lessons learned from the spectacular price surge followed by an equally spectacular fall in 2007 - 2009, do we really want to wait for "shit to hit the fan" (again) before we start thinking about remedial measures? Prices especially for mass market homes have already surpassed their 2007 peaks, while buyers remains undeterred even after the ABSD is imposed (read: The Hillier?). And even if the % of foreign purchases in 2011 is nothing like that of 2007, it remains a fact that such purchases contribute to the escalating prices.

4. Have prices of industrial properties or offices been rising anywhere as spectacularly as private homes? To be honest, we have not been following the latest developments in these real estate segments.

5. How many of the so-called "high-skilled foreign families" actually buy a home for themselves to settle down in Singapore for the long term, rather than renting and moving on once their employment contracts end or once prospects in their home countries (or abroad) are better?

Oh well, maybe we just think too much... Have a great week ahead!

$408 million top bid for Clementi GLS plot

- January 13, 2012 No Comments

A 99-year leasehold condominium site along Jalan Lempeng has attracted a top bid of $408 million in an eight-cornered bidding session among developers.

IOI's property unit, Multi Wealth (Singapore) Pte Ltd, was the top bidder for the residential land parcel, offering $554.41psf ppr, 13% higher than the next highest bid of $490.50 psf ppr by joint bidders UOL Venture Investments Pte Ltd, Singapore Land's SL Development Pte Ltd, and Kheng Leong unit Russville Pte Ltd.

The lowest bid of $260.1 million was put in by Soilbuild Group Holdings Ltd, translating to $353.44psf ppr.

Highlighting that the number of bids was within expectations, Lee Sze Teck, senior manager of research and consultancy at DWG, said: "The level of interest and price level indicate that developers think that demand in the mass market segment is still robust."

Mr Lee said the Clementi estate has not had a condominium project launch for many years and the site is likely to benefit from pent-up demand from residents residing in Clementi. He cited the recent DBSS project, Trivelis, as a "good example".

Credo Real Estate executive director Ong Teck Hui agreed, saying: "As expected, the more attractive GLS (government land sales) residential sites will draw more bidders with some being prepared to bid more optimistically than others.

"The subject site is a reasonable distance from Clementi MRT station, the bus interchange, and the amenities in Clementi Town Centre."

He added that there are relatively fewer GLS residential sites available in the west compared to other locations, especially the north-east and east where most of the tendered sites were located.

Consultants estimate the break-even point for the future development to be between $950 and $1,000psf and the selling price would likely be around $1,200 to $1,300psf.

With a total site area of 262,828.6sqft, the plot with a maximum plot ratio of 2.8 times can be built up to 735,920.1sqft and yield about 685 apartment units.
Source: The Business Times

Click on link below to read our previous post on this GLS tender.


HUDC - How it all began

- January 12, 2012 No Comments

Below is a short history on HUDC (article from The Straits Times today).

Reference: The story began in the 1970s

Everyone talks about HUDC but not many knew what it stands for. The wife and I certainly didn't... not even when the answer was staring right in our faces!

So we actually went to look it up and while searching for the answer, we came across this rather informative article on the history of public housing and thought we might as well share it with you.

Now to go get our eyes checked....


Property Spotlight: Bouna Vista area

- January 11, 2012 No Comments
The one-north area is coming alive with the opening of the One-North Circle Line MRT station and the recent completion of The Rochester, a mixed-use development by United Engineers with 366 apartments including SOHO-style lofts, a 271-room business hotel-cum-serviced suites called Park Avenue Rochester and a 10,000sqft mall called Rochester Mall. The 99-year leasehold development is also within walking distance of the Bouna Vista MRT station.

Retail and entertainment zone VistaXchange is located next door. Scheduled to open later this year, VistaXchange has a net lettable area of 164,906sqft and is developed by CapitaMalls Asia.

"There's a lot going on in the area and the newly completed projects such as The Rochester and One-North Residences are definitely bringing a buzz to the neighbourhood as residents move in," says Kelvin Tan, a property agent from One International Real Estate.

While the up-and-coming neighbourhood is seeing increased interest among local buyers, foreign buyers are shying away from making property purchases - largely in reaction to the government's property cooling measures introduced on Dec 8. The main deterrent is the additional 10% buyer's stamp duty imposed on foreigners buying residential property. "Foreign and PR investors have been showing very little interest, if any, in the one-north area since the new measures were implemented," says Alfie Isa, head of residential at Aptitude Real Estate Advisory.

Even though the residential market has turned quieter, there were still a number of transactions in the neighbourhood. At The Rochester, the most recent transaction was the sub-sale of a 1,032sqft two-bedroom unit on the 10th level, which changed hands for $1.8 million ($1,382psf). The seller had purchased it in August 2007 for $1.22 million ($936psf), thus making a 47.7% gain.

When The Rochester was launched in July 2007, units were sold at an average price of $1,300psf. Another new condominium in the vicinity, the 405-unit One North Residences was launched just a few months earlier in March 2007, and the average price then was $900psf. One-North Residences, developed jointly by UOL Group, Low Kheng Huat and Kheng Leong, was completed in 2009.

In December, there were three caveats lodged with URA Realis (as at Jan 4, 2012), and transaction prices ranged from $1,351 to $1,460psf. However, prices are still nowhere near the $1,680psf achieved for a 2,540sqft four-bedroom unit, which changed hands in a sub-sale at the previous peak in August 2007, nor the $1,625psf achieved when a 1,302sqft two-bedroom apartment was sold by the developer at the same time for more than $2.1 million.

The most recent transaction was the resale of a 980sqft two-bedroom unit for $1.4 million ($1,399psf). The seller purchased it in May 2007 for $920,000 ($939psf), making a 52% gain in less than five years. On the third level of the same block, a 1,033sqft two-bedroom unit changed hands for $1.3 million (1,258psf). The previous owner had bought it for $873,852 ($846psf) in September 2007, thus making a 48.8% gain.

Subsequent to the sale, a 1,109sqft two-bedroom unit on the eighth floor was transacted for $1.5 million ($1,375psf), the third time the unit has changed hands. The first owner bought it for $962,822 ($868psf) in April 2007, when the project was launched. He sold the unit two months later for $1.12 million ($1,008psf), a price appreciation of 16%.

Aptitude's Isa says the average asking price for One-North Residences is $1,400psf now, whereas it ranges from $1,350 to $1,500psf at The Rochester.

Prior to the government's cooling measures, many foreigners working at the Biopolis biomedical hub and at Fusionpolis, the infocommunication technology, media and physical sciences and engineering hub, at one-north had been interested in buying units at One-North Residences. "They were mainly looking to buy for their own [use], and therefore preferred new apartments," says Nicole Lim, senior team director at ERA Realty. "However, most of the units put up for sale at One-North Residences are already tenanted."

At One-North Residences, two-bedroom apartments fetch rental rates of about $5,000 a month. At The Rochester, two-bedroom apartments of a similar size fetch about $500 more, notes Lim. Generally, investors at both One-North Residences and The Rochester are looking at rental yields of 3%, she estimates. "While there's still interest, it's a little quieter now," she adds.

With new condos such as One-North Residences and The Rochester fetching $1,200 to $1,500psf, some investors are gravitating towards older condos in the area, where prices are still hovering around the $1,000psf range, notes Lim. Based on the lower quantum prices, the rental yields for such condo units in developments such as Normanton Park and Dover Parkview tend to range from 3.5% to 4%.

At the 686-unit, 99-year leasehold Dover Parkview, which was completed 15 years ago, the most recent transaction was for a 936sqft two-bedroom apartment that changed hands for $980,000 ($1,046psf). This is the third time the unit has changed hands. The first owner had bought it for $700,000 ($747psf) in October 1996 and sold it in June 2009 for $690,000 ($737psf). The most recent transaction of $1,046psf is one of the highest prices achieved in the condo so far. The highest average price achieved at Dover Parkview was last September, when a 936sqft unit changed hands for $1 million ($1,068psf).

Also at Dover Parkview, a 969sqft two-bedroom apartment changed hands for $904,500 ($934psf) in December. The previous owner had paid $632,000 ($652psf) for the unit in April 1996. One International's Tan, who brokered the sale of a unit at Dover Parkview recently, says most buyers do not mind the older condos in locations such as Dover Rise, as these units tend to be spacious and the absolute prices of about $1 million are also more palatable compared with those at newer condos. "The older condos represent value," he says. "Investors who want space but do not wish to overstretch their budgets are more inclined to buy units in older condos."

Another condo that is also favoured by investors is the 35-year-old Normanton Park. The 99-year leasehold condo is located off Ayer Rajah Expressway and near the Science Park. Based on the caveats lodged with URA Realis, the most recent transaction recorded was the sale of a 1,270sqft unit on the sixth level for $1.3 million ($992psf). The seller, who purchased it for $500,000 ($394psf) in September 1999, saw the price almost triple in just over a decade.

The wife and I recalled visiting the showflats of The Rochester when it was launched for sale back in 2007. Our memories of the visit are kind of fuzzy now but we do recall that we are not real impressed by the unit layout and the fact that a 1,300sqft unit hardly looked the size. It was also the first project whereby we were introduced to the concept of "no car park for apartment owners" - one will have to secure seasonal parking at the mall, which is subject to availability.

And while searching for pictures of the respective developments, we chanced upon this beautifully taken photo of Normanton Park by Ray Alvin. Enjoy!

Enbloc News: Royalville, Asia Garden & Jade Towers

- January 10, 2012 2 Comments

Royalville, a residential site located on Bukit Timah Road, is back on the market, with an asking price in the range of $320 million to $370 million.

In the last tender exercise conducted in July last year, the asking price was between $370 million and $400 million.

Assuming a land cost of $320 million, this translates to $1,312psf ppr.

Inclusive of the additional 10% balcony space, this translates to $1,197psf ppr, including an estimated development charge of $1.16 million, says marketing agent Credo Real Estate.

Royalville has a land area of approximately 174,176sqft, with a gross plot ratio of 1.4. It has an allowable building height of up to five storeys.

The tender closes at 2.30pm on Feb 15.

Asia Gardens
Asia Gardens, an 84-unit condominium development located on Everton Road, has an indicative pricing of between $302.6 million and $307.7 million. This translates to about $1,500 to $1,525psf ppr, based on GFA of 201,765sqft.

The plot has a site area of about 72,059sqft and is zoned "residential" with an allowable plot ratio of 2.8 under the 2008 Master Plan.

The tender for Asia Garden will close on Feb 29.

Jade Towers
Jade Towers, which is located along Lew Lian Vale, has an indicative guide price of $108.8 million to $110.8 million, which translates to $826 to $841psf ppr.

There are 72 apartments spread across two 10-storey towers. The site has an area of 92,412sqft with a plot ratio of 1.4 and can be reconfigured to accommodate GFA of 131,702sqft.

"With a near rectangular configuration, the site can be redeveloped into 101 new condominiums averaging 1,200sqft each," said marketing agent Savills Singapore.

The tender for Jade Towers will close at 3pm on Feb 16.

Source: The Business Times/The Straits Times


Our "Recommendations"

- January 9, 2012 No Comments

1. Renovating your apartment?  
The wife and I have re-posted some of our "experiences" on home renovations in our Forum page.
Hope you find them useful and feel free to contribute and share some of your own!

2. Enjoy Food & Travel?  
Here's a brand new blog that you should check out!


When then, Bradell View..?


So...only Bradell View remains "unprivatised".

Reference: "Potong Pasir HUDC blocks set to go private" - The Straits Times, 9 Jan 2012

The wife and I had posted an article back in August 2011 on the delimma (dilemma) that Bradell View faces with regard to privatisation - the main obstacle being that the estate is sitting on 2 separate land parcels with different lease expiry dates.

Click below to read our previous post on Bradell View:


SOR is soaring..!

- January 6, 2012 No Comments

A KEY interest rate that determines how much home owners pay on their mortgages is continuing to rise and is likely to increase further.

Borrowers could be facing hundreds of dollar a month in extra repayments in the wake of the steadily increasing swap offer rate (SOR) as the benchmark rate is called.

It was at 0.53428% yesterday - down a touch from the 23-month high of 0.56185 it hit on Dec 15 but still well above the rare negative level of -0.6987% it dived to in August.

The SOR has also increased more than the other key interest rate linked to mortgages - the Sibor (Singapore Interbank Offered Rate).

That was at 0.3985 yesterday, up 5 basis points since last August.

The weak Singdollar in recent months and rising borrowing costs amid the global credit squeeze are behind the SOR's rise of 1.23 percentage points since that low point.

Whatever the reasons, home owners with SOR-linked loans are facing repayments of about 50 basis points higher once the movement from the negative level is taken into account.

A borrower who took out a $1 million loan over 20 years back in August is now paying about $250 more a month in the first year on the initial repayment of $4,688.72, assuming no other charges to the conditions.

As the SOR has been increasing steadily since August, the monthly repayments would also have risen in tandem. The extra interest paid works out to around $5,000 a year.

In August, when the SOR went into negative territory, banks had to invoke special clauses to floor SOR rates at zero. Otherwise, they would have been in the strange position of having to pay borrowers for taking out a loan.

Only ANZ Bank and the Bank Of China offer SOR-pegged loans now.

The SOR is fixed daily by the Association of Banks in Singapore using a formula that takes into account the current and expected exchange rates of the US dollar against the Singdollar and the local interbank lending rates for the greenback.

OCBC Bank economist Selena Ling expects the SOR to keep rising, hitting 0.55% this year as the economic conditions will probably not change in the foreseeable future.

Mr Rohit Arora, Barclays Capital's emerging markets fixed-income strategist, thinks the SOR could even reach 0.7% by the end of the year if the euro zone crisis worsens.

Currency experts say that the Singdollar is likely to stay weak against the greenback for the first half of the year - just the sort of conditions that will keep the SOR trending up.

The US dollar is heading north because investors around the world are bailing out of almost every other assets and seeking safety in the old standby of the greenback.

UOB economists expect the Singdollar to fall to $1.33 against the greenback this quarter, with more declines in store in light of the global economic woes.

UOB economist Chow Penn Nee said: "We think the unresolved crisis in the euro zone will continue to weigh on the Singdollar and will be the key factor in guiding (its) direction."

"So far, European Central Bank measures, such as providing liquidity for banks to participate in European sovereign debt, are only stop-gap measures, which do not solve the debt problems."

But home owners who have a loan pegged to the SOR should not rush to refinance as they may incur additional administrative costs.

Mr Vinod Nair, chief executive of, which offers home loan comparisons, said: "My opinion is that if they are on SOR, they should stick to it because the SOR is still at an acceptable rate."

Mr Nair advised that only when the difference between the SOR (now at 0.53428%) and the Sibor (now at 0.3958%) exceeds 0.5 percentage points should homebuyers look for alternatives.
Source: The Straits Times

Back in August 2010 when SOR was hovering around negative territory, the wife and I were cautioning anyone who bothered to listen that the low interest rates are not sustainable. We also raised concerns about possible rate hikes in the foreseeable future . But some of our friends (esp. those who had taken a second SOR-based home loan for their investment property) had waved off our concerns. How high can the rates possibly go given the low base-level, they said. It'll be silly not to take full advantage of the "cheap money" that the banks are offering, they added.

Now that SOR has risen by a whopping 1.23% in just 4 months, we wonder how much longer the monies offered by our banks will remain... "cheap".

And speaking of banks, we also wonder if any of those who had discontinued their SOR-based packages back in August 2010 (citing reasons like SOR-based loans are unsuitable for property buyers who buy residential property for owner occupation, in view of their inherent volatility and the long-term nature of mortgage loans) will do an about-turn now that SOR is back in the positive and rising...


Private home prices rise despite cooling measures...

- No Comments

Private home prices and rents in Singapore rose in 2011 from the previous year despite cooling measures, said property consulting firm DTZ.

The measures included imposing seller's stamp duty and a reduction in loan-to-value limit.

In its report released on Thursday, DTZ said resale prices of leasehold condominiums in suburban areas increased 8.2% on-year.

This makes it the fastest growing segment among non-landed housing according to a basket of completed condominiums tracked by DTZ.

Fourth quarter flash estimates also showed HDB resale prices went up last year by 10.7%.

But prices of luxury condominiums only saw a 1.0% on-year growth in 2011.

DTZ said the global economic uncertainties dampened demand for luxury condominiums, dragging prices down by 0.7% in the fourth quarter.

"As a larger proportion of purchases in the luxury segment are by foreigners who are now subject to the Additional Buyer's Stamp Duty (ABSD) of 10%, this segment is expected to see a sharper fall in prices than other segments in 2012," said Ms Chua Chor Hoon, head of Asia Pacific Research, DTZ.

Home prices in the prime freehold segment also took a hit, growing only 4.6% on-year, compared to 8.3% in 2010.

This contrasted with a sharp 12.8% on-year increase in resale prices of freehold landed homes in the prime districts. Leasehold landed homes in suburban areas also rose 12.4% last year.

Rents, meanwhile, were also higher in 2011, led by condominium rents which moved up by 8.9% due to demand from foreign professionals with higher housing allowances.

However, rents for luxury condominiums only grew 1.3% on-year.

From January to November, private home sales of 15,393 units in 2011 already outpaced the 15,288 units sold in the same period in 2010.

Volume is expected to fall in December and carry through in 2012 following the property cooling measures.

"Historically, significant price falls have been triggered by external events that affect the economy rather than cooling measures. The projected economic slowdown in 2012 will thus have a more significant impact on buyer sentiment and consequently on demand and prices," said DTZ's Ms Chua.

Overall, DTZ expects a take-up rate of 16,000 for 2012, slightly lower than the 16,292 units sold in 2010.
Source: Channel News Asia


New Project Info: Riversound Residence

- January 5, 2012 No Comments

Qianjian Group will be launching their 99-year leasehold condominium Riversound Residence on Saturday.

Situated at Sengkang East Avenue, the 590-unit development comprises six 18-storey blocks. Unit sizes range from 452sqft for a one-bedroom unit; 1,184sqft for a three-bedroom dual-key unit; and between 2,508 and 2,734sqft for a four-bedroom penthouse.

Units are priced at an average of about $850psf, with early-bird buyers entitled to attractive discounts.
Source: The Business Times

Here are more info about Riversound Residence for those who are interested:

Developer:   Qingjian Realty (Sengkang) Pte Ltd
Tenure:   99-year Leasehold commencing 26 August 2011
Address:   Buangkok Drive / Sengkang East Drive
Site Area:    210,427.59 sqft
Expected TOP Date:   31 December 2015
Expected Date of Legal Completion:   31 December 2018
Type of Development:   6 Blocks of 18-Storey
Total No. of Units:   590
Total No. of Carpark Lots:   598 (592 + 6 Handicapped Lots)

• 1-Bedroom (32 units):   452sqft
• 2-Bedroom (64 units):   753sqft
• 3-Bedroom Compact (80 units):   904/ 947sqft
• 3-Bedroom Dual-Key (16 units):   1,184sqft
• 3-Bedroom Utility (122 units):   1,066sqft
• 4-Bedroom Compact (142 units):   1,163/ 1,259sqft
• 4-Bedroom Dual-Key (14 units):   1,421sqft
• 4-Bedroom Utility (92 units):   1,292/ 1,345/ 1,367sqft
• 4-Bedroom Penthouse (28 units):   1,927 – 2,734sqft


Rich as I am, it's still unfair to penalize me for wanting to be richer!


The wife and I are definitely NOT referring to ourselves...

The article below appeared in The Straits Times Forum page today.

Reference: Multi-property owner speaks up

Everyone is entitled to their own opinions (including Mr Tan) so here's our two cents: To say that every (rich) Singapore citizen should be entitled to own as many private residential properties as they desire without incurring additional taxes is akin to saying that owners of apartments in private condos should be entitled to as many free parking spaces as the number of cars they own. We have to acknowledge (even if we do not like it) that the later is impossible, especially with new condos these days. So why is it so difficult to accept the former?

Objectively speaking (and no, we do not work for the Government), the additional buyer's stamp duty (ABSD) is hardly putting citizens on equal footing with PRs or foreigners - Singapore citizens are allowed to purchase 2 properties before the ABSD kicks in, whereas PRs only get 1 and ABSD applies to the very first property that a foreigner buys.

So unless a native Singaporean has 3 wives that cannot live harmoniously under one roof (a situation that should warrant special exemption from ABSD, after he is charged with bigamy), we reckon that two private properties should more than satisfy his aspiration of home ownership with an extra for investment. Should he decides to plough more money into the market by investing in more than 2 properties, well... the Government has no obligation to continue supporting those profit aspirations, especially given the sky-rocketing home prices that many (not so rich) Singaporean are struggling to keep up with.

Finally, even the slightest hint that ABSD penalises one's "patriotism" to invest in local property is probably far-fetched. If the state of our property market is anything like those of the US or Ireland, we wonder how many of these "patriots" will continue to invest their monies here rather than abroad...


SG PropConsult is open for business!

- January 4, 2012 No Comments
The SG PropConsult page is now "live" and you will find a list of services (which we hope to expand in due course) that SG PropConsult can provide.

We must emphasize (again) that SG PropConsult is very much an information provider. Any opinions/recommendations made in our reviews are not meant to be professional advice and should not be construed as such. But we will always strive to conduct our research with the same diligence and objectivity that is synonymous with our blog.

On our fees: we believed this is pegged at a level which makes sense for us to take on a project and yet not overly prohibitive to our (potential) clients. This is especially considering that buying a private home these days is easily a million-dollar commitment.

Finally, the wife and I are very excited about SG PropConsult and we look forward to be of service to you soon. So come talk to us!


Home prices are slated to fall this year. Question is, by how much?

- 1 Comment

Prices of private homes are poised to fall this year. This was foreshadowed in the official flash estimates for the fourth quarter of last year which showed a slowdown in growth.

Urban Redevelopment Authority's private residential property price index rose a mere 0.2% quarter-on-quarter in Q4 2011, its most anaemic growth in 10 quarters since the index bottomed out in Q2 2009.

From the 15.8% q-o-q increase in Q3 2009, the index has now moderated for nine consecutive quarters, according to CBRE's analysis. The 0.2% q-o-q hike in Q4 was lower than the 1.3% q-o-q rise for Q3 last year. For the whole of 2011, the index rose 5.9% - a marked slowdown from the 17.6% jump in 2010.

Most market watchers say it is a given that prices will go down this year, amid the weaker economic outlook and poorer sentiment, especially after the introduction of the additional buyer's stamp duty (ABSD) last month.

"Developers know they need to cut prices but the difficulty is in gauging how much. If they don't cut enough, buyers are not going to act. But if they give too much, there's always a fear that buyers will expect a bit more. What you want to do is to give enough for the fence sitters to come back into the market. Despite the weaker economic outlook, there's still a lot of cash and liquidity in the market," says Knight Frank chairman Tan Tiong Cheng.

DTZ's head of Asia Pacific research Chua Chor Hoon predicts a 10 - 15% drop in URA's overall private home price index in 2012 citing the ABSD which took effect on Dec 8 and the economic slowdown. The luxury housing segment, where there are more foreign buyers, is expected to take the biggest hit given the top ABSD rate of 10% levied on their residential property purchases.

CBRE executive director Li Hiaw Ho expects overall demand for new private homes to be trimmed by 15 - 20% this year.

"Price of luxury/prime condos may fall by 10 - 15% in 2012, and the mass-market condos, by 5 - 10%," he added.

URA's flash estimates show that the price index for non-landed private homes in Outside Central Region (OCR) - where mass-market condo projects are located - was the star performer, though it has also dimmed somewhat. It rose 0.6% q-o-q in Q4 last year, a slower rise than the 2.1% increase in Q3 2011. The full-year 2011 increase of 7.7% was also slower than the 15% climb in 2010.

Prices of non-landed private homes in OCR increased the fastest as demand was supported by HDB upgraders as well as investors, notes DTZ's Ms Chua.

Credo Real Estate executive director Ong Teck Hui notes: "The strong run in OCR market has led to their current (Q4 2011) prices being 28.3% above their pre-financial crisis peak in 2008, while prices in Core Central Region (CCR) and Rest of Central Region (RCR) are only 6% and 15.9% higher than their respective 2008 peaks."

The price index for non-landed homes in CCR - which includes the traditional prime districts, financial district and Sentosa Cove - appreciated 0.5% q-o-q in Q4, following a 0.7% gain in Q3. The full-year 2011 increase was 4%, significantly lower than the 14.2% rise in 2010. The index for RCR for Q4 was unchanged from the preceding quarter, taking the full-year appreciation to 4.4%, after rising 17.6% in 2010.
Source: The Business Times

Most market analysts have said that prices for mass-market private homes will only fall by between 5 to 10% this year. However, the wife and I will go on a limb here by saying that we think mass-market home prices will drop by more than 10%. This is because:

1. More mass-market projects are expected to be launched this year, adding to the rather substantial inventory of launched but unsold units in the market.

2. The furious pace in which the Government is releasing land parcels through its Government Land Sales (GLS) scheme - most of these are slated for mass-market homes or ECs.

3. The new additional buyer's stamp duty (ABSD) rule stipulating that all land parcels bought by developers have to be built and fully sold within 5 years - this is likely to put more downward pressure on home prices.

4. The ramping of supply of HDB flats (especially BTO) and easing of HDB flat purchase criteria (income ceiling increase, higher allocation for second-time buyers etc) may mean that some demand for mass-market private homes will be siphoned off to HDB flats.

Only time will tell if our observations are correct or just a load of bull...

But what do you think?


New project sales update: 225 units sold at The Hillier!

- January 3, 2012 No Comments

Far East Organization's project The Hillier in Upper Bukit Timah has chalked up healthy sales, despite the recent property cooling measures.

Close to half of the 528 units at the Soho-style project have been sold so far, the property developer said yesterday.

One key factor seems to be the developer's offer to give a stamp duty reimbursement of 3%. Another sweetener is furniture vouchers, with the amount varying based on the apartment size.

Far East is offering a "stamp duty reimbursement" of 3% to all buyers, a move industry players say is equivalent to a 3% discount.

Far East yesterday said 93% of the buyers were Singaporeans and PRs, adding that more than half of the buyers are existing residents in the Hillview neighbourhood.

The developer has been collecting cheques since the project's preview phase started on Dec 16 and buyers have snapped up 225 units averaging $1,175psf. So far, 333 units have been launched.

Prices start at $668,000 for a 549sqft one-bedroom studio unit, which works out to $1,217psf.

The concept is similar to Far East's other mixed-use projects such as The Tennery at Junction 10 and The Greenwich in Seletar, where residential components are integrated with retail malls.

Some market observers have labelled the offer to absorb stamp duty and the furniture vouchers as marketing tactics and have called on developers to lower their price instead.

But buyers like Dr Ng said he felt it made no difference to him. "Giving vouchers is like lowering the price. Ultimately, my concern as a buyer is the net amount I will have to pay and whether I feel it's value for money," he said.

Some market observers add that developers may wait for a while before cutting prices.

Developers will be more price sensitive in the current market, said PropNex chief executive Mohamed Ismail, where many buyers are aware prices could fall further.

"Hence lowering prices on its own may not always work as some buyers will feel it's not low enough... Pairing incentives like stamp duty absorption with lower prices may have greater appeal."

The Hillier, a 99-year leasehold project, contains a mixture of one- and two-bedroom apartment in two blocks: a 22-storey New-York themed tower and a 28-storey tower modelled after the modern architecture seen in London.

Both towers sit above hillV2, a retail and lifestyle shopping mall slated for completion by next year. The Hillier will be ready by 2016.
Source: The Straits Times

Despite calls from market observers for a direct lowering of prices, the wife and I felt that this will only happen as a last resort. There is compelling reason why developers like Far East will prefer to give out stamp duty reimbursements and furniture vouchers: By doing so, the average price for projects such at The Hillier can still achieve average price of $1,175psf. A direct discount will knock at least 4% (i.e. 3% stamp duty + 1% furniture vouchers) off the selling price, which will reduce the average selling price to around $1,128psf. So by employing what some market observers termed as "marketing tactics", developers may continue to prop up the (perceived) selling price. And as long as there are still buyers like Dr Ng, there is little incentive for developers to lower their prices directly.

If the wife and I are considering a 2-bedder at The Hillier because of hillV2 and its supposed proximity to the upcoming Hillview MRT station, we will be sure to check out neighbouring projects such as Glendale Park and Hillview Heights as well. Granted that these are older projects but both are freehold and currently transacting at about $1,000psf. And our gut feel suggests that the upside potential of these developments may not pale comparison to The Hillier...


The Real Deals (22-12-2011)

- January 2, 2012 No Comments

The latest issue of  "The Real Deals" featured the up and coming estate of Punggol.

According to an entry in Wikipedia, Punggol, also spelt as Ponggol, means "hurling sticks at the branches of fruit trees to bring them down to the ground" in Malay. It could also refer to a place where fruits and forest produce are offered wholesale and carried away. These possible names indicate that Punggol was a fruit growing district. The place is said to take its name from the river Sungei Ponggol.

Punggol used to be called a "ghost town" due to the large number of built but unoccupied HDB flats. It was unpopular with potential home buyers then, given its distance from the city and lack of malls and recreational facilities. But what a difference a couple of years make!

The Real Deals (22-12-2011)