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Government to release 2 prime GLS sites!

- April 29, 2015 1 Comment
Two residential sites that could eventually offer 1,180 housing units were released by the Government on Wednesday (Apr 29).
The Housing and Development Board (HDB), as the Government's land sales agent, released the sites under the 1st half 2015 Government Land Sales Programme, it said in the press release.
The two sites are located at Toa Payoh Lorong 6 and Lorong 4, and Dundee Road, and were launched for sale under the Confirmed List. The former is expected to provide 535 housing units when fully developed, while the Dundee Road site is estimated to yield 645 units, it added.

The closing dates for the tender for the Toa Payoh site is on Jun 18, and for the Dundee Road site Jun 23, HDB said. More details are available on the agency's website
Source: CNA
The wife and I reckon that the two latest GLS sites released by the Government should garner quite a bit of attention from developers, given their good locations. But it'll be interesting to see how developers will play this one out. Despite the widely acknowledged over-supply situation in the private homes market (which is expected to last over the next 2 - 3 years), coupled with the depressed demand that will probably persist for awhile yet (at least until some of the cooling measures are relaxed), recent signs have indicated that buyers will still enter the market if the new projects have good locations and "suitably" priced. 

So will developers be "buoyed" and bid more aggressively than expected? Something tells us that they just might...especially when comes to the Dundee Road site.

Update (April 30):
It was opined in both ST and BT today that the Toa Payoh plot will be the one that will attract strong interests. This is especially in view of the muted take-up rate at Commonwealth Towers, which is located at a site nearby to the Dundee plot.

So the wife and I might be wrong on this one. Good thing we aren't the experts then...

March resale prices up after 4-month decline: SRPI


Prices of private non-landed residential properties edged up 0.2% in March from the previous month, according to latest flash estimates of the Singapore Residential Price Index (SRPI) released by the National University of Singapore.
This is the first such increase after four straight months of decline.
In terms of region, the index for private residential property in the central region - excluding small units - rose 0.1% in March compared to the previous month, while the index for homes in non-central regions gained 0.3%.
Meanwhile, the index for small-sized units declined 0.4%.
Despite the uptick in the headline index in March, SLP International Property Consultants said it still expects the overall index to decrease by 3 to 6% this year. 
Source: CNA

Private home prices fell 1% in Q1015: URA

- April 25, 2015 No Comments

Prices of private residential properties decreased 1% quarter-on-quarter in the first quarter of 2015, representing the sixth straight quarter of price decline, the Urban Redevelopment Authority said on Friday (Apr 24).
The price index for Q1 dropped to 145.5, from the previous quarter's 147.0. The decline was seen across the whole private residential property market, with non-landed properties in the Rest of Central Region (RCR) leading the drop with 1.7%. Prices for the Core Central Region (CCR) dipped by 0.4%, while the Outside Central Region (OCR) fell 1.1%, the data showed.
Landed property prices also fell by 0.9%, it added.
In terms of rentals of private residential properties, the rental index dropped 1.7% from Q4 2014's 114.1 to Q1 2015's 112.2, URA said. The decline was seen across all segments, with the CCR leading the drop with 1.9%.
Developers had launched 1,189 uncompleted private residential units, excluding Executive Condominiums (ECs), in Q1 - lower than the 1,592 units in the previous quarter. Sales hit 1,311, lower than the 1,376 units sold in Q4 2014, it added.
Source: CNA

Questions about "Dual Representation"...

- April 23, 2015 No Comments

According to a response in the Forum page of ST today, the Deputy Director (Licensing) of the Council for Estate Agencies (CEA) has stated that it is an offence under the Estate Agent Act for an agent to represent both the landlord and the tenant, and to collect commissions from both parties.

Two questions came to mind:

1. So it is okay for an agent to represent both parties if he/she only collects commission from one part and not both? Then again, one can probably argue that the agent is really representing only the party that pays him/her the commission.

2. Does the same rule apply to resale rather than rental?  We reckon that it does.

The wife and I must also admit that we are unfamiliar with the Estate Agent Act. And you don't really think about such things until it stares at you right in the face (as it did when we were reading the papers this morning).

So the wife and I decided to do a bit of digging and this is what we found on the CEA website:

No dual representation 
If a real estate salesperson tells you that he can represent you in your purchase and at the same time he is engaged by the seller to sell the flat. Ask yourself, whose interest will he be safeguarding? 

It used to be a prevalent practice in the HDB resale market, with sellers’ salespersons often collecting a commission from the buyer or refusing to sell to a particular buyer if there is no commission. This practice presents a clear conflict of interest. The sellers naturally want the highest price for their property and buyers would want to pay the lowest. The same salesperson cannot possibly discharge his professional duties to both equally and to represent both their interests fully. 

The Council for Estate Agencies (CEA) has prohibited the practice of dual representation with effect from 15 November 2010. A salesperson cannot be appointed by both buyer and seller for the same property transaction. He can only act for one party. The same prohibition also covered the rental transactions. The ban on dual representation applies to all property transactions, including residential, commercial and industrial properties. 

However, he may help the other party to do paperwork as long as it is clear to all parties that he is not acting for the other party and has obtained the consent of his client. Also, he cannot collect a fee from the other party for the paperwork rendered. 

If a salesperson collects a fee from the tenant/buyer and also collects part of the fee from the landlord/seller, it will be a case of dual representation and is an offence under the Estate Agents Act. 

In addition, a salesperson may not collect a commission from his client and collect a co-broke fee from the other salesperson representing the other party for the same transaction as there will be a conflict of interest. 

So what is co-broking? Co-broking refers to the involvement of two or more salespersons in the property transaction. The salesperson should promote your interest and explain and advise you on the co-broking option in the Estate Agency Agreement to you. Co-broking is advantageous as it widens the exposure of the property to all salespersons and consumers. With more potential parties who may be interested, you may be able to get the best deal. The salesperson should not deny co-broking opportunities to other salespersons because of pre-identified salesperson/s whom he is only prepared to work with. 

Case Study 1 – Salesperson A posted an advertisement of a flat for sale. A buyer responded to the advertisement and asked A to cobroke with his salesperson. However, A refused to co-broke and insisted the buyer to engage his partner B as the buyer’s salesperson. The buyer declined the offer. A second buyer came along and the flat was sold to him, with B representing the buyer and A representing the seller. The first buyer was unhappy as he lost out the deal because he refused to engage B as his salesperson. 

Case Study 2 – A salesperson advertised a property for sale and in the advertisement, indicated the words “already co-broke” and “1% commission – buyer”. It was targeted at turning away other salespersons and potential buyers who did not wish to engage any salesperson. The salesperson had intended to have the transaction handled only amongst salespersons in her team, and have different members of the team collect commissions from the seller and from the buyer. The salesperson had acted contrary to the interest of the property owner (seller) and brought disrepute to the industry. 

The salesperson should not deny opportunities to others by adopting unacceptable practices such as advertising the property with phrases such as “buyers only”, “no agents”, “already co-broke” or other similar terms which are not in the interest of their clients. 

The salesperson also cannot force someone to engage him and pay him commission if they are interested in the property. For instance, he cannot deny property viewing opportunity to a consumer who did not want to engage him. If the consumer is interested and does not intend to engage a salesperson, he can still try to participate and cannot be blocked from expressing interest or making an offer for the property. 

CEA takes a serious view of salespersons who seek to block other salespersons or consumers from participating in the property transaction to the detriment of the client’s interest. CEA will take action against the errant salesperson.

So there you have it!

Need a fix-it guy?

- April 21, 2015 3 Comments

The caption behind this van caught our attention this morning.

This is not a recommendation as the wife and I have yet to engage their service. But if you are looking for someone to "take on the small stuff" (home repair-wise), you may wanna give these guys a call. 

And we will appreciate your feedback after...

Maybank raised red flag over private residential properties in Iskandar!

- April 17, 2015 No Comments

The property oversupply situation in Iskandar Malaysia, Johor, is "likely to get worse before it gets better", said Maybank Investment Bank's research wing in a report, with property values in an increasingly crowded development space possibly declining over the medium term.
In a research note issued by the Malaysian bank on Tuesday (Apr 14) urged investors to be cautious about the region, noting that property transactions and prices in Iskandar have been dropping. 
The value of property transactions in Johor had fallen by 33% quarter-on-quarter in the Q4 2014, under-performing the country (-7%) and other major cities such as Kuala Lumpur (-12%) and Penang (8%).
Property prices in Johor were also weaker than that of other cities, with the House Price Index (HPI) contracting 1% quarter-on-quarter. In contrast, property prices in the whole of Malaysia dropped 0.2%, the research paper said.
Residential and commercial property transaction values plunged 42% and 43% on-quarter in the fourth quarter 2014, respectively, compared to the 4% dip by industrial properties. 
"The latest statistics reaffirm our view that industrial properties are a better investment choice in Iskandar due to the relocation of small medium enterprises (SMEs) from Singapore and its relatively limited supply as compared to residential and commercial properties," Maybank said.
The research note said that Malaysian developers have scaled back their launches and shifted their product mix to avoid direct competition with Chinese developers, and have lowered sales expectations for their projects at Iskandar.
"Judging from the number of approved high-rise projects, the Iskandar property market could be hit by too much supply of high-rise mixed development projects if there is still no coordinated planning and control - this will induce price volatility," Maybank analyst Wong Wei Sum said in the research.
"The oversupply situation will be exacerbated by the huge incoming supply in 2015/2016, where units under construction have risen 18% year-on-year in 2012 and 2013, respectively."
The research note also raised concerns about "aggressive land-banking activities" by Chinese developers in the already-crowded Iskandar region.
"Without coordinated planning and control, this could aggravate the oversupply situation and induce price wars, especially in the high-rise mixed development segment."
For instance, Shanghai-based Greenland Holdings Group recently expanded its foothold in the space with the acquisition of a 128-acre freehold land in the south of Bandar Baru Permas Jaya. This was after its first purchase of 14 acres of land in Danga Bay in 2014. The company is also looking to acquire about 1,200 to 1,400 acres of industrial land near the Tanjung Langsat Industrial Complex, according to Maybank.
"If this materializes, Greenland will emerge as one of the largest land owners in Iskandar with a total land-bank of 1,342 acres and it would pose strong competition to the local developers," the report said.
Maybank also said it is "cautious" over "massive land reclamation" in Iskandar.
Reclamation works spanning 3,425 acres for the Forest City project has been given the green light from the Development of Environment. The development will spread over a 30-year period, and will consist of four man-made islands reclaimed in four phases.
"The execution and planning of such reclamation projects is complex, especially Forest City, and carry elements of risk and uncertainty. Hence, developers' financial positions are paramount; else we may see projects being abandoned or price wars initiated to clear inventories or reduce sales risks by the developers," Maybank said.
"More importantly, the failure of any of these projects could erode buyers' confidence and perception on Iskandar."
As such, the bank said it remains cautious on property exposure in Iskandar, instead preferring developers with exposure in the Klang Valley and Penang.
Klang Valley, in particular, is preferred because of the upcoming KVMRT and LRT lines, and potential KL-Singapore high-speed rail project, which will end at Bandar Malaysia, Maybank said.
More importantly, the strong population growth potential in Greater KL and Klang Valley - a possible 40% increase to 10 million by 2020 - offers more sustainable demand for properties, it added.
Source: CNA
The wife and I have been raising alarm bells during the past year or so over Singaporeans flocking by the bus-loads to the other side of the causeway to pick up what seemed to be "bargains" offered by private residential property developers in Iskandar Malaysia. While prices are definitely cheap compared to what one can get back home, our major concerns are the humongous number of units that are being put onto the market and whether if there is enough real demand (be it in sales or rentals) to support such huge and rapid roll-outs.
Now that the largest bank in Malaysia has put out its red flag over Iskandar, the wife and I certainly hope that our fellow countrymen will heed the call and be more prudent with their purchasing decisions...

Technical problems are now fixed!

- April 16, 2015 No Comments

The wife and I had just realized that our drop-down-menu had malfunctioned since dunno when. This has resulted in our readers not being able to access some pages (e.g. Comments, Discussion Forum etc).

We have since fixed the technical problems *fingers crossed*. In addition, we have consolidated the various sections (i.e. Shout Out, SG News, Reviews etc.) within the "Drop Down Menu". Just hover over the letters to access the menu.

We apologize for the inconvenience caused!

March new home sales highest in 5 months!

- No Comments
New private home sales jumped in March, with developers selling almost 60% more units compared to the previous month. But as cooling measures are still in place, property watchers Channel NewsAsia spoke to said it remains to be seen if the uptick represents a recovery in the market.

Developers sold 613 new homes in March, excluding executive condominiums. This was a sharp increase from the numbers sold in the previous two months, when 390 and 376 homes were sold respectively, although there were about the same number of new units launched - about 400 units each.

In keeping with previous monthly trends, new private homes in the suburban area remained the most popular with buyers, taking 63.8% of total sales in March.

This was followed by the city fringe area, at 32.1%, and the city area at 4.1%.
Jones Lang LaSalle’s national director of research Mr Ong Teck Hui said affordability remains a “critical factor” for buyers who have been constrained by the cooling measures, including the Total Debt Servicing Ratio.

"Outside Central Region units remain significantly more affordable as their project median prices in March are on average 22% below those of Rest of Central Region and 43% lower than Core Central Region’s," said Mr Ong.
Property watchers said it is more than the pricing that drove sales in March. According to property firm CBRE, potential buyers could have been pressured to seal that purchase by the recent rise in interest rates.

Said Mr Desmond Sim, head of research, Singapore at CBRE Research: "That has probably caused the decision-making process to be shorter because (buyers) want to come in, and step into the rates that are on offer before they rise even higher."

The top-selling project in March was the newly-launched Kingsford Waterbay. The development sold 155 units at a median price of $1,111psf. Sims Urban Oasis, located at Sims Drive, was the second-best seller. The project, which was launched in February, cleared another 107 units at a median price of $1,401psf in March.

Other projects such as City Gate and The Skywoods, which were launched even earlier, also moved 28 and 27 units each.

Despite the spike in transactions in March, overall sales for the first quarter fell short when compared to the same period in previous years.

In total, developers sold 1,379 units in the three months ended in March this year. This was lower than the 1,791 units sold in the same period in 2014, and a sharp drop from the 5,533 units in the first quarter of 2013.

Analysts said the weak sales momentum is expected to persist, with property cooling measures and mortgage-tightening rules still in place. But they also said that sales may see a slight uptick, as there could be more attractively-priced projects in the later half of this year.

Said Mr Alan Cheong, senior director of research at Savills Singapore: "Because of some of these Government land sales tenders that closed late last year, the land price on per square foot basis per plot ratio is pretty reasonable. So the developers have the luxury to price it attractively to clear the first launch."

In the near term, analysts said April looks set to be a good month. Already, North Park Residences, which opened for sale last week, has sold 413 units.
Source: CNA

Investors to sue lawyers of failed UK projects: Our takeaways

- April 14, 2015 No Comments

Looks like a lawsuit is looming over the failed UK hostel/hotel projects that some 200 Singaporeans had invested a total of $20 million into.

It was reported in The Straits Times today that a group of 30 Singaporeans who invested in the botched real Estate projects are looking to reclaim their losses by suing the lawyers who had represented them in the multi-million venture.

The Singaporean investors said they paid an average deposit of  £ 40,000 for units in seven unfinished hotel and hostel projects built by now insolvent British developer Key Homes.

The investors claim that their British conveyancing lawyers did not tell them that the projects' insurer, Northern and Western Insurance Company, is registered in Caribbean island Nevis instead of Britain. Also, the insurer is not regulated by the British financial authorities.

"The investors would not have put money in the projects if they were told that their deposits were insured by an unregulated and unrated insurer," said the spokesman of the law firm representing the investors in the lawsuit. "Their loss in deposits plus interest is due to the solicitors' negligence."

Three questions came to mind after reading the article:

1. Is it within the conveyancing lawyers' scope of work to ascertain the suitability of the project insurer and make qualified opinions about them to their clients?
Hopefully we have some readers who in the legal profession that can help answer the question. The wife and I had worked with several conveyancing lawyers for overseas property purchases over the years and the subject of who the project insurer was had never came up. Maybe we were just lucky that all the overseas projects that we had bought into thus far are insured by reliable insurers. But it has never occurred to us (till now) that this will become a problem and to ask if the project insurer is credible.

2. Shouldn't any deposit paid for an overseas property purchase be held in a trust account jointly managed by the Seller's and Purchaser's legal agents and only released to the Seller upon the completion of the project? 
We had assumed all along that such practice is mandatory, since this had been the case for all our purchases so far. It is probably prudent to ask the question "at what point the money that's held in trust will be paid to the Seller?" henceforth.

3. Assuming that the deposits were indeed held in a trust account. Can this account be freeze by the governing authority and the money goes into a "common pool" for debt settlement, if the developer becomes insolvent?
If so, does the investors have first right to this money, since it is after all, their money? The wife and I can probably Google this but we will much prefer hearing from our legal-minded readers.

Anyhow, the wife and I wish those Singaporean investors well on their lawsuit and hope that they are able to recoup some (if not all) of their investments.

North Park Residences: 80 units sold on first day of "walk-in sales"!

- April 11, 2015 1 Comment

A project selling private homes at the largest integrated development in the north opened for walk-in sales on Saturday (Apr 11).

Developers of North Park Residences have sold about 80 units, while about 320 units were sold at the project's soft launch last week. In total, about 40% of the 920 units have been sold so far.

North Park Residences will be part of Northpoint City, which will also house the Nee Soon Central Community Club and a Community Garden. It is this proximity to amenities and transport nodes that has attracted buyers.

At $1,300 per square foot, some buyers say it is "reasonably-priced". "Because of its position, with this price, it is a good buy," said Mr Ng Say Tiong, a buyer.

Its developer Frasers Centrepoint says most of the units sold are the smaller ones and that it has seen a fair mix of those who buy to live in as well as investors.  

Integrated developments like North Park that have direct access to transport hubs are not new in Singapore. Projects like Bedok Residences, Watertown and J-Gateway have been launched in recent years, but with Singapore beefing up its transport networks, such integrated developments may become less attractive, says real estate firm Century 21.

"More and more Singaporean homes would be within the 500 to 800 metres of an MRT station so in future as our transport networks expand and our efficiency in public transport improves, this premium would be eroded," said Century 21 CEO Ku Swee Yong.

North Park Residences is expected to complete in three years' time.

Source: CNA

Encouraging sales results indeed. But the more pertinent question being: Is "walk-in sales" = official launch, or is this still the "semi-hard" stage after the soft launch last week..?

Big Data strikes again!

- April 10, 2015 No Comments

In our April 2 blog-post on the proponent of using Big Data (or more specifically, the X-Value derived by SRX Property using Big Data) as the de facto real estate pricing standard in Singapore, the wife and I did say that the exchanges that we had witnessed (and wrote about) will probably not be the last. We were right.

In another article published in The Business Times on April 8, Big Data algorithms are again being trumpeted - this time as THE mean to bolster Singapore's mortgage system. We shall not reproduce the lengthy article (you can always Google "How Big Data algorithms can bolster Singapore's mortgage system" if interested), but the message seemed to be "Leave it to our algorithms and computers to come up with THE transparent pricing mechanism and make this the industry standard, and all the instabilities seen in our home mortgage and financial systems will soon go away".

The wife and I have noticed increasingly amount of sound-sites appearing in our local newspapers - we understand that SPH owns a stake in SRX Property's parent company - on how Big Data can supposedly solve most (if not all) the problems that plagued our property market today. Heck, it may even soon cure cancer (no, they didn't say that...yet)!

The recent vigorous "promotion" of  Big Data in relation to the Singapore property market has also piqued our interests in the subject. Is Big Data (or X-Value) really THE saviour that we so desperately need?

So the wife and I went searching for answers on the internet and as expected, the judgement is still out on Big Data. And we would like to share two articles that we found particularly interesting:

1. Why analyzing Big Data can be bad for business

2. Big Data without good analytics can lead to bad decisions

We found these parting words in the second article particularly poignant:

"its always bad to rely just on data analytics. When you take the human element out of the equation, you by definition create a higher error rate."

"It (Big Data) can help you narrow something down from millions to perhaps 150," but the temptation is to let the computer do it all, and that is what is going to get you in trouble."

And to those who (like us) are fans of the U.S. TV series "Persons of Interest", the above should resonate quite well with you...

Source: DILBERT by Scott Adams

Freehold not necessarily better than leasehold going forward?

- April 7, 2015 1 Comment

Amid the sluggish property market in recent years, prices of leasehold private homes appear to have been more resilient than those which are freehold, according to a study by consultancy Cushman & Wakefield.

Cushman & Wakefield said prices of non-landed freehold homes saw a steeper drop of over 4% since the third quarter of 2013, compared to the 1% decline for those on a 99-year leasehold. Its study was based on the price indices of freehold and leasehold condominiums compiled by the Urban Redevelopment Authority (URA).

However, analysts have said transaction volumes have been thin, and that could have affected the overall numbers.

Cushman & Wakefield said the weighted average price of leasehold properties have held up better - declining by about 1.4% since the third quarter of 2013. And when compared to the second quarter of 2009 - when the market was at a bottom - they have climbed about 57%.

The consultancy also said that the price gap between the two segments has narrowed.

Ms Christine Li, director of research at Cushman & Wakefield, noted: "If you look at Newton 18, which is a freehold property as compared to its neighbour Amaryllis Ville, (which has a) 99-year lease - if you compared the price gap in the early days, say 2002-2003, the difference is actually about 35% or so. But in recent quarters, the gap has narrowed to 15%, which means that over time, leasehold projects might outperform freehold projects.

“In terms of outlook, if everything is status quo, if the Government does not loosen the cooling measures, TDSR (Total Debt Servicing Ratio) or stringent requirement for en bloc sales, we think leasehold properties could outperform freehold properties, given that attributes of some leasehold properties are better in terms of location and amenities."

In recent years, curbs on loans, such as the Total Debt Servicing Ratio framework, have weighed on overall property demand, but Cushman & Wakefield said freehold projects are at a disadvantage because they are generally more expensive and require a higher capital outlay.

Analysts said the price performance of freehold and leasehold properties also depends on the en bloc potential. Typically, freehold properties enjoy a higher price premium when the en bloc market is active.

And according to other industry watchers, freehold properties continue to attract interest. Based on a study of caveats lodged, consultancy Knight Frank said the price gap between freehold and leasehold non-landed homes across Singapore has risen - from about 33% in 2011 to nearly 47% last year.

According to numbers from Knight Frank, the yearly prices of freehold units averaged at $1,532psf in 2014 - an increase of 9.8% year-on-year. However, those for leasehold units fell by 0.4% over the same period to $1,045psf.
Ms Alice Tan, head of consultancy and research at Knight Frank, said: "Going forward, in the next few years, as the Government gradually releases land sites which are all leasehold tenure, the availability of freehold properties is slated to remain stagnant or decline. Given that limited supply, I think buyers will still have freehold properties as their first choice."

Meanwhile, Mr Alan Cheong, senior director of research and consultancy at Savills, added: "Look at the resale and subsale market. If you look at the period in time, the gap has been consistently between 25 and 28% since the advent of TDSR. I guess if these measures are in place, the gap would be probably maintaining at the 20-plus per cent range. I do not expect it to come down."

Analysts said it is important to note that transaction volumes in the last two years have been thin and could affect the overall data analysis. They also noted that apart from land tenure, other factors like location and features of the development, also have an impact on home prices. 
Source: CNA

The wife and I belong to a generation that grew up with the perception that when comes to value preservation, a freehold property is always "a better buy" than a leasehold one (within the same vicinity), as the former tends to hold their values better especially when the market turns south. But the paradigm seems to be shifting. Then again, it also depends on who you ask...

New project sales update: Botanique at Bartley, North Park Residences, Sims Urban Oasis & Kingsford Waterbay

- April 6, 2015 4 Comments

Botanique at Bartley
UOL Group said it sold more than 150 units at the Botanique at Bartley at an average price of $1,290psf over the weekend. Some 300 units of the total 797 units were released.

UOL Group general manager of marketing Anthony Wong said that there is "good interest across all unit types" for Botanique at Bartley, particularly for the two-bedroom units.

"We believe the positive response is due to the development's high-quality specifications and design, proximity to MRT station and realistic pricing," he said. "Given the strong sales momentum, we will be offering new stacks to give buyers more choices."

This development on Upper Paya Lebar Road, a three-minute walk from Bartley MRT Station, comprises one, two and three-bedders. More than 70% of the units are priced below $1 million to ensure their affordability, following loan curbs imposed in June 2013.

North Park Residences
In Yishun, Fraser Centrepoint Ltd (FCL) sold over 300 units when it started sales on Sunday for the 920-unit North Park Residences during a "soft launch" for buyers who registered interest, according to its marketing agents.

Early-bird prices for studio units of 431sqft start from $612,000 and one-bedroom plus study units (549- 560sqft) start from $758,000. A two-bedder of 624sqft starts from $840,000 while a three-bedder cost $1.049 million and above. The four-bedroom deluxe and five-bedroom units start from $1.496 million and $1.79 million respectively.

The main draw of this development is its mixed-development concept, with its seamless connection with a transport hub and retail mall.

To sweeten the deal, FCL offered Frasers Centrepoint Malls shopping vouchers worth thousands of dollars to buyers on Sunday, the agents said.

Sims Urban Oasis
Since its launch on Feb 14, GuocoLand's 1,024-unit Sims Urban Oasis at Aljunied has sold a total of 220 units up to Sunday. Of these, 112 units were sold at a median price of $1,397psf in February, according to the survey on developers' sales by URA.

Kingsford Waterbay
Close to 170 units have been sold at an average price of $1,100psf till Sunday since its launch on March 7, of which 140 units were snapped up during the first weekend. Kingsford Waterbay is a 1,165-unit development located in Upper Serangoon and will cover two amalgamated government land sales (GLS) sites with a combined 400-metre direct frontage of Sungei Serangoon.

Info source: BT

All the fuss about Big Data...

- April 2, 2015 3 Comments

The wife and I have been following a series of exchanges that occurred over the course of the past two weeks about the Singapore property price data. More specifically, who has the "better" data.

It all started on March 17 with a column penned by Mr Sam Baker, the co-founder of SRX Property. In his article, he claimed that a lack of pricing transparency is the reason for the property market reaching a point where cooling measures currently in place have cost home owners an estimated $21 billion in lost market value (and counting).

When participants have insufficient information to make pricing decisions, markets fail - he said.

Mr Baker proceeded to expound on the virtues of Big Data and how such will make a transparent pricing possible.

So what exactly is Big Data? This is where SRX Property's X-Value comes into play. Supposedly developed with government agencies, academics and valuers, it sources from the nation's most comprehensive property database and instantaneously calculates a single value for every home using best practices methodologies, including comparable market analysis.

As a computer-driven price mechanism, X-Value factors in all the comparables and adjusts for important variables like location, size, floor and age.

It also factors in macro trends from its proprietary price indices, and important on-the-ground information from thousands of market participants interacting with SRX Property apps and pricing data on a daily basis.

It is impossible for a human, even if he had access to all SRX Property's raw property and geospatial data, to do what a computerised price mechanism does in seconds in terms of accuracy, data completeness, relevancy and objectivity.

And to reinforce the value of Big Data, Mr Baker claimed that 93.8% of HDB homes were transacted within 10% of the X-Value. And SRX Property arrived at the figure of a market loss of $21 billion by using the X-Value to calculate the value of all transacted flats (recorded) at the market’s price peak and then compared it with their values at Dec 31 last year.

Similarly, researchers and analysts can use X-Value to track market movements and estimate gains and losses. Consumers can also use the tool to check on a valuation price of properties they are interested in. Government agencies and research institutions can use X-Value and associated data and analytics to forecast the market and solve problems before they get too big.

So Mr Baker concluded that with Big Data and technology, productivity, efficiency and decision-making will improve. And a property market with a universally accepted and transparent pricing mechanism would make the market more transparent, keeping it on an even keel that reduces the need for cooling measures.

With the article’s innuendo of “my property price data is better than everything that’s out there, including the Government’s”, the wife and I were pretty certain that the other vested parties would not take this lying down. We did not have to wait long.

The Council for Estate Agencies (CEA), Housing Development Board (HDB) and Urban Redevelopment Authority (URA) wrote a combined-response that was published in the Forum page of The Strait Times yesterday (April 1). In their response, they refuted some points raised in Mr Baker’s article:

1.      Government agencies that deal with housing issues, such as HDB, URA and CEA did not collaborate with SRX to develop X-Value.

2.      There is NO lack of transparency in Singapore’s housing market - both HDB and URA have been releasing data on the transacted prices of individual private and public housing units on their respective websites free of charge for many years to help home buyers make informed decisions. In fact, SRX has been relying on such open-source property data from government agencies for its work.

3.      It is untrue that the Government is unable to monitor the prices of properties in different market segments. Government agencies have up-to-date and comprehensive information on individual sale and rental transactions of housing units, and use them to monitor property market trends and formulate policies.

4.      The movement in property prices is due to a complex mix of internal and external economic factors, such as the economic outlook, interest rates, liquidity, market sentiments, and business and investment strategies of industry players. It does not hinge on the availability of a market value for each home alone.

In other words, your (SRX) price data is not any better than ours (HDB/URA) and definitely not more useful!

And in the latest twist to the tale, Mr Barker wrote a reply to CEA/HDB/URA today. In his response (again published in the Forum page of The Straits Times), he acknowledged that raw data is available to the Government and the public. However, raw data does not equal a transparent pricing mechanism for the property market.

Mr Baker akin the free transaction data on the HDB and URA websites as rice – it must be processed and combined with other ingredients to form something meaningful, like sushi. The problem with raw data is that it must be processed by users with different levels of expertise, or no expertise at all. Furthermore, even experts can misinterpret or manipulate raw data.

Big Data, on the other hand, IS sushi. Again referencing to SRX Property’s X-value, this standardizes market pricing by applying best-practices methodologies to process raw data from multiple public and private data sources, and instantaneously computes and disseminates a single value for each unit. With X-Value, all Singaporeans start from the same page – meaning the property market joins other markets in having a transparent pricing mechanism.

So in the words of Mr Baker: We don’t have to settle for rice. We can eat sushi!

The wife and I wondered if the latest development will signal an end to the whole debate (probably not). We also wondered if yesterday’s announcement by URA to revise their Property Price Index to take into account attributes such as a property’s proximity to MRT, size and age was (at least in some small ways) prompted by Mr Baker’s original commentary. But from what has transpired thus far, the wife and I will like to give our two-cents on what we can only deem as a "pissing contest":

1. While any attempt to understand the complexity associated with deriving the X-Value may be too much for our simple minds, we are quite certain that this involves some kind of formula/algorithms that require weightages to be assigned to the variables used. And how/why these weightages are assigned will surely introduce some level of subjectivity to the X-Value.

2. The wife and I do not believe that there is one single set of property price data/index that is the best or should be used as "the standard" for all references. Based on our experiences, each set of data produced by the various institutions/agencies has their own merits (and deficiencies). Only when compared together instead of relying on any single set of data/index will enable the user to make the most informed judgment on how the market is behaving.

3. Property price data/index generally provide more of a macro picture. While these are useful as a gauge on how the property market is moving, nobody (at least not us anyway) will base their buying decisions solely on the price data/index. And many a times, sentiments do come into play during property purchase - you may like that condo unit so much (and it has nothing to do with the unit facing, proximity to MRT etc.) that you are prepared to pay way above what the X-Value had deemed as "fair value".  

And finally, on the subject of rice versus sushi: the wife and I reckon that this is really a case of "to each his/her own". While the wife and our little son are huge fans of sushi, I will take my bowl of rice any day! I will probably complement it with some chicken, small helping of vegetables and probably a fried egg. But I will not have everything combined into a single rice-ball and then claimed that this is the one-and-only type of food that anyone will need. 

Then again, that's just me. We can always agree to disagree! 

Private home prices fell 1.1% in Q12015!

- April 1, 2015 No Comments

Private home prices slipped 1.1% in the first quarter this year from the preceding quarter - marking a sixth straight quarter of decline from the peak in the third quarter of 2013.

This followed a similar 1.1% fall in the overall private residential property price index (PPI) seen in the fourth quarter of 2014.

The first-quarter flash estimate of the PPI by the Urban Redevelopment Authority (URA) adopts a revised approach that captures all private housing transactions and utilises a more sophisticated index methodology to control for property attributes so that a purer change in price is measured.

Prices of non-landed private residential properties slipped 1.1% in the first quarter after a one per cent drop in the fourth quarter of 2014. Prices fell 0.6% in Core Central Region (CCR), 1.8% in Rest of Central Region (RCR), and 0.9% in Outside Central Region (OCR).

Landed properties also posted a 1.1% drop in prices, after falling by 1.3% in the fourth quarter of 2014.

URA said these flash estimates are compiled based on transaction prices given in contracts submitted for stamp duty payment, caveats lodged and survey data on new units sold by developers during the first 10 weeks of the quarter. Previously, URA uses caveats and survey on developers only.

The statistics will be updated four weeks later when URA releases the full real estate statistics for the first quarter of 2015, which captures more data from the caveats lodged, stamp duty records and the take-up of new projects.

"Past data have shown that the difference between the quarterly price changes indicated by the flash estimate and the actual price changes could be significant when the change is small," URA said. "The public is advised to interpret the flash estimates with caution."
Source: BT