Singapore Property News This Week #86

January 16, 2013

Singapore Property News This Week #86

Residential

Guidelines on private enclosed space to be reviewed

Following recent reports of super-sized EC units being sold to buyers not from the sandwiched class the ECs are meant to cater to, URA had been directed review guidelines on private roof terraces and private enclosed space on ground floors. These spaces which are open to the sky are not considered part of the GFA has no development charges to encourage developers to build more private or communal open spaces for residents to enjoy. They are the reason why penthouses units can be sold at much lower psf prices than smaller typical units since the entire space of the unit (including the open space) is included in the pricing. The resulting high price of the units may not be affordable for the class ECs are targeting and buyers who can afford these units may not even need the subsidies. Furthermore, as more developers sell off the open space, there will be less communal space for all residents and buyers of units with these open spaces may not covered them up or enclose them in the future.

(Source: Business Times)

Over 75% of Echelon’s units sold

390 units of the 99-year 508-unit private condominium project next to Redhill MRT at Alexandra View have been sold. Over 200 of these units were sold at its preview at an average selling price of $1,700 psf. The price will increase by 2% and 4% subsequently for future releases. 80% of the buyers were Singaporeans, with the remaining being PRs and foreigners. The 43-storey, twin-tower development houses one to four-bedroom apartments and four penthouses.

(Source: Business Times)

Freehold Hampton Court at Draycott sold

All 12 units in the four-storey Hampton Court (located at the corner of Draycott Park and Draycott Drive) were said to be sold to Swire Properties at $155 million or $2,526 psf ppr including a $22.3 million development charge, breaking the previous record of $2,525 psf ppr. The 33,425 sq ft freehold site has a 2.1 plot ratio and can be built up to 24 storeys. It can potentially be redeveloped into a project with 33 2,000 sq ft apartments.

(Source: Business Times)

Possible measures to hit various property markets

Following recent reports of super-sized EC units being sold to buyers not from the sandwiched class the ECs are meant to cater to, URA had been directed review guidelines on private roof terraces and private enclosed space on ground floors. This may lead to additional development charges if private roof terraces and enclosed spaces are included under the GFA. There may also be additional measures introduced in the resale flat market especially since the increase in prices of mass market homes can be attributed to the high HDB resale prices. Upgraders may have to sell their flats before purchasing private property, or have restrictions placed on them.

On the commercial end, there could also be seller stamp duties to discourage investment demand, and strengthen enforcement against unauthorised use of industrial spaces and an extension of guidelines regarding strata division of certain sites sold under the industrial GLS to private sites.

(Source: Business Times)

Freehold Villa Des Flores back on the market for the third time

The 41-unit condominium (13 townhouses and 28 apartments) at Whitley Road is back on the market for the third time with an unchanged asking price of $160-165 million or $1,533-1,581 psf. The development sits on a 104,370 sq ft which can be redeveloped into two-storey mixed landed housing of detached, semi-detached, terrace housing or a combination, based on conventional housing types or as a cluster housing development. The tender closes on Jan 30 at 3pm.

(Source: Business Times)

Slew of cooling measures to hit property markets (effective 12 Jan); both short and long term

The temporary measures include an increase in ABSD rates, lower LTV ratios and increase in minimum downpayment while the permanent measures include a maximum EC unit size, restrictions on PRs subletting flats and disallowing PRs to retain HDB flats after buying private property.

The ABSD now applies to the second home purchase of Singaporeans at a rate of 7%, and the ABSD for their third and subsequent home purchase has been increased to 10% from 3%. Similarly, PRs now have to pay a 5% ABSD and the rates for the second and subsequent purchase has increased from 3% to 10%. The ABSD for non-PR foreigner and corporate purchases has also been increased from 10% to 15%. Buyers whose options were granted before January 12 and exercised them by Feb 1without any extension of the option validity period can apply for remission so that they only need pay the old rates. The LTV ratios will also be lowered by 10% and 20% for second housing loans and third and subsequent housing loans respectively for individuals with at least one outstanding loan and companies. The minimum cash downpayment for the second or subsequent home mortgages has also increased from 10% to 25%. The LTV limit for non-individual borrowers was also lowered from 40% to 20%.

ECs now have a maximum unit size of 160 sq m (1,722 sq ft) and the formerly free private enclosed spaces and private roof terraces will now be included in the 10% bonus GFA for all non-landed residential developments including ECs and private condos, and be subject to development charges. The latter will also be included under the maximum GFA for strata commercial and industrial projects. Eligibility for HDB loans has also been tightened, in addition to stipulating that PRs who purchase private housing must sell their HDB flats within six months of the purchase and that PR owners of HDB flats are not allowed to sublet the entire flat.

(Source: Business Times)

New cooling measures to affect mainly HDBs and ECs

With the restriction on the maximum unit size of ECs to 160 sq m (1,722 sq ft), there will unlikely be record high prices of $2.05 million ECs in the future, with most costing under $1.2 million, based on an average price of $700 psf. In addition, the previously free private roof terraces and private enclosed spaces will now be considered under the 10% bonus GFA for all non-landed residential developments including ECs, and hence subject to development charges. Other new measures affecting ECs include the restriction of dual-key EC units to multi-generational families and the stipulation that developers can only launch the development for sale 15 months after the site is awarded or after the completion of foundation works.

For HDBs, the Mortgage Servicing Ratios (MSRs) for housing loans is lowered to 35% and 30% of the borrower’s income for loans from HDB and financial institutions respectively. PR owners of HDB flats are also not allowed to sublet their entire flats if they had not obtained their HDB approval before January 12. PRs who purchase a private property on Jaunary 12 or after must also sell their HDB flats within six months of the purchase. This will likely result in increase in resale HDB flats. In addition, from July 1, there will be tighter terms in relation to HDB loans and the use of CPF savings to purchase flats with fewer than 60 years’ lease left.

(Source: Business Times)

Resale prices of private homes saw 6.6% increase in Q4

The average resale price of private homes hit $1,233 psf in Q4 2012, a 6.6% increase from $1,157 psf in Q3, bringing the year-on-year increase to 13.4% in 2012, compared to 10.4% in 2011. Specifically, resale prices rose 4.8%, 4.6% and 3.6% in the OCR, CCR and RCR respectively. Transaction volume, however, fell by 5.5% in Q4 from Q3 and also fell by 7% from 2011 to around 12,500 private non-landed homes in 2012. Rents fell 1% to $3.91 psf in Q4 from Q3, resulting in a smaller rental yield of 3.8% in Q4 compared to 4.1% in Q3.

Growth in resale prices are expected to increase by 5% at most in 2013, given the increase in supply in the primary market, which will also possibly lead to a fall in prices and rents. Sales volumes are also likely to fall, given the economic conditions and possible new cooling measures.

Meanwhile, the median COV for HDB resale flats increased by $4,000 to $34,000 in Q4 2012, resulting in a 1.1% increase of the median price of HDB resale to $455,000 in the same period. Median rents remained at $2,400 per month.

(Source: Business Times)

Commercial

99-year leasehold Mohd Sultan conservation shophouse for sale

The three-storey-plus attic shophouse at 15 Mohamed Sultan Road is asking for $15.5 million or $2,259 psf based on its 6,862 sq ft GFA. The 2,606 sq ft site zoned for residential use with commercial on the first storey has a 3.8 plot ratio. This allows for potentially 3,000 sq ft more GFA at the back of the building, bringing the height of the building to five storeys. The site is located near the River Valley Road, the Singapore River and the upcoming Fort Canning MRT Station. The tender will close on Feb 20.

(Source: Business Times)

Strata factories transactions made in 2012 mostly profitable

There were 1,136 secondary-market transactions involving resales and subsales of 60-year strata factory units, of which only 618 had caveats of previous transactions that can be found. 60% of these 618 units were last transacted in 2010 or 2011, with another 5.8% last transacted in 2012. 99.7% of these transactions were profitable, with only two transactions involving units last bought in 2011 being a loss. The average profit made was 47% or $262,636, with the 73 units last bought in 2007 making an average of 85% or $406,160, the units bought in 2009 gaining 64% or $366,208, the 177 units bought in 2011 gaining 27% or $166,795 and the 36 units bought and sold last year gaining 15% or $86,797.

The total sales volume of both primary and secondary market will likely be lesser than 2011’s 5,183, with 4,392 caveats lodged and 4,700 predicted for the year of 2012. Prices for 60-year upper storey factory and warehouse units rose 3.3% to $451 psf in Q4 2012 from Q3, bringing the full-year price increase to 13%, compared to the 26% in 2011. However, the rental market did better, with 5,924 rental deals transacted in the first 11 months of 2012, compared to the 5,575 deals in 2011. Monthly average rents for upper-storey factory and warehouse units and high-tech units hit $2 psf and $3 psf respectively in Q4 2012.  There is around 27 million sq ft GFA of upcoming industrial space in 2013.

(Source: Business Times)

SSD for industrial properties sold within 3 years introduced

To control the increasing prices of industrial properties, a SSD of 15%, 10%, and 5% will be imposed respectively on properties sold within the first, second, and third year of purchase with effect from Jan 12. There has been diversion to the industrial property market following the introduction of cooling measures in the residential sector, which had led to an increase in resale transactions of multiple-user factory space within three years of an earlier purchase to 15% and 18% respectively in 2011 and the first 11 months of 2012 from a 10% average from 2006 to 2010.

(Source: Business Times)

by Propwise.sg on January 16, 2013 · 0 comments

Posted in Singapore Property News

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