Singapore Property News This Week #127

Residential

20th storey of Peninsula Plaza for sale at $21.3m

The 20th level of the 30-storey 999-year leasehold Peninsula Plaza in North Bridge Road has been put up for sale by an entity linked to a Taiwanese shipping company. The floor has six strata units ranging from about 990 sq ft to 1,776 sq ft and adding up to a total of 8,514 sq ft. The indicative price is about $21.3 million or $2,500 psf on total strata area. Interested buyers may submit bids for either individual units or the whole floor.

(Source: Business Times)

German European School to sublease its campus in the Swiss Club

The German European School Singapore (GESS) has launched a tender for a 26-year sub-lease on its campus at 72 Bukit Tinggi Road in the Swiss Club, surrounded by international schools and near Good Class Bungalow (GCB) areas. The site is 130,216 sq ft in size and is zoned for “educational institution” use under the Urban Redevelopment Authority’s (URA) Master Plan 2008. The minimum reserve price is $39 million, or $415 psf on the existing gross floor area of 93,969 sq ft. The site is said to attract new and existing players in the foreign school arena looking for a long-term investment in a flagship Singapore campus. GESS’s enrolment, in fact, has been on the rise and has outgrown its current premises, with a campus on a short-lease site on Jalan Jurong Kechil in the Bukit Batok area besides this Bukit Tinggi site. GESS’s selling a long sub-lease for the Bukit Tinggi site to another educational institution would allow the school to fund development of a new campus in Upper Bukit Timah until 2017 to replace the two current campus locations.

(Source: Business Times)

SkyPark Residences attract most electronic applications for ECs in 2013

The SkyPark Residences has received 1,604 electronic applications at its close on Oct 20, more than three times the number of available units. The 506-unit executive condominium (EC) is located in Sembawang. It drew applications from upgraders, with a higher proportion of applicants from Housing and Development Board (HDB) estates in Sembawang, Yishun, Woodlands, and Ang Mo Kio. The developers, JBE Holdings and Keong Hong Holdings, said that the majority of applications apparently looked for bigger units of four-room, five-room, and maisonette units. SkyPark Residences are considered the EC with the highest number of maisonettes with a total of 28 five-bedroom maisonettes which are 1,772 sq ft and offer double-volume ceiling height in the living and dining spaces. SkyPark Residences has attracted the highest number of e-applications for an EC so far this year, surpassing Sea Horizon in Pasir Ris with 1,500 e-applications (for 495 units) in August.

(Source: Business Times)

8,700 shoebox units for resale until 2017

As the Seller’s Stamp Duty (SSD) lock-in period approaches expiry, 8,700 shoebox units are expected to hit the resale market from now until 2017. The figure was revealed by the Singapore Real Estate Exchange (SRX) report, with 805 resale units bought between Aug 30, 2010 and Jan 13, 2011 and 7,910 units entering the market from 2015 to 2017. It also assumed that the first 805 units would be sold in the fourth year of acquisition, which attracts a 4 per cent SSD, given that these units have achieved capital gains of around 30 per cent over the three-year SSD lock-in period. The figure is also more than double the existing completed shoebox residential stock of 3,472 units, which suggests the market sign of relatively flexible demand for resale units amid a slow-moving overall resale market. The number of shoebox units transacted in the resale market, in fact, has been increasing from 0.4 percent in the first nine months of 2009 (of 10,019 units transacted), to about 2.5 percent this year (of 5,550 units transacted).

(Source: Business Times)

TDSR may have hit HDB upgraders more

According to a caveats analysis by property consulting group DTZ, the total debt servicing ratio (TDSR) framework may have had a more adverse impacts on purchases of private homes by those with HDB addresses than those with private addresses. In Q3 of 2013, those living in HDB flats bought only 1,574 private homes, which decreased by 52 percent from the 3,303 units bought in Q2. The drop was a bigger percentage drop than the 46 percent fall in purchases by those with private addresses of 2,102 in Q3. Consequently, the share of HDB owners among private home buyers declined from 46 percent in Q2 to 43 percent in Q3, while those with private addresses witnessed their share increasing from 54 percent to 57 per cent in Q3. DTZ said that HDB upgraders may be affected more by the TDSR because they are more likely to need a loan when they upgrade from the HDB flat to private housing, compared with other property investors.

(Source: Business Times)

Private homes bought by Chinese, Malaysians, Indonesians and Indians decreased 40%

In the third quarter of this year, the number of private homes bought by mainland Chinese, Malaysians and Indonesians each fell around 43 per cent quarter-on-quarter to 238, 240 and 149 respectively. Indians also bought 36 per cent fewer private homes over the same period, at 71 units in Q3. Conversely, US buyers’ statistics, despite their small share, remained the same at 44 units in Q3, unchanged from Q2. According to property consulting group DTZ, US buyers have been less affected by the additional buyer’s stamp duty (ABSD) measures compared with other foreign buyer groups because US citizens who are buying their first Singapore residential property are exempt from ABSD, as they are given the same treatment as Singapore citizens under the terms of the US-Singapore free trade agreement. However, mainland Chinese, Malaysians, Indonesians and Indians still remain the top four nationalities among all foreigners and Singapore permanent residents (PRs) who bought private homes in the first nine months of this year. Together they made up 81.3 percent of the 4,028 private homes purchased by PRs and foreigners in Jan-Sept 2013, similar to their 80.9 percent share of the 7,717 private homes that PRs and foreigners bought in 2012.

(Source: Business Times)

TDSR hit Singapore buyers more than foreigners

The total debt servicing ratio (TDSR) framework has hit private home purchases by Singaporeans more than foreign buyers, which was not unexpected because the TDSR framework was aimed at Singaporeans rather than foreigners. In Q3 of 2013, home purchases of Singaporean buyers and PRs declines 51 and 44 percent respectively, while home purchases of foreigners only fell 39.1 percent. On the contrary, with the initial rollout of the additional buyer’s stamp duty (ABSD) in December 2011, foreign buyers have been hit harder. DTZ reported that the number of caveats foreign buyers lodged for private home purchases fell 73.5 quarter-on-quarter.

(Source: Business Times)

HDB flats resale prices drop

The resale price index (RPI) has shown the prices for resale HDB flats fell 0.9 percent in Q3, despite a 0.5 percent gain in the previous quarter. The number of resale flats in Q3 decreased 13.5 percent to 4,529 units, from 5,235 units in Q2. The cash premium of cash-over-valuation (COV) also fell 30 percent from the previous quarter to only $18,000 in Q3. This is the first time the index has dropped in four years, since Q1 of 2009. Analysts have attributed the drop to various measures introduced between June and August – the total debt servicing ratio (TDSR) framework, a tighter mortgage servicing ratio (MSR), lowering the maximum loan tenure, allowing singles to purchase Build-to-Order (BTO) flats, and a three-year wait for all new PRs before they can buy a resale flat. The official RPI drop was larger than the earlier estimate of minus 0.7 percent, which is due to a delayed impact from the tighter MSR introduced in August, and the TDSR introduced in June.

(Source: Business Times)

Property consultants have mixed reactions to URA’s Q3 data

The latest third-quarter private housing data released by the Urban Redevelopment Authority (URA) have received mixed reactions from property consultants. Some say mass-market sentiment is still strong, others see weakness setting in. The latter group of consultants pointed out that the 3,951 private homes (excluding executive condos) sold in primary and secondary markets in Q3 of 2013 was just 57 percent of that of Q2. Q3’s figure was also the weakest showing since Q4 2008 during the global crisis, when 1,639 units were transacted. The price indices for non-landed private homes in Core Central Region (CCR) and Rest of Central Region (RCR) also decreased 0.3 percent and 0.9 percent respectively quarter on quarter.

(Source: Business Times)

Commercial

Singapore CBD 8th most expensive office area in the world

According to a Jones Lang LaSalle study, the extended central business district comprising Raffles Place and Marina Bay is the eighth costliest office area in the world, standing at S$11 psf per month or US$103 psf per year. Hong Kong (US$162 psf per year) and Beijing (US$137 psf per year) secured the second and third places respectively for the most expensive office areas in the world. The first position belongs to St James’s in London which costs US$194 psf per year.

(Source: Business Times)

More weakness in developer sentiment in Q3

Following the introduction of the Total Debt Servicing Ratio (TDSR) framework in June, developers’ sentiment has weakened further in Q3. The Real Estate Sentiment Index, which reflects overall market sentiment through the Composite Sentiment Index, was 3.9 in Q3, which was down from 4.5 in Q2. The Q2 figure itself decreased from the 4.8 reading of Q1. The Future Sentiment Index also dropped to 3.9 from 4.4 in Q2. The index was developed by the Real Estate Developers’ Association of Singapore (Redas) and the National University of Singapore. A score below five is a flag for deteriorating market conditions.

(Source: Business Times)

Far East Hospitality launches 3 Singapore hotels

Over the next three months, Far East Hospitality Management will launch three Singapore hotels – the Village Hotel Katong in the Marine Parade/East Coast area, the Amoy at Far East Square in the Chinatown/CBD area, and a relaunch of the Rendezvous Grand Hotel in the Bras Basah area acquired from Straits Trading Company. The Village Hotel Katong has 229 rooms with a modern Peranakan theme, which is a $30 million makeover of the old Paramount Hotel. The Village Hotel Katong will be officially launched next month with opening rates starting from $178 per night. Far East Hospitality is the hospitality management arm of Far East Orchard Limited (FEOrchard). The parent group, Far East Organization, owns about 52 per cent of units in Far East Hospitality Trust.

(Source: Business Times)