Singapore Property News This Week #130

Residential

Duo Residences receives good interest

During the first phase of sales at Duo Residences, the 99-year leasehold development at Ophir-Rochor Road, more than 1,000 cheques were submitted. The project is a joint collaboration of Temasek Holdings and KhazanahNasional. Apartments at the development start from $2,214 psf for a studio apartment of about 420 sqft in size, while prices of one-bedders of 538 sqft start at $2,045 psf. Two-bedroom units of at least 807sqft in size are priced at $1,983 psf. The property is a few-minute drive from TiongBahru, VivoCity, Orchard Road, MBS, the CBD and Sentosa.

(Source: Business Times)

National Development Minister sees light for Singapore property market

At Parliament on November 12, National Development MinisterKhaw Boon Wan was asked by Member of Parliament Christopher de Souza about what can be done to ensure a predictable regulatory regime to regulate foreign ownership in Singapore’s property market in order to create sustainable property prices. Minister Khaw said he was seeing light at the end of the tunnel to achieve a sustainable Singapore property market, with the cooling measures creating the intended effect of dampening foreign demand and reducing speculation. The proportion of purchases by foreign in Singapore private housing market has decreased since 2011 – from 17 percent in 2011 to only 7 percent in Q3, 2013. The number of purchases by foreigners has also decreased from about 1,400 per quarter to 330 in Q3, 2013. In addition, subsales, a proportion of private housing transactions and a gauge of level of speculative activity in the property market,fell from 7.6 percent in 2011 to 4.6 percent in Q3, 2013. Minister Khaw said that only citizens are now allowed to buy new HDB flats and provided grants to purchase resale HDB flats, and almost all landed housing can only be purchased by Singaporeans.

(Source: Business Times)

Singapore property market to correct in 2015 or 2016

According to presentations at the 20th Singapore Economic Roundtable Forum, one of several medium-term challenges and risks confronting the Singapore economy in the future is that the property market could correct substantially in 2015 or 2016 as higher interest rates are expected to coincide with large increase in housing supply. Other challenges mentioned at the forum include over-leveraging in certain household segments, lower cost-competitiveness and obstacles to productivity growth. The forum was organised by the Institute of Policy Studies and The Business Times, and is held twice a year under the Chatham House Rule which participants agree to keep each other’s views anonymous to promote frank debate.

(Source: Business Times)

CITY Developments Ltd raises red flags on private housing

Following its 10.4 percent year-on-year drop in Q3 net earnings to $120.6 million, City Developments Ltd (CDL) has raised red flags on the Singapore private housing market. CDL said that although developers are cutting their prices in existing and new projects and willing to take lower profit margins, land prices are continuing to increase. In addition, non-traditional developers, especially foreign construction companies, are entering state tenders by bidding aggressively to secure land, and at the same time sacrifice their profit margins on construction. This has led to many developers to form joint venture to bid for land and then cause successful bid prices to differ widely among different sites, which would need careful study from the government.

(Source: Business Times)

Singapore banks could withstand even 50% property price plunge

According to the stress tests carried out by the International Monetary Fund (IMF) and the Monetary Authority of Singapore (MAS), Singapore banks will be able to withstand even a 50 percent plunge in property prices over the next two years. It was also found that Singapore’s financial system is highly developed, well regulated and supervised, with financial-soundness indicators for the big three domestic banks remained strong during the global and European crises. However, the risk which Singapore property sector could pose to financial stability is that property prices were already above their 2008 peak, and that the rapid growth of credit and real estate prices could exacerbate aggregate sensitivity to macroeconomic shocks and interest-rate cycles.

(Source: Business Times)

Singapore Land sells 150 units at Alex Residences

150 out of 200 units released in Alex Residences were already sold on November 13 by Singapore Land with the average price of $1,650 psf. The popular units are one, two and three-bedroom units to owner-occupiers and potential investors. The Residences condominium is located near MRT station and has 429 units, and is a short distance from Chatsworth Park Good Class Bungalow Area, a wet market, a food centre, restaurants and cafes.

(Source: Business Times)

Private homes said to rebound in November

Developers’ sales of private homes are expected to rebound this month, with 468 units sold out of 540 units released at the 660-unit Duo Residencesat an average price of $2,000 psf. Earlier, Singapore Land had sold 150 units at Alex Residences, while later this month, GuocoLand is expected to release Clermont Residence in TanjongPagar at a price above $3,000 psf. Sales of private homes had fallen 19 percent in October to only 1,009 units from 1,246 units in September. The October’s figure itself was about half of the 1,949 units year-on-year. Savills Singapore predicts of about 1,400 to 1,500 unit sales this month.

(Source: Business Times)

New global property measurement standard to be ready in 2014

A new global property measurement standard tostandardise the way valuation is conducted around the world could be ready in June 2014 the earliest, following the formation of the first International Property Measurement Standards Coalition (IPMSC). The draft of this first standard targeting office space is being finalized, and will likely be sent out for consultation in January 2014 before being sent back for approval in June or July 2014. According to Mr. Michael Newey, president of the Royal Institution of Chartered Surveyors (Rics), “In theory, if you are valuing a building here in Singapore, and you’re valuing a building in Hong Kong, and one in London or Sydney, it’s the same methodology. The problem is that properties are measured in hugely different ways around the world”. For example, floor space in Spain would include outdoor swimming pools, while in the Middle East it would include the hypothetical maximum number of floors that can be built on existing foundations.

(Source: Business Times)

Commercial

Havelock hotel site gets highest bid of $30 million

Despite a shorter tenure and the need for parts of the original building to be conserved, a plum hotel site at Havelock Road has drawn the highest bid of 30.09 million or $1,303.24 psfppr out of nine valid bids. This highest bid is 6.6 percent higher than the second highest bid of $28.09 million or $1,216.62 psfppr from OoiTeckHin. Analysts had previously expected the winning bid at only between $920 and $980 psfppr.

(Source: Business Times)

All vacated City space at Millenia Tower taken up

All of the 143,000 sqft under Citi’s lease at Millenia Tower expiring next month have been taken up, showing a strong demand for secondary office space.Citi started to vacate the space earlier this year and completed its exit from the building in July, marking the final leg of the group’s four-phase departure from Millenia Tower and the next-door Centennial Tower that began in 2011.Citi had occupied a total of 440,000 sqft in the two buildings, but it moved to Asia Square Tower 1 in 2011.

(Source: Business Times)

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