Residential

Minister Khaw: public housing policies must match social objectives

In a blog post, National Development Minister Khaw Boon Wan said that 10,000 couples would benefit from the Parenthood Priority Scheme in the coming January, and that housing policies must be guided by social objectives including encouraging the young to get married and couples to have children after marriage, and match Singaporean’s changing aspirations at the same time. Previously, people get married, rent a home, have a baby and then buy a home. But now, Mr Khaw believes that people prefer to first get a home, then get married and finally start a family. So, the strengthening of HDB Build-To-Order (BTO) flat construction, the Parenthood Priority Scheme and Parenthood Provisional Housing Scheme are meant to help the young meet their aspirations.

(Source: Business Times)

Too early for the government to roll back cooling measures

The Ministry of National Development will cut state land sales for private housing development on both confirmed and reserve lists in H1 2014 for fear of an oversupply building up. It will also push not-so-hot sites on the confirmed list to prevent benchmark bids from being set. Since the introduction of the total debt servicing ratio (TDSR) framework in late June, private housing sales have significantly declined and are likely to continue to shrink until next year. Developers have started to trim prices as sales have been down. Hence there have been suggestions that the government may begin to roll back some of the property cooling measures in 2014. However, other opinions express that there is no sign that the price of land is coming down because players have been stoking up land bids at Government Land Sales (GLS) tenders and they are unlikely to underprice their projects. Developers may also have strong financial reserves to hold prices of mass-market and mid-tier projects to develop and sell them. So, it is too early now for the government to roll back the property cooling measures.

(Source: Business Times)

GLS: consultants’ views

As the government is trying to temper land tender prices in Singapore, consultants have expressed their views that this should not come at the expense of Singapore’s reputation for being open and pro-business. They are concerned of the sustainability of the trend of increasing prices, and of the government’s coming down hard on foreign developers. The Urban Redevelopment Authority (URA) has introduced batched tender closings, where bids for some Government Land Sales (GLS) sites end on the same day. This is to encourage a “divide-and-conquer” strategy where developers focus on one or the other plot due to the absolute capital needed.

(Source: Business Times)

Singapore developers head overseas

As the domestic market weakens with plunging sales, climbing land prices and high foreign rival bets, Singapore’s mid-tier property developers are heading overseas. In particular, Hiap Hoe Ltd and Oxley Holdings Ltd followed sector leader CapitaLand Ltd this year to go abroad. While in Singapore, the government’s slowing the rise of record-high prices has resulted in a 50 percent fall in Q3 private home sales. Official plans for more supply of new homes over the next decade come when land prices are pushed up by foreign developers. According to Teo Ho Beng, Hiap Hoe’s chief executive officer, the Singapore property market is now very tough with so much competition. Hiap Hoe is focusing on Australia, while Oxley Holdings is heading to Britain, Cambodia, China and Malaysia.

(Source: Business Times)

Commercial

Singapore investment sales fall hard in Q4

Investment sales of Singapore property have fallen to only around $3 billion in Q4 2013 from $13 billion in Q3 2013. Investment sales reflect the confidence of major property players in the mid to long-term prospects of the property market. The latest year-to-date tally is around $29 billion, and the possible final number is $30 billion as more caveats of transactions are lodged, a figure similar to each of the preceding three years. The figures cover items of at least $10 million. Due to a cutback in the Government Land Sales (GLS) Programme among other factors in early 2014, property consultants expect next year’s investment sales to be lower. Investment sales in 2014 are predicted to be around $20 billion-$25 billion by Savills Singapore, and around $20 billion by CBRE.

(Source: Business Times)

TripleOne Somerset sold for $970m

TripleOne Somerset has been sold for $970m or $1,714 psf on a net lettable area (NLA) of around 566,000 sq ft to a consortium led by Perennial Real Estate Holdings, headed by Pua Seck Guan. The 17-storey property has a lease term of about 61 years, and is located opposite Somerset MRT Station. This price is $10 million less than the $980 million amount that Perennial previously did due diligence under a letter of intent granted by the building’s owner, a fund managed by Pacific Star. Lend Lease is understood to be another potential buyer that was approached. Lend Lease did due diligence but there was no deal made.

(Source: Business Times)

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