Singapore Property News This Week #139

Residential

All 281 units of Hillford sold

All 281 units at 60-year leaseholdThe Hillford, Singapore’s first retirement resort, were sold within five hours on Jan 18 from about 1,000 prospective buyers with earlier indicated interest. The average price for the units is $1,100 psf. 186 of all the units are in one-bedroom configurations, with size from 398 to 431 sqft, and a starting price of $388,000. 52 two-bedroom units from 506 to 560 sqft had starting prices of $498,000, and the rest – 40 two-bedroom dual key units of 657 sqft in size – had starting prices of $648,000. Even though the lease is only 60 years, prospective buyers cited affordability as the main driver for their decision to buy a unit. The Hillford is expected to get its Temporary Occupation Permit in November 2017.

(Source: Business Times)

Rental yields of non-landed private homes down

According to the Singapore Real Estate Exchange (SRX), rental yields for non-landed private homes dropped below the 4 percent psychological mark to stand at 3.9 per cent in 2013, from 4.2 percent in 2012. SRX co-founder and chief technology officerJeremy Leesaid that 4 percent for rental yields is the psychological barrier for many investors seeking income from residential properties. Above 4 percent, investors would be able to justify the risks inherent in property as an asset. Below 4 percent, investors would worry that inflation affects their gains. 31 out of 34 planning areas witnessed a weakening in median gross rental yields.

(Source: Business Times)

HDB subletting quota framework for non-citizens is out

The Housing & Development Board (HDB) released the details of the subletting quota framework for non-citizens on Jan 16 – the number of flats that can be wholly sublet to non-citizens is now capped at 8 percent at the neighbourhood level, and 11 per cent at the block level. This applies to subtenants who are Singapore permanent residents (PRs) and foreigners.Malaysians are exempt because they are able to better integrate due to their cultural and historical similarities with Singaporeans. The details reflect the government’s efforts in preventing the formation of foreigner enclaves in HDB estates. However, the quota would not apply to subletting of rooms to reduce the impact on those who rely on subletting for additional income, for example the elderly and low-income households.

(Source: Business Times)

Private home sales decline

Developers’ private home sales decreased to only 259 units (excluding executive condominiums – ECs) in Dec 2013, compared with 1,271 units in November and 1,410 units in December 2012. This figure is also the lowest since Jan 2009 with 109 units. Despite its being worse than market expectations, there is no panic apparently. Agents believe that the December drop was mainly due to developers’ strategy of holding back launches and gathering interest first. Developers only launched 118 new private homes in Dec 2013, the least since the Urban Redevelopment Authority (URA) started to release monthly developer housing sales data in June 2007.

(Source: Business Times)

Government not likely to unwind cooling measures

At The Business Times-MaybankKim Eng Invest Asia 2014,Maybank Kim Eng head of research Ng Wee Siang said that the government is not likely to unwind any of its property cooling measures in 2014, as long as interest rates remain where they are now. The government may reduce the number of private homes and HDB flats in the longer term instead. This comment comes amid a call for the government to relax its property cooling measures.

(Source: Business Times)

Private resale home prices continue to slip

Flash figures by the Singapore Real Estate Exchanges (SRX) showed that prices of private resale homes continued to decline in Dec 2013 for the fourth month, led by decrease in the core central region (CCR). Home prices in the city area decreased 2.3 percent, followed by those in the Outside Central Region (OCR) which decreased 1 percent. Homes in the Rest of Central Region (RCR) rose 2.9percent. Overall, the price index eased 0.2 percent in Dec 2013.As the Total Debt Servicing Ratio (TDSR) framework and other cooling measures take their toll, consultants believe that this trend is likely to continue this year.

(Source: Business Times)

Bartley site receives top bid of $648 psfppr

The site near Bartley MRT Station received the top bid of $648.30psfppr from UOL, which was 3.7 percent higher than the second-highest offer of around $625 psfppr by EL Development.These two top bids were also quite higher than the next five bids. The sixth highest bid was from a partnership between City Developments Ltd (CDL) and TID, standing at $463 psfppr. These two companies, together with Hong Leong Holdings, previously bought two nearby sites – one for nearly $621 psfppr (which is now being developed into Bartley Residences), and the other for $495 psfppr (which is now being developed into the Bartley Ridge project).

(Source: Business Times)

Commercial

MRT network erodes prime offices’ premium

As Singapore’s MRT network is expanding to improve accessibility across the island, the rental differences between prime office and decentralised office space are expected to erode. In Q4 2013, gross average office rents in Tampines were 46 percent lower than Raffles Place; those with office space in Jurong East had 25-35 percent discount off Raffles Place rents. DTZ data showed that office spaces closer to town had smaller differences: Novena rents were 15 percent lower than Raffles Place; Buona Vista and HarbourFront were 18 percent and 21 percent lower respectively.The premium that Raffles Place commands has been decreasing over time.

(Source: Business Times)

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