Residential

GCB put up for auction for $20m

A Good Class Bungalow (GCB) that is located at Binjai Rise has been put up for auction. Its indicative price is $20 million, or $1,174 psf. The site has a gross floor area of 13,378 sq ft. It is currently partially completed, and is expected to have a swimming pool. To complete the construction, it is expected that it will cost another $1 million to $2 million; to tear down the current structures, it may cost up to $6 million, said the Business Times. According to industry experts, mortgagee sales of GCBs like this are rare. In instances where they are placed for auction, GCBs are typically put up for sale by owners, not mortgagees. Industry experts added that since 2014, there have been fewer GCB auction sales due to the implementation of the total debt servicing ratio framework. The framework, which acts as a cooling measure, had affected demand in the GCB market, said experts. According to William Wong from RealStar Premier Group, the site at Binjai Rise is competitively priced, however its proximity to the expressway may reduce its appeal.

(Source: Business Times)

Private home prices fall by 1% in Q1

In the first quarter, private home prices have fallen by 1 percent, according to the Business Times. Rents have also fallen by 1.7 percent. Data from the Urban Redevelopment Authority (URA) showed that the fall in prices and rents in the private residential property market has persisted for six consecutive quarters.  In Q1, prices of non-landed properties fell by 0.4 percent in the core central region, 1.7 percent in the rest of central region and 1.1 percent in the outside central region, according to URA’s data. On the other hand, a 0.9 percent fall was observed in prices of landed properties. Compared to the previous quarter, Q1 rents of non-landed homes have fallen by 1.9 percent in the core central region, 1.8 percent in the outside central region and 1.6 percent in the rest of central region. Chia Siew Chuin from Colliers International said that developers have offered discounts in an attempt to attract more buyers. For example, GuocoLand offered discounts of up to 19 percent for Sims Urban Oasis, while a 10 percent discount was offered to Marine Blue buyers by CapitaLand. Chia added that she believes private home prices will continue to fall by about 5 to 8 percent this year. Nicholas Mak from SLP International said that a 4 to 7 percent fall in overall rent is expected this year. He believes that rents in the rest of central region and outside central region are falling faster than in previous quarters due to an increase in supply of private and HDB housing units for lease.

(Source: Business Times)

Q1 resale flat price index fell by 1 percent quarter-on-quarter

In Q1 this year, the HDB resale flat price index has fallen by 1 percent, quarter-on-quarter. According to the Business Times, the fall in prices is slower than the previous quarter, and is the smallest recorded quarter-on-quarter decline for the index since Q3 2013. As the supply of Build-to-order (BTO) flats tapers, market experts believe that buyers may flock back to the resale market. This year, HDB is expected to launch 16,900 BTO flats, which is fewer than the 22,455 BTO flats launched last year and the 25,139 BTO units launched in 2013. Not only so, there are 10.8 percent fewer applications for resale HDB flats in the first quarter of this year, compared to the previous quarter, said the Business Times. Eugene Lim from ERA Realty believes that this year there will be more resale flat deals. He predicts that 18,000 to 20,000 resale flats would change hands by the end of the year. Market experts believe that there would be a 3.5 percent to 5 percent drop in HDB resale prices this year. This is less than the 6 percent fall in the price index last year.

(Source: Business Times)

Commercial

Q1 Grade A office vacancy rates fall by 0.3 percent quarter-on-quarter

According to Cushman and Wakefield, vacancy rates for Grade A office spaces have fallen by 0.3 percent quarter and quarter to 3.9 percent in Q1 this year. Data from URA showed that overall the vacancy rates of office spaces have remained unchanged at 10.2 percent this year. Christine Li from Cushman and Wakefield added that Grade A office rents are expected to increase by 5 to 6 percent this year as vacancy rates will be around 3 percent by the end of the year. Chia Siew Chuin from Colliers International added that the average monthly gross rent for Premium Grade spaces in Raffles Place/New Downtown may increase by about 5 to 10 percent this year. However, rents in the CBD area for Grade A and B offices may increase by about 5 percent for the entire year. Chia said that despite the low transaction volumes in the office market, there is still growing interest in office properties. However Li believes that retail rental market may remain weak due to higher business costs and a smaller influx of tourists.

(Source: Business Times)

Q1 industrial prices increased by 0.7% while rents increased by 0.4%

According to the Business Times, prices and rentals of industrial space have increased. However this increase is slowing down due to an increase in supply. In Q1 this year, the overall prices of industrial spaces have increased by 0.7 percent quarter-on-quarter and rents have increased by 0.4 percent. However, occupancy rates have fallen by 0.2 percent. According to Chia Siew Chuin from Colliers International, in Q1, prices in the multiple-user factory market have increased by 0.1 percent from the previous quarter. The Business Times added that the stabilising in prices could be due to the festivities in February and may also be due to the Total Debt Servicing Ratio framework. By the end of February this year, about 1,700 units of uncompleted multiple-user developments were still available for sale, according to statistics by JTC. Chia believes that the overall industrial prices may reduce by 3 percent this year. However, rents for business parks and independent high-spec buildings are expected to increase by 3 percent and 6.5 percent in 2015 respectively, said market experts.

(Source: Business Times)

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