Singapore Property News This Week #237

Residential

Strong interest for Poiz Residences at Potong Pasir

According to the Business Times, about 75% of the units released for sale at Poiz Residences have been sold. Located at Potong Pasir, the development consists of a total of 731 units. Last weekend, 350 units were released at an average price of $1,380 psf. The project is part of a mixed-use development that includes a retail component. It has three distinct zones, namely the hotel-like “Suites”, “Urban” units for price-sensitive young professionals and “Habitat” units for families.

(Source: Business Times)

Prices of shoebox units fall by 3.1%

According to NUS’ flash estimates for the Singapore Residential Price Index (SRPI), small units have led price falls for completed apartments and condos year to date and on a year-on-year basis. Island-wide, prices of shoebox units had fallen 3.1% from December last year to October this year. On the other hand, the prices of condo units fell 2.3% and 2.1% respectively in the Central and Non-Central regions. This excludes small units. The overall SRPI had fallen by 2.2% year to date, according to the Business Times. Year-on-year, the October flash estimates showed that there was a 4.6% drop for the small unit sub-index. This was higher than the 4.4% fall and 2.7% drop recorded in the Central and Non-Central region respectively. According to Alan Cheong from Savills Singapore, small units suffered the largest price cut due to a more severe rental erosion in small units compared to other apartments.

(Source: Business Times)

Interest falls for Singapore property market

Since 2011, interest in the Singaporean property market has been slipping. According to the Business Times, Singapore’s real estate investment prospect ranking has fallen from first place in 2011 and 2012, to 3rd in 2013, seventh in 2014 and 9th in 2015. A study by PwC and Urban Land Institute showed that in 2016, Singapore is expected to fall to the 11th place, while Tokyo, Sydney and Melbourne are expected to be the top three contenders. Nonetheless, Colin Galloway, principal author of the Emerging Trends in Real Estate Asia Pacific 2016 report said that counter-cyclical global investment funds may be interested in Singapore’s high-end residential assets as they may find this as a good entry point.

(Source: Business Times)

Nov’s HDB resale prices up by 0.4% month-on-month

According to the Business Times, HDB resale prices had increased by 0.4% month-on-month in November this year. Market experts believe this increase in price is led by the resale of four- and five- room flats. Despite the month-on-month increase in price, HDB resale prices are still 1.9% lower than in November last year. Eugene Lim from ERA Realty believe that this increase in resale prices is due to seasonal fluctuations. According to SRX Property, resale volumes had fallen by 16% from 1745 units in October to 1467 units in November this year. Ong Kah Seng from R’ST Research added that more transactions could have been made in November as sellers and buyers would want to close the deal before the holiday season.

(The Business Times)

No surprises at H1 2016 state land sales

Market experts are not expecting major surprises for the government land sales (GLS) programme for the first half of 2016. Market experts believe that for the private housing segment, the government will factor in the current market conditions, such as the increased supply of private homes and rising vacancies. Chua Yang Liang from JLL said that following the introduction of the total debt servicing ratio framework in 2013, the government has been cutting land supply for private homes in the confirmed list for GLS. Chua believes that the downward trend is expected to continue for the upcoming H1 sales. Desmond Sim from CBRE agreed as market conditions have not changed since H2 this year. However, Ong Kah Seng from R’ST Research said that there should be an increase in EC land supply as developers are expected to cut prices to $750-780 psf in H2 from $800 psf in H1 this year. As such, Ong believes that ECs will remain a popular among buyers and sales is expected to increase. In the non-residential segment, market experts predict that office spaces will still be supplied through the reserve list due to the expected glut in office spaces from 2016 to 2018 due to an increase in office space completions.

(The Business Times)

Commercial

Office rents in Marina Bay drop by 19% over last 3 quarters

The rental gap between Raffles Place and Marina Bay is narrowing as Grade A office rents in Marina Bay fell 19% in the first three quarters of this year to $10.70 psf per month, while office rents in Raffles Place had only fallen by 0.7% to $10.31 psf per month. According to Cushman & Wakefield, higher occupancies as well as a lack of Grade A office supply within Raffles Place had resulted in a minimal fall in rents. In Q3, office occupancy rate in Raffles Place stood at 97.1%, which was an increase from the 96.5% in Q2. In November, the occupancy rates rose to 97.2%. Alice Tan from Knight Frank said that demand for office spaces in Singapore had been affected by slowing economic growth. Also, an expected increase in supply of office spaces have also contributed to the shrinking office market.

(Source: Business Times)