Singapore Property News This Week #89

Residential

NUS SPRI: Prices of completed condos slipped 0.3% in December

In December, the NUS’s Singapore Residential Price Index (SRPI) series reflected a 1.3% fall in prices in the Central Region sub-index (excluding small units) in December, a 0.5% increase in the Non-Central Region,  and no change in prices of small units (up to 506 sq ft) islandwide. The overall index fell by 0.3% in December, compared to a 1.7% increase in November. In the whole of 2012, the sub-index for the Non-Central Region saw the highest increase of 8.8%, followed by the small unit sub-index, which saw a 5.7% increase and the Central Region sub-index, which fell by 1.2%. The overall SRPI increased by 4%.

Looking ahead, the small unit sub-index may increase in January 2013 given the lowered LTV limit for individuals taking their second or subsequent housing loans which would result in a smaller budget. Prices are generally expected to fall as a result of an increase in supply (more than 16,000 units), though not by much given the low interest rates.

(Source: Business Times)

700,000 more homes needed by 2030 for growing population

To support the population of 6.9 million expected by 2030, 700,000 more homes are needed by then as a buffer. Of these 700,000, about 200,000 are already under construction. The rest will mostly be in new towns such as Tengah, Tampines North and Bidadari. The figure translates into about 39,000 units a year, which is similar to the current rate. Building a buffer stock also helps to control prices. However, there is risk of under-building or over-building. Overbuilding can lead to extra costs to taxpayers as the homes are left unoccupied when the building value depreciates with the age of the building and the shorter lease. Another concern would be having smaller home sizes and lower quality of life.

(Source: Business Times)

99-year Lakeside condo site draws 12 bids

The site located 450 m away from the Lakeside MRT station drew a total of 12 bids, with the top bid of $651.33 psf ppr from MCL Land.  It is bounded by Jurong West Street 41 and Boon Lay Way and offers unobstructed views of Jurong Lake. The expected breakeven price and average selling price are $1,050 psf and $1,300 psf respectively. The high bids and the high number of bids reflect an optimism in the residential market despite the latest cooling measures.

(Source: Business Times)

3,346 BTO flats launched in both mature and non-mature estates

HDB has launched 3,346 BTO flats for balloting. In the non-mature estates, there will be  Keat Hong Colours at Choa Chu Kang Avenue 7 with 968 three to five-room flats ($140,000 – $376,000), Hougang ParkEdge at Upper Serangoon Road with 578 three to five-room units ($165,000 – $427,000) and The Oleander Breeze @ Yishun at Yishun Avenue 1 with 688 three to five-room flats ($170,000 – $388,000). In the mature estates, there will be Kebun Baru Court at Ang Mo Kio Street 21 with 283 four- and five-room flats ($380,000 – $575,000), Whampoa Dew at Lorong Limau with 156 studio apartments ($105,000 0 $154,000) and 249 four-room flats ($385,000 – $483,000) and Tampines GreenForest at Tampines Avenue 8 with 424 three-room and four-room flats ($191,000 – $356,000). All three projects in the mature estates and the Yishun project which offers a view of the Singapore Orchid Country Club golf course and Seletar Reservoir are expected to be oversubscribed given their locations. The Parenthood Priority Scheme which gives priority (30% of the flats to be allocated) to first-time applicants who are married with children is applicable for this launch. The Multi-Generational Priority Scheme will also apply for the Whampoa Dew project. In addition, elderly flat owners living in the area will have doubled balloting chances for studio apartments at Whampoa Dew. Applications will close on Feb 4.

(Source: Business Times)

Questioning the plan for 700,000 new homes by 2030

As part of the plan to build 700,000 new housing units by 2030, more homes will be built in the central region, such as in the former Bukit Turf Club, Kallang Riverside, Bukit Brown, and the waterfront area around Keppel, in addition to three new towns, Bidadari (11,000 public and private homes), Tampines North (21,000 homes), and Tengah (55,000 homes). While some felt that the figure may not be sufficient, citing the need to tear down old flats and rebuilt leading to a need for one million new homes, others felt that it was too large since it would mean a compounded average 2.7% growth rate in housing stock compared to a 1.7% per annum population growth (based on the targeted 6.9 million). The ratio of private to total housing stock is also expected to increase from 23% to about 28.5% by 2030 though it may not result in lower prices.

(Source: Business Times)

Commercial

Alexandra Central units on the resale market

At least 19 of the 114 retail units at Alexandra Central sold recently are on the resale market, with prices ranging from $3,720.93 psf for a 24 sq m (258 sq ft) unit to $8,600 psf for a 10 sq m (107.6 sq ft) unit. A 15 sq m (161.5 sq ft) unit on the third floor and an 18 sq m (193.8 sq ft) unit were being sold at $850,000 and $833,000 respectively. The remaining two units left unsold are a 102 sq m (1,097 sq ft) F&B unit on the second floor and a 667 sq m unit on the third floor.

(Source: Business Times)

Freehold commercial property No 160 Changi up for sale

The four-storey building sitting on 18,000 sq ft plot at the corner of Changi Road and Lorong 105 Changi has been put up for sale with vacant possession. The building also consists of 33 carpark lots on two basement levels. The site with a 3.0 permissible GPR is expected to fetch around $62 million and is located about 300 metres away from Eunos MRT station. It can potentially be redeveloped for strata sales for retail or office use or into a hotel subject to approval from the authorities. No development charge, ABSD or SSD is applicable for the site, which tender closes on March 8 at 4pm.

(Source: Business Times)

Units at the Mediplex@SBFCenter to be launched in February

The 48 units in Mediplex@SBFCenter on Robinson Road near Tanjong Pagar MRT station will occupy the third to fifth levels of the SBF Center and range from 667 sq ft to 1,292 sq ft in size. They are said to be marketed at $3,800-4,000 psf under a 99-year lease to specialties such as dentistry, diet & nutrition, licensed traditional Chinese medicine, physiotherapy and others. These units are expected to be popular given the limited supply of such strata-titled units available for sale as well as the expected demand for medical and healthcare services in the CBD area.

(Source: Business Times)

Rents in suburban malls set to fall

An increase in investor demand for strata retail space is expected as investors are diverted from the industrial and residential sector following the latest cooling measures, leading to a 5-10% increase in price. However, only 46,630 sq ft or 2% of the 1.9 million sq ft of retail space to be completed this year is strata-titled and 80% of this 1.9 million sq ft of space is expected to be located in the suburbs, the bulk of which coming from the Jurong Gateway area.

Jem will offer an estimated 573,000 sq ft of GFA in retail space while Westgate will offer another 426,000 sq ft, making up the bulk of the completed retail space in 2013. They are said to be over 80 and 50% leased, respectively. This might lead to high vacancy rates on average given initial vacancy in these new malls and possible flight to these malls from existing malls, resulting in a fall in rents in older malls which may take some time to stabilise.

On the other hand, the AEIs (asset enhancement initiatives) of The Heeren, Orchard Gateway and the redevelopment of 268 Orchard Road are three projects in Orchard Road that are expected to be completed this year and they could help stabilise rents. These three projects will likely bring a 5% increase in retail space along Orchard Road. This relatively smaller increase in supply will help stabilise rents.

However, malls in both the suburbs and the Orchard area may see lower rents as the uncertain economy affects retail sales, leading to tenant resistance against rental increases.

(Source: Business Times)

Two JTC industrial sites launched at Buroh Crescent and Tuas Bay Walk

The first is a 30-year leasehold 1.77 ha Business 2 site located at Buroh Crescent. It has a 2.5 maximum permissible GPR. It is expected to attract bids of $70-100 psf ppr. The second is a 30-year leasehold 0.58-ha site at Tuas Bay Walk. The site with a 1.7 maximum permissible GPR is also zoned for Business 2 food development. It is expected to attract bids between $60 and $80 psf ppr from mainly end-users given its small size and specialised nature. Both tenders will close on March 14 at 11am.

(Source: Business Times)

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