Wednesday, January 30, 2013

Property cooling measure round #8: Capital Gains Tax...?

It is a well-publicized fact that Singapore do not have a capital gains tax regime. Even our Malaysian neighbour has a Real Property Gains Tax, which imposes a 15% tax on gains from sales of property bought within 1 -2 years; 10% for those bought within 3 - 5 years and zero tax if one has held on to the property for more than 5 years.

One of our readers has suggested that the most effective way to cool our red-hot property market is via a capital gains tax. 

The wife and I must admit that we do not know enough on the subject and our quest for answers (from the internet) thus far has revealed little.

So we are opening the questions to our readers:

1. Do you feel that a capital gains tax will be more effective than the measures that have been implemented (e.g. lower LTV, additional stamp duties) to cool the property market?

2. If so, why has the Government not taken revisited this option?

Monday, January 28, 2013

Resale home prices dropped 0.3% in Dec 2012!

Prices of private resale homes dropped 0.3% in December from November.

This is according to the latest Singapore Residential Price Index (SRPI), which tracks prices of completed private apartments and condominiums.

The SRPI data is published by the Institute of Real Estate Studies at National University of Singapore (NUS).

Analysts said the drop may be due to lower transactions during the school holidays in December.

They added that when volume is lower, prices tend to be flat or register a small decline.

Resale prices of private homes in the central area saw the biggest decline, down 1.3% last month.

But prices of units in the non-central region went up by 0.5%.

Meanwhile, the index covering small units of 506 square feet and below remained flat last month.

DWG Real Estate senior manager Lee Sze Teck said: "For January 2013, the prices for small units could see a rise because of the lower loan-to-value (LTV) ratio implemented on 12 January 2013."

He added: "Buyers are likely to adjust their budget downwards because of the lower LTV ratio and look to buy smaller units."

In contrast, data compiled by the Urban Redevelopment Authority showed private residential property prices grew 1.8% in the last quarter of 2012.

Mr Lee said that the difference between the two data "could be due to NUS revising their base to March 2009."
Source: Channel News Asia

Friday, January 25, 2013

This just in: 4Q 2012 home prices rose 1.8%

Private home prices rose 1.8% in the fourth quarter of 2012, compared to a 0.6% increase in the previous quarter.

But for the whole year of 2012, prices of private residential properties increased by 2.8%, a smaller rise compared to the 5.9% growth recorded in 2011.

The Urban Redevelopment Authority (URA) on Friday said that prices of non-landed properties outside the central region rose 3.8% in the fourth quarter, compared to an increase of 1% in the third quarter.

Prices of non-landed properties in the core central region edged up 0.7% in Q4. For the rest of the central region, prices increased 0.9%.

Rentals of private homes climbed 0.7% in Q4. For the full year, private home rentals rose 2.1%, compared with the 3.8% increase in 2011.
Source: Channel News Asia

Thursday, January 24, 2013

We were Yahoo-ed!

THE wife and I were told that our recent blog entry entitled "A home buyer's lament: Here's some relief?" was featured in Yahoo! Singapore News today. While we are strong advocate of information sharing and have no qualms about agreeing to requests from other blogger/blog site to repost our entries, today's feature did catch us totally by surprise.

THE wife and I decided to take a peek at the Yahoo! Singapore News article and besides having quite a few chuckles over the various comments made on the article, we have these thoughts:

1. Yes, we do not have all the answers but then again, we never profess that we do.

2. We have always maintained that whatever we have written are strictly our opinons, so anyone taking what we said as facts is either a huge fan (one can always hope!) or he/she truely believes that we make (some) sense. But nobody is pointing a gun at anybody to take what we said as the gospel truth.

3. Even if we are wrong (which certainly will happen from time to time and if so, we really don't mind being corrected), we hope our entries will at least invoke responses from people who may have the correct answers. This will provide opportunities for those who don't know to learn from those who do.

4. We appreciate someone educating us on the difference between "unusable" and "unhabitable" space. But if AC ledge is indeed classified as "unhabitable space", then we are really surprised when the same someone claimed that "most projects do not have unhabitable space to begin with" - THE wife and I probably need to get our heads checked because if our memories served us right, most of the new projects (including "shoeboxes") that we had seen over the past 3 years have rather large AC ledge/space.

5. We are also grateful to be taught the difference between "covering over" and "enclosures". Having said that, nobody ever said anything about "covering up of roof terraces". Despite our limited English abilities, we believe that "having covered structures built on top of open roof terraces" is quite different from "covering up of roof terraces". And if anyone still insists that the former is prohibited in older estates, he/she has obviously not been to Lakeview Estate!

6. And before this becomes the subject of another Yahoo! News Singapore article (or the National Conversation, for that matter), THE wife and I wanna go on record to say that there is just THE one and only wife... and we shall leave it at that.


Tuesday, January 22, 2013

New project sales status: Q Bay Residences 61% sold!

Q Bay Residences at Tampines has sold 312 out of its 510 launched units as of Monday, after its launch last weekend.

The project is jointly developed by Fraser and Neave (F&N), Far East Organization and Sekisui House.

It is the first private residential project to be launched since the latest round of property cooling measures introduced by the government.

According to a statement released by F&N on Tuesday, the units were sold at an average price of $1,007psf.

Q Bay Residences was launched at an average selling price of $985psf from an originally planned price of $1,050psf.

Excluding Q Bay Residences, F&N said it has a total unsold inventory of 299 units, or about 5% of projects currently under development.

The unsold inventory is primarily from the eCo, Palm Isles, Seastrand and Flamingo Valley private residential projects.

F&N said it plans to launch its remaining site in Woodlands by the second quarter of 2013.

The conglomerate acquired the site in October 2012 at $302psf ppr.

This will be jointly developed with Lum Chang Binjai Holdings, and is expected to yield around 500 units.

F&N has a 70% effective interest in this site.
Source: Channel News Asia

So who says a little more discount won't work...?

Monday, January 21, 2013

Developers getting creative?

Property analysts said developers will probably have to get more creative in order to move sales after the introduction of new cooling measures recently.

One developer told Channel News Asia that it is planning to complete its condominium project a year ahead of schedule to entice buyers.

To date, 380 of the 500 units launched at La Fiesta at Sengkang have been sold. There are 810 units at La Fiesta in total.

Most of the deals were done before the cooling measures kicked in on January 12.

Since then, sales have cooled and just eight units were sold over the weekend.

Its developer, EL Development, has offered discounts of up to 24% off the selling price.

On average, a unit at La Fiesta cost about $1,125psf after discount.

It hopes to deliver the new units a year ahead of schedule by June 2016.

The committed date for delivery of the units was originally set at June 2017.

It will start work earlier and adopt more efficient construction techniques.

Lim Yew Soon, managing director at EL Development, said: "Initially, we are thinking of starting in April, May. We will speed up our construction progress, we intend to commence construction in March, early March. By completing our project earlier, we believe we will be able to draw buyers who are looking for self-occupation."

Mr Lim said this could raise construction cost by two to five per cent, which it will absorb fully.

The developer will also roll out its new marketing campaign for the project this week.

Going forward, EL Development will also devote more resources to explore opportunities in overseas markets like the Iskandar region in Malaysia, Myanmar and China.

Meanwhile, analysts said many developers have offered extra discounts to cushion the impact of the increase in Additional Buyer's Stamp Duty (ABSD).

Colin Tan, director of research and consultancy at Chesterton Suntec International, said: "If you are in the midst of a launch, the developer can't have sales stagnating. The best thing they could do is to absorb the ABSD. That is why the discounts that they are giving is around five to seven per cent."

Singaporeans buying their first home will not be affected by the latest round of cooling measures and some analysts said developers can look at packaging their products to target this group of buyers.

Beyond current projects, analysts expect developers to work at right sizing units and maximising space usage or explore other property segments.

Chia Siew Chuin, director of research and advisory at Colliers International, said: "The way to go is still catering to families with room types catering to them but because of the affordability issue, developers may be prompted to look at smaller sizes of apartments. This is of course not to the extent of Mickey Mouse apartment."

Nicholas Mak, executive director at SLP International Property Consultants, said: "Another way is that the developers may start to look at developing outside the residential market. For example, they may be looking at the commercial property market or industrial property market locally.

"If the developers were to venture into the industrial development market, they have to be aware that they should build industrial units that are suitable for end-users and not retail investors."

Creativity aside, analysts said developers must be careful that their marketing activities do not contradict the intention of the cooling measures.

Source: Channel News Asia

Saturday, January 19, 2013

New project sales status: Q Bay Residences

More than 210 units were sold at Q Bay Residences at Tampines during its preview on Friday.

The development is the first private residential project to be launched since the latest round of property cooling measures kicked in last weekend.

The most popular units were the "one- to two-bedroom suites", followed by the three- and four-bedroom "Verandah Homes" for large families and the TRIO units.

In a statement, Cheang Kok Kheong, chief executive officer of Frasers Centrepoint Homes, said: "They were mainly first-time buyers intending to use the property for their own stay. We are encouraged by the response, and expect more purchases by families tomorrow, at our official launch."

The 630-unit project is a joint venture by Frasers Centrepoint, Far East Organization and Sekisui House.

Q Bay Residences was launched at an average selling price of $985psf ppr, from an originally planned price of $1,050psf ppr. This was after a 15% discount and a 7% stamp duty discount.

The additional buyer's stamp duty (ABSD) is imposed on Singaporeans purchasing their second and subsequent home, as well as permanent residents who purchase a home in Singapore.
Source: Channel News Asia

Looks like the discounts given did help to maintain buying interests somewhat...

Friday, January 18, 2013

Beginning of The Great Singapore Laylong...?

Q Bay Residences at Tampines is the first private residential project to be launched since the latest round of property cooling measures kicked in last weekend.

To attract buyers, the developer is offering discounts of up to 22%.

Market experts said Q Bay Residences will be a test of home buyers' appetite for new developments

The 630-unit project, which is a joint venture by Frasers Centrepoint, Far East Organization and Sekisui House.

It will be launched at an average selling price of $985psf after all discounts this Saturday.

This is below the price of most other new suburban launches out in the market for more than $1,000psf.

The developers of Q Bay Residences said about 550 to 600 buyers put in cheques for pre-booking but about 100 withdrew after the cooling measures were announced.

The developer said many are likely to be third and fourth-time property buyers but they are hoping that the project's location in Tampines will entice buyers.

Q Bay Residences is the first private condominium project to be launched in Tampines in the last two years.

Cheang Kok Kheong, chief executive officer of development & property at Frasers Centrepoint Limited, said: "In Tampines, there has not been many condominiums over the last eight years. There is sort of a pent up demand, people that have been upgrading, have to move on to places like Woodlands and Punggol. But now, the people who own HDB flats are able to continue living in Tampines at Q Bay."

Meanwhile, analysts noted that developers should now be targeting first-time property buyers and pricing is key.

Chris Koh, director of Chris International, said: "It's good that they didn't cross the $1,000psf barrier mark, because if they do, it may scare many people off. By keeping it below $1,000psf, it looks more attractive.

"There's very little comparison because we don't have many developments in that area, but we also know of developments in suburban areas, 99 year leases, that sell at $1,200 psf. On top of that, it's the discount that will make people bite. We're talking about a 15% and an absorption of the Additional Buyer Stamp Duty up to seven per cent."

Experts said the Q Bay Residences project will be a test bed for the market.

Developers are expected to continue with their launches if the sales volumes for the project is healthy.

Q Bay Residences is expected to be completed in May 2017.

Source: Channel News Asia

A home buyer's lament: Here's some relief?

The wife and I came across an article in the Forum page of our de facto English newspaper ("So many questions, so few answers") from a certain Mr Tan who happens to be an enthusiastic first-time home buyer. He claimed that the numerous doubts and anomalies he had after viewing several new and completed projects could not be explained clearly even by experienced real estate agents. He went on to list the questions that he is stilling seeking answers to.

While maintaining that we are no real estate experts (and thus not dispensing professional advice here), we like to have a crack at Mr Tan's questions:

1. What constitutes part of total floor area and what does not?
Technically speaking, everything that is shown on the floor plan of an apartment/house will form a part of the total floor area. The obvious ones are open roof terraces and private enclosed spaces. But areas labeled as "RC ledge", "A/C ledge", "void", "void over staircases", "flat roof of houses (no access except for maintenance)" etc are generally included as part of the total floor area as well. The wife and I have previously came across a new project in the Holland area (recently TOPed) where a planter box located on the outer wall of the master bathroom toilet was included as part of the total area, despite the fact that one has no access whatsoever to this planter box!

The areas that generally do not constitute as part of the total area are what we termed as "common areas", e.g. the walkway outside your apartment, the lift landings (unless your apartment has a private lift, in which case the lift landing is also part of your total area) etc.

2. Is it true that unusable space constitutes 20 - 35% of a unit's total floor area (jumbo penthouses excluded)?
Although this differs between projects, but 10 - 20% of unusable space is a realistic ballpark.   

3. Why are secondary market units valued at a hefty discount to primary market ones?
The can be due to various factors: age and condition of the older development, pedigree of older development versus new, and in some cases, the perception of owners in the older development as to how much they can move prices of their units up vis-a-vis the price of neighboring new development. But the primary reason is due to the obscene bids that developers have made for land parcels over the last 2 - 3 years, coupled with increase in construction costs. As such, their break-even price is much higher now resulting in higher selling prices for new projects.

4. Can small office, home office (SOHO) units with commercial titles like those at Southbank and The Central be purchased for residential use? Is office-cum-residential use allowed?
This is best explained by URA on their website, which has this to say:

Increasingly, we are seeing more developments marketed as “SOHO” in the property market. “SOHO” is essentially a marketing term used by property developments to refer to Small Office, Home Office.  Many would-be buyers are unsure whether “SOHO” units are approved for office or home use, or both.

URA does not recognize “SOHO” as a planning term and does not specifically approve a development for “SOHO” use. Rather, developments being marketed as SOHO today are approved either as Office or Residential but not for both uses.

We have noticed that some office developments are being marketed as residential apartments by calling themselves “SOHO”.  This is misleading and inappropriate as the office development may not fully meet the guidelines and various technical agencies’ requirements for Residential use (eg. provision of sufficient parking facilities).  Similarly, home buyers should not be misled by the term ‘SOHO’ to think that they can convert the residential unit to a pure office.

Residential homeowners or tenants who want to conduct selected small-scale businesses from homes can make use of the existing Home Office Scheme. This is not to be confused with “SOHO” as these units under the Home Office Scheme are still approved and used primarily for Residential purposes. To ensure that the home office uses do not disturb the neighbors, applicants under the Home Office Scheme must meet the stipulated conditions and performance criteria.  For example, there is a limit on the number of employees and type of business uses that can be conducted within the homes. More details on the Home Office Scheme can be found at

Would-be property buyers should be cautious and are advised to check the approved use of the property before committing to any purchases.

5. Some formerly freehold estates that went en bloc are now being sold as new 99-year leasehold condos. Are there any implications to buyers - legal or otherwise?
We are talking about the likes of The Shore Residences in Katong (formerly Rose Garden), which is sold on 103-year lease but resides on a freehold site.

Realistically speaking, this is no difference to buying a leasehold property. The only major implication to buyers (that the wife and I can think of) is that, at the end of the 103-year lease, the land owner can rightfully "take back" the land and do whatever with it as they please, with the buyers/owners having little/no recourse. This is the same right the government has over owners of units in 99-year leasehold developments when the lease is up.

6. Why are new developments prohibited from enclosing balconies and having covered structures built on top of open roof terraces whereas old estates aren't?
This has to do with not changing the facade of the estate. Imagine what a brand new development will look like if every owner decides to have their own ways with their balconies and roof terraces? So a rule is generally put in place at new developments prohibiting any additions/alterations that will alter the facade of the estate. But these rules will generally be relaxed as the estate gets older, although we are unsure if there is a stipulated number of years before this happens.

7. What is the difference between unit size, gross floor area and strata floor area?
This is one that we are not exactly sure (so we stand corrected) but we believe the terms are used interchangeably these days to mean one and the same thing. However, Gross Floor Area is typically referred to in formal and legal documents while Strata Floor Area is used when determining share-values of the unit concerned.

8. Why is photography disallowed in showflats?
This question is best left to the developers, but we reckon they do not want people to just go to their showflats to "steal ideas" without the slightest intention of buying.

There you have it! So if Mr Tan happens to read our blog, hope the above helped in some small ways towards explaining your numerous doubts and anomalies ...

Have a good weekend, everyone!

Of compliments under false pretences...

The wife and I have recently been getting alot of unwanted attention from spammers - comment spams to be exact. It has gotten to the point whereby we need to perform daily (sometimes more than once a day) purging of these "compliments" to ensure that only genuine comments from our readers are "aired" on our blog.

We have now enlisted the help of Akismet ( in an attempt to filter out the spammers. But since we can only incorporate this to all blog entries that currently do not have a comment (else any existing comments will be deleted), our problem may not be entirely resolved.

As such, we seek your patience on the matter and if anyone has some brillant idea on how to keep to the spammers at bay, we're all ears!

Thursday, January 17, 2013

Proposed new MRT lines: Huat Ah...?

According to property analysts, home prices near the proposed new MRT lines are unlikely to increase in near future.

Market watchers say the announcement of a new MRT line could generally prop up prices of homes in the area by 3 to 5%. But the response to the announcement of the expanded rail network on Thursday may be more muted.

News of the new MRT lines would have generated more excitement among developers, buyers and sellers alike in normal circumstances, say analysts. But they are probably still thinking about the impact of the cooling measures introduced recently.

Without further details on the exact locations of the train stations, analysts added that it will not be easy to justify any significant increase in home prices.

Chia Siew Chuin, director of research and advisory at Colliers International said: "When the stations are announced, probably you will see another increase in prices for those located near MRT stations, probably to the tune of 10 to 15%. Nearing completion of the stations, then we will see probably a 20 to 30% increase in prices."

The expanded rail network and new lines and are expected to be ready in 2025 and 2030.

According to analysts, the flip side is that future construction work could undermine the value of homes in the area.

"Typically, no one will want to buy a property to live next to a construction site, that is why buyers will only be willing to pay a premium when they are able to enjoy the benefits, when the lines are completed," said Eugene Lim, key executive officer at ERA.

Market watchers also do not expect the announcement of the new train lines to reduce the impact of cooling measures to keep rising home prices in Singapore in check.
Source: Channel News Asia

At least 12 more years before the expanded network is ready - that's a pretty long time especially for the wife and I, since we have never stayed put at the same place for more than 3 years thus far...

And as far as the inconvenience due to construction work of the new MRT Lines is concerned, just ask those who have to commute along Bukit Timah/Dunearn Road during rush hours these days!

Wednesday, January 16, 2013

December 2012 prvate home sales: So is this what prompted the latest cooling measures?

Demand for new private residential property in Singapore rebounded in December 2012, following a sharp decline in the previous month.

According to the Urban Redevelopment Authority (URA), 1,410 units of new private homes were sold last month, up by about 30% from November's sales of 1,087 units.

Including executive condominiums (EC), the sale of new homes came in at 2,259 units in December.

The best selling project last month was Echelon located at Alexandra View with 331 units changing hands.

In the EC segment, the top performer was CityLife@Tampines which sold 452 units in December.

URA's data showed that 263 units of new private homes located in the core central region were sold during the month.

Meanwhile, developers moved 527 new units in the city fringe and 620 units in the suburban areas.

For the whole of 2012, 22,684 units of new homes, excluding executive condominiums were sold - topping 2010's record high of 16,292 units.

It is also higher than the 16,027 units sold in 2011.

Meanwhile, analysts expect the cooling measures announced last week to have an impact on new home sales in January.

Donald Han, special advisor at HSR, said: "Looking at the numbers, I would expect January to have about 700 to 1000 units being sold -- less activity until the market finds its footing.

"But from March onwards, we could see transaction volume coming back to a normalcy, and normalcy would translate to about 1,600, or 1,650 of new home sales being sold every month for the rest of 2013."

Source: Channel News Asia

Tuesday, January 15, 2013

Post January 12: Transaction volume to drop 20 - 50%!

At least that is what several banks and research houses have predicated after the latest round of property cooling measures took effect.

Here is the report by Credit Suisse on what they see as the likely impact, for those who are interested. (* Thank you Jason! *)

And below is what Maybank-Kim Eng thinks:

Saturday, January 12, 2013

The Big Freeze!

The Government has introduced the seventh set of property cooling measures in over three years to try and rein in the red-hot prices. These is effective for all new property purchases on/after today (January 12).

The latest package are seen as the most sweeping to date, with some of the measures being temporary and will be reviewed later while others are likely to stay for the long term.

Below is the list of new measures and what the wife and I think about each:

Temporary, counter-cyclical measures (applies to all residential property)

1. Singaporeans to pay 7% Additional Buyers' Stamp Duty (ABSD) on their second purchase (up from 0%) and 10% on subsequent purchases (up from 3%).
More costly to acquire a second (or more) property for investment purposes.

2. PRs to pay 5% ABSD on first purchase (up from 0%) and 10% on subsequent purchases (up from 3%). Foreigners and corporate entities will pay 15% ABSD on all purchases (up from 10%).
Our government finally concede to the people's call for "Singaporean first" private housing policy?

3. Tighter Loan-to-Value limit on housing loans for those with at least one outstanding home loan; 50% for second loan (down from 60%) and 40% for third (down from 60%); if loan tenure is more than 30 years or extend past age 65, it is 30% for second loan and 20% for third onward.
Putting the squeeze on how much you can borrow from the bank, so one will have to be even more "deep pocket" to be able to afford a second or more property.

4. Minimum cash payment for those with at least one outstanding home loan to go up from 10% to  25%
More cash downpayment = more cash upfront = reduced affordability

Permanent, structural measures

1. Maximum strata floor area of no more than 160sqm (1,722sqft) for new Executive Condominium (EC) units.
Bye bye super-sized penthouses and presidential suites!

2. New dual-key units for multi-generational families' use only
If policed properly, this spells the end of the "stay in one, rent out the other" dream...

3. Developers of future EC sites from Government Land Sales to sell units only 15 months from the award of the site or after completion of foundation works, whichever is first.
No more of them Forestville fiasco!

4. Private enclosed space and roof terraces to be treated as gross floor area.
  • These will be counted as part of the 10% bonus gross floor area (GFA) for both EC and private condos, and subject to payment of development charges/differential premium. Thus no more "free area" for developers to make money on.
  • The new treatment will likely mean that existing owners of homes with PES and roof terraces will see their properties appreciate in value (at least on paper) as these areas will now be priced the same as all interior space. So Huat Ah!

The wife and I feel that the latest set of  cooling measures is likely to cause a fair bit of upheaval to the private property and EC market over the next couple of months. The big question is whether the effects will be longer lasting this time around as compared to the previous 6 rounds.

What do you think?


Friday, January 11, 2013

Q4 resale prices jumped 13%!

Resale prices of private non-landed homes jumped 13.4% on-year in the fourth quarter last year, according to flash estimates put out by the Singapore Real Estate Exchange (SRX).

SRX compiles data from 11 top property agencies in Singapore.

It said non-landed private resale home prices continued its uptrend to hit $1,233psf in the fourth quarter (Q4), compared to $1,157psf in the third quarter (Q3) in 2012.

Resale units in the mass market segment led the gain with a 4.8% increase over Q3, while those in the city fringes saw prices climb 3.6%.

But it was the core central region which saw a higher-than-expected growth of 4.6% in Q4.

SRX said this was due to the city area's strong performance in December.

Average private resale home prices in the city area surged 8.8% to $1,899psf in December, over November's average of $1,746.

SRX said the strong growth is partly attributed to a possible record breaking price paid by Hong Kong's Swire Properties for all 12 units in the en bloc sale of Hampton Court located at the corner of Draycott Park and Draycott Drive

Meanwhile, resale transaction volume of non-landed private homes showed a seasonal drop of 5.5% in Q4 compared with Q3.

But transaction volumes in the city area bucked the trend by reporting a 7.3% increase. Volumes in city fringes and mass market segments fell by 11% and 4.6% respectively.

For the full year, 12,500 units were transacted in the private resale non-landed market - a 7% drop compared to 2011.

SRX said this can be attributed mainly to the weak performance in the first half of the year, which saw a 27.3% plunge in transaction volumes after the additional buyer's stamp duty was introduced.

But the trend was reversed in the second half of the year with a 20.1% jump in the number of units transacted compared to a year ago.

Source: Channel News Asia

Thursday, January 10, 2013

Enbloc news: Villa Des Flores...yet again!

Villa Des Flores, a freehold development on Whitley Road has been up for collective sale again, after two previous unsuccessful attempts last year.

The indicative price range remains unchanged at $160 million to $165 million or $1,533 to $1,581psf, said DTZ.

The 41-unit condominium sits on a 104,370sqft land parcel and comprises 13 townhouses and 28 apartments.

Shaun Poh, DTZ's senior director for investment advisory services and auction, said previous bids for the site did not meet the indicative asking price.

He revealed that a handful of inquiries for the site were received after the closing period in October, prompting this third attempt at a collective sale.

According to Master Plan 2008, the site can be developed into two-storey mixed landed housing.

The developer has the option to build detached, semi-detached, terrace housing or a combination of such, either based on conventional housing types or as a cluster housing development.

The tender closes on Jan 30 at 3pm.

Click on link below to read our previous posts on the Villa Des Flores collective sale:

Tuesday, January 8, 2013

New project sales staus: Echelon

It was reported in our de facto English newspaper today that 390 units had been sold at Echelon, a 508-unit condo in Alexandra View which was officially launched at the weekend.

This means that nearly 200 more units at the 99-year leasehold project developed by City Developments (CDL) were sold after the Dec 28 preview when more than 200 units were snapped up in a single day.

CDL said the units were launched at an early-bird price of $1,700psf on average, with increases of 2% to 4% for subsequent releases.

Singaporeans made up 80% of the buyers, with the rest being permanent residents or foreigners from countries including Malaysia, Indonesia and China.

Monday, January 7, 2013

No more "free spaces" for developers ...?

National Development Minister Khaw Boon Wan has asked the Urban Redevelopment Authority (URA) to review and fix the policy allowing developers to sell off free spaces to make additional profit for themselves.

He said this in a blog post, "Who Gets Short-Changed?", on Monday, on the heels of recent launches of executive condominium (EC) projects.

Mr Khaw noted that in these projects, super-sized units were offered and snapped up by buyers who did not appear to be from the "sandwiched" households.

He said understandably, there was public indignation that there were "deviations" from the government's intention of meeting the needs of such households through ECs.

Mr Khaw said the developers explained that such super EC units were a minority, and that they were snapped up by buyers who could actually afford private properties as they had priced them low.

One such developer, he noted, priced its super penthouse at $470psf, while selling the other smaller typical EC units at $770 psf.

Mr Khaw was referring to CityLife@Tampines, which made the news for a penthouse unit with a record price tag of $2.05 million. The unit was over 4,000sqft - roughly four times as big as a five-room HDB flat. The unit was snapped up within two hours of its launch.

This sparked a public outcry on whether ECs have deviated from its original intent to provide subsidised housing for the sandwiched class - those who cannot afford private property but with an income exceeding the limit that qualifies them for a HDB flat.

Mr Khaw said communal sky terraces have been effective in promoting greenery and providing useful common amenities for residents.

But the creation and sale of super-sized private roof terraces is becoming more prevalent.

This is also happening on the ground floor, where it's referred to as "private enclosed space" for the buyer.

Mr Khaw said under URA rules, it's "not improper" for developers to sell off free spaces to make additional profit.

But he's concerned that as more developers do so with larger private roof terraces and private enclosed space, communal space in the development that benefits all residents will shrink.

Chesterton Suntec's research head Colin Tan said: "This is a closed market in the sense that there is a ceiling cap. And so the developers may think that the majority will not be prepared to pay for such space, and so they decided to concentrate most of this space in just a few units. They feel that at least there will be some buyers who will be prepared to pay for this."

In an emailed response to Channel NewsAsia, URA said: "We are reviewing the guidelines on private enclosed space and private roof terraces, and will announce the details once the review is completed."

Property analysts said the issue has much to do with equity.

CEO of International Property Advisor Ku Swee Yong said: "A sandwiched class family with a household income of $12,000 - are they able to afford a property that is more than $1.5 million? If the family, together with support from parents and relatives can afford (a unit costing) more than $1.5 million then perhaps they are not really in the sandwiched class anymore. They should be better off buying a private property rather than buying a subsidised property which is subsidised with taxpayers' money."
Source: Channel News Asia

Mr Ku seems to have hit the nail right on its head there...

Saturday, January 5, 2013

Thomson View: En bloc-ed no more..?!

Apparently the supposed $590 million collective sale of Thomson View Condominium has stalled after 13 owners lodged objection to the deal.

It was reported that the Strata Titles Board has issued notice of a stop order yesterday. This will take effect on Jan 14. Such orders are made only if mediation is unsuccessful. There have been 3 rounds of mediation for Thomson View.

One of the issues raised by the 13 objectors is believed to be the sale price (surprise, surprise!), which they believe undervalues the development. As the Upper Thomson MRT station - part of the upcoming Thomson Line - was announced during the site's tender period, the objectors believe they should be getting more for the site as the MRT station will be near by.

The majority owners of the 255-unit Thomson View will now have to make an application to the High Court for further adjudication.

The stop order raises concerns that the collective sale process for Thomson View may result in a drawn out legal battle due to the large size of the development.

The 540,314sqft site in Upper Thomson Road was bought by a consortium led by developer Wee Hur Development and private equity investment company Lucrum Capital for $712psf ppr in September last year. It was the fifth largest collective sale made. Owners of Thomson View units - ranging from apartments to townhouses and shop space - were expected to receive gross proceeds of $1.62 million to $3.59 million.

So the Thomson View Condominium collective sale has the making of another Horizon Towers saga, which dragged on for more than 4 years. So would this be another case of only the lawyers making all the money at the end of the day?

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit   -    Gordon Gekko

So anyone remembers what happened to Mr. Gekko at the end...?

Click on link below to read our previous posts on the Thomson View collective sale:

Friday, January 4, 2013

Tweaking EC rules to make it more "palatable"?

The average number of penthouse units in executive condominium (EC) projects has climbed slightly in the past year, according to market watchers.

The sale of a luxury penthouse recently has triggered a debate over the role of ECs.

Some analysts have told Channel NewsAsia that while ECs are still relevant, some rules could be tweaked.

ECs were introduced in 1995 and its objective is to provide alternative housing for households who do not qualify for public housing and are unable to afford private condominiums.

Recently-launched ECs often come with all the trappings of a private residential project. Such features include high quality fittings and even concierge services, but at a 25% discount in terms of prices.

But a penthouse at CityLife@Tampines stole the limelight when it was sold for an eye-catching S$2 million.

Property consultancy Knight Frank said that in 2010 and 2011, on average, penthouses made up about 3 to 5% of an EC development.

This number rose to between 5 and 6% last year.

"Developers have to think of new ways to entice buyers for their projects. One of the ways is to introduce luxurious penthouse units," said Alice Tan, senior manager of consultancy and research at Knight Frank.

"With this recent hype about the 400-square-metre penthouse unit, which was snapped up within an hour, it demonstrates that people are actually looking for luxurious living."

According to analysts, ECs still serve their purpose of providing alternative housing for the sandwiched class, but some rules could be fine-tuned.

ECs - a hybrid of private and public housing - come with ownership and resale restrictions. The buyer's income must not be more than $12,000 a month.

Currently, the government offers a grant of up to $30,000 for first-time buyers and does not require those upgrading from a public housing flat to pay a resale levy.

Mohd Ismail, CEO of Propnex suggested that the government could also put out guidelines to limit the size and number of large units within an EC project.

For example, he suggested that a penthouse unit should not be larger than 2,000sqft and larger units of between 1,200sqft and 1,500sqft should not constitute more than 15% of the development.

Meanwhile, some analysts say the trend of developing large EC units are not very different now as compared to the 90s.

Alan Cheong, director of research and consultancy at Savills said the number of sale transactions for EC units over 2000sqft remain quite similar at over two per cent on average, and the ongoing debate could be a result of rising property prices.

"All the while they had large units in ECs, people hardly made any noise until now," said Mr Cheong. "This thing is coming to haunt everyone because property prices are at an elevated level, everyone wants to have the cake and eat it and profit from it."

The government is expected to roll out more sites for EC development this year.

According to analysts, the projects will attract strong interest from developers who will continue to offer attractive EC units, comparable to those in the private condominiums.

The National Development Ministry said it is watching developments in the EC market closely and will consider further measures if needed.
Source: Channel News Asia

While we are on the subject of tweaking the EC rules, here's a thought: Why don't the Government just stipulate that penthouses be forbidden in EC projects altogether?

If the purpose of such development is truly to cater to the so-called "sandwiched class" who aspired to upgrade themselves to condominium living but are priced out of the private condominium market, these group of individuals should not be given options that they can ill-afford (technically speaking that is, as a significant number are supported by FAMA, i.e. Father and Mother Association).

And to allow such ginormous units to be built on supposedly subsidized land parcels and with grants given to eligible buyers is (in our humble opinion as always) a terrible use of tax-payers' money.

If banning penthouses in new EC projects is untenable, the Government should at least disallowed any form of grants to be used for purchase of such units.

What do you think?

Wednesday, January 2, 2013

Enbloc News: Kimis Lodge - take two!

Kismis Lodge, a freehold site located off Toh Tuck Road, is up for collective sale.


This is the second time the site is being put up for sale.

According to its marketing agent Jones Lang LaSalle, the 70,283sqft site is zoned for a "3-storey mixed landed" development.

The site can be redeveloped to yield up to 43 strata terraces or a combination of conventional and strata landed homes, subject to design and planning approval.

"Given its location, we believe that the new development at Kismis Lodge could easily achieve between $3.5 million to $4.0 million for its strata terraces." said Ms Yong Choon Fah, National Director, Jones Lang LaSalle.

Ms Yong added that keen interest from developers is expected.

The owners of Kismis Lodge are expecting offers in the region of $90 million from the collective sale, or approximately $1,281psf. 

That is at the lower end of its asking price of $1,281 to $1,352psf when it was first put up for sale by Credo Real Estate last July.

There is no development charge payable for the site.

If successful, each owner of the 64-unit apartment will fetch approximately $1.4 million.

More than 80% of the owners by floor area and share value have consented to the collective sale.

The tender for Kismis Lodge closes at 2.30pm on January 24.
Source: Channel News Asia

So the first en bloc attempt has kicked off for 2013. Given the substantial number of land parcels that the Government will release under the Government Land Sales (GLS) scheme this year, it will be interesting to see if second time's really a charm for Krimis Lodge. And with $1.4 million these days, we reckon there aren't that many options when comes to replacement apartment for the owners, unless they are prepared to downgrade.

Private home prices at record high!

Prices of new private homes in Singapore rose to a new record in the fourth quarter of 2012.

This comes on the back of rising demand for private homes in the sub-urban areas.

Preliminary data from the Urban Redevelopment Authority (URA) showed a 1.8% quarter-on-quarter increase to a record 211.9 points in the fourth-quarter period from the previous quarter.

But prices increased by about 2.8% for the entire 2012, slower than 2011's 5.9% increase.

Despite the last quarter of the year being traditionally slower for the property market, rising demand for private homes lifted the URA Private Residential Property Price Index to its highest level in the last six quarters, according to SLP International.

Mr Eugene Lim, Key Executive Officer of ERA, said: "There have been projects that were launched in Q4. These were on plots of land that were bid at higher prices. So pricing for profit - the developers built on the momentum of the market and they went out at higher prices. So this accounted for a price increase in Q4."

The mass market segment, which are commonly located in the suburbs, increased the most by 3.4%.

SLP International noted that preliminary figures from SLP Research show that 61.3% of all the private homes that were transacted in the last quarter were located in the outside central region (OCR).

The city fringes was 0.9% higher while the high-end market, which are mostly located in the city, rose 0.8%.

For the full year, home prices increased by 2.8% and is slower than the 5.9 per cent rise in 2011.

Analysts say the government's market cooling measures, such as the Additional Buyers' Stamp Duty and the latest mortgage tenure curbs, have been effective to some extent in moderating price growth in 2012.

Prices are expected to climb but moderate in 2013.

Mr Mohd Ismail, CEO of PropNex, said: "I'm not expecting the moderation to come in the first half of this year simply because many of the land sites were bid, very much higher than the first half of last year. The first half, we would see a higher increment of 4%, and the second half of the year tapering between 2-3%. And that's where the overall price increment of about 6-7%."

Some analysts expect the Eurozone crisis to drive high networth individuals to invest in real estate in Singapore, boosting the high-end property market.

The mass market segment should also see double digit increases of 10 to 15% in 2013 due to the rapid land price increases seen in last year's Government Land Sales site tenders.
Source: Channel News Asia

In every ongoing abusive relationship, there is one party who enjoys dishing out the beating and another party who continues to put up with the beating. The wife and I wonder for how long more the abused party is prepared to suffer before calling it quits...

Tuesday, January 1, 2013

Third year on, fourth to come?

Time really flies; another year has quickly come and gone.
2012 was a year characterized by private home prices that seem to defy gravity. This is despite the additional rounds of cooling measures implemented by the government to try and cool the market. The year has also seen renewed interests in Executive Condominiums (ECs), with record number of new launches. And speaking of ECs, developers have suddenly decided to build bigger and bigger “super-sized penthouses” and “presidential suites”. The mother of all such is a 4,349sqft penthouse at CityLife@Tampines that was sold for $2.05 million, an all-time high for an EC unit. How/Why the government would approve the construction and sale of such “luxury” units in housing projects that are supposedly meant for the so-called “sandwiched class” is quite the mystery (certainly the URA or whatever relevant department cannot claim ignorance on the unit sizes and designs for new ECs that developers want to build).  This is especially when the land cost for ECs is subsidized and many eligible families are given subsidies to purchase such class of semi-public housing.

2012 has also been somewhat of a watershed year for the wife and I. One of us had decided to change job and with it, our daily lives have become increasingly grinding. In addition, our Primary 2-going son needed closer supervision in his studies, which meant more time (and added pressure) on his parents. Given our busier schedules, something had to give and thus the reason for the less frequent blog posting and new project reviews last year. Matter of fact, we had totally forgotten about our third anniversary (December 7th) until it suddenly dawned on us while we went on vacation last week.

There were several junctures in 2012 when the wife and I had contemplated closing shop on SG PropTalk, but we eventually decided to take it by the day and see what happens. And before long, SG PropTalk has “survived” another year. One of the reasons that kept us going was the support and encouraging words from our readers, which we are extremely grateful.

Going forward, the wife and I don't know how long more we will continue blogging, as it is becoming quite the chore rather than enjoyment. And we did say previously that we will stop blogging once it is no longer fun to do so. But we really hope that come December7th  2013 (or thereabouts), we will be sitting somewhere penning our little anniversary note.

Happy New Year, everyone!

P/S:   The last paragraph was actually written on a piece of tissue paper while our flight was descending towards Changi Airport earlier.