Private home prices: Climbing at slower pace

Source : Today – 24 Jul 2010

Private home prices in Singapore continued to trend up, but at a slower pace.

Data released by the Urban Redevelopment Authority (URA) on Friday showed that overall prices rose by 5.3 per cent in the second quarter of 2010, compared to 5.6 per cent in the first three months of the year.

The increase pushed the residential property price index to an all-time high, surpassing the market peak of 181.4 points in the second quarter of 1996.

Prices of private residential properties in the city and prime districts went up by 5.4 per cent, while homes in the city fringe cost 4.6 per cent more in the second quarter.

Meanwhile, prices of private suburban homes rose by 5.7 per cent.

At the same time, prices of non-landed properties increased by 5 per cent in the second quarter, a tad higher than the 4.9 per cent increase in the previous quarter.

For landed properties, it was up 6.2 per cent in the second quarter, compared with 8.3 per cent in the previous quarter.

Also, rentals of private residential properties, office, shop and industrial properties, were higher by between 0.5 per cent and 5.9 per cent.

Enbloc sales: Still going according to plan

Source : Today – 23 Jul 2010

Despite changes in the Land Strata Titles Act, developments are continuing their en bloc runs

Property owners with en bloc sale aspirations seem unfazed by the new provisions to the Land Strata Titles Act which took effect last week as a number of them are still proceeding with their collective sales as planned.

Developments such as Allsworth Park, Mayfair Gardens, Thomson View and Shenton House are among those continuing their en bloc runs and have elected sales committees.

Analysts are also expecting between 20 to 40 en bloc launches for the rest of the year with an average deal value of between $50 million and $100 million.

Things are also looking smooth for Laguna Park, whose new sales committee has appointed Knight Frank as marketing agent and Khattar Wong as lawyer.

Laguna Park dwellers are looking to open for tender by the first quarter of next year, a resident told MediaCorp.

Market watchers also expect several smaller developments with fewer than 50 units to be en bloc ready by year end.

The latest amendments in the Land Strata Titles Act have won the approval of marketing agents and residents who believe the provisions will help prevent a lengthy and convoluted en bloc process.

In particular, they laud the recommendation to raise the requisition rate to reconvene another extraordinary general meeting to 50 per cent of share value or total number of residents.

That is higher than the previous 20 per cent of share value or 25 per cent of the total number of owners required and will apply to homeowners who failed their initial attempt at an en bloc sale.

The Ministry of Law said the new provision is to discourage numerous en bloc tries if there is insufficient interest from homeowners.

Some changes in the Land Strata Titles Act – such as the two-year restriction if a first attempt fails – should help en bloc sellers to time their sale in a property upswing and increase their odds at pocketing larger profits.

“Collective sales should be moving along swiftly as it is now or never for them,” said Ms Christina Sim, director of investment at Cushman and Wakefield.

“For the property agents, they know they are embarking on something serious and the chances of it coming to fruition are better,” she added.

However, property analysts believe that with more launches expected in the second half of this year, this may result in a developers’ market.

This means that with the onset of launches, developers will have more to choose from and sellers will have to keep their prices competitive and “realistic”, said Ms Sim.

“With the buffet spread of collective sales coming up, and with the limited spending power from developers, the sites have to be priced realistically to meet the balance between market demand and residents’ needs,” she explained.

Just this month, tenders for two en bloc sites were completed with the People’s Mansion in Lorong 31 Geylang selling for $42.68 million, and Meng Garden Apartments in Killiney Road going for $137 million.

This week, CBRE launched the en bloc sale of Holland Tower with an indicative asking price of $68 million.

“The 13 en bloc deals in the first half of the year were relatively small, averaging at $40 million,” said Mr Karamjit Singh, managing director of Credo Real Estate.

He also expects 20 to 40 en bloc launches in the second half, mainly medium sized projects and a handful of large ones.

5 tips for investing in shops and shophouses

The number of commercial units, typically shophouses and strata units for office and shops, sold in 1H 2010 remained similar to that in 2H 2009. A total of 495 commercial units were transacted in 1H 2010, reflecting a 4 per cent decrease compared to that in 2H 2009.

Although economic conditions have tremendously improved in 1H 2010, the number of commercial properties transacted was subdued, underpinned by limited supply and a stalemate in sellers’ asking prices and owners’ offer prices.

The limited supply meant limited choices for potential buyers while for sellers, the limited supply of strata commercial properties meant that there would be no urgency to sell their properties in case prices appreciate with further economic recovery.

Nevertheless, the total value of commercial units transacted was $976.9 million, 12 per cent higher than that in
2H 2009. The encouraging value of commercial units transacted in 1H 2010 could be the result of a shift from an interest for units in the lower price-band, to units in the mid price-band.

In 2009, due to the adverse economic conditions, investors and buyers were cautious and preferred to purchase commercial units which were affordably priced in the lowest price band.

Most transaction activities of strata shops and shophouses still remain in the Central Region (planning areas like Outram, Rochor, Kallang, Geylang). Meanwhile, strata office investors are shifting their interest to fringe areas like Beach Road, Middle Road and East Coast vicinity.

Buying Shops & Shophouses – What should you look out for?

* Financing

As with most property transactions, getting funding is pivotal to the buying decision. Since July 2006, CPF savings cannot be used to finance commercial purchase. As such, getting a bank loan is critical.

With most banks granting loans of 70 to 80 per cent of the purchase price or valuation (whichever is lower), prospective buyers must have cash upfront for the remaining 20 to 30 per cent.

Currently, many banks are offering commercial loan packages at promotional rate of about 2.3 per cent which is a booster for many investors who are considering buying commercial properties for investment or owner occupation.

* Location

Location is one key consideration in the buying decision for any property, more so for shops and shophouses. As shops/shophouses are for retailing purposes, they should be in conspicuous locations and sited where human traffic is high.

In a shopping mall, one has to pay a premium for shops in the main shoppers’ concourse and facing the escalator where most shoppers will pass by when shopping. In the case of shophouse, its visibility from the main road and easy access to carparks are essential factors for consideration.

Good locations of shops/shophouses generate better rentability and therefore higher rental yields if they are held as investment properties.

* Tenure

Statistics in 2H2009 & 1H2010 have shown that most buyers for shophouses preferred freehold properties while about half of the strata shop transactions in the same period were 99-year leasehold strata shops.

Differences in values between the two tenures can be in the region of 15 per cent to 20 per cent depending on the balance years of lease and other factors.

In recent years, many buyers of commercial properties have embraced 99-year leasehold properties in their investment portfolios as they are more affordable and have higher rental yields because of their lower capital values.

* Zoning

This is essential to note when buying shophouses. Shophouses are usually erected on land zoned “Commercial” or “Residential with Commercial on Groundfloor Only”.

Shophouses sited on land zoned residential are essentially terrace buildings with “tolerated” commercial uses and the occupants have to pay Temporary Occupation Licence (TOL) fees to the relevant authority for the non-residential usage.

Buyers have to note that they cannot assume that the building erected on residential zoned land can continue to run as a shophouse when there is a transfer of ownership.

* Road line

This must be factored in when buying shophouses. Shophouses that face the main road are often affected by road lines. If the property is adversely affected – say, by a major road line – it will be more difficult to get bank financing as there is the risk of government acquisition for road widening.

However, if the shophouses are conserved or located within a conservation area, they are generally safe buys as these are “protected” areas.

Outlook for commercial units

Strata Office

The commercial property sales market is expected to continue to improve in 2010, in tandem with an expected economic recovery. Sales activity for strata office units is likely to reflect moderate increase, as investor sentiments for strata office units improve.

Potential buyers of strata offices are likely to continue to remain less sensitive to the tenure of strata offices. About two-third of strata offices transacted in 2H 2009 and 1H 2010 were 99-year leasehold strata offices. This trend is likely to continue, given limited supply, lower capital outlay and attractive yields of leasehold strata offices.

Strata Shops

The number of shop units transacted is expected to remain similar to the current number. However, due to limited new supply of strata shops, transaction prices is expected to be stable and there is potential for some capital appreciation.

Additionally, while strata shops are generally older and may be thought to be losing their appeal, there are certain trades which can only be supported by strata shops. These include lower-cost retail services, offering personable and customized services for regular customers.

About half of strata shops transacted in 2H 2009 and 1H 2010 were 99-year leasehold strata shops. This is likely to continue in 2H 2010.

Shophouses

Shophouses are expected to remain favourable for buyers, underpinned by limited supply and unique design. Some potential buyers will also feel that owning shophouses will be more tangible than renting as the unique value can only be actualised through owning.

Buyers are expected to remain keen in freehold shophouses. Currently, only about a quarter of shophouse transactions are leasehold, reflecting buyers’ strong desire to have a lasting interest in shophouses.

By Mary Sai, Executive Director Auctions (Commercial), Knight Frank

HDB resale prices hit record high again rising by 4.1% in Q2

Source : Channel NewsAsia – 23 Jul 2010

HDB resale flat prices have hit record highs again. Prices rose by 4.1 per cent in the second quarter of 2010 compared with the previous quarter. This makes it the fifth straight quarter of increase.

The HDB resale market continues to attract keen interest. Analysts said the demand is driven by those who don’t qualify for a new flat or want a flat quickly.

These are the singles, permanent residents, flat owners who want to upgrade or downgrade and married couples who can’t wait three years for a new HDB flat.

Chris Koh, director, Dennis Wee Group, said: “Private property prices are very high today and because it’s so high there are a lot of people who are now turning to the HDB market.”

The high demand also sent the cash-over-valuation or COV upwards.

96 per cent of transactions in Q2 were above valuation.

Mr Koh added: “A lot of people who are selling their HDB flats today are cashing out, with S$100,000 to S$200,000. So for example, if you ask them to put down a COV of S$50,000, for the next flat they buy, they wouldn’t mind.”

Cash-over-valuation (COV) is the cash premium paid on top of a flat’s valuation.

According to the latest data from HDB, the median COV is now some S$30,000 for all resale transactions. But market watchers said the market could be reaching a threshold soon.

That’s because of a ruling introduced in March 2010 requiring home buyers who want a second HDB loan to plough back half their cash profits from the sale of the first flat.

Mohd Ismail, CEO, PropNex, said: “Even if anyone who makes a S$100,000 profit, you have to plough back S$50,000 into the new flat and you’re only left with S$50,000. And with that S$50,000, if you pay a high COV of S$40,000, you are left with nothing.”

Mr Ismail added that the market is showing signs of resistence and expects the COV to hit a threshold of S$40,000.

Market watchers noted that many buyers and sellers now treat the COV as part and parcel of any resale transaction.

And this is not healthy for the market in the long term.

Mr Ismail added: “During the previous peak in 1996, there were people who paid well above S$100,000 COV for a house. We had a house at Yishun, valued at S$510,000, and somebody paid S$135,000 cash. Today, even though the HDB prices are at their peak, in terms of price index, such houses are still below water.”

Given the positive economic outlook, analysts expect prices to continue climbing.

The Housing and Development Board (HDB) said it’ll ensure that there’s an adequate supply of new flats for first-time buyers.

In the first six months of 2010, HDB launched close to 9,000 Build-To-Order (BTO) flats, which is the number of BTO flats launched for the whole of last year.

Another 7,200 BTO flats will be launched in the second half of 2010, bringing the total BTO flat supply for 2010 to 16,000.

This is an increase of 80 per cent over the previous year.

HDB said the BTO projects in the second half of the year will enjoy a good geographical spread in towns such as Woodlands, Yishun, Punggol and Sengkang.

For this month, flat buyers can look forward to about 1,000 BTO flats in Jurong West and Bukit Panjang.

HDB resale market hits a new high

Source : AsiaOne – 23 Jul 2010

Prices of HDB resale flats have hit a new high in the second quarter of this year.

According to the latest statistics released by the Housing Development Board (HDB), the resale price index in the second quarter this year rose 4.1 per cent over the previous quarter, compared to the increase of 2.8% in the first quarter of this year.

The median Cash-Over-Valuation (COV) amount amongst all resale transactions also increased to $30,000, with the proportion of resale cases transacting above valuation increasing to 96%.

Units in the Bishan area garnered the highest median COV amount as compared to other towns, with flats going for $40,000 above valuation on average in Q2.

However, Singaporeans seem undeterred by the jump in prices, as resale transactions rose by about 7% this quarter, from 8,484 cases.

Increase in supply of flats to meet demand

HDB says it is ramping up its new flat supply this year to meet the demand from first-timer households. More Design, Build and Sell Scheme (DBSS) flats and Executive Condominiums (EC) units will also be launched.

It will hopefully provide more choices for first-timer households, and divert some demand from the HDB resale market, said the HDB.

The Built-to-Order (BTO) projects in the second half of the year will located in towns such as Woodlands, Yishun, Punggol and Sengkang, for a “good geographical spread”.

For this month, flat buyers can look forward to about 1,000 BTO flats in Jurong West and Bukit Panjang.

To provide more choices for higher-income earners, 4,700 upcoming units are to be launched under the Design, Build and Sell Scheme (DBSS) and Executive Condominium (EC) Housing Scheme:

They are:

* The Yishun DBSS site awarded in May 2010 has an estimated yield of 700 units;
* Another DBSS site at Tampines PH2, launched on 23 Jun 2010 for sale by public tender, has an estimated yield of 580 units;
* Two new DBSS sites in Bedok Reservoir and Upper Serangoon, to be launched later this year, will yield another 1,000 flats;
* Four EC sites in Sengkang, Yishun and Punggol yielding an estimate of 1,985 units had been awarded in 1H2010; and
* One EC site in Jurong with an estimated yield of 460 units was launched on 2 Jul 2010 with tender closing on 12 Aug 2010.

There are also four sites in the pipeline for EC supply located in Punggol, Pasir Ris, Bukit Panjang and Tampines, expected to yield another 1,900 units.

HDB says it is prepared to launch more sites for DBSS development if there is sustained demand.

HDB rental market

Subletting transactions increased by about 15% from 6,606 cases in the first quarter of 2010 to 7,595 cases in the second quarter of this year.

The median rental price for a five-room flat is about $2,000, with median rent on executive units at $2,100. The median rental price for a 2-room, 3-room and 4-room unit is $1,200, $1,500 and $1,800 respectively.

The total number of HDB flats approved for subletting rose to about 30,500 units in Q2, compared to about 27,300 units in Q1 2010.

S’pore Q2 private home sales climb up by 5.3%: URA

Source : Channel NewsAsia – 23 Jul 2010

Private home prices in Singapore continued to trend up but at a slower pace.

Data released by the Urban Redevelopment Authority showed that overall prices rose by 5.3 per cent in the second quarter of 2010, compared to 5.6 per cent in the first three months of the year.

This was marginally higher than the initial forecast of a 5.2 per cent climb for Q2 reported earlier this month.

The increase pushed the residential property price index to an all-time high, surpassing the market peak of 181.4 points in Q2 of 1996.

URA says prices of private residential, office, shop and industrial properties all increased by between 3.9 and 5.7 per cent in the second quarter.

Rentals of private residential properties, office, shop and industrial properties, meanwhile, were higher by between 0.5 and 5.9 per cent.

Price of private residential properties in the city and prime districts went up by 5.4 per cent.

While homes in the city fringe cost 4.6 per cent more in the second quarter.

Meanwhile, prices of private suburban homes rose by 5.7 per cent during the period.

URA says as at the second quarter, there were close to 62,000 private residential units in the pipeline.

It comprises supply from projects already under construction and those that had been granted planning approval but not yet constructed.

Of those, some 32,500 units were still unsold.

This number is equivalent to about three years of supply based on the average take-up of about 11,300 units per year over the last three years.

Signs of another en bloc rush

Sale proceedings may have begun at up to 80 developments, with many more to follow

They were a feature of the last boom but fast fell out of favour when markets went south, yet there are signs that another collective sale rush is in the making.

There have been at least 16 collective sales this year, not counting many smaller ones that may have gone unreported.

This is in stark contrast to last year, when only one collective sale was sealed. There were 10 in 2008 but most were late spillover deals from the boom of 2006 and 2007.

The greatest spell of collective sales remains the first six months of 2007, when at least 55 projects were sold for an astounding $9.3 billion.

The slow start this year is not due to a lack of demand for collective sales, but a shortage in supply arising from the extra time needed to meet the tougher legal formalities and more detailed logistical arrangements when gathering owners’ consent.

We should certainly see more collective sales over the remaining months of the year as the organisational momentum picks up pace.

As many as 80 developments are believed to have formally embarked on steps to sell their properties en bloc, although the actual figure may well be more. But not all will secure the 80 per cent owners’ mandate or find a buyer.

Numbers aside, larger projects are also expected to be introduced this year and next.

The average deal size of the 16 successful cases this year is $50 million – a far cry from the average deal size of $170 million in the first half of 2007.

The 52-unit Goodrich Park near Kovan MRT station was sold in a collective sale to BBR Holdings for $86 million this month, but as the deal has not won unanimous approval from owners, it may need approval from the Strata Titles Board (STB).

Each of its owners is set to receive gross sale proceeds of between $1.55 million and $1.72 million – or about 70 to 80 per cent more than the market price.

In April, Culford Gardens in Siglap was also sold to Fragrance Properties for $39 million.

Despite the dominance of the Government Land Sales (GLS) programme this year, we believe that collective sales are still relevant in today’s market as they fill the void left by the programme.

GLS sites have leasehold tenure and are mostly located in suburban areas, and their large-sized plots mean they typically cater mainly to bigger developers.

In most cases, collective sales complement the GLS programme, especially when they produce large prime freehold sites, which are in short supply.

However, leasehold collective sales in mass-market locations might find it harder to make large profits as developers might prefer the relative ease and certainty that GLS sites offer.

Owners contemplating such sales should also understand that sale activity takes place in waves since the factors that give rise to price differentials do not stack up for very long.

Many owners get concerned over the rising cost of replacement homes but this paradox is always present as collective sales inherently occur only when the market is buoyant. Acting decisively might help offset the risks of being caught cold.

It is also important for owners to elect objective and honest leaders, appoint and listen to competent lawyers and property consultants, set realistic prices, act decisively and stay united to ensure a happy ending.

Some owners might also wonder if there is a possibility that we will see another Horizon Towers dispute.

Horizon Towers was the most high-profile property sold in early 2007, just before the steep run-up in land prices. This factor and other technical irregularities resulted in the Leonie Hill Road condo becoming embroiled in one legal suit after another before the deal finally collapsed.

Since then, the laws have been refined. They now load more work and costs upfront for the owners, providing relief for developers with clearer rules.

Recent changes include the STB being relieved of its role of making rulings in disputed cases. The STB will continue its mediatory role, but this will be limited to 60 days – again to expedite the resolution of disputes over contentious sales.

In other words, warring parties can head to the High Court earlier in the process to have their disputes resolved, reducing the time taken to resolve the more difficult cases.

Minority owners are now unlikely to find as many faults as most of the typical grouses in the past have been adequately addressed. As a result, we expect fewer cases to reach the High Court and the Court of Appeal.

As we also do not see the market moving this year and next as dramatically as it did in the boom years, the motivation for a minority owner to challenge a sale may not be as strong as in 2007.

The laws are more robust and structured now and should make collective sales less controversial and more predictable.

By Karamjit Singh, managing director and Pamela Kow, senior manager of Credo Real Estate.

Room for growth in high-end market

Trends in other cities show demand for luxury apartments in S’pore may grow yet

Singapore has long been seen as a safe investment haven – and foreigners are responding by snapping up property across the island.

About 23,000 non-landed private homes have been bought by foreigners since 2007 – of which about 35 per cent are high-end homes in districts 1, 2, 4, 9, 10 and 11 – based on the Urban Redevelopment Authority’s (URA) record of caveats lodged.

Yet, the high-end apartments sector still has room for growth if trends in other cities are anything to go by.

Data from Savills shows that the average price of high-end apartments was $2,154 per sq ft (psf) in the second quarter, while that of super luxury private homes was $3,055 psf.

Super luxury homes – a subset of high-end homes – are defined as developments that achieved an average of $2,500 psf in the fourth quarter of 2006.

In Hong Kong, however, prices for high-end residences in the same quarter hit HK$14,520 (S$2,570) psf, 20 per cent higher than those here. As common spaces like corridors are taken into account in computing unit prices in Hong Kong, the actual price disparity could be even greater.

In fact, prices for high-end apartments in Hong Kong rose 47 per cent last year, raising concerns about an already overheated market. On the other hand, high-end values here went up by only 3.9 per cent last year.

Moreover, the most expensive private apartment in Hong Kong is a 6,830 sq ft unit at The Albany – which sold for HK$49,488 psf, or HK$338 million in total, this year. This is about 58 per cent more than Singapore’s priciest apartment, a 5,048 sq ft home at Orchard Residences, which sold for $28.3 million, or $5,600 psf, in 2007.

In addition, Sydney apartment prices are about 28 per cent up on Singapore’s while London’s values are an eye-watering 41 per cent higher.

China, however, is a mixed story. While prices in its two major cities are lower, they shot up 32 per cent in Shanghai last year and 15 per cent in Beijing – and are both at record levels, marginalising any potential short-term capital gains.

Furthermore, the high-end market in Singapore is the only sector where prices are still below previous peaks. Prices of high-end apartments are 11 per cent below record levels set in the fourth quarter of 2007 while super luxury prices are 17 per cent cheaper.

In contrast, mass market prices in May were already 15 per cent over previous peaks with mid-tier apartments a more modest 5 per cent above. As positive economic prospects for Singapore are likely to continue into the second half of this year, it is possible that prices of high-end apartments could reach previous peak levels by early next year.

Compared to the full year of 2009, the number of apartments sold above $2,500 psf has already more than trebled over the last six months, with some even falling in the $3,500 to $4,000 psf range.

With rising anxiety over bubble risks and fears of more tightening measures that could derail prices, many East Asian investors may shift their funds to Singapore.

The government imposed 11 cooling measures in China earlier this year, helping to send new home sales plummeting 60 to 70 per cent in Beijing, Shanghai and Shenzhen in May alone.

As a result, more foreign buyers, especially mainland Chinese, have flocked to Singapore, at times buying with full cash payments.

They have displaced Malaysians this year as the No. 2 buyers of super luxury homes priced $5 million and above.

The growing number of high net worth individuals and millionaire Singaporeans could also see an increasing demand for luxury homes.

However, prime redevelopment sites for sale are lacking. The average take-up rate of high-end homes between 2005 and last year is 3,500 units per year, sitting comfortably above the average of 2,500 units being constructed yearly from this year to 2014.

Therefore, the supply of luxury homes is expected to be limited in the coming years and this imbalance should continue to sustain prices.

Luxury apartment prices are expected to rise by 5 to 8 per cent in the second half of this year.

Optimism surrounding the integrated resorts and robust GDP growth – and the increased expatriate employment it brings – should keep drawing affluent foreign buyers here.

This should help sustain demand for high-end homes even as an approximate 1,800 luxury apartments are expected to be launched in the second half of this year.

By Christine Sun, senior manager, research & consultancy of Savills Singapore

Mistakes made when buying a house

Source : The Star/Asia News Network – 22 Jul 2010

A home is a place of residence or refuge and comfort. It is usually a place where an individual or usually a family can rest and relax, communicate, share, feast and be able to collect and store their personal properties.

Therefore it is important that when you consider a place to call your home, it must be a safe and pleasant place to be in.

Buying a house is more often than not, the single largest investment most people ever make; yet all too often it’s a decision made in rush without adequate thought and preparation.

In this article we will explore some of the house-buying mistakes to watch out for in your property hunt.

Solo Mission

Buying a house is a complex transaction and should not be undertaken alone.

You need to enlist the help of these individuals early in the buying process : Real Estate Agent, Banker, Lawyer and Property Inspector.

It is also wise to get referrals and advise or tips from family and friends.

When assembling your team, select rightly. Lack of experience in the person who’s suppose to be your guide can make your property hunt a frustrating experience.

Love At First Sight

You may be in love with the house at first sight, but you have to ask yourself if the house fit your family’s needs and budget.

You have to make sure that you make a list of your needs and wants and also check whether the house fits your requirements.

Besides that, you should check out the neighbourhood and the communities before you buy by visiting at different times of the day and week.

Even if you do not have kids, you should also check out the local schools to make sure your resale value will be good.

Get past the love at first sight to consider what it’d really be like to live there.

Pre-qualified and Pre-approved Financing

Being pre-qualified gives you a general idea of how much you can afford to borrow.

It is a good idea to get in touch with your banker or mortgage officer early in the buying process so that you are aware of the amount you can borrow as this will determine your budget for the home.

The mortgage officers will also be in a position to advise you on aspects of financing i.e. the possibility of having joint borrowers to strengthen the application or to lengthen loan tenures should a need arise.

Being pre-approved means your banker has verified your information and credit rating and agreed to provide you with a specific amount of money.

You are in a better position to go house hunting knowing exactly how much you can afford and that you have the financing ready.

Over-Buying

You may qualify to borrow more, but you have to ask yourself again whether you can afford it or not.

Borrowing more would mean higher monthly loan commitments for just the purchase of the house. You have not considered the cost of improvements on the house i.e. renovations and furnishings.

What you need to do is analyze your monthly costs – food, transportation, entertainment, car loans and other commitments. Therefore you have to be sure to budget enough to cover closing costs (often two to five percent of the purchase price), plus moving and maintenance.

Beyond mortgage payments, there’ll be costs like insurance. You don’t want your house to deprive you of your lifestyle.

Misplacing your trust

Remember that buying a house is a business transaction.

Your decision is binding.

You should do your own research and know your support team’s roles and responsibilities and not just depending on what one says 100%.

Verbal Agreement

Get it right and get it in writing.

Written agreements almost always trump verbal ones when it comes to contracts.

Don’t set yourself up for surprises when you move into that new house and some of the items in it are now missing.

There are many details that make up the purchase contract that governs the particulars of your house purchase.

It is not unusual for an item to be missed; especially those requests made by you of the seller or seller’s agent. If you ask for a toilet to be repaired or a chipped tile to be repaired, don’t simply take someone’s word that the item will be repaired prior to transfer of the property. Make sure every item that you agree on is put in the purchase contract.

Verbal agreements are hard to prove and even harder to enforce. They can lead to an ugly “he said, she said” situation.

Once the property transfers to your name; problems or issues that you thought were going to be repaired are now your responsibility. Don’t let miscommunication or failed promises ruin the purchase of your dream home.

Get all commitments – no matter how small – in writing.

Fine print

You need to understand what you’re signing.

As soon as possible, review the documents you’ll be signing. You must always ask for documents in advance, make time to read them and ask questions, where necessary.

Don’t just skim through the purchase contract. Real estate contracts are long and dense, but you need to know what you’re committing to.

Wrong assumptions, poorly written or missing clauses, and not understanding how the clauses affect the purchase can lead to increased costs or a void contract.

Do not sign documents in a hurry. Do not rush the closing.

Resale

You should avoid buying a home that costs much more than neighbouring homes and think before buying the most expensive house in the area.

Your neighbours’ lower house values will weaken yours.

Remember, markets change.

If you buy intending to flip your investment and the market falls and you have to sell, your selling price may not be enough to even cover your mortgage.

Wrong Price

Many home-buyers forget that the market value of a house is affected a great deal by its neighbours.

The best way to gauge a fair offer price is to get your real estate agent to pull prices that comparable homes nearby recently fetched. The listings will show not just the amounts but how long the house has been on the market and its condition and size.

Note that the nearby houses will affect your house’s value. That means the most expensive house on the street may be pulled down in value by its cheaper neighbours, while a low-end one will benefit from posher surroundings.

Conditional Offer

It is good practice to have your offer to purchase the house conditional upon securing financing.

The last thing you want happen to you is the forfeiture of your deposits for backing out on a purchase transaction because of it.

One thing is being pre-approved, the other is the property itself.

The banks will do a valuation on the property to confirm the market value and then to determine the margin of loan they are willing to offer you. There may be other conditions are well that you might want to add in at this point.

House Inspection

It is well worth your money engaging a House Inspector to check out the house before committing to the purchase.

These Inspectors know what to look out for and can advise you accordingly on the state of the house, whether it is in need of repairs so that you are fully aware of the additional expenses needed.

Don’t take the word of the seller that certain repairs and maintenance has been made to the home. A formal inspection of wiring, plumbing, and general structure of the home is needed to avoid nasty surprises.

Inspection reports are great negotiating tools when it comes to asking the seller to make repairs.

If a professional home inspector cites specific repairs in the inspection report the seller is more likely to agree to them than if you simply try to negotiate based on your observations. As we mentioned above, make sure that any last minute items that arise based on the inspection report or your own visual inspection during the walk through are addressed in writing and completed before you take ownership of the property.

If the seller agrees to make repairs, have your inspector verify the work is completed properly. Do not assume that everything will be done as promised.

If you’re buying a new house, off the plans from the developer, they will offer the Defect Liability Period upon Vacant Possession, where they will rectify problems, if any, with the house during Handover.

Buyer’s Remorse

No place is perfect. There will always be surprises. Don’t let a few initial blips spoil the whole ride.

And don’t miss a great house waiting for the perfect one!

Failing to jump on an opportunity, I believe, is a mistake. Too much shopping around can backfire.

When you have done your homework and when you see something you that matches, go for it.

S’pore investment sales market strengthens in Q2: Colliers

Source : Channel NewsAsia – 21 Jul 2010

Property consultants Colliers International says Singapore’s investment sales market strengthened further in the quarter that ended in June turning in sales of S$7.11 billion.

That’s 24.3 per cent above the S$5.72 billion chalked up in the first quarter of this year.

Colliers released the information in its latest Knowledge Report Tuesday.

It found that the investment sales market was driven predominantly by developers’ aggressive land acquisition activity.

In all, developers picked up some $3.25 billion worth of development sites from both the public and private sectors in the quarter.

In fact, Colliers says the total investment sales value for the first half of this year stood at S$12.83 billion – already surpassing the S$10.54 billion accumulated for the whole of 2009.

Going forward, Colliers expects developers to continue acquiring land, particularly for residential sites located in outlying suburban areas.

However, developers will likely be more selective with the ample supply and wide selection of sites available from the second half Government Land Sales programme, and this should keep tender bids in check.

The report also found that the Singapore office property market surprised with a moderately strong rebound in the second quarter, despite concerns over large new supply.

The average monthly gross rents of Grade A office space posted gains of between five and seven per cent, with the Shenton Way – Tanjong Pagar micro-market leading the climb.

The uptick in rents came as occupancy rates tightened across all micro-markets, in spite of the addition of more than 1.5 million square feet of Grade A office space since the second half of last year.

On average, the occupancy rates of Grade A office space climbed three percentage points in the second quarter.

Going forward, Colliers says the positive economic outlook for 2010 is expected to further boost demand for office space.

While there are concerns over the possible hollowing out of the older office buildings in the central business district when companies move to the newly completed office buildings, Colliers notes that some of these spaces will be maintained by the expanding companies, or have secured new tenants.

The report also noted that the recovery of the industrial property market continued into the second quarter, with values outperforming rents.

Industrial strata sales volume continued to climb in the period, reaching a new high of 340 deals.

This brings the industrial strata sales volume for the first half of this year to an estimated 669, up 9.7 per cent on year.

Property value in flood-prone areas could suffer if problem not fixed

Source : Channel NewsAsia – 21 Jul 2010

Property watchers have warned that the value of developments in flood-prone areas could suffer if the problem of flooding is not fixed.

They said prices and rental rates for residential and commercial properties could fluctuate if the problem continues for another three months. This may force businesses to move out.

Landlords may have to lower rent or take measures to prevent flooding to attract tenants.

Some buyers are now asking about the risk of flooding when they check out a property, including those that are not directly hit.

Executive director of Residential Projects, Orange Tee, Steven Tan, said: “In the past, this was never an issue. Now we can see that they are starting to have a concern whether the condominium or house that they want to buy will encounter this problem.”

Nicholas Mak, Real Estate lecturer at Ngee Ann Polytechnic, said: “Even if the property is not prone to flooding, but just because it is near another property that often suffers flooding whenever it rains, it could be guilty by association and its value could also be adversely affected.”

Reservations over HDB legislative amendment

Source : Today – 20 Jul 2010

A legislative amendment to allow the Housing and Development Board to provide technical and consultancy services internationally drew concern from two Members of Parliament yesterday.

They felt the HDB was deviating from its core mission of providing affordable housing for Singaporeans.

If this happens, the top brass would focus on generating income, which would pay them “fat bonuses”, rather than “channelling their minds to seeking local solutions”, said Ms Lee Bee Wah (Ang Mo Kio GRC).

“If HDB is so keen to share its expertise and experience, why not transfer its knowledge to local engineers and architects who are pleading for overseas projects?” Ms Lee asked.

Agreeing with her, Mdm Cynthia Phua (Aljunied GRC), pointed out that Surbana Corporation was hived off from the HDB to provide consultancy. She questioned if the HDB had manpower resources to place staff overseas.

Noting their “grave reservations”, National Development Minister Mah Bow Tan said HDB will not abdicate its primary responsibility of meeting the housing needs of Singaporeans.

The provision arose due to requests for consultancy from overseas governments.

For instance, for the Tianjin eco-city project, the HDB shared policies on home ownership, rental housing and financing with the Chinese government, said Mr Mah.

HDB does have plans to work with small and medium enterprises on technical and environmental services such as green buildings and solar panel installation, which the provision will allow for, he added. “Just to reiterate, it’s not going to make money for HDB; it is rather to generate goodwill on behalf of the Government to create a reservoir of goodwill with other governments.”

New guidelines on limited, non-exclusive use of commercial spaces for religious activities

Source : Channel NewsAsia – 20 Jul 2010

New guidelines on the limited and non-exclusive use of commercial spaces for religious activities were issued on Tuesday.

The guidelines were jointly issued by the Urban Redevelopment Authority (URA) and the Ministry of Community Development, Youth and Sports (MCYS).

Under the guidelines, sites zoned for “Commercial” use in URA’s Master Plan are intended for commercial activities should serve as secular spaces for all.

Religious activities should be conducted at sites zoned “Place of Worship”.

While religious activities are generally not allowed in commercial buildings, URA said it is prepared to exercise some flexibility.

Commercial premises can be used by religious groups if the usage is limited and non-exclusive as long as it does not cause disturbances such as noise, traffic or parking problems.

Examples of spaces in commercial and hotel developments include auditoriums, function halls, convention centres and cinemas.

Also, only existing approved auditoriums, function halls, convention halls and cinemas located within commercial and hotel developments can be considered for non-exclusive and limited religious use.

Further, there will be a size limit.

The maximum space within a commercial development that can be considered for religious use should not exceed a total Gross Floor Area (GFA) of 20,000 square metres or 20 per cent of total GFA of the development, whichever is lower.

Each religious organisation is limited to use up to 10,000 square metres in any commercial space at any one time.

The authorities said this is to ensure that a single religious organisation does not dominate a particular commercial development by taking up a very large amount of space.

In addition, the premises cannot be owned by or exclusively leased to religious organisations.

The use of the commercial space for religious activities should also not exceed two days a week including Saturday and Sunday.

There shall be no display of signage, advertisements or posters of the religious use at the premises or on the exterior of the building.

The building owner and the religious organisation must also take appropriate measures to ensure that the activities do not cause disturbances to the public.

Banks’ loss risks from home loans ‘limited’

Source : Today – 20 Jul 2010

Ratings agency Standard and Poor’s (S&P) believes the credit loss risks of Singapore banks from home loans is limited even if an asset bubble is to form.

In a report, S&P said its view is based on the reasonable level of housing affordability, sound borrower repayment ability and low loan-to-value ratios here.

Also it added that the Government’s measures to cool the market, and mortgage rates turning upward, all played a factor in its assessment.

Mortgages represent the single largest industry exposure for Singapore banks, at about 25 per cent of loan portfolios.

S&P noted that a high savings rate here and low household debt support borrower repayment ability when collateral values fall.

“Singapore households have strong balance sheets, underpinned by a high savings rate, low debt, and low unemployment,” the report said.

The ratings agency added that an unabated increase in property prices is unlikely, given the government’s past willingness to implement cooling measures. Amongst which is the move to lower the ceiling for home loans to 80 per cent of valuation.

“We believe the government will continue to monitor the property market and will implement further cooling measures if necessary,” S&P said.

Still, S&P believes Singapore banks seldom extended loans of more than 80 per cent of valuation even before the loan ceiling was lowered.

HDB flats not meant to be used as source of funds: Mah

Source : Channel NewsAsia – 20 Jul 2010

National Development Minister Mah Bow Tan has stressed that HDB flats are not meant to be used as a source of funds for business or other uses.

He said this a day after changes were made to the Housing and Development Act, to prevent owners from using their flats as collaterals to settle debts with moneylenders.

Mr Mah said: “The HDB flat is not meant to be used as a source of funds for business. “The whole scheme was designed to provide affordable, good quality home for them, not to use that as a collateral or sources of funds for other uses whether it is for business, or other things.

“Can you imagine if people are allowed to raise funds from flats, what kind of things they are going to use for? Some will be using it for business. But I can tell there will be many who would not be using that for legitimate business.

“They will be using it for other things. They may even use it to go to the casinos, for example. And then what happens? They lose their money and then they lose their flats. They lose their homes, the roofs over their heads, where will they stay? Where will be their children stay?

“So we decided to be prudent, as far as HDB flats are concerned. If you want to raise funds for businesses, for other things, entrepreneurship, look for other sources for funds.”

The amendments were passed under the “certificate of urgency” in Parliament on July 19.

Any contract using an HDB flat as a security or collateral for any debt other than as mortgage to finance the purchase of the flat will be null and void.

Mr Mah stressed that the gap has to be plugged immediately to prevent moneylenders from lodging future caveats against HDB flats.

“The number of caveats has gone up sharply, and if you don’t move fast, the numbers will keep going up and more and more people will be placed in this position of putting their flats as risk and possibly being homeless.

“So I think that is something obviously not in the interest of the HDB flat owners themselves. So that’s the reason why I decided to move on the certificate of urgency.

“This practice of agents and moneylenders colluding to get people to borrow and use their flats as collateral, I think that practice, will stop because they will no longer be legal.”

He added there have been indeed many cases where flats owners had fallen into serious difficulties after they sold their flats, as a result of the inability to repay loans.

Mr Mah was speaking to reporters on the sidelines of his ministry’s joint scholarship ceremony Tuesday morning.

He presented scholarships to 39 undergraduates and 12 graduate students.

The scholars come from a spectrum of specialisations, including environmental engineering and environmental biology. Some of them will be exploring new fields of study, such as aquaculture, agricultural economics and food technology.

38-year-old Kelvin Ang, who will be taking up a Masters in Sustainable Heritage at the University College London, said: “This scholarship will give me an opportunity to learn from the best practices from Europe in terms of heritage. So if I can have those skills and bring them back to Singapore and apply them here, I think there’s a better future for heritage buildings.”

19-year-old Lee Si Min will be taking up an engineering degree course at the University of Cambridge. She’ll join the Building and Construction Authority when she completes her studies.

Ms Lee said: “I am very interested in how the designs of buildings are made to be safe and sustainable. There are many projects coming up in the MND, for example, the Tianjin Eco-city and I am very interested in them. I hope to play a part and contribute to the society in this manner.”

2 residential sites made available for sale by URA

Source : Channel NewsAsia – 20 Jul 2010

Two more residential sites have been made available for sale by the Urban Redevelopment Authority (URA).

One of the sites, at Jalan Eunos, is launched for sale under the Confirmed List of the Government Land Sales (GLS) programme.

The other site located at Buangkok Drive and Sengkang Central is being made available for sale under the Reserve List.

A Reserve List site will be released for sale if a developer commits to putting in a minimum bid acceptable to the government.

Together, URA said both sites can potentially yield about 1,020 housing units and will provide developers and home buyers with more choices.

The two sites have a lease period of 99 years.

For the land parcel at Jalan Eunos, the site is about 4.1 hectares in size, with a maximum permissible gross floor area of 57,766 square metres.

The land parcel at Buangkok Drive and Sengkang Central, spanning 1.8 hectares, has a maximum permissible gross floor area of 55,027 square metres.

URA added that 20,175 units made available for the whole of 2010 under the Government Land Sales programme is the highest potential supply in the history of the GLS Programme.

Stiffer penalties on illegal subletting soon

Source : Straits Times – 20 Jul 2010

SINGAPOREANS who qualify for highly subsidised public rental flats but sublet them illegally will soon face tougher penalties.

National Development Minister Mah Bow Tan yesterday announced changes to existing legislation giving the Housing Board the same punitive powers over public rental flats that it has over sold HDB flats.

Currently, when rental flats are sublet illegally, the HDB’s only recourse is to take back the flats and bar the tenants from renting for a fixed period.

However, experience showed that was not a sufficient deterrent and stiffer penalties were needed to keep rental flats for the truly needy, Mr Mah told Parliament.

The vast majority of those who sublet rental flats had alternative accommodation, and were abusing the highly subsidised monthly rentals of up to $60, he said.

In 2008, the HDB terminated the tenancies of 221 residents for illegal subletting.

The number of such cases has come down due to warnings against the practice, he added.

Last year, there were 170 cases. The first six months of this year saw 63 cases.

Good class bungalows soar in price

Source : Straits Times – 20 Jul 2010

Sales in first half pass $1b mark, and demand unlikely to flag: Report

THE priciest homes just keep getting pricier, with the values of upmarket, prime-area bungalows rocketing this year, and sales totalling more than $1 billion in the first six months.

And just to underline the boom in what are called ‘good class bungalows’, a Nassim Road house sold in April for $43.5 million, that is $1,800 psf and just shy of the record $1,899 psf set in 2007 for a plot along the same road, according to a Savills Singapore report.

The most expensive bungalow sold this year in terms of overall price was a sprawling Leedon Park plot that went last month for a whopping $59.4 million, or $1,419 psf.

Good class bungalows tend to be big and exclusive, and are arguably Singapore’s most coveted landed homes.

They typically sit on plots of at least 1,400 sq m, or 15,070 sq ft, and can be found in 39 prime gazetted areas such as Nassim Road.

In the first half of this year, sales of good class bungalows reached about $1.12 billion, which is about 81 per cent of the value done last year, said Savills.

There were 54 deals done in the first six months, compared with 24 in the same period last year, it said.

Prices have continued edging higher on the revived demand from well-heeled buyers, added Savills.

The average price of good class bungalows rose from $928 psf in the first quarter to $1,082 psf in the second and is now 36 per cent higher than a year ago.

‘This year we are seeing more demand from ultra-rich, new citizens and PRs in the market, which could possibly have resulted in the higher volume and prices,’ said the firm’s director of prestige homes and investment, Mr Steven Ming.

An agent who declined to be named added: ‘Some new citizens from China are still looking for good class bungalows.’

He said the market has quietened down a bit recently as the gap between buyers’ and sellers’ price expectations widens.

CB Richard Ellis director (luxury homes) Douglas Wong said: ‘Good class bungalow prices have continued to rise since 2007 and through the global financial crisis. Owners’ expectations are still high due to the limited supply.’

Some sellers have been asking for higher prices after hearing talk of a Cluny Road bungalow achieving a record price of slightly over $2,000 psf, agents said.

Buyers may be sitting on the sidelines but they are likely to come back to market soon when they realise that prices are not going to fall, Mr Wong said.

The managing director of RealStar Premier Property, Mr William Wong, said he has already seen some local investors returning to the good class bungalow market recently.

But foreign buyers are few and far between. They need special permission and must be permanent residents to own landed property.

Foreigners who are not permanent residents can buy landed homes in Sentosa Cove, subject to government approval.

In recent years, the typically smaller landed homes in the 99-year leasehold gated residential enclave have also seen exceptional prices.

Average prices of Sentosa Cove bungalows rose 55 per cent to $1,959 psf in the second quarter over the same period a year ago, said Savills.

In the first half, there were 35 caveats lodged for bungalows in Sentosa Cove compared with 36 for all of last year, it said.

Just over half of this year’s bungalow caveats were lodged by Singaporeans.

China accounted for 10 deals, the largest of the foreign buying contingent.

But Mr Ming said that good class bungalow prices are looking more attractive than the prices of leasehold Sentosa Cove bungalows.

He added that good class bungalow prices may rise by a further 5 to 10 per cent this year, given the more robust economic recovery and the fact that the buyer base has expanded.

Bill passed to prevent homeowners from using HDB flats as collateral for loans

Source : Channel NewsAsia – 19 Jul 2010

The government has plugged loopholes in the law to prevent moneylenders from egging homeowners to use HDB flats as collaterals for any debt other than as mortgage for the purpose of financing the purchase of the flat.

Changes to the Housing and Development Bill were passed on Monday under a “certificate of urgency”, which means it was read and passed in one Parliamentary sitting.

There has been an increasing number of HDB homeowners using their flats as collateral to pay off loans.

In 2008, there were 12 registered resale applications with caveats lodged by moneylenders.

One year later, the figured jumped to 546.

In the first six months of this year alone, there were 556 cases.

It is a worrying trend that the government wants to put an immediate stop to.

“A HDB flat is for long-term homeownership. I cannot over-emphasize this fact,” said Minister for National Development, Mah Bow Tan.

But this approach will only work if people do not encash their retirement asset prematurely.

The old law had allowed moneylenders to use a seller’s flat as collateral for debt repayment.

“Instead of just the 1.5 per cent interest that was touted before they took the loan, they ended up paying as much as 15 per cent interest rates in some cases. Their shock starts when they discover that they have nothing left after paying off their debts to the moneylenders, which they had to clear first since it is protected by the caveat,” said Mdm Halimah Yacob, MP for Jurong GRC.

MP for Holland-Bukit Timah GRC, Christopher de Souza added: “These lenders have hence made agreements with their borrowers to lodge caveats against their flats. This way, they have the first claim on the sales proceeds. It is all perfectly legal and above board; and the lenders have security in recovering the principle sums loaned, plus an obscene amount of interest.”

Minister Mah said: “Some homeowners may want to get a quick personal loan and therefore allow moneylenders to lodge a caveat on their flats. Moneylenders are more willing to give loans, especially to low-income borrowers, if they are able to secure the loan on the sale proceeds of the flat, as this reduces their risk.

“If the flat owners already plan to sell their flat and take a loan from a licensed moneylender, for example as a bridging loan to meet some urgent needs, the caveat ensures that the loan would be paid from the sales proceeds.

“However, there are some flat owners who originally had no intention to sell their flats, but still allowed moneylenders to lodge caveats against their flat. These flat owners may be pressured to sell their flats to raise money quickly to repay debts.”

So the seller who has sold off his flat and repaid the moneylender, may not be able to afford to buy his next flat.

Some may also join HDB’s queue for rental flats when they do not in fact qualify for rental housing.

With the amended Bill, moneylenders can now no longer claim caveats to have first cut of the sales proceeds of a seller’s flat.

Mr Mah said existing contracts with valid caveats lodged will not be affected. This is in recognition of the sanctity of contracts already legally entered into.

The changes also do not affect banks and financial institutions, which can continue to grant loans on the security of the flat for the purpose of financing its purchase.

“This policy change does not mean that HDB flat owners can no longer borrow from moneylenders. They can continue to do so. But they cannot use their HDB flat as a security and they must find other ways to ensure that they can repay their debts,” said Mr Mah.

The Moneylenders Association of Singapore said a lot of the cases involve real estate agents who are also licensed moneylenders.

It added the new law will mean less protection for moneylenders, which may drive them to raise interest rates.

Interest rates are now between 18 to 25 per cent and this may go up to more than 30 per cent.

New ‘hot’ residential districts coming up

Non-traditional prime areas have emerged as the property boom spreads to the suburbs

For years, Districts 9, 10 and 11 – covering Orchard, Holland, Newton and Bukit Timah – have been the must-have residential areas in Singapore.

But as the recent property boom spreads to the suburbs, a number of newly popular districts have emerged outside these traditional prime areas.

Developers with a keen eye snapped up land around city-fringe locations and suburban MRT stations, and have been launching projects in these areas over the last few months to great demand.

Some of these new sizzling spots may come as no surprise. District 2, for instance, comprises mainly the Tanjong Pagar area around the Central Business District, which is evolving into an inner-city residential hub. Recent launches such as City Developments’ 76 Shenton and Far East Organization’s Altez have been well-received.

Slightly farther from the city is District 14, where Waterbank @ Dakota and Casa Aerata have been sell-outs, and Dakota Residences is 95 per cent sold.

Property consultants say the opening of the two integrated resorts this year has boosted the popularity of these more centrally located areas.

Mr Joseph Tan, executive director for residential services at real estate consultancy CB Richard Ellis, said: ‘Not only do they attract people who bought for their own use, they also attract a good number of property investors with a view to future price appreciation or rental income.’

Ms Tay Huey Ying, director of research and advisory at Colliers International, explained: ‘District 2 has grown in popularity since 2006 and 2007 when the development of the two integrated resorts and Marina Bay Financial Centre popularised inner-city living.’

She added that homes there have remained popular since then, although sales have slowed, owing to their relatively high price tags, and especially with investors turning more cautious following the global financial crisis.

But there are also other ‘hot’ districts that may be less obvious, including District 5 in the West Coast and District 16 in Upper East Coast.

In District 5, recent launches such as Hundred Trees and The Vision were 95 per cent sold within three months, and Parc Imperial was 100 per cent sold, according to data from DTZ Debenham Tie Leung. Over in District 16, Optima @ Tanah Merah sold out in just three days.

These areas have drawn interest because of their proximity to current or future MRT stations, good local schools and international schools, said Mr Tan. Buyers of homes in the area are mostly locals – HDB upgraders and private homeowners – and also permanent residents settling down here.

‘These properties tend to be more affordably priced than those situated in the city or at the city fringe,’ he said.

Ms Chua Chor Hoon, head of South-east Asia research at DTZ Debenham Tie Leung, said in general, there are more ‘hot’ areas in Singapore now than in the past because of two main reasons: collective sales of estates in older areas and deliberate government policies to decentralise office hubs.

With more people, including expats, working outside the CBD, there is higher demand for rental homes – and hence more potential for property investors – in other parts of the island now, she said.

CBRE’s Mr Tan agreed: ‘With new initiatives to chart the progress of the country, future growth areas like Marina Bay, Jurong East, Kallang Riverside and Punggol Waterfront town are becoming more and more attractive because there is still room to encompass new ideas.’

It helps that the Government is constructing more MRT lines, consultants said. ‘The MRT network is reaching more areas of Singapore, making outlying places more accessible and desirable,’ said Ms Chua.

In the years to come, Ms Tay believes new emerging districts would include those with newly opened or soon-to-be-constructed MRT lines, as well as districts within growth areas designated by the Government.

These could include District 22 in Jurong and Boon Lay, which could benefit from the Government’s plan to develop the Jurong Lake District, and District 23 – Bukit Batok and Hillview – which would get a double boost from the construction of the MRT’s Downtown Line stage 2 as well as the spillover effects of the development of the Jurong Lake District.

Still, property consultants maintain that the traditional prime residential districts of 9, 10 and 11 will always retain their charm.

‘The exclusivity and prestige attached to certain addresses cannot be fully replicated in the new growth areas,’ concluded Mr Tan.

Source : Sunday Times – 18 Jul 2010

Marina Bay to define S’pore the way the Bund defines Shanghai

 The Marina Bay will be a key platform and catalyst for Singapore’s future growth.

Speaking at the official opening of the waterfront promenade at Marina Bay on Sunday, Prime Minister Lee Hsien Loong said Marina Bay will boost Singapore’s position as a financial hub for Asia.

Mr Lee said the new Marina Bay will define Singapore in the same way the Bund defines Shanghai.

He said: “The private sector has shown its confidence in Marina Bay. Already, it has attracted $20 billion of private sector investments in real estate. And we’ve got firms, local and international ones from around the world – America, Australia, Europe, the Middle East – they’ve come, they’re optimistic and bullish about the development. In fact, they would like us to develop it further.”

Marina Bay is not just for businesses.

With the completion of the 3.5km waterfront promenade, which follows the opening of the Helix Bridge and Marina Bay Sands integrated resort earlier this year, visitors can now walk around the whole Marina Bay and take in the magnificent views.

Prime Minister Lee said: “I came here one evening a few weeks ago, walked along the helical bridge, walked most of the way around the Bay, and it was full of people – families, children, courting couples, tourists – taking in the sights, enjoying the atmosphere.”

With the upcoming Youth Olympic Games and Gardens by the Bay to open soon, Mr Lee said the area promises to be a vibrant destination for all Singaporeans and tourists.

He said the development of Marina Bay mirrors the government’s efforts to build best homes for Singaporeans.

And this is possible, as long as the economy prospers and people work together.

Mr Lee also launched the Marina Bay City Gallery.

URA’s group director (Urban Planning and Design), Fun Siew Leng, said: “The Marina Bay City Gallery shows the transformation story of Marina Bay – how it’s been developed over the last 30 years, from planning to implementation to what you see on site today. It tells the fascinating story of all the different events that happen in this area since the 1800s up to now.”

The gallery’s centrepiece is a model of the entire Marina Bay area.

Visitors can make the Singapore Flyer and Marina Bay Sands integrated resort light up, by just touching the interactive panels.

Admission to the gallery is free.

To celebrate the opening of the waterfront promenade, the Urban Redevelopment Authority (URA) has organised a two-day carnival, which started on Saturday.

It expects about 80,000 people to gather at Marina Bay area to enjoy the performances and activities.

Earlier Sunday, Prime Minister Lee flagged off some 20,000 participants for The New Paper Big Walk@Marina Bay at the Singapore Flyer. He then took a walk to the Youth Olympic Park, The Helix and the Mist Walk at the Marina Bay waterfront promenade.

Source : Channel NewsAsia – 18 Jul 2010

Home Run

A large number of new properties are set to be launched in the next six to 12 months. The Sunday Times looks at what savvy buyers should look out for.

Sovereign debt crises may have hobbled property markets elsewhere, but not here it seems.

Buoyed by Singapore’s strong economic recovery, optimism has staged a vigorous comeback, with property developers set to launch at least 3,500 new homes by year-end on top of about 8,500 they have already released so far this year.

This will result in an estimated total of between 12,000 and 14,000 new units this year.

And the supply of available building land shows no sign of drying up: 31 residential sites will be up for grabs from the Government Land Sales (GLS) programme in the second half of this year.

In the years ahead, new residential enclaves are predicted to emerge with the completion of the Circle Line, boosting once sleepy areas such as Paya Lebar, Mountbatten and Dakota.

Up, up and away

Analysts say that despite the uncertainty triggered by eurozone sovereign debt issues, overall buying interest here remains positive – especially in mass-market and mid-tier projects.

Although the overall upbeat sentiment has dipped slightly of late, with lower volume and slower price increases, the residential market looks set to remain largely strong given the strength of the economic rebound.

The Government forecasts a stunning 13 to 15 per cent growth in gross domestic product (GDP) this year, up sharply from an earlier prediction of 7 to 9 per cent, due mainly to the huge recent surge in manufacturing.

DTZ South-east Asia research head Chua Chor Hoon is upbeat about the market. ‘There is still buying interest and more new developments are being planned for launch in the coming months. If they are well taken up, that would motivate more developers to launch other projects and stimulate more buyer interest,’ she said.

Knight Frank manager of consultancy and research Ong Kah Seng is slightly more cautious about prospects, but still thinks the outlook is good.

‘Buyers are likely to rethink about rushing into home purchases and adopt a wait-and-see attitude… However, although sales will moderate, it is still reflective of a healthy residential market.’

Against this broadly bullish backdrop, prices have continued to climb ever higher.

Official estimates show they rose a higher-than-expected 5.2 per cent in the second quarter of this year after a 5.6 per cent jump in the first.

Prices are now 1.5 per cent above their peak in the second quarter of 1996.

And property experts are pencilling in price increases for the full year of between 12 per cent and 20 per cent, with the average estimate at about 15 per cent.

CB Richard Ellis (CBRE) residential director Joseph Tan thinks that because economic fundamentals ‘are still intact’, home prices will increase slightly in the second half of the year.

‘Projects which are well located and are close to main transport nodes could still enjoy a slight premium,’ he added.

Prime pickings
With developers looking to make the most of this positive market, Knight Frank is anticipating another 17 major launches (of at least 50 units each) within the next six months – a total of 4,056 apartments added to the market.

Upscale residences in districts 9, 10 and 11 are likely to make up almost half of these major launches, but a surge of mid and mass-market developments is slated from next year onwards as GLS land sites situated mainly outside the central regions are released, Mr Ong said.

CBRE notes that 38 apartment launches – inclusive of small to mid-size projects – are likely within the next six months.

Of these, 22 are located in the core central region, 10 in the rest of the central region and six outside the central region – allowing home buyers to cherry pick according to their budgets.

They range from Allgreen Properties’ prime 360-unit Skysuites @ Anson in Enggor Street to the mass market 408-unit executive condominium project in Yishun Avenue 10 by MCC Land.

In addition, experts say that prime developments are beginning to appear in numbers on the horizon as developers scent rising prices.

Mr Colin Tan, research and consultancy director of Chesterton Suntec International, said developers may have held back many of their high-end launch-ready projects, some of which were prime freehold sites from the ‘en bloc’ fever three years ago.

‘Some developers may have decided that high-end prices may take even longer to reach their desired levels. Given that there are still risks ahead, they may decide to make the best of an uncertain situation and launch within the next few weeks and months,’ he added.

A buyer’s spread

With 15 residential sites sold through the GLS programme in the first half of this year (four of which were executive condominiums) – and more than double that number planned for the second half – the property pipeline shows no sign of drying up.

Mass and mid-market homes are likely to be launched on these sites in areas such as Simei Street 3 and Hougang Avenue 2 as the Government attempts to dampen demand.

The plots are certainly being snapped up by developers eager to replenish their land banks and willing to pay top dollar for well-located plots.

A 99-year leasehold residential site at Simei Street was released for tender in March received a total of 18 bids, with the top bid at $152.7 million or $523 psf per plot ratio (ppr) coming from developer Chip Eng Seng. This was well above market expectations of between $300 and $400 psf ppr.

UOB Kay Hian property analyst Vikrant Pandey estimates the break-even price for the site to be in the range of $800 to $850 psf and, assuming a 15 per cent development margin, the average selling price to be�upwards of $970 psf.

‘Resale prices for the secondary market projects in the vicinity are in the range of $600 to $800 psf.�The top bid is quite aggressive, factoring in a 20 to 30 per cent future price appreciation�in the region,’ he said.

Similarly, the hotly contested tender of a choice residential plot in Boon Lay Way next to Lakeside MRT station attracted a whopping 14 bids in May, with Keppel Land (Mayfair) putting in the top bid of $499 psf ppr, or $302.98 million.

Property experts estimate the break-even level for units on the site will be $800 to $850 psf, with an eventual selling price of about $950 psf – which factors in a 10 to 20 per cent�future rise in prices within the next year.

DTZ’s Ms Chua said that developers were already inching up prices at new projects, with many recent launches being priced higher than neighbouring projects.

However, the bumper release of 31 residential sites by the GLS programme in the second half of this year could dampen some of the exuberance in the market, moderating mass market prices.

There are 18 residential or residential/commercial sites on the programme for confirmed sale, with another 13 sites for residential use put on the reserve list.

The plots – which include 20 that are new and not rolled over – could accommodate 13,905 new homes and are anticipated for launch next year.

They are located in areas such as Jurong West and Pasir Ris but also in mass-market areas like Hougang and Tampines.

The sites commanding the most attention are, predictably, those with the best locations and amenities.

CBRE’s Mr Tan said sites with better amenities and close to MRT stations will generally attract more interest from developers. And mixed-use sites located at the town centre of HDB estates are likely to be vied for.

One of the most attractive sites is the land parcel at the junction of Woodland Avenue 1 and Woodgrove Avenue, he said, which is located within the American expatriate enclave and close to the Singapore American School.

Mr Tan pointed out that condominiums and landed homes in the nearby Woodgrove Estate were enjoying strong rentals, and the last condominium project launched in this location – Rosewood Suites in November 2008 – was fully sold.

Elsewhere, the commercial- cum-residential site in New Upper Changi Road and Bedok North Drive is expected to attract strong bidding, given that it will be the first comprehensive development in Bedok New Town and comprise a retail mall, residential units and a bus interchange.

Knight Frank’s Mr Ong added that close proximity to existing and upcoming MRT sites could well drive prices higher at a number of new plots.

These include the Alexandra Road site, the Tanah Merah Kechil site – near existing condos East Meadows and Optima@Tanah Merah – and the Petir site next to City Developments’ recently launched 429-unit Tree House.

Chesterton’s Mr Tan said: ‘The fact that there are still en bloc transactions taking place – most of which are in the suburbs – indicates that developers will still bid for land.’

However, with economists predicting a slowdown in growth in the second half of this year due to concerns over the European debt crisis and the bumper supply of land released, some analysts are less bullish.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said that with an average of three tenders a month, developers were both limited in their budget and manpower resources.

‘We might see the level of interest in GLS sites drop towards the end of this year… If signs of economic uncertainty re-emerge and if companies start putting their expansion plans on the backburner, developers might start bidding more cautiously,’ he said.

Source : Sunday Times – 18 Jul 2010

Selling en bloc? Big gains unlikely

Prices now start from a higher base and attractive prime sites have already been sold

Last Wednesday, a relatively small property, Melrose Court, off Balestier Road, was launched for collective sale.

Owners of the 32 freehold units there are

asking for $48 million, and hoping to reap between $1.23 million and $2.46 million each.

Marketing agent Colliers International said the ‘en bloc’ premium each seller will get is around

40 per cent to 50 per cent more than what he can get if he were to sell his unit on his own.

Compared with those of the collective sale boom of 2006-2007, the premiums are lower these days because existing apartment values are high, said Mr Ho Eng Joo, the firm’s executive director of investment sales.

Property pundits say the market recovery last year has been fast and furious, so prices are now starting from a higher base.

‘We see an erosion of en bloc premiums today. In 2006 and 2007, the premiums can easily be 80 per cent to 100 per cent. Today, they are more like 30 per cent to 50 per cent,’ said Mr Jeffrey Goh, head of investment sales at HSR International.

Some investors may want to cash in fast before the collective sale. This will close the gap between the potential collective sale price and the individual sale price, experts said.

But the higher prices they fetch may not be a true reflection of the market, said Knight Frank executive director Nicholas Wong.

‘A handful of them may be able to sell at higher prices before the collective sale. But if all the owners were to go out and sell their units individually, they wouldn’t get those kinds of prices,’ he said.

The rest of the owners who may now want to pull out of the collective sale after some sell at higher prices, or who then become unhappy with the collective sale prices, should be aware of the risks of a failed sale, as the value of their estate will likely come down if that happens.

Also, today’s new rules mean that a two-year restriction period will kick in, making it harder to restart the collective sale process after a failed attempt, Mr Wong said.

An expert, who declined to be named, said: ‘The en bloc premium is relative. It just has to be a level that can get people excited, with which they think they are able to find a replacement property. This would be around 50 per cent more than what they can sell at individually.’

Besides prices having moved up to a higher base, most of the attractive prime sites have already been sold in previous collective sale booms over the past 15 years, property experts say.

‘Nowadays, sites that have been sold or put up for sale are in the city fringes and are small,’ said Ms Suzie Mok, director of investment sales at Savills Singapore.

‘The en bloc premiums for prime spots tend to be higher than those for suburban estates as they are the more sought-after sites. The prime spots appeal to the bigger developers who are willing to pay more because of their scarcity and the appeal of the posh address.’

While there are still underbuilt sites out there, many of the estates eyeing collective sales today are very old developments and may have low redevelopment potential, experts said.

Some of these estates have already used up their maximum built-up area allowed, and may thus get a lower premium when they want to sell en bloc, the experts pointed out.

Source : Sunday Times – 18 Jul 2010

Brisk sales continue at new launches

Sales picking up after quiet June with World Cup, school holidays

SALES have stayed fairly hot at a new condominium in Bukit Timah with 114 flats in the 172-unit estate now sold in just over a week, including 24 of the 30 pricey penthouses.

Ten apartments were snapped up at the official launch of the Terrene yesterday following the 104 that have been sold since a private preview started on July 8, UOL Group said.

The 999-year leasehold condo in Jalan Jurong Kechil is priced at an average of $1,250 per sq ft (psf) for a typical unit, with a one-bedroom flat starting from $719,000.

The penthouses are priced from $1.7 million for a three-bedroom unit to $2.79 million for a five-bedder.

Terrene is a 50-50 joint venture between UOL and La Salle Asia Investment Management.

The newly released 368 Thomson has also done well.

City Developments (CDL) said yesterday that it has sold more than 90 per cent of the 157-unit freehold condo in Thomson Road since it started a private preview on July 8.

The Straits Times understands that 144 units have been sold, leaving a balance of 13 units.

Last Friday, CDL announced that it had sold 96 out of 120 launched units. Prices were about $1,350 psf, or from $918,000 for a one-plus-study unit to $4.4 million for a five-bedroom penthouse.

Since then, the developer has released more units with prices 2 to 3 per cent higher.

The market for new private homes quietened last month with buyers distracted by the euro zone debt crisis, school holidays and the World Cup. A certain amount of price resistance had also set in.

But this month will be a slightly busier month, say property consultants.

Hong Leong Holdings said in a statement yesterday that it will launch the 99-year leasehold The Scala at the end of this month.

The Scala, which is in Serangoon Avenue 3 and near the Circle Line’s Lorong Chuan MRT station, will have 468 units. It has one- to four-bedroom units ranging from 474 sq ft to 2,142 sq ft.

Hong Leong said the condo will have seven pavilions, each designed to give residents a different interactive experience. One will be an Italian pavilion with a wood-fired oven for residents to make their own pizzas.

More property launches can certainly be expected from September, after the traditionally quiet Hungry Ghost Month, experts say.

CDL said its 642-unit, joint venture condo in Pasir Ris will be released in the third quarter.

Source : Sunday Times – 18 Jul 2010

The appeal of designer condos

More developers are engaging world-class architects as buyers get more sophisticated

It is hard to miss the striking high-rise residential projects in central Singapore, some designed by internationally renowned architects.

In recent years, these internationally acclaimed names include German Ole Scheeren – who was behind The Interlace in the Alexandra Road area – and American Daniel Libeskind, who designed Reflections at Keppel Bay.

Equally famed Zaha Hadid is behind a huge condominium project on the former Farrer Court site, which has yet to be launched for sale.

Developers say it is crucial to differentiate their products in a challenging market where buyers are becoming more discerning.

Far East Organization, Singapore’s largest private developer, launched an ultra luxury brand called ‘Inessence’ last month.

Apart from allowing it to tap further into the rapidly growing wealth in the Asia-Pacific region, the developer said its move is a testament to Singapore’s strong foundations and transformation into a vibrant global city.

Mr Augustine Tan, chief executive officer, Singapore residential, Keppel Land, said: ‘With increasing globalisation, home buyers have also becoming increasingly sophisticated, so much so that owning a home is beyond the brick and mortar but involves the considerations of prestige, lifestyle and other value propositions associated with the development, such as designer architects.’

Property experts say that condos designed by world-renowned architects have a particular appeal to brand-conscious buyers.

Furthermore, these architects are believed to be able to design condos with superior layout and lifestyle concepts – for both the individual apartments and the overall development, said Colliers International’s director for research and advisory Tay Huey Ying.

Many of these designer condos are then able to command a pre- mium.

‘It’s one of the marketing tools for developers to help them achieve their price target,’ said ERA Asia-Pacific associate director Eugene Lim.

‘If I put a brand-name architect to a high-end project, I can push the price slightly higher. The pre- mium is possible because of the product differentiation.

‘People have to associate what they are paying for with what they are getting. It’s about selling an image, a lifestyle and status.’

The price premium, said Ms Tay, is, however, not guaranteed.

‘More often, they are differentiators that can help to move sales, particularly in a competitive market.’

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said buyers will be willing to pay a premium only if the property comes with other attributes – such as a desirable location and a sensible layout.

And developers do change the designs to fit the market if needed. Far East Organization, for instance, did away with an eye-catching design by Mr Scheeren for Scotts Tower as the market had changed significantly.

It had wanted to launch the project – which had only 67 large units – back in late 2007 but the high-end market had started to show signs of slowing.

It has since replaced the original design, featuring four suspended towers, with a creation by Mr Ben van Berkel of UNStudio.

Singapore can expect to see more designer condos, but they would not be flooding the market any time soon. They will remain in a class of their own.

‘Not all developers can afford to pay for the services of a world-renowned architect. Moreover, such architects may also be selective in the projects that they want to be a part of,’ said Ms Tay.

‘As such, it is unlikely that designer condos will be the norm one day, although such condos could grow in numbers, particularly in the higher-end segments.’

Source : Sunday Times – 18 Jul 2010

What you need to know before buying your home

Buying a home is one of the biggest purchases you will make in your lifetime, so it’s important to do your homework before you apply for that loan.

Prepare in advance

You must pay at least 1 per cent of the purchase price in exchange for an option to purchase. After that, you have 14 days to decide whether to proceed with the deal and pay the balance of 9 per cent for a completed property or 4 per cent for one under construction.

At this point, consult a mortgage specialist about financing. Mortgage documentation takes about 10 to 12 weeks to complete, so apply early.

Note that most banks charge a cancellation fee of up to 1.5 per cent on the loan amount if you pull out later.

Banks determine the maximum loan amount by applying a debt servicing ratio of between 30 and 35 per cent of your monthly income.

Therefore your total monthly repayment should not exceed this ratio when compared to your monthly income. Other commitments, such as a car loan, will be taken into consideration as part of your monthly commitments.

Select your loan tenure

Generally, the maximum loan tenure is 35 years, but it depends on the borrower’s age. In the case of joint applicants, the maximum tenure will be based on the age of the youngest borrower as long as the loan tenure plus the age of the youngest borrower does not exceed 70 years on loan maturity.

For example, if a borrower wanted to select the maximum loan tenure of 35 years, he must not be more than 35 years old.

Here are some useful tips:

Choose the right package according to your needs

Most banks offer three types of home loan packages: fixed-rate, variable-rate and market-pegged packages.

It is important to understand your needs and intentions before you decide which package suits you.

A fixed-rate package is suitable for those who want peace of mind as during the fixed-rate period, there will be no rate volatility.

But it is not recommended if you want to make a partial prepayment or full settlement during this period as there will be penalties.

A variable-rate package is one where the rate is pegged against the bank’s reference or board rate. This allows the borrower to make prepayments.

If you have a good understanding of market-pegged rates and you do not mind rate movements, go for the market-pegged package.

The rate offered by banks in Singapore is generally pegged to the Singapore Inter Bank Offer Rate (Sibor).

It also allows you to make loan prepayment without penalty for no lock-in packages on specific rollover dates.

Get mortgage insurance for protection

Mortgage insurance – or Mortgage Reducing Term Assurance – covers the home loan balance in the event that the borrower dies or is totally and permanently disabled.

Although not compulsory, it is recommended. If an unfortunate event strikes, the loan repayments will be covered by the insurance.

Have difficulty in your repayments? Talk to your bankers. Late charges or non-repayment penalties are but a deterrent for non-payment. More importantly, promptly seek help in managing an overdue debt.

Banks try to help customers work through such difficult times. It might include allowing customers to pay only the interest portion of the loan for a short period, stretching the loan period so as to reduce the monthly repayment amount.

Help might also come in the form of allowing borrowers to include a second loan applicant to help service the initial loan.

It is not in the bank’s interest to foreclose on home loans. We advise customers who have loans to pay off and are close to running into the risk of not being able to make payments, to speak to their bank officers before their situation gets worse.

By Phang Lah Hwa, OCBC Bank’s head of secured lending

July property spurt expected before Hungry Ghost Month starts

A breather for home sales in lazy June

Students were not the only ones taking a break during the mid-year school holidays. Home seekers also slowed their pace, buying just 847 private homes from developers in June.

This is the smallest number of new sales in a month since the start of the year. It is 22 per cent lower than the 1,083 units sold in May, and 62 per cent below April’s 2,208 units.

But market watchers are hardly fretting as they expect purchases to pick up slightly in July before the Hungry Ghost Festival is celebrated.

Also, overall sales for the first half of the year have been strong. Developers offloaded 8,584 units from January to June – an average of 1,431 monthly. They did better compared with the same period last year, when they sold 7,374 units in total or an average of 1,229 monthly. ‘The momentum of new home sales slowed down in June as expected,’ said CBRE Research executive director Li Hiaw Ho.

Purchases had started falling in May as the euro debt crisis and high prices caused interested buyers to think twice.

According to flash estimates from the Urban Redevelopment Authority (URA) two weeks ago, the private residential property prices index hit a new high in Q2, past the pre-Asian financial crisis peak.

Then there were other distractions – the football World Cup and the school holidays – which could have persuaded developers to hold back launches. They rolled out 1,010 homes in June, down 11 per cent from 1,135 in May.

Buying activity was concentrated in the suburbs, reflecting market caution. Home hunters bought 429 homes in the outside central region, accounting for 51 per cent of total sales. These included 77 units from Waterfront Gold at Bedok, which made its debut in June.

In the rest of central region, developers sold 275 units or 32 per cent of the total. Activity was quietest in the core central region with 143 units or 17 per cent sold.

New launches included Far East Organization’s Skyline @ Orchard Boulevard, where two units changed hands for a median price of $3,839 per square foot (psf).

Property consultants believe developers may sell slightly more homes this month, with the World Cup and school holidays over.

Also, the Hungry Ghost Festival arrives in the second week of August. There might be ‘superstitious buyers looking to pick up homes in July ahead of the inauspicious home-buying period’, said Colliers International research and advisory director Tay Huey Ying.

DTZ executive director (consulting) Ong Choon Fah added that strong economic growth in Q2 could boost market sentiment. On Wednesday, the government revised its GDP growth forecast for the year to a range of 13-15 per cent, up from 7-9 per cent.

CBRE’s Mr Li noted that sales in the third quarter have ‘started well’.

At UOL Group’s Terrene in Bukit Timah, more than 100 homes out of 130 soft-launched since July 8 have been sold. The average price is $1,250 psf and demand came mainly from Singaporeans, especially those with private home addresses. UOL will officially release 42 units for sale today.

While the market could get better in July, few consultants expect buying activity in the coming months to revisit highs reached earlier in the year.

‘Buying interest will remain selective, depending on the location and product attributes as well as price points of new launches,’ CBRE’s Mr Li said.

Price resistance could keep some buyers on the sidelines. ‘Bargain hunting is likely to be the main focus of buyers,’ said Chua Yang Liang, South-east Asia and Singapore research head at Jones Lang LaSalle.

To some extent, home sales are driven by the number of property launches, said DTZ’s Mrs Ong. She expects launches in the mass market to continue because developers who recently won tenders for state land may want to roll out their projects before more government sites and more competition come onstream.

But developers of prime freehold projects could hold back launches because there have been fewer collective sales of such sites. They may consider waiting ‘for a little while more when they have a bit more pricing power’, Mrs Ong said.