Property News and Trends

***”Pleasure in the job puts perfection in the work” – Aristotle ***

DAILY NEWS UPDATES
9 April 2013

Childless couples can apply to rent from pool of 900 available subsidised flats

 

Childless couples waiting for their new flats to be built can apply from Monday to rent subsidised Housing Board (HDB) flats in the meantime. As promised by National Development Minister Khaw Boon Wan last month during the budget debate, HDB’s Parenthood Provisional Housing Scheme (PPHS) has been extended to those without children. It was originally launched in January for couples with young kids as part of the Government’s push to boost the birth rate. The 1,150 unfurnished flats in Ang Mo Kio, Bedok, Jurong West and Queenstown, going at 40 % below the market rental rate, were meant to provide an affordable source of housing for young families while they waited for their new flats to be completed. Over 200 applications have been received from young families for the flats that cost between $800 to $1,900 a month to rent. About 900 flats are still available for rent by both couples with children and childless couples. They have until April 29 to apply, said HDB in a statement on Monday.

 

-StraitsTimes, Singapore
Demand for industrial units falls sharply

Measures designed to curb speculation in industrial property appear to have worked, judging by Q1 sales. Demand for multi-user factory units plunged in the January to March period, after the Government imposed a first-ever seller’s stamp duty (SSD) on the industrial sector on Jan 12. Industrial sales tumbled 62.3 % to 319 caveats lodged in the first quarter of this year from 847 in the Q4 of last year, consultancy Knight Frank said yesterday in a report. New uncompleted factory projects bore the brunt of the greatly weakened demand. For those projects, new and sub-sale volumes plummeted 71.3 % to 138 caveats lodged in the Q1, from 480 caveats in the October to December period last year. Sales volume in the secondary resale market fell 50.7 %, from 367 caveats lodged in the fourth quarter last year to 181 in the Q1 this year. Knight Frank Singapore director and head of industrial Lim Kien Kim said the SSD had “deterred speculative demand and reduced overall buying interest for strata-titled factory space”. The duty is meant to dampen speculative activity in the industrial segment, where prices have doubled over the past three years. However, Knight Frank said that, despite the plunge in sales volumes, prices for new sale and sub-sale multi-user factories remained “relatively firm” in the first three months of this year. New sale and sub-sale prices for 30-year, 60-year and 99-year leasehold and freehold strata factories fell 4.2 %, 4 %, 1.6 % and 3.5 % respectively from the preceding quarter. Resale prices for different tenures paint a more mixed picture. Resale prices for 30-year leasehold industrial units dropped 10.7 % q-o-q. But resale prices for 60-year leasehold and freehold multi-user factories climbed 3.8 % and 3.3 % respectively. As for rents, Knight Frank said islandwide industrial gross rents grew 5 % to $2.13 psf per month on average in the Q1 from the preceding three months. Although newer factories such as UE BizHub East and Oxley BizHub command higher rents, an upcoming supply of about 24.12 mil sq ft of new factory space this year will cap industrial rent rises, Mr Lim said.
-Straits Times, Singapore
Condo sales taper off but interest still strong

The frenetic pace of a few weeks ago might have eased but sales at new condominium projects are still healthy. Hundreds of units flew off the shelves during the initial launches of a string of new suburban projects last month and buyers are still in the hunt although sales have tapered off. The 582-unit Urban Vista next to Tanah Merah MRT station has moved 40 units over the past two weeks, bringing total sales to 370 apartments since. Average prices range from $1,400 to $1,550 psf for the one- to four-bedroom units, said developers Fragrance Group and World Class Land. Sim Lian Group’s Hillion Residences condominium in Bukit Panjang has also enjoyed healthy sales, with 204 units in the 546-unit project sold at an average price of $1,370 psf. The Hong Leong Holdings development in Bartley Ridge in Mount Vernon also continued to receive healthy interest from buyers, with more than 400 units sold at the 868-unit project. About 260 units went during its initial launch weekend about two weeks ago. Buyers have now claimed about 730 units of the 912 homes at D’Nest in Pasir Ris since its preview launch on March 15 where 500 units were snapped up within a matter of days. Roxy-Pacific Holdings has moved about 70 apartments at Jade Residences – comprising 171 homes and two shop units in the Lorong Lew Lian area – since its launch last Friday. Prices work out to $1,416 psf on average, with a two-bedroom 527 sq ft unit going for about $845,000. Most buyers are first- and second-timers who are buying mainly two- and three-bedders, said Mr Teo Hong Lim, executive chairman of Roxy-Pacific Holdings. But sales at 512-unit Kingsford Hillview Peak are believed to be slow, with market sources saying that fewer than 100 units have been sold since its launch over a week ago. Other developments gathering interest now include the Twin Fountains executive condominium in Woodlands, Sant Ritz in Potong Pasir and the mixed-use development on the former King Albert Park site.
-Straits Time, Singapore
Demand for business park space up

Increased interest from financial, pharmaceutical, media and IT firms drove up demand for business park space in the Q1, said consultancy CBRE yesterday. New buildings with quality specifications in One North, Mapletree Business City, Changi Business Park and similar complexes had more inquiries and a higher take-up rate in the first three months of this year than in the last three months of last year. Telecommunications firm Ericsson points to this “flight to quality”. It signed a lease for 32,000 sq ft in One @ Changi City in the quarter, sealing its move from premises at the SLF Building in Thomson Road. The trend has prompted older business parks and science parks to undergo facelifts and upgrade facilities to remain relevant, CBRE said. The overall vacancy rate for the business park market was 6.4 % in the three months to March 30, down from 7.2 % in the preceding quarter. Average rents have stayed at $3.80 psf per month since the Q3 last year, CBRE said. A DTZ report last week put average monthly rents for business park space at $4.35 psf while newer city-fringe space was going for between $5 and $6 psf per month. CBRE added that an impending surge in supply is expected to keep business and science park rents from increasing much further. It pointed out that major tenants relocating from older to newer developments this year combined with possible downsizing could mean an extra 800,000 sq ft of business park space becoming available. On top of that, around 750,000 sq ft of this year’s new business park space supply has yet to be pre-let. CBRE’s Mr Tay said the market’s take-up of the total 1.55 million sq ft of additional supply would be an “acid test for the health of the business park market going forward, and a key factor in determining the direction rents will take in the medium-long term”.
-Straits Times, Money
Curbs on car loans depend on market conditions

Any change to the recent curbs on car loans will hinge on whether there is “sustained moderation” in certificate of entitlement (COE) prices, said Acting Minister for Culture, Community and Youth Lawrence Wong. He noted that the impact of the loan restrictions can be determined only over a period of time, and there is just a month’s worth of data available since the restrictions were put in place on Feb 26. Mr Wong, a board member of the Monetary Authority of Singapore (MAS), was speaking in Parliament yesterday on behalf of Deputy Prime Minister Tharman Shanmugaratnam. He was replying to Mr Lim Biow Chuan (Mountbatten) and Nominated MP Teo Siong Seng, who asked about the effect of the curbs and whether they could be eased. He said: “We will recalibrate our financing restrictions for all cars new and old in response to market conditions, in particular if there is a sustained moderation in COE prices.”The MAS’ recent curbs limited car loans to 50 or 60 % of the purchase price, and capped the loan tenure to five years. Previously, car buyers could borrow the full amount and stretch the loan up to 10 years. Mr Wong said it was necessary to set “significant” limits to moderate the demand for cars. The curbs are also to encourage financial prudence, he added.nIn response, Mr Wong said the curbs are tiered so those who buy smaller cars have a higher loan limit of 60 %. Last week, the MAS announced that it would lift loan restrictions on 7,000 used cars for 60 days. These cars were in stock or acquired before Feb 25, when the curbs were announced. Mr Wong said about 6,000 used cars were sold each month on average in the past. In the month after the curbs took effect, 5,000 used cars were sold, of which 4,000 were registered before Feb 25. Prices have also gone down by about 10 %.
-StraitsTimes, Money
Pay rises may not mean higher inflation: Iswaran
Pay rises may not necessarily lead to long-term inflation, as much depends on whether they are backed by productivity gains, Second Minister for Trade and Industry S. Iswaran said yesterday.”I want to emphasise that it’s not axiomatic that just because wages increase, that prices must go up and inflation must be a consequence,” said Mr Iswaran. “Because the key elements here are whether… those wage increases are underpinned by productivity and other enhancements in the economy.” This is why a key part of the Government’s strategy is to boost productivity, he said. Earlier, Ms Tan had asked if inflation in Singapore would slow. Mr Iswaran noted that inflation in the first two months of this year averaged 4.2 %, down from last year’s 4.6 %. The growth of housing rental prices has slowed and certificate of entitlement premiums have moderated, he said. Imported inflation is also expected to be “benign” this year, with lower food price inflation and falling prices of oil-related items. As for services, the tight labour market could raise wage costs “in the transitional period”, thus putting upward pressure on prices. But as the Government is helping firms defray the cost of pay rises, this passing-on of costs will be dampened, said Mr Iswaran. “In the longer term, with productivity gains, firms will be able to afford higher wage costs and cope with higher business costs, without having to pass on the increased costs to consumers.”
-Business Times, Money
Khaw: No delay to BTO flat construction timeline so far

National Development Minister Khaw Boon Wan said there is no delay to the construction timeline for Housing and Development Board (HDB) flats so far, even as HDB expects to be impacted by tighter foreign worker policies just like other developers. He said HDB should be less impacted by two upcoming policies: the first which will see man-year-entitlement (MYE) quota for new projects get cut another 15 % in July this year to bring the cumulative figure to 45 % since 2010, and the second to increase foreign worker levy over 2014 and 2015, except for higher skilled workers employed within the MYE quota. Mr Khaw said this is because HDB uses prefabrication construction extensively, which helps to raise productivity and reduce labour requirements on site. Between 60 and 70 % of the super-structure of HDB projects are done with prefab components. HDB will also consider replacing contractors unable to cope with the tighter policies. It may allow the contractor to get another contractor to take over with a new contract. HDB may also terminate non-performing contractors and hire a new one to finish the remaining work.

 

-Business Times, Singapore
Law passed to ensure ‘what you see is what you get’ at showflats

Developers of private housing projects face more stringent laws on marketing and information disclosure, after Parliament passed amendments to the Housing Developers Act today. Showflats, for instance, can no longer be made to look bigger than the final product through the use of glass panels instead of brick walls, or higher ceilings. Transaction prices reported will also have to reflect all forms of discounts and rebates, including furniture vouchers and stamp duty refunds – to counter any artificial inflation of prices by developers. The amendments give the Government greater power to punish errant developers – with fines up to $100,000 and the power to inspect and, if necessary, close showflats, among other measures. In laying out the Government’s case, Senior Minister of State (National Development) Lee Yi Shyan said the bill would further safeguard the interests of home-buyers and enhance professionalism in the residential property industry. He noted: “A home is, in most cases, the single largest investment in one’s lifetime. It is only right that home-buyers are provided with the appropriate tools and legal safeguards to make informed decisions.”

 

-Straits Times, Singapore

 

Exchange Rates (extracted from xe.com)
1.00 SGD = 0.81 USD
1.00 SGD = 4.98 CNY
1.00 SGD = 2.46 MYR
1.00 SGD = 0.53 GBP
1.00 SGD = 916.12 KRW
1.00 SGD = 44.15 INR
1.00 SGD = 7,848.08 IDR
1.00 SGD = 6.25 HKD
1.00 SGD = 708.29 MMK
1.00 SGD = 16,834.89 VND
1.00 SGD = 0.78 AUD

1.00 USD = 1.24 SGD
1.00 CNY = 0.20 SGD
1.00 MYR = 0.41 SGD
1.00 GBP = 1.91 SGD
1.00 KRW = 0.001 SGD
1.00 INR = 0.02 SGD
1.00 IDR = 0.0001 SGD
1.00 HKD = 0.16 SGD
1.00 MMK = 0.001 SGD
1.00 VND = 0.00006 SGD
1.00 AUD = 1.29 SGD
ST Index change: 3,298.17 (+13.56) *As at Tues, 9 Apr 2013, 9:34am

SIBOR (3 mths): 0.37333 (S$)
SWAP (3 mths): 0.26456 (S$)