Published January 29, 2011

The charge of the bungalows brigade
URA's sub-index for detached homes soars 37.6%, boosting overall index's gain to 17.6%

By KALPANA RASHIWALA

IN a year fuelled by strong liquidity and economic growth, bungalows were the stars that led the surge in the Singapore property market in 2010. Latest data from the Urban Redevelopment Authority shows that its price index for landed homes climbed 30.8 per cent last year. The sub-index for detached houses, or bungalows, soared 37.6 per cent against a 5.6 per cent rise in 2009.

The index for non-landed private homes rose 14 per cent last year, following a 0.5 per cent gain in 2009. The biggest price hike in 2010 in this segment was for completed non-landed homes in Core Central Region, which climbed 19.5 per cent last year, although prices of uncompleted units in the same region rose at a much slower rate of 10.6 per cent in 2010.

URA's overall price index for private homes swelled 17.6 per cent last year, after posting a 1.8 per cent rise in 2009. It rose 2.7 per cent quarter on quarter in Q4 2010.

Knight Frank chairman Tan Tiong Cheng observed that the index has appreciated by about 65 per cent over the past five years, translating to an average annual increase of 13 per cent. 'This is a very significant increase considering that we had the biggest financial crisis during this period,' he added. Developers sold a record 16,292 private homes (excluding executive condos) last year, up 10.9 per cent from 2009 and busting the previous high of 14,811 units in 2007.

The other sectors of the property market also saw sharp turnarounds last year, according to the latest URA numbers. For instance, the office price index rose 18.9 per cent in 2010, against a 16.4 per cent drop in 2009. Flatted factory and warehouse prices, too, shot up 23.7 per cent last year, compared with respective declines of 14.2 per cent and 16 per cent in 2009.

Looking ahead, market watchers expect some wind to be taken out of the residential sector following the latest property cooling measures. Investors are channelling their money to the commercial and industrial property segments, which were not the target of the cooling measures announced on Jan 13.

DTZ's SE Asia research head Chua Chor Hoon is predicting a minus 5 per cent to 0 per cent change in URA's overall private home price index this year. Others are more sanguine. Colliers International director of research and advisory Tay Huey Ying forecasts a 5-8 per cent rise with the increase led by mid and high-end properties.

Prices of mass market homes are expected to stay relatively unchanged or ease by up to 2 per cent given the ample new supply in this segment, she said.

As for the landed segment, RealStar Premier Property managing director William Wong, who had earlier predicted an average 10 per cent rise this year in Good Class Bungalow (GCB) prices - the creme de la creme of landed homes on mainland Singapore, now expects prices to hold in 2011.

'Transaction volumes are expected to fall 20-30 per cent over the next 3-6 months. Owners are not prepared to adjust prices downwards while buyers are waiting for prices to go down. This may not happen.'

Another bungalow specialist, KH Tan, managing director of Newsman Realty, said that some sellers have started to withdraw GCBs from the market following the latest cooling measures as they would face longer holding periods on any replacement bungalows they may purchase because of the hikes in seller's stamp duties.

Nevertheless, he predicts an increase of about 10 per cent in GCB prices this year, following last year's appreciation of about 35 per cent, because of the limited stock of GCBs, wealth effect from new ultra high net worth citizens and low interest rates. On Sentosa Cove, where foreigners may buy landed homes, the price gain this year could be higher, about 15 per cent, as 'there are still a lot of rich Chinese foreigners coming in'. Bungalow prices on Sentosa climbed 30 per cent last year on average, he estimated.

On URA's numbers, CB Richard Ellis executive director Li Hiaw Ho observed that while the price index for uncompleted non-landed homes in Outside Central Region (where mass-market condos are located) has surpassed the peak in Q2 2008 by 19.1 per cent, the equivalent index for Core Central Region (which covers the traditional prime districts, financial district and Sentosa Cove) is still 7.1 per cent below its Q1 2008 high.

Meanwhile, the National University of Singapore's Singapore Residential Price Index (SRPI) flash estimate shows that prices of completed non-landed private homes in Singapore's Central region (postal districts 1-4 and 9-11) appreciated 7.8 per cent last year, while the sub-index for the Non-Central region rose 15 per cent. As a result, the overall SRPI increased 11.9 per cent in 2010. In 2009, the three indices posted respective gains of 27.3 per cent, 19.5 per cent and 22.2 per cent.

URA's data showed that 10,399 private homes were completed last year - close to the 10,488 units in 2009 and 10,122 units in 2008. The overall private residential rental index rose 17.9 per cent last year, a sharp reversal from the 14.6 per cent slide in 2009.

Savills Singapore director for residential leasing Patrick Lai said that overall residential rents may increase a further 5 per cent in 2011. 'We believe that the rental rates for super high-end condominiums and GCBs will remain robust and are likely to increase by 6-10 per cent as more top executives relocate to Singapore.

'For example, we have just leased out a 2,852 square foot unit at The Orchard Residences for $20,000 per month. We also recently handled the leasing of a GCB in the Peirce Villas/Swettenham Road neighbourhood for $40,000-45,000 per month.'


Source: www.businesstimes.com.sg

URA also launches another 99-year leasehold plot at Seletar Road


By KALPANA RASHIWALA


A HOUSE in Punggol built in 1902 by the father of the late legal eagle Howard Cashin has been put up for sale as part of a 99-year leasehold private residential site launched for tender by the Urban Redevelopment Authority yesterday.

The single-storey house will have to be conserved and restored for use as a clubhouse or private residential use within the new proposed development on the site. Matilda House was acquired by the government under the Land Acquisition Act in the mid-1980s and gazetted as a conservation building on Feb 21, 2000.

The house was built in 1902 by Alexander Cashin, the father of Howard Cashin and son of Joseph Cashin, who arrived in Singapore in the 1840s. Starting out as a lawyer's clerk, Joseph Cashin made his fortune investing in legal opium farms in the 1880s and later, in real estate. Cashin Street, next to Bras Basah Complex, was named after him.

The Cashin family was one of the oldest Irish families to have settled in Singapore and owned several other houses as well as about 400 shophouses here.

Matilda House is named after Mr Joseph Cashin's wife. Mr Alexander Cashin built it as a present for his wife, according to an article in October 2002 in The New Paper. The Punggol seaside bungalow served as a weekend retreat for the family. Sited on the Punggol seafront, it was surrounded by orchards on all sides. The Cashin family also owned about 350 hectares of land in the area on which there were also rubber and coconut plantations.

The house today is in pretty rundown condition sparking some talk about it being spooked.

URA said that Matilda House is an example of an early-style tropical bungalow. Its distinctive features include entrances on both sides of the main building, raised floors, timber lattice and louvred windows and transoms to allow cross-ventilation. It is the only remaining historic bungalow in Punggol Town.

The single-storey Matilda House has an existing gross floor area of about 4,488 sq ft. In addition to this, the successful bidder of the 2.7 hectare site (which includes Matilda House) can develop a total 888,904 sq ft gross floor area of new buildings. This can generate a condominium with about 810 units.

Credo Real Estate executive director Ong Teck Hui describes the plot as a 'plum suburban site with many things in its favour - proximity to Punggol MRT Station, the bus interchange and the proposed town centre, with Matilda House thrown in for uniqueness'.

Based on current sentiment, the site could draw six to 10 bidders with top bids of around $400 to $450 psf per plot ratio (psf ppr), or $355-400 million in absolute quantum.

SLP International Property Consultants executive director Nicholas Mak predicts bids of about $380-420 psf ppr, with five to nine bids expected.

The tender for this site closes on Dec 7.

URA yesterday also launched for tender another 99-year leasehold plot at Seletar Road, slated for development into condominium/flats (up to five storeys) or landed housing/strata landed housing (up to two storeys). If developed into a condo, the 1.7 hectare plot can generate about 270 units.

The site is next to a plot awarded to Far East Organization at a state tender that closed in September last year at $376 psf ppr. Far East is developing Greenwich V (comprising 35 shop units) and The Greenwich, a 319-unit condo, on the site. It released the condo in early August and to date has sold 233 units.

Credo's Mr Ong notes that caveats for The Greenwich have been lodged at about $1,300-1,400 psf for smallish units and $1,000-1,100 psf for more normal-sized apartments.

Mr Ong observed that while the latest site also enjoys a good location in the Seletar Hills area, which is in good demand and which will benefit further from the aerospace hub, 'it is in a way 'landlocked', sandwiched by landed estates, the Greenwich development and a SingTel telephone exchange'.

He predicts four to eight bidders going by current sentiments, with top bids in the $550-600 psf ppr range (or about $145-158 million).

Mr Mak says the site may attract four to seven bids with top bids coming in at $320-360 psf ppr. 'Some of the bidders could be medium-size developers as the absolute land cost is not excessive,' he added.

The tender for this site closes on Dec 14.

Published October 27, 2010

http://www.businesstimes.com.sg

They boost tally of properties auctioned so far this quarter to about $54.1m

Published September 28, 2010
By KALPANA RASHIWALA

TWO Good Class Bungalows (GCBs) at Margoliouth Road (off Stevens Road) and Sixth Avenue were sold at a Colliers International auction last week for a total of $25.6 million, boosting the tally of properties sold at auction so far this quarter to about $54.1 million.

With another three auctions to go before the month ends, the final figure for Q3 this year could be higher. The figure so far has already surpassed the $45.3 million and $41.7 million of auction sales done in Q1 and Q2 respectively, although the action - in terms of volume of transactions at auctions - has been less buoyant.

From July 1 until yesterday, 11 properties changed hands at auction, compared with 23 each for Q1 and Q2, according to Colliers International Research. And although in terms of value the $54.1 million of properties is close to the $57 million done in Q3 last year, that came from a broader spread of 42 deals.

'There were more apartments and residential properties in general being sold at auctions this time last year,' recalls Colliers International deputy managing director Grace Ng.

A stalemate arising from owners' high price expectations had started to slow auction sales, particularly for apartments and condo units, even before the government announced measures to cool the property market on Aug 30, according to Ms Ng.

The measures, particularly a lowering of the maximum loan-to-valuation (LTV) ratio from 80 per cent previously to 70 per cent when buying a new home for those with one or more existing mortgages, seem to have further slowed sales enquiries for apartments/condos, though interest in landed properties has not been hit, she added.

'Most buyers of landed property would have some equity from the sale of their first property and would not need an 80 per cent LTV; they would take 50-70 per cent LTV,' explains Ms Ng.

Year to date, 57 properties have been sold on the auction block for $141.1 million, compared with 118 properties transacted at $168.4 million for the whole of 2009. In terms of value, the record was set in 1999, at $409.5 million.

Among the properties that went under the hammer recently were the two GCBs that Colliers auctioned last week.

The single-storey freehold bungalows - at 4 Margoliouth Road and 53 Sixth Avenue - were sold by the same party, a trustee of an estate. They were picked up by different parties, Singaporeans who acquired them through companies.

There was greater interest for the Margoliouth Road property, which is located off Stevens Road and is within the White House Park Good Class Bungalow Area. Bidding started at $10.5 million and the property received a total of 14 bids. It was sold for $13.6 million or $1,304 per square foot (psf) based on its land area of 10,433 square feet.

Bidding for the Sixth Avenue bungalow opened at $11.5 million and it was sold at the next bid, at $12 million or $1,145 psf on a land area 10,476 sq ft.

The two properties are understood to be about 20-30 years old, although their interiors have been renovated.

Market watchers note that it is not common to achieve sales of GCBs at auction these days as most such properties are put up for sale by owners, who typically have high price expectations.

Ms Ng, who conducted the auction for the two bungalows last week, says: 'Because these are trustee sales, the seller's price expectation would be pegged to market prices, which are a reflection of current valuations - unlike owner sales where it's common to have asking prices of about 20 per cent above valuation.'

BT Weekend reported last week that GCB prices have been on the rise. A CB Richard Ellis analysis of URA Realis caveats data downloaded on Sept 23 showed that the average price for GCBs transacted so far is $1,050 psf, about 26 per cent higher than the $831 psf for GCB deals for the whole of last year.

A house at Cluny Hill was sold this quarter for $28 million or $1,841 psf based on its land area of 15,210 sq ft.

On a psf basis, this is believed to be the second highest price ever achieved in the GCB market, surpassed only by the $1,899 psf recorded in 2007 for 32H Nassim Road.

The Cluny Hill property is understood to have been bought by Mike Scott, director at oil/commodity trader Trafigura Pte Ltd. He is a Singapore citizen.

The sale is understood to have been brokered by RealStar and Orange Tee.



Source: http://www.businesstimes.com.sg