While the Government has to act to prevent the property market from getting beyond the reach of most Singaporeans, I am however not very comfortable that the latest steps - announced last week - are the best means of dealing with the issue.

Not only are the measures fairly drastic, they appear to be dealing more with curbing demand than raising supply.

The Government has claimed that there is no shortage of supply. It points out that the sites awarded last year under the Government Land Sales Programme (GLS) will yield about 13,300 units. For the first half of this year, it says it will make available sites that would be able to yield about 14,300 units.

Further, as at the end of the third quarter of last year, there were about 64,400 uncompleted units in the pipeline, of which roughly half were still unsold. These compare with the annual take-up rate of about 12,700 units between 2007 and last year. Unfortunately, there is a lag period between the site award and the sale of the property.

The latest attempt to cool the property market may have the unintended effect of reducing supply as developers decide to take a wait-and-see approach. They might be even willing to pay the penalties for missing completion deadlines rather than sell at a loss. It could also see the bigger developers with the financial muscle to hold being able to take advantage of those who can't hang on to their sites.

And will the new rules which took effect the day after they were announced - Jan 13 - force buyers to give up options, now that financing will be more difficult to obtain?

Under the new rules, financial institutions can only grant loans amounting to half the value of the properties purchased by non-individuals, such as companies, trusts and collective investment schemes. Individuals with existing outstanding mortgages can now borrow only up to 60 per cent of the value of their next property purchase.

Another unintended effect could be that those who have the financial resources will be able to get more properties on the cheap - to sell when prices recover later.

But should the Government be overly concerned with private-sector housing? Should it be going all out to prevent a fool from parting with his money?

Despite numerous warnings about the dangers of a property bubble bursting and that the current low interest rate regime might not last for too long, property prices, prior to the latest measures, continued to climb.

I believe the Government should be more concerned about housing the masses. It has done a marvellous job, having built more than one million units since the Housing and Development Board (HDB) was established. At present, some 900,000 units house more than four-fifths of the population. For the vast majority of newly-weds, their first home is likely to be an HDB flat. These are the people whom the Government has to be concerned with.

The Government has said it will be building more HDB flats - up to 22,000 Build-To-Order flats this year - to accommodate the masses. Will these be enough?

It should perhaps also get out of building executive condominiums (EC) units which provide condo-like facilities and the Design, Build and Sell Scheme (DBSS) units. The HDB says land for some 8,000 of these could be launched this year. Why should the HDB be catering to the needs of this select group?

Look at what is happening to the estates that were built by the HUDC for an earlier group of the so-called sandwiched class. Some like Farrer Court, Amberville and Bedok Reservoir, have been sold en bloc to private developers. The remaining ones - Shunfu, Braddell Heights, Pine Grove, Laguna Park, Neptune Court, Chancery Court and Eunosville - have been privatised or are in the process of being privatised in anticipation of en bloc sales. Why must public funds be used to cater to such profiteering?

Rather than be all things to all people, the Government should concentrate on housing the masses.

by Conrad Raj
05:55 AM Jan 21, 2011

Conrad Raj is editor-at-large with Today.

Source: www.todayonline.com

Published January 21, 2011

Govt launches tenders for 3 housing sites
All three plots are near MRT stations in Choa Chu Kang, Sengkang and Bishan

By KALPANA RASHIWALA

THE government yesterday launched tenders for three 99-year leasehold housing sites near Choa Chu Kang, Sengkang and Bishan MRT stations.


This includes two plots on the confirmed list - an executive condo (EC) plot in Choa Chu Kang next to Mi Casa condo, and a private condo site near Sengkang MRT Station.

The third parcel, near Bishan MRT Station, was triggered from the reserve list as announced on Jan 7.

The EC plot at Choa Chu Kang Drive, which is near Choa Chu Kang MRT Station and Lot 1, can generate about 490 housing units. Cushman & Wakefield senior manager of Asia Pacific research Ong Kah Seng estimates top bids for the site at about $260-280 per square foot per plot ratio (psf ppr), translating to a breakeven cost of about $550-580 psf and average selling price in the $600-630 psf range.

Credo Real Estate executive director Ong Teck Hui expects three to five bids with the highest in the $220-240 psf ppr band, reflecting average selling price expectations of about $610-620 psf.

ECs are a hybrid of public and private housing with ownership and resale restrictions in the first 10 years.

The Sengkang plot can be built into a private condo with about 530 units. Both consultants predict the top bid could come in at $350-380 psf ppr and a resulting breakeven cost of about $700-740 psf and average selling price in the $800 psf region.

The calculation factors in the possibility of price softening; one MRT stop away, at Buangkok, units in The Quartz are selling at about $900 psf.

The Sengkang plot launched yesterday is a stone's throw from the bustling Sengkang Town Centre, bus interchange, MRT/LRT stations and Compass Point mall.

On January 7, the government announced that the Bishan plot had been triggered from the reserve list, following a successful application from an unnamed developer that had agreed to bid at least $189.83 million or $300 psf ppr.

Credo's Mr Ong predicts six to 10 bids for the land parcel, with the highest offer around $550-580 psf ppr; this would result in a breakeven cost of about $950 psf and an average selling price of around $1,100 psf.

Cushman's Mr Ong forecasts five to seven bids, with the top in the $450-480 psf ppr range and reflecting an average selling price expectation of about $920-950 psf.

Market watchers expect developer interest for Government Land Sale sites to be cautious following the Jan 13 cooling measures, although overall economic fundamentals remain good.

The tender for the Bishan site closes on Feb 24, followed by the Sengkang plot on March 15, and the Choa Chu Kang EC plot on March 22.


Source: www.businesstimes.com.sg

by Jo-Ann Huang Limin

05:55 AM Jan 18, 2011

SINGAPORE - Sales of new private homes totalled 1,332 units last month, down 583 units from November, the Urban Redevelopment Authority (URA) said yesterday.

Inclusive of executive condominiums, or ECs, the total number of units sold amounted to 1,699 units. This is a sharp fall compared to November, when new private home sales including ECs numbered 2,092 units. But experts said the fall was seasonal in nature, given that the year-end is usually a lull period for the property market.

"December is a month where you got parents rushing around for their PSLE results and you've got people going off on their holidays. Developers at the same time also launch fewer units and will have advertised less in the month of December," said Mr Ku Swee Yong, chief executive officer of International Property Advisor.

Together with units sold in November and October, a total of 4,313 new homes were sold in the fourth quarter of 2010. Assuming none of the units sold at the end of last monthwere returned to developers following the fourth round of property cooling measures effective from Jan 14, it will bring sales volume for the whole of 2010 to a record of 16,364 units, said Mr Li Hiaw Ho, executive director at property consultant CBRE. This would be 11.4-per-cent higher than the 14,688 new homes sold in 2009 and higher than the 14,811 new homes sold during the market peak of 2007, he noted.

The priciest unit sold last month was at the Ritz Carlton Residences in Cairnhill at $4,307 per sq ft, while Punggol EC Prive sold the most number of units at 326.

Analysts said the latest round of cooling measures should stamp out speculation, especially in the mass market segment. The measures included seller stamp duties imposed at 16, 12, 8 and 4 per cent, respectively, for homes sold in the first, second, third and fourth year from purchase, as well as the lowering of the loan-to-value ratio to 60 per cent for individuals with outstanding mortgages.

Experts projected that new home sales volume for this month should fall by about 10 per cent as a result.

"We will probably see a knee jerk reaction so I expect that January numbers and probably February numbers to be nowhere as strong as what we have seen for December," said Mr Ku.

Source; www.todayonline.com

Published January 18, 2011

After red-hot December, property braces for chill
Private home sales sizzled before cooling measures; 2011 expected to be a more sobering story

By KALPANA RASHIWALA

(SINGAPORE) December may have been chilly in the rest of the world, but for Singapore's property market, it was simply sizzling. The latest numbers underscore the backdrop against which authorities introduced last week's cooling measures.




Developers sold 1,332 private homes (excluding executive condos) in the traditionally slow month, exceeding the combined figure for the three preceding Decembers. This took the total for 2010 to a fresh high.

But property consultants expect the numbers to drop dramatically this year from the 16,364 private homes that developers sold in 2010 - in the face of the latest cooling measures.

Forecasts for developers' private home sales this year range from 8,000 to 12,000 units. Prices too are expected to drop with one consultant pegging the dip at 5 per cent for the mass market in the first quarter.

Speculators may now turn their attention to shoebox industrial units and strata offices and shops as non-residential property has been spared under the latest cooling package, observers say.

The 2010 sales number was 11.4 per cent above 2009's 14,688 units and surpassed the previous high of 14,811 units set in 2007, according to figures released yesterday by the Urban Redevelopment Authority.

The secondary market has also been buoyant.

Knight Frank's analysis of URA Realis caveats data shows a 23 per cent increase in the number of private homes (excluding ECs and en bloc sale units) sold in the resale market last year to 18,468 units. In addition, 3,264 caveats were lodged for private homes traded in the subsale market in 2010, close to the 3,838 units in 2009.

The 2010 resale and subsale figures are expected to increase as more caveats are lodged in the coming weeks. Resales refer to secondary market deals in projects which have received Certificate of Statutory Completion while subsales involve secondary market transactions in projects that have yet to receive CSC.

DTZ's South-east Asia research head, Chua Chor Hoon, forecasts that this year, developers may sell about 8,000-10,000 private homes. Knight Frank's number is 10,000-12,000 units.

Ms Chua reckons that prices would decline this year but not in the first quarter, when transactions are likely to thin amid a standoff between buyers and sellers. 'When sellers see demand is not coming back, those who need to sell will have to be more open to negotiation. I think prices in the mass and mid-market segments are likely to fall more as the lower loan-to-value (LTV) limits will hit those on a tighter budget.'

Knight Frank consultancy and research head Png Poh Soon foresees an up to 5 per cent price decline in Q1 for the mass-market segment while prices remain flat in the mid and luxury markets. 'Developers of mass-market projects, which are typically bigger, may be more inclined to price their projects attractively to draw buyers.'

Mr Png also reckons that sales of shoebox apartments would plunge as these have drawn many speculators, who are expected to be affected by the stiffer penalties for short-term trading now.

The government last week hiked the seller's stamp duty rate to as high as 16 per cent for private homes sold within the first year. The LTV limit for new home purchases by individuals servicing one or more existing housing loans has been lowered from 70 per cent to 60 per cent.

Ms Chua said that strong primary market sales for two consecutive years reflect 'a lot of speculative and investment demand'. 'Now, with the clampdown on the residential sector, a lot of investors will look at other property sectors as well as overseas properties.'

Savills Singapore senior manager Christine Sun said: 'Small investors may switch from buying 'mickey mouse' apartments to small strata industrial and office units, or HDB shophouses which still command attractive yields without bearing the brunt of the property measures.'

URA's figure of 1,332 private homes sold by developers in December was 30.4 per cent lower than November's 1,915 units but significantly above sales of 481 units in December 2009, 131 units in December 2008 and 305 units in December 2007.

Including ECs, the trend was similar, with the sales tally at 1,699 units for December 2010, more than the 940-unit total for the preceding three Decembers.

Including ECs, developers sold 17,438 private homes last year, up from 14,688 units in 2009 and also surpassing the 2007 figure of 14,967 units.

The Outside Central Region (OCR), where mass-market projects are located, made up 45 per cent of private homes (excluding ECs) sold by developers in December. The number of units they sold in Core Central Region (CCR), which includes the prime districts, CBD and Sentosa Cove, doubled from 218 in November to 449 in December.

'Reflecting the pick-up in investor confidence in CCR, where the price rise has lagged, 75 non-landed homes were transacted at above $3,000 psf in December, up significantly from 11 units in November and the most deals in this price-band since the 103 units sold in December 2007,' said Colliers director Tay Huey Ying

December's priciest deal was $4,307 per square foot, for a unit at The Ritz-Carlton Residences Singapore Cairnhill, followed by Nassim Park Residences ($3,833 psf) and Tomlinson Heights ($3,643 psf). Last month's best selling project was Prive, an EC in Punggol (326 units), followed by The Tennery in Choa Chu Kang (220 units), D'Leedon at Farrer Road (180 units) and Robinson Suites (157 units

Source: www.businesstimes.com.sg

SINGAPORE: Sales of private home properties moderated in December, but still came in above the 1,000 units level. Data released on Monday by the Urban Redevelopment Authority (URA) shows that 1,332 private homes were sold last month.

That is a 30 per cent on-month drop from the 1,915 units sold in the previous month.

Including Executive Condominiums, the total sales would have reached an even higher figure of 1,699.

Chalking up the best sales was Prive at Punggol Road, which sold 326 units for a median price of S$704 per square foot.

Meanwhile, the most expensive property sold in December was at The Ritz Carlton Residences at Cairnhill Road, where a unit was sold at a median price of S$4,307 per square foot.

-CNA/ac

Source: www.channelnewsasia.com

by Joanne Chan

Updated 11:20 AM Jan 14, 2011

SINGAPORE - Executive condominiums continue to see strong demand from home buyers who have been shut out of the public housing market until recently.

Austville Residences in Sengkang, the latest development for sale and the fourth EC to have been launched after a five-year hiatus, had a queue of some 150 home buyers and their families forming even before doors opened for booking yesterday morning.

One reason: A first-come-first-served system to allocate the 540 units, unlike the previous three ECs, which used balloting.

Early birds arrived on Wednesday and waited overnight to get a shot at choice units. Some came prepared with mats and chairs, others simply stood in line. By 9am, the line had snaked past the showroom.

The first couple in line, who declined to be interviewed, said they arrived at 3pm on Wednesday.

Mr Levan Heng, who arrived three hours later and was seventh in line, said he was attracted to Austville because his parents and in-laws live nearby.

"I've already applied for a Build-To-Order flat and I've in fact paid some money - like $2,000. But I was thinking I might even forfeit that to get this," he said.

Property developer United Engineers said it decided on a first-come-first-served system because balloting left too much to chance for genuine buyers. It declined to disclose first-day sales numbers.

Project director Chua Kien Pin said: "We have keen buyers who have aspirations for, maybe, a unit on a high storey or good spacing. They're not really well taken care of in a balloting system. In a queue system, buyers can come early and get what they want."

Market watchers were not surprised by the queue for Austville, whose units are priced at $680 per sq ft on average.

Dennis Wee Group director Chris Koh said: "There's quite a group of people who can't afford private property, but then their salary is above $8,000, so they can't buy Housing and Development Board flats either."

He added that Austville has good attributes, such as proximity to the Light Rail Transit and a shopping centre.

With ECs available to households with a maximum income of $10,000, Mr Koh said: "You can say it's a long route to owning a private property. If you aspire to own a private property today but can't afford one, perhaps choose an EC and, in the years to come, when it gets privatised, you benefit."

Since ECs were relaunched, sales have been good. Esparina, which was launched in October, has seen a 92-per-cent take-up rate for its 573 units.

For the Canopy, rolled out in the same month, this figure stands at almost 60 per cent, while Prive in Punggol, which was launched last month, has reached its 75-per-cent mark.

Three EC sites in Choa Chu Kang, Tampines and Punggol will be up for tender in the first half of this year under the Government's Land Sale Programme.

Source: www.todayonline.com

Published December 11, 2010

Over a third of Punggol's Prive snapped up
Other projects that are coming to market include Austville Residences, Spottiswoode 18 and Killiney 118

By EMILYN YAP

CHRISTMAS came early for NTUC Choice Homes Co-operative and Chip Eng Seng yesterday as home buyers inked deals for more than a third of the 680 apartments at their executive condominium project, Prive.

As at 5pm, the developers had processed over 270 sales options and said that they were clearing more. They declined to give an estimate of the total number of units that could be sold.

Balloting for units at the 99-year leasehold Prive at Punggol began yesterday. As many as 1,036 applications had poured in by the end of Tuesday, reflecting strong interest for the project.

Prive is the first EC to come up in Punggol and the developers had said earlier that the average selling price of units would be between $660 per square foot and $690 psf. Buyers can opt for a deferred payment scheme, but they will have to pay 2 per cent more.

Another EC launch will be coming up soon. United Engineers could be rolling out Austville Residences between Sengkang East Avenue and Buangkok Drive either this month or next.

BT understands that the selling price might start from $620 psf. The developer is planning to give out branded fridges to early buyers and hold a lucky draw with return air tickets to Australia as prizes.

Some agents are gathering interest for the freehold Spottiswoode 18, which will come up on the site of the former Dragon Mansion near Tanjong Pagar.

Roxy-Pacific Holdings had bought Dragon Mansion en bloc late last year. There are plans to build a 36-storey residential tower on the site, with 251 apartments measuring 387 square feet to 1,324 sq ft. Prices are said to be above $2,000 psf.

Spottiswoode 18 will be near UOL Group's recently launched Spottiswoode Residences, which is also a freehold project. Selling prices at the latter were last reported to be in the range of $1,720-2,270 psf.

Marketing for the freehold Killiney 118 has also started. The project in the Somerset area has 30 units comprising one and two-bedders and is developed by a unit of Amara Holdings.

The momentum for property launches could pick up in January after the December holiday season ends and before the Chinese New Year kicks in. For instance, CB Richard Ellis is in discussions for four to five launches slated for that month.


Source: www.businesstimes.com.sg

Published December 8, 2010

Good response to Prive

PRIVe, the first executive condominium (EC) project to come up in Punggol, has attracted strong interest from home buyers.

The developers, NTUC Choice Homes Co-operative and Chip Eng Seng, received 1,011 applications for the 680 apartments available as at 8pm yesterday. Applications have closed and bookings will start on Friday.

The 99-year-leasehold development offers two to four-bedders across four 17-storey towers, and the average selling price will be between $660 and $690 per square foot (psf).

The developers are offering a deferred payment scheme, although buyers who opt for that will have to pay 2 per cent more.

DMG & Partners analyst Brandon Lee, who visited Prive's sales gallery over the weekend, said in a report that the turnout was buoyant. 'We thought overall pricing of $680 psf is reasonable, which equates to a slight 8 per cent premium over the $630 psf fetched by nearby completed ECs.'

Response to ECs launched this year has been moderate. When Frasers Centrepoint launched Esparina Residences, it received 1,155 applications for the 573 units available. Actual take-up was lower as some potential buyers could have backed out after their preferred units were sold. At MCC Land's The Canopy, around 450 applications had come in for the 406 units available.


Source: www.businesstimes.com.sg

Published December 7, 2010

URA explains why DPS is still available for exec condos

By EMILYN YAP

PROPERTY developers can continue to offer the deferred payment scheme (DPS) for executive condominiums (ECs) because eligibility and ownership rules keep speculation in such projects at bay.



But homebuyers hoping that the interest absorption scheme (IAS) and interest- only housing loans (IOL) will also be available for ECs are in for a disappointment. The withdrawal of these two schemes in September last year applies to all types of private residential projects.

The Urban Redevelopment Authority (URA) issued clarifications on the various payment schemes in response to queries from BT.

Many in the property industry thought the government had scrapped the DPS for all types of uncompleted private homes in 2007 to curb speculation. It was not until last week that they realised DPS would still be available for ECs.

The news spread when developers of Prive - an EC in Punggol - said they would offer the scheme.

As at 5pm yesterday, 823 applications had poured in for the 680 apartments available in Prive.

Asked why developers can still offer the DPS for executive condominiums, URA said that ECs 'are different from other private residential developments' as they are meant for owners to live in and are subject to eligibility criteria and ownership conditions. For instance, EC buyers must form a family unit and they have to occupy their units for five years before selling them in the open market.

In addition, the subsale of booked ECs is not allowed.

'With these conditions, there is no need to remove DPS for ECs,' URA said. The 2007 move was meant to 'discourage excessive property investments in a buoyant market'.

According to URA, when the DPS was cancelled in October 2007, it had informed the Real Estate Developers' Association of Singapore, the Law Society of Singapore and all licensed developers in writing that the withdrawal would not apply to ECs and flats under the design, build and sell scheme.

Developers which intend to offer DPS for ECs have to seek the Housing and Development Board's approval to vary the terms in the standard sales and purchase agreement.

Then what about the IAS and IOL, which the government disallowed last year for all private residential projects to also discourage speculation? The news release made no mention of ECs then.

URA said that the ban on IAS and IOL 'is effected via the Monetary Authority of Singapore's housing loan rules for financial institutions', which apply to all residential properties, including ECs

Source: www.businesstimes.com.sg

Published December 3, 2010

CDL's bid for EC site tops closest rival's by 15.5%

By KALPANA RASHIWALA

CITY Developments Ltd's top bid for an executive condo (EC) plot at Segar Road in the Bukit Panjang area at a state tender yesterday was 15.5 per cent higher than the next highest bid, from EL Development.

The gap is wider than those of previous EC tenders this year, which have ranged from 0.6 per cent to 10 per cent, noted Cushman & Wakefield senior manager for Asia-Pacific research Ong Kah Seng.

At yesterday's tender, CDL unit Grand Isle Holdings bid $181.99 million or $270.51 per square foot per plot ratio, while EL Development offered $234.11 psf ppr. The tender drew five bids, the lowest at nearly $168 psf ppr from Sim Lian Land.

CDL's relatively high winning margin is probably due to the fact that it has tasted success in the location, say some market watchers. Earlier this year, it launched Tree House, a 99-year leasehold private condo, which sold out like hot cakes.

Also, the latest EC plot is a short walk from Segar LRT Station and three LRT stations away from the Bukit Panjang MRT station of the proposed Downtown Line 2, which is scheduled to be completed in 2015, said CB Richard Ellis executive director (residential) Joseph Tan.

ECs are a hybrid of public and private housing with ownership and resale restrictions in the first 10 years. After that period, they are fully privatised. EC projects, which boast private condo facilities, are an attractive housing option for buyers who meet the eligibility criteria, including a monthly household income ceiling of $10,000.

The Segar Road EC site offered at yesterday's tender by the Housing & Development Board can potentially generate about 570 EC units, according to the Government Land Sales Programme for second half 2010.

A CDL spokesman said: 'In the event that we are awarded this well-positioned EC site, we plan to build a 15-17 storey project. We see great potential in this growing district and we're confident that there'll be strong demand from young families and upgraders for an EC project on this site.'

This will be CDL's fourth EC project - after Esparis, Florida and Nuovo.

CBRE's Mr Tan estimates that CDL's breakeven cost for the latest EC site could be around $570-590 psf. 'There will be a market for this new EC project if it's priced 20-25 per cent lower than Tree House, which was completely sold at an average price of $830 psf in Q2 2010,' he added.

Nearby, units at Chestervale - a completed EC that is now fully privatised - were sold at $500-540 psf in the resale market in July-October this year, he added.

Cushman's Mr Ong said that the five bids for the latest EC tender reflect 'moderate interest from developers, given that a few EC projects are expected to be launched next year'. 'In addition, the government will release another three EC sites through the confirmed list in first-half 2011, signalling that there will be ample supply in this segment.'

The remaining bidders at yesterday's tender were a tie-up between Frasers Centrepoint and Lum Chang Building Contractors which bid about $191 psf ppr, and Pinnacle Realty, whose shareholders include Fission Holdings, with about $178 psf ppr.

Source; www.businesstimes.com.sg

Published December 1, 2010


Exec condo surprises with DPS option

By EMILYN YAP

(SINGAPORE) NTUC Choice Homes Co-operative (NCH) and Chip Eng Seng (CES) are launching an executive condominium (EC) project in Punggol with a surprising feature - a deferred payment scheme (DPS).

Many in the property industry had assumed that the DPS was entirely scrapped in the boom year of 2007 to curb speculation. The two developers' move could trigger owners of other EC projects to also offer DPS.

NCH and CES are behind the 99-year-leasehold Prive, the first EC to come up in Punggol. The site is at the junction of Punggol Field and Punggol Road, and average selling prices will be between $660 and $690 per square foot (psf).

There will be 680 apartments ranging from two to four-bedders, located across four 17-storey towers. The developers bought the plot from the government in June this year.

The developers will open the sales gallery on Dec 3 and allow viewings and applications up until Dec 7. Bookings will start on Dec 10 and home seekers have to gain entry to the gallery that day through a ballot.

Buyers can finance their homes through a normal payment scheme (NPS) or the DPS. Under the DPS, they need to pay only a 5 per cent booking fee and 15 per cent of the purchase price. They will not need to make further payments until the development obtains its Temporary Occupation Permit.

Developers of two earlier EC projects - Esparina Residences and The Canopy - did not offer DPS.

Several developers and consultants whom BT spoke to were surprised to learn that DPS was allowed for EC projects.

In October 2007, the government withdrew DPS for the sale of uncompleted private residential, commercial and industrial properties. The news release made no mention of ECs then.

Some industry players seem to have assumed that DPS was also disallowed for ECs. After all, ECs are seen as a hybrid of public and private housing. They have facilities comparable to private condominiums but carry public housing restrictions which are lifted only after 10 years.

Few might have thought of clarifying the rule change with the authorities, since the last EC launch happened some time back in May 2005.

Following some checks yesterday, BT understands that the withdrawal of DPS in 2007 did not apply to ECs. Some in the industry could have been 'a little presumptuous', said one developer who declined to be named.

Also, EC buyers have to fulfil a minimum occupation period of five years. This means that speculation would be minimal to begin with.

Knight Frank chairman Tan Tiong Cheng said it is possible that other EC developers will follow suit to offer DPS, now that they are aware of the option.

MCC Land is currently exploring the viability of offering both DPS and NPS for The Canopy. It has sold 190 out of 406 units at an average price of around $590 psf.

United Engineers is also working towards offering DPS for its upcoming EC project, Austville Residences. It could launch the site this month or next.

Response to ECs has been warm this year. Frasers Centrepoint has sold 508 out of 573 units at Esparina Residences, at an average price of $740 psf.

DMG & Partners analyst Brandon Lee expects to see good take-up for Prive as it is just a few minutes' walk from Punggol MRT station.


Source: www.businesstimes.com.sg

Published November 24, 2010

PROPERTY
EC housing land prices bouncing back?

By KALPANA RASHIWALA

THERE appears to have been a rebound in the pricing of executive condominium (EC) housing land.


A tender for an EC site at Tampines Avenue 8 yesterday drew a top bid of $302.14 per square foot per plot ratio (psf ppr) from a tie-up between Hoi Hup Realty, Sunway Developments and SC Wong Holdings. This land price is 15 per cent higher than the $263 psf ppr winning bid for an EC plot in Pasir Ris sold at a tender that closed last month. The latest tender in Tampines drew six bids.

Two schools of thought have emerged on the latest tender result. Some market watchers attribute the higher top bid at yesterday's tender to Tampines having more amenities than Pasir Ris and as Hoi Hup director Wong Sjew Hung says, 'Tampines being a more mature town than Pasir Ris'.

However, Cushman & Wakefield senior manager (Asia-Pacific research) Ong Kah Seng argues that the higher pricing for the latest EC site 'is due not just to location but increasingly positive market sentiment as reflected in strong sales by developers'.

He also noted that EC projects are being well received as they're more affordably priced, at about 15-20 per cent below 99-year leasehold suburban private condos (in similar locations), which are scaling record prices.

ECs are a hybrid of public and private housing with ownership and resale restrictions in the first 10 years. After that period, they are fully privatised. EC projects, which boast private condo facilities, are an attractive housing option for buyers who meet the eligibility criteria, including a monthly household income ceiling of $10,000.

Credo Real Estate executive director Ong Teck Hui said that the top bid for the Tampines plot being 15 per cent higher than the Pasir Ris plot could be due also to the latest plot having a better configuration and this being the first EC site to be released in Tampines this year.

Nonetheless, he said that the top bid yesterday is an optimistic one given that winning bids for 99-year private condo plots in other HDB new town locations have been in the $320-345 psf ppr region lately.

The Hoi Hup consortium's top bid at yesterday's tender was about 8.6 per cent higher than the second highest offer of $172.8 million or about $278 psf ppr by Frasers Centrepoint and Lum Chang Building Contractors. City Developments unit Grand Isle Holdings bid $260 psf ppr and EL Development offered $239 psf ppr.

NTUC Choice Homes Co-op offered $238 psf ppr and Sim Lian was the lowest bidder, at $228 psf ppr.

Hoi Hup's Ms Wong said that the plan is to develop a 16-storey project with 575 units on the Tampines Ave 8 plot. About 60 per cent of units will be three-bedroom compact apartments of slightly over 1,000 sq ft; 20 per cent will be two-bedders; slightly more than 10 per cent will be dual-key units comprising a studio unit attached to a two-bedder. The rest will be four-bedders.

'Our breakeven cost will be slightly over $600 psf and we're looking at an average selling price of below $700 psf.'

CBRE Research executive director Li Hiaw Ho said: 'There will be a market for this new EC project if it's priced 15-20 per cent below the recently released Waterview.'

Waterview, a 99-year leasehold private condo a stone's throw away from the latest EC plot, has an average price of $838 psf. It is being developed by Sim Lian

Source: www.businesstimes.com.sg

November 15, 2010, 12.43 pm (Singapore time)

Developers sell 1,058 private homes excluding ECs in Oct

By KALPANA RASHIWALA

Developers sold 1,058 private homes excluding executive condominium (EC) units in October, up 16.1 per cent from the 911 units they sold in September, according to latest developers' monthly sales data released by Urban Redevelopment Authority on Monday.


Developers also sold 529 ECs in October (against nil sale of ECs in September), taking their total sales for October to 1,587 units.

In the first 10 months of this year, developers have sold 13,109 private homes excluding ECs - against 14,688 units in the whole of last year.

Source: www.businesstimes.com.sg

Published November 16, 2010


Primary market shrugs off impact of cooling measures as Oct sales rise; industry watchers wonder if this will prompt new steps from govt

By KALPANA RASHIWALA

(SINGAPORE) After September's slump came October's rebound. This turnaround, reflected in the latest developer sales figures revealed yesterday, has prompted some industry observers to say that another round of demand-cooling measures may follow, as those announced on Aug 30 do not seem to have had a strong or lasting impact.

Developers sold 1,058 private homes excluding executive condominium (EC) units in October, up 16.1 per cent from September's sales volume of 911 units, according to primary-market sales data released by the Urban Redevelopment Authority yesterday. In addition, developers sold 529 ECs in October (no ECs were sold in September), taking total developer sales (including ECs) for October to 1,587 units.

The number of private homes sold in the $2,000 to $2,500 per square foot price band in October was 207 units, or about eight times the 26 units developers sold in September. The increase was partly due to the release of The Glyndebourne (along Dunearn Road) and Suites at Orchard (at Handy Road).

Excluding ECs (which are a hybrid of public and private housing), developers had sold 1,259 units in August before the cooling measures pushed this number down to 911 in September. It climbed back to 1,058 in October.

Said Knight Frank chairman Tan Tiong Cheng: 'Gauging by new sales, I suppose what government is trying to do doesn't seem to have had a severe impact on the market.

'The market is still buoyant; it's hard to say it's not. It would seem to me that if the government feels that current price levels are still high, we can expect more measures to cool the market.'

In the first 10 months of this year, developers sold 13,109 private homes excluding ECs - against 14,688 units for the whole of last year. Property consultants reckon the full-year tally may reach 14,700-15,000 and could surpass the record 14,811 units sold in 2007.

DTZ executive director (consulting) Ong Choon Fah said: 'Demand is still liquidity driven; it goes beyond the property market. It's an overall market phenomenon.'

She also pointed to the emergence of a two-tier market, with new projects launched by developers commanding a price premium of 20 per cent or more to earlier developments in the area.

The number of private homes (excluding ECs) sold by developers in the Core Central Region and Rest of Central Region rose, but sales in Outside Central Region (where mass-market homes are found) fell about 25 per cent.

In tandem with this trend, Colliers International's analysis shows that the number of private homes (excluding ECs) costing up to $1,000 psf sold by developers declined from 427 units in September to 183 last month.

Some of the demand in the low-price band was probably siphoned off to the two new EC projects released last month - Esparina Residences in Buangkok and The Canopy in Yishun - the first EC launches in five years, with sales of 425 units (at $761 psf median price) and 104 units (at $658 psf median price). Developers also continued to roll out smallish units to drive up sales and per square foot prices, such as Suites @ Sims, RV Point along River Valley Road and Kovan Grandeur.

The most expensive new home sold by a developer last month was a $4,800 psf unit at Boulevard Vue, a 33-storey freehold development at Cuscaden Walk. BT understands that the deal involved a 4,500 sq ft high-floor apartment, amounting to $21.6 million.

Other high-priced deals in October included Tomlinson Heights ($3,416 psf), Marina Bay Suites ($3,328 psf), Paterson Suites ($3,133 psf), Alba in Cairnhill Rise ($3,100 psf), Twin Peaks in the Leonie Hill area ($2,885 psf) and Seascape in Sentosa Cove ($2,838 psf).

In terms of sales volume, October's top-selling primary market projects included the two new ECs. The total of 979 units in these two projects boosted total units launched by developers in October to 2,049 units.

Excluding ECs, developers released 1,070 private homes in October, slightly above the 1,058 units in September.

Other projects that sold well last month include The Glyndebourne (112 units at $2,149 psf median price), NV Residences in Pasir Ris (81 units at $831 psf), Suites at Orchard (80 units at $2,140 psf) and Vacanza @ East (77 units at $1,081 psf).

Source: /www.businesstimes.com.sg

by Millet Enriquez
05:55 AM Oct 22, 2010

SINGAPORE - An executive condominium (EC) site put up for sale by the Housing and Development Board last month has attracted six bids.

The land parcel located at Pasir Ris Drive 1 / Elias Road received a top bid of $89.89 million from joint bidders ChoiceHomes Investments and CEL Development.

This is slightly higher than the second bid of $89.33 million submitted by EL Development. The lowest bid of $61 million came from Ecco Development.

"This is the second-smallest difference between the top bid and second highest bid in the history of EC land tenders," observed Mr Nicholas Mak, executive director of research and consultancy at SLP International, on the 0.6 per cent gap in the top two bids.

It was back in May 1997 when the top bid of $139 million from a consortium led by Lum Chang Building Construction for an EC site at Boon Lay Way was only 0.5 per cent higher than the second-highest bid, Mr Mak added. That site was developed as Summerdale Executive Condominium.

Meanwhile, Mr Joseph Tan, executive director at CBRE Research, said the bids showed that developers were fairly confident about the site. The top bid of $89.89 million works out to $263 psf/plot ratio and translates to a breakeven cost of $560 to $600 psf.

The 15,142 sq m Pasir Ris site, with a lease term of 99 years, is estimated to yield some 320 units.

There will be a market for the new EC project if it is priced about 20 to 25 per cent lower than NV Residences, which sold around 400 units at the median price of $869 psf since early September, Mr Tan said.

"Demand is likely to come from the first-timers and potential upgraders currently living in Pasir Ris and Tampines new towns," he said.

http://www.todayonline.com/

Published October 22, 2010

Pasir Ris EC site draws top bid of $262.62 psf

By KALPANA RASHIWALA

A 60-40 joint venture between NTUC Choice Homes Co-operative and Chip Eng Seng Corporation has emerged as the highest bidder for an executive condo (EC) site in Pasir Ris.

Its bid of about $89.89 million works out to $262.62 per square foot per plot ratio (psf ppr) - just 0.6 per cent above the next highest bid of $89.33 million or $260.99 psf ppr from EL Development - in one of the most tightly contested state land tenders. The tender drew six bids.

Choice Homes and Chip Eng Seng said yesterday that they intend to build an 18-storey, 320-unit project with full condo facilities. 'This will be the first EC to be offered in Pasir Ris since 2002,' they said.

Breakeven cost for the project will be below $600 per square foot, they added.

Credo Real Estate executive director Ong Teck Hui estimates that an EC development on the site could command an average selling price of about $650-700 psf if it were to be launched today.

ECs are a hybrid of public and private housing.

The plot, bounded by Pasir Ris Drive 1, Elias Road and Sungei Api Api, is flanked by Ris Grandeur on one side and Livia and NV Residences on the other. All three are private condos. NV Residences, which has 99-year leasehold tenure, was launched last month.

CB Richard Ellis executive director Joseph Tan said: 'Given that 347 units were sold at NV Residences last month at a median price of $859 psf, there will be a market for this new EC project if it is priced at about 20-25 per cent below this level, given the restrictions on EC ownership, which are similar to HDB ownership rules.'

Other bidders at yesterday's tender included a joint venture between Frasers Centrepoint unit Opal Star and Lum Chang Building Contractors ($251.49 psf ppr); and City Developments subsidiary Sunmaster Holdings ($240.71).

A partnership involving Hoi Hup Realty, Sunway Developments and SC Wong Holdings bid $230.43 psf ppr, while Ecco Development placed the lowest bid of $178.22 psf ppr. Credo's Mr Ong said: 'The tender response for the Pasir Ris site was a shade better than that for a Punggol site last month in terms of price as well as bidder interest. This is probably due to Pasir Ris being a more mature and developed location. Also this is a less crowded sub-market since most of this year's EC sites have been concentrated in the north-east region, especially Sengkang/Punggol.'

The bid price and interest level indicates the bidders' confidence that there will be sustained buyer interest in ECs, he added.

http://www.businesstimes.com.sg

ONG TECK HUI says Singapore is faced with a looming under-supply situation in the prime and mid-prime segments

Published September 23, 2010
ONG TECK HUI

THE residential property market roared back to life in the second half of 2009 with both transaction volume and prices surging upwards, following a year of relative inactivity due to the global financial crisis. Against this backdrop, buyers flooded the market again and developers were busy replenishing their land banks so as to capitalise on the growing demand. The recently announced measures to cool both the HDB resale and private housing sectors may change certain dynamics in the market for enbloc sites so it may be timely for a quick review

Prime shortage looming?

As the market became more buoyant, transactions in prime district residential properties picked up. Buyers are attracted by their central location, ability to command better rental yields, investment appeal, and other reasons.

During the first half of 2010, prime residential properties accounted for nearly one-third of primary market sales. Interest in the prime districts has been picking up in the last couple of years - in 2008, 23 per cent of primary market sales were attributable to prime properties while in 2009, there was an increase to 25 per cent.

Year-to-date, developers have poured more than $2.5 billion into residential sites (excluding executive condominium or EC sites) offered under the Government Land Sales programme (GLS).

Most of the GLS residential sites cater to mass suburban housing where the bulk of housing demand lies. It is certainly a sub-market which no housing developer can ignore. Furthermore, GLS sites are large, offering economies of scale in the entire investment chain for a developer, including site search, acquisition, planning, design, development, marketing, and sales.

While the GLS programme caters more to the suburban sector, demand for prime and mid-prime residential properties are generally met by sites offered within the private domain, including those under collective sales.

Year-to-date, developers have spent some $1.3 billion on private residential sites, with prime district sites accounting for 33 per cent of that value. Over the total amount invested in both GLS and private sites, it accounts for just 11 per cent. This seems to suggest an under-investment in prime district sites. The amount invested in mid- prime sites is also low, at 14 per cent of the total.

At this rate there would be a shortage of supply of prime and mid-prime residential properties. Barely 300 units will be generated by the prime sites transacted thus far while mid-prime sites would yield about 700 units.

In contrast, GLS residential sites would result in well over 7,000 suburban housing units being developed. It is noted that as at the second quarter of 2010, there are 10,997 units with pre-requisites for sale but not yet launched and 39 per cent of that supply is from the prime districts. However, that quantum is barely equivalent to demand in a good year and we need to address the needs of the market beyond that time horizon.

Fallout from new measures

We now consider the recent measures to cool the market in our review. The increased holding period for Sellers' Stamp Duty (SSD), reduced loan limit of 70 per cent, and increased upfront cash of 10 per cent for buyers with one or more outstanding mortgages would deter speculators and short- term investors, and encourage greater financial prudence amongst buyers in general. This should result in some calming effect on the market.

The HDB measures, on the other hand, have been designed to cool the HDB resale market.

The higher income ceiling for Design, Build, and Sell Scheme (DBSS) flats, increased supply for executive condominiums and DBSS flats, longer minimum occupation period (MOP) of five years for resale flats, and ban on concurrent ownership of HDB resale flats and private housing during the MOP - these are expected to moderate HDB resale activity.

As HDB households ride on a buoyant resale market to upgrade into the suburban housing market, we believe this housing segment will feel the effects of the market moderation more than the upper market segments. The prime and mid-prime residential markets appear to be more insulated from lower end market risks and could be more resilient.

While the suburban housing market appears set to have more challenges, it does not mean that it is to be avoided by developers. At realistic price levels, buyers would surely bite and any housing developer would strive to maintain an adequate suburban land stock to realise such opportunities.

However, good investment is about balance and ability to manage exposure and risks. It is timely for housing developers to review their portfolios and to re-balance if necessary. We are faced with a looming under-supply situation in the prime and mid-prime segments while the suburban market is more amply supplied.

Collective sales trends

During the course of this year, residential collective sales activity has been gradually picking up with increasing interest from buyers. In Q1, $141 million worth of collective sales were done. The quantum rose to $505 million in Q2 and registered $586 million in Q3 to date.

The outlook is for this trend to continue for the rest of this year into 2011. As suburban residential sites are likely to face more challenges from the new measures, we see a likely shift by developers toward collective sales.

An additional trend is toward increased investment in collective sale sites in prime locations. Year-to-date, only three out of 20 successful collective sales have occurred in the prime districts, accounting for 31 per cent of total collective sales value. As developers realise the under-investment in prime as well as mid-prime sites and a potential shortage of supply from these locations, they are expected to focus more on these segments.

Demand for collective sale sites will be met by more than 80 sites awaiting sales launches. Nearly half of these are in prime districts and a good number are in mid-prime locations. The stage is set for a change in market play in collective sales - all that is needed is for the players to act

The writer is executive director, research and consultancy, Credo Real Estate

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

05:55 AM Oct 15, 2010
by Png Poh Soon

The good response to the recent launch of Esparina Residences has triggered interest and aroused curiosity over executive condominiums (EC). A large turnout was seen on the first day of the launch, when 344 out of 573 available units were sold. More EC launches are expected in the coming months.

What are ECs and how do they compare with private condominiums? More importantly, do ECs make good property investments?

ECs were introduced in 1995 to meet the housing needs of the "sandwiched class" whose gross monthly household income exceeds $8,000 but is below $10,000. These home buyers do not qualify for new Housing and Development Board flats but may not be able to afford private properties. To date, there are 23 completed ECs accounting for 10,430 units.

Where design and facilities are concerned, ECs are comparable to private condominiums. However, unlike private properties, ECs owners are required to occupy their units for five years before they can sell them in the open market - and only to Singapore citizens or permanent residents. It is only after the 10th year that all restrictions are removed and the ECs can be sold to anyone, including foreigners and corporate entities. Effectively, ECs are equivalent to private properties from this point onwards.

Because of these restrictions, ECs are often priced at a discount from nearby private condominiums. The first batches of ECs in 1996 were sold at steep discounts compared to nearby condominiums. In some instances, the discount was as big as 60 per cent. Developers then were unsure of the market response as the EC launches coincided with soft market conditions after the introduction of anti-speculative measures. On average, the discount was between 35 and 40 per cent.

The gap narrowed to about 25 per cent for ECs that were launched in the early 2000s. This included Nuovo at Yio Chu Kang and Lilydale at Yishun Avenue 11, among others. Recent launches such as the Esparina Residences and The Canopy are priced at a narrower 10 per cent discount from nearby private properties. Invariably, the smaller price difference implies stronger developers' confidence and increased buyers' receptiveness towards ECs.

That said, how do ECs fare as a property investment? Knight Frank studied the price appreciation and price differences between ECs and private properties from 2004 to this year. Average sale transactions of ECs after the 5th year and the 10th year were included in the analyses. Sizes were controlled to reduce price distortions where smaller units commanded higher prices on a per-square-foot basis and vice versa. Prices of mass market non-landed properties were referenced to the Urban Redevelopment Authority's price index of non-landed properties outside the central region.

ECs appreciated by an average of 66 per cent over the six years while prices of mass market properties increased by 53 per cent. A majority of these ECs had crossed their 10th year mark and were no longer subject to any resale restrictions. Interestingly, the better performers were the older ECs that had deeper discounts and were catching up with their private counterparts from a lower base - resulting in higher price appreciation.

The price difference between ECs and private condominiums were also notably smaller after the 5th year and 10th year marks, with the average discount shrinking by some 20 per cent and 15 per cent, respectively. In some instances, the difference was less than 10 per cent at the 5th year.

Not surprisingly, location is an important factor affecting prices, with those nearer MRT stations and shopping centres performing better. In the case of Bishan Loft, the average transacted prices went above that of the nearby private properties, even though it had not reached the 10th year mark.

Looking ahead, as the Government releases more EC sites, what is important when purchasing ECs is to note the quantum of discount from surrounding private properties as well as the location. While ECs are subject to a minimum occupation period as well as a myriad of other restrictions, there is value waiting to be unlocked.


The writer is senior manager, consultancy and research, at Knight Frank.

Source: http://www.todayonline.com

05:55 AM Oct 15, 2010
by May Wong maywong@mediacorp.com.sg

SINGAPORE - Demand for executive condominiums (ECs) is expected to be sustained - at least for next year, with property watchers saying there is still interest from a sizeable group of sandwiched-class buyers who are priced out of private apartments.

The Esparina (picture), in Sengkang, is seeing strong response, with 370 units, or more than 60 per cent, of its 573 units sold since it was launched last Friday. The Canopy, in Yishun, the other EC launched last weekend, received about 240 applications by Oct 10 for its 406-unit project. Sales will begin on Saturday.

About three more ECs are expected to be launched within the next nine months in Sengkang and Punggol.

Mr Ong Teck Hui, executive director, Credo Real Estate, said: "The demand for ECs will be sustained. But as to how the individual projects will perform, this will depend on the individual attributes."

He added that the EC's "proximity to amenities, proximity to accessibility, LRT stations, MRT stations, individual attributes like views and so forth" would determine if the development would enjoy strong demand.

Analysts pointed out that prices of executive condominiums are about 10 to 20 per cent cheaper than private condominiums in a comparable location.

Property watchers expect a total of about 3,000 EC units to be sold within one year. There is a ready market of key buyers, with some 25,000 newly-weds, looking for their first homes, they said.

Prospective buyers, though, can afford to take their time to shop.

DMG and Partners investment analyst Brandon Lee said: "The take-up rate is going to be moderate - about 40 to 60 per cent in the first two weeks or so. That's because right now, buyers have a good problem at hand."

He believes that the fresh supply of ECs coming to the market and the recent softening of HDB prices may prompt first-time home buyers to take their time before deciding on their purchase.

"The government has pledged very strongly that they're going to come up with 4,000 EC units this year as well as next year. Secondly, I think their selection range has also widened, with the fact that the income ceiling for DBSS projects are going to be increased to $10,000. And thirdly, with the HDB resale prices coming off, first-time home buyers will have another avenue to look at buying their first homes," said Mr Lee.


Source: http://www.todayonline.com

Published October 9, 2010
By UMA SHANKARI

344 units sold in Esparina Residences EC

By UMA SHANKARI


A TOTAL of 344 units were sold in Frasers Centrepoint's 573-unit Sengkang executive condominium (EC), Esparina Residences, as of 6pm yesterday.


The developer had received 1,155 applicants for the project since it was launched on Sept 30. Eligible applicants with a ballot number had priority to enter the showflat for the balloting and booking of units yesterday.

But only 344 units were sold. Because of the balloting process, some potential buyers could have decided not to purchase a unit at all if their preferred unit had been sold. In particular, three-bedroom units, penthouses and dual-key units (which are units that can be divided into two separate apartments with different entrances) proved to be popular, Frasers Centrepoint said.

Prices at Esparina Residences range from $590,000 to $723,000 for a two-bedder; $697,000 to $981,000 for a three-bedder; and $1 million to $1.18 million for a four-bedroom unit. Penthouses are priced at between $864,000 and $1.3 million. On a per square foot (psf) basis, unit prices range from $730 to $750 psf on average.

Esparina Residences is the first EC project to be offered to homebuyers since end-2004.

ECs are a hybrid of public and private housing. New EC units are sold with eligibility, ownership and resale restrictions similar to those for public housing, but these restrictions cease to apply after 10 years.

Another EC project, MCC Land's 406-unit The Canopy in Yishun, previews this weekend. MCC Land has priced the units at an average of $600 to $700 psf. Unit sizes at the 99-year leasehold project range from 872 sq ft to 1,410 sq ft in two, three and four-bedroom configurations. There will also be 22 penthouses of between 2,088 and 2,239 sq ft

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