Complete Property Market Updates of Singapore

December 31, 2007

More legislation needed to protect condo owners who do not wish to join en-bloc sale

Filed under: Collective Sale,Community Voices — Propertymarketupdates @ 11:59 pm

I HOPE there can be some preventive measures to protect owners of condominiums which have failed in an en-bloc sale, or those who have spent substantial funds on upgrading.

In my condo in Clementi Park, there is renewed dissent by residents against the forming of yet another committee to try again for another en-bloc sale. Owners recently banded together to form an anti-en-bloc group called Save Clementi Park and have launched a website to save the condo. The web site features many pictures of the condo.

The en-bloc sale attempt last year failed to receive even 50 per cent of the vote. Immediately after this failed attempt, one committee was disbanded, but another one was formed in November this year. This has unsettled many of the residents and such social upheaval is becoming all too common in Singapore.

As a resident of the condo, I am not in favour of an en-bloc sale. En-bloc processes, to say the very least, are disruptive. Moreover, our condo is in the process of upgrading at a cost of $2 million. An en-bloc attempt after a majority of us have voted to upgrade would be a sheer waste of owners’ funds. Our upgrading will only complete around mid-2008.

There is no mechanism in place to deal with this. This is harmful to our societal psyche as stated by Mr Waleed Hanafi in his many website articles on en-bloc madness. Perhaps a time ban of, say, 15 years could be put in place for condos which have spent more than $500,000 for upgrading. Some balancing mechanism to reflect and honour decisions made by subsidiary proprietors should also be in place.

The en-bloc law needs to be reviewed.

Source : Straits Times – 29 Dec 2007


Owners decide what is fair compensation in en bloc sales

Filed under: Collective Sale,Community Voices — Propertymarketupdates @ 11:59 pm

IN REPLY to Mr Alex Cheong’s letter, ‘En bloc sales: Find fairer way to compensate all’ (ST, Dec 17) on the method of distributing sale proceeds to owners in a collective property sale, the Singapore Institute of Surveyors and Valuers (SISV) would like to clarify its guidelines on the various methods of distribution.

As guidelines, they are meant to assist owners in selecting the distribution method suitable for their development. The recommended methods (based on share value, strata area, valuation or a combination of them) have been used in many successful collective sale applications made to the Strata Titles Board. However, the institute appreciates that there could be specific situations, for example, due to some unique or peculiar aspect of the development where the strict application of the guidelines may be viewed by some to be unfair. This is why there can be no single prescribed method of distribution, and the majority owners will have to decide the best method that will be acceptable to all owners.

Mr Cheong suggested an 85 or 90 per cent strata floor area and 15 or 10 per cent share value as a fair method of distribution instead of the fixed 50 per cent for both. We would like to clarify that using 50 per cent area and 50 per cent share value is just a guide based on the various formulations used in past collective sales. Under the law, it is for the owners themselves to choose a method and proportion. In addition, anyone who is aggrieved with the proposed method of distribution may file an objection with the Strata Titles Board.

The issue of the method of distribution is now better addressed with the amendments to the Land Titles (Strata) Act, which came into operation on Oct 4. Under the amended legislation, the collective sale committee has to convene a general meeting for all owners to consider the method of distribution of the sale proceeds.

The Ministry of Law and SISV will continue to work together to further refine the guidelines where necessary.

Janet Han (Ms)


Singapore Institute of Surveyors and Valuers

Radha S. Khoo (Ms)

Head, Corporate Communications

Ministry of Law
Source : Straits Times – 29 Dec 2007

Property sales under the hammer hit high notes

Filed under: Market Watch,Property Deal,Property Trends,Singapore Economy — Propertymarketupdates @ 11:59 pm

Auctions dominated by owners seeking good deals – not bank foreclosure

The value of properties sold at auctions in 2007 was the highest in eight years – and the second best showing ever. But property consultants reckon that this is about as good as things will get for now. Next year could see a slowdown led by the high-end residential sector, a star performer this year.


Colliers said that the value of properties sold at auctions conducted by private auction houses in 2007 reached $407.4 million, up 28.2 per cent from last year and just a tad shy of the $409.5 million achieved in 1999, when the market was recovering after the Asian Financial Crisis. Similarly, Knight Frank’s research showed the value of properties transacted at auctions rose 32 per cent to $422 million this year.

‘The big difference between 1999 and 2007 was that the record auction sales in 1999 was dominated by mortgagee sales as valuations had fallen a fair bit from the high in 1996 and this drew buyers. Whereas this year, auction sales were predominantly by property owners themselves who took advantage of the auction method to extract the best price, after two years of steep price appreciation,’ observes Colliers’ deputy managing director and auctioneer Grace Ng.

She expects the value of properties sold at auctions to fall by about 25 per cent to $300 million in 2008 as fewer high-end homes as well as fewer older apartments with en bloc potential may be put under the hammer. Ms Ng also expects the number of properties transacted at auctions to fall to about 160-170 next year from 204 this year.

Knight Frank’s executive director (auctions) Mary Sai too predicts a ‘cautious buying mood’ at auctions next year, citing stock market uncertainty and ‘exceptionally high price expectations from some owners’.

But assuming that the economy remains in fine fettle, Ms Sai expects strong demand for properties in mass-market developments, especially those near MRT stations or good schools. Auctions will also be a popular hunting ground for those who’ve sold their homes in collective sale and are looking for replacement properties within a short span of time, Ms Sai reckons.

The increase in value of properties transacted at auctions this year was achieved despite a drop in the total number of properties put up for auction, from 2,018 last year to 1,456 this year, going by Colliers’ figures.

The drop was due to a 54.4 per cent decline in the number of properties put under the hammer by mortgagees/banks in cases where borrowers defaulted on their property loan repayments.

The value of mortgagee properties sold at auctions this year fell 24.2 per cent to $143 million, while the value of properties sold by property owners themselves through auction nearly doubled to $265 million in 2007. Colliers attributed the nosedive in mortgagee sales to a vibrant economy and high employment situation which resulted in a lower (mortgage) default rate.

And even in instances where borrowers were facing difficulty servicing their property loans, the robust property market enabled them to sell their properties in the open market – instead of waiting for bank foreclosure.

On the other hand, 810 properties were put up for auction this year by their owners – up 35 per cent from last year and the highest in 10 years, according to Colliers.

This reflects the continuing trend of auction losing its stigma among property sellers, market watchers say. ‘Amidst the property boom this year, more owners turned to auction to attempt to achieve the best price for their properties,’ Ms Ng said.

There was a strong deceleration of auction sales in second-half 2007 – as the mood in auction halls became more subdued amidst US sub-prime mortgage woes, stock market turmoil, as well as stricter collective sales rules, hikes in development charges and withdrawal of the deferred payment scheme. After seeing 131 properties changing hands for $263 million in H1 2007, the market slowed to just 73 deals worth $144 million in H2, based on Colliers’ analysis.

The strong full-year auction sales in 2007 was buoyed by the vibrant residential market in the first half of this year, when sales were dominated by high- end residential condominiums and old apartments with potential for collective sale. The year also saw keen interest in shops/shophouse properties amidst the office supply crunch, as well as development sites put up for auction.

The value of non-landed residential properties sold at auction more than doubled to $109.5 million this year, from $41.5 million in 2006 – helped by the sale of 12 apartments at Tuan Sing’s Botanika development at Napier Road, which fetched a total $52.92 million. The value of shops/shophouses sold at auctions jumped 172 per cent, to slightly over $78 million this year, from only $28.9 million in 2006.

Source : Business Times – 28 Dec 2007

Asia all set to decouple further in 2008

Filed under: Singapore Economy — Propertymarketupdates @ 11:58 pm

AT a personal level, many involved in the financial market universe will no doubt have suffered from the credit market crunch whose after-shocks have reverberated throughout the world’s financial capitals since August.

Bonuses paid for 2007’s efforts have by several accounts been less generous. And more cost-cutting can be expected. In the bigger picture, however, the world’s financial markets have so far weathered the crisis well, thanks no doubt to timely central bank intervention, in the form of interest rate cuts and generous liquidity injections.

So despite the fact that a host of blue-chip US investment banks have announced billions of dollars in losses or provisions related to the sub-prime debt held on their books, Wall Street’s blue-chip indices will end 2007 comfortably higher than in 2006. Not even the falling US dollar or the threat of slower US growth in 2008 has been enough to force the US stock market into a dizzy downward spiral. Researchers at US investment bank Morgan Stanley – itself a victim of large losses on the sub-prime front – warn that the US economy could even experience a mild contraction over the coming months.

Others warn that Japan’s economy may very well suffer the same fate, and that Germany’s economy could run out of puff too.

Closer to home, however, the picture remains more upbeat, despite the fact that Shanghai’s composite index has exploded 330 per cent since end-2005. And, compared to where they finished in 2006, Hong Kong’s Hang Seng and Singapore’s STI are likely to end 2007 with gains in excess of 15 and 40 per cent respectively.

Even Morgan Stanley – which expects US GDP growth to average just 0.8 per cent next year, and for oil prices to hold above US$80 per barrel – doesn’t expect weaker US growth to impact on this region by more than half to one per cent of Asian GDP in 2008. Indeed, The Economist now expects China to replace Germany as the world’s largest exporting nation in 2008, and to overtake the US as the world’s largest economy within the coming decade.

In short, Asian economies’ healthy external accounts and accumulated surpluses put them in a much stronger position to weather any inclement economic weather.

Currency forecasts for 2008 tell the story best. While some expect the US dollar to recover against the euro and even the high-yielding New Zealand dollar (or Kiwi) by end-2008, almost all expect it to record yet more losses versus a good number of Asian counterparts.

Based on an average of five end-2008 forecasts that have come our way, the US dollar could be as much as 7 per cent stronger versus the Kiwi in a year’s time, but may slide a further 5 per cent towards S$1.37 or so.

Source : Business Times – 28 Dec 2007

For sale: Amber Park at $750m

Filed under: Land Sale — Propertymarketupdates @ 11:57 pm

A FREEHOLD residential redevelopment site on the east coast has been put up for sale for $750 million or $1,234 per square foot per plot ratio.

 On the market: Amber Park comprises two 26-storey tower blocks that contain 192 apartments and eight penthouses. Sole marketing agent First Tree Properties says the site can be redeveloped into a high-rise condominium; this could yield about 375 apartments with an average size of 1,600 sq ft

Amber Park, in Amber Gardens, Katong, is on 213,673 sq ft of land and has an approved gross floor area of 607,601 sq ft.

It comprises two 26-storey tower blocks that contain 192 apartments and eight penthouses.

Sole marketing agent First Tree Properties says the site can be redeveloped into a high-rise condominium, subject to planning approval.

This could yield about 375 apartments with an average size of 1,600 sq ft.

According to First Tree, there will be no development charge based on the existing plot ratio of 2.843, which is slightly higher than the 2003 Master Plan plot ratio of 2.8.

The site is close to Joo Chiat, Marine Parade and East Coast Park. The nearest MRT station is Paya Lebar.

Other nearby amenities include Parkway Parade Shopping Centre, Katong Shopping Centre, eateries in the Katong vicinity, Tao Nan School, Tanjong Katong School, Chung Cheng High School and Dunman High School.

The tender for Amber Park closes on Feb 1, 2008, at 3pm.

Source : Business Times – 28 Dec 2007

Two years on, and property fliers still sent to old address

Filed under: Community Voices — Propertymarketupdates @ 11:57 pm

I SOLD off my previous property about two years ago and bought a new one in one of the prime estates.

Since then, there have been countless fliers sent to my previous residence address from different property agents asking if I am interested to sell my new property.

The fliers were sent in sealed envelopes attentioned to me and the current owner has been nice enough to keep them for me to collect on a periodic basis. However, it is long enough to cause him great annoyance and inconvenience.

I tried calling the property companies to remove me from their central mailing list but all mentioned that the individual agents keep their own database. Each of them has more than 700 agents and there is no way for them to reach out to all.

The only way for me to prevent the current owner from receiving any more of my mail is to subscribe to a ‘redirect mail’ service from SingPost. However, it is rather costly and not a long-term solution.

I am sure the property agents obtained the information of buyers from an authority in Singapore that governs the transaction. Can that authority stop providing such private information to third parties?

I would appreciate it if anyone could share with me a long-term solution as I believe I am not the only one suffering from this.

Source : Straits Times – 28 Dec 2007

HDB launches two new BTO projects in Punggol and Yishun

Filed under: HBD Reviews,Regulators — Propertymarketupdates @ 11:57 pm

Sources say demand is expected to be strong for the flats

THE Housing and Development Board (HDB) yesterday launched two new projects – Damai Grove at Punggol and Jade Spring @ Yishun – under its Build- To-Order (BTO) system.

Some 1,122 new flats, comprising 110 three-room and 1,012 four-room flats, will be offered. And sources say demand is expected to be strong.

In a recent sale exercise, 5,147 applications were made for just 316 new HDB flats at Hougang, Punggol and Sengkang. The numbers work out to 16 would-be buyers for every flat.

ERA Singapore’s assistant vice-president Eugene Lim reckons the Punggol project, because of its proximity to the LRT network, is expected to be the more sought-after of the two developments put on the market yesterday.

The Punggol flats may also represent more value for money, he says. For example, the 676 four-room flats in Damai Grove have an indicative price range of $195,000-$240,000.

But four-room resale flats in the area are going for $250,000-$300,000.

For the Yishun flats, the difference between the cost of the new flats and homes in the resale market is not as great, says Mr Lim.

The 336 four-room flats in Jade Spring @ Yishun have an indicative price range of $183,000- $246,000.

This is comparable to four-room resale flats in the area which are going for $190,000-$230,000.

However, demand for flats in Jade Spring is still likely to be strong because of the current shortage of HDB flats, according to Mr Lim.

Chris Koh, director of Dennis Wee Properties, says both locations are good and the prices are reasonable. Many resale flat owners are asking for high amounts of cash over valuation, which makes new flats more attractive, he says.

The presence of three-room flats also shows HDB is looking to cater to lower-income people, Mr Koh says.

Source : Business Times – 28 Dec 2007

1,100 flats go on sale in Punggol and Yishun

Filed under: HBD Reviews,Regulators — Propertymarketupdates @ 11:56 pm

Projects, ready by 2011, signal to the market that there is adequate supply

MORE than 1,100 Housing Board flats went on sale in Punggol and Yishun yesterday, just a day after a plum Bishan site reserved for condo-style flats was launched.

The new projects – Damai Grove in Punggol town and Jade Spring @ Yishun – are being offered under the build-to-order (BTO) system where flats are built only when a certain demand is reached.

On Wednesday, the HDB released a site in Bishan Street 24 that can accommodate 460 upmarket flats built by private developers.

Market watchers say the consecutive HDB sales are a clear sign the Government is addressing the housing shortage that has worsened amid soaring resale prices.

ERA Singapore assistant vice-president Eugene Lim said the sales sent a clear message to the market – that there is ‘housing for everyone’ across all segments.

‘This is to alleviate fears that there’s a shortage of homes, and to prevent people making rash decisions,’ said Mr Lim.

Damai Grove, which consists of 738 flats – 62 three-roomers and 676 four-room units – caught the industry’s eye due to the potential of its location.

The estate is next to Damai Light Rapid Transit (LRT) station and a stone’s throw from Punggol MRT, but its proximity to Punggol’s proposed waterway is its greatest selling point.

This 5.5km waterway is part of the ambitious ‘Punggol 21-plus’ vision Prime Minister Lee Hsien Loong unveiled in his National Day Rally speech in August.

The town will boast features like a freshwater lake while homes and a town centre will line the waterway’s banks with recreational facilities and nearby amenities.

The chief executive of property agency Propnex, Mr Mohamed Ismail, said the HDB’s latest project meant ‘Punggol 21-plus is taking shape’.

Mr Ismail added that the sale was ‘timely’ given the high demand for housing.

Prices at Damai Grove will range from $123,000 to $152,000 for a 65 sq m three-room flat and $195,000 to $240,000 for a 90 sq m four-room unit.

These are significantly lower than in the resale market, where a four-room unit’s median price in Punggol is about $271,000, according to HDB’s third-quarter data.

Damai Grove is Punggol’s ninth BTO project and the fourth for the year.

Jade Spring @ Yishun offers 384 flats – 48 three-room units and 336 four-room units – at the junction of Yishun Ring Road and Yishun Avenue 11. It is also near the Khatib and Yishun MRT stations.

Prices range from $118,000 to $134,000 for a three-roomer to $183,000 to $246,000 for a four-roomer.

At the close of the HDB’s last BTO sale, 7,970 people applied for 400 flats at Telok Blangah while 1,626 applications were lodged for 516 flats in Punggol Lodge, which is next door to Damai Grove.

The HDB website yesterday showed 112 applications for Damai Grove and 106 for Jade Spring. Applications close on Jan 16.

Both projects are expected to be completed by 2011, and the construction of the waterway, which will take up to four years, will likely start at the end of 2009.

Models of the two estates are being exhibited at the HDB Hub Habitat Forum at Toa Payoh until Jan 16.

Source : Straits Times – 28 Dec 2007

Alexandra Road site draws six bids

Filed under: Developer News,Land Sale — Propertymarketupdates @ 11:56 pm

Top bid of $288.4m made jointly by Wing Tai Holdings, United Engineers

A RESIDENTIAL site at Alexandra Road saw a bullish six bids and a top bid of $288.4 million – or $639 per square foot per plot ratio (psf ppr) – at the tender’s close yesterday.

The top bid for the 92,100 sq ft site was jointly put in by Wing Tai Holdings and United Engineers (UE).

Other bidders include familiar names such as Singapore’s Hong Leong Group, GuocoLand and Frasers Centrepoint, as well as mainboard-listed Lafe Technology, which designs and manufactures computer magnetic heads.

‘This price is bullish and shows that developers have not lost their appetite for good quality plots of land,’ said Ku Swee Yong, director of marketing and business development at Savills Singapore.

The site is conveniently located along Alexandra Road and less than five minutes’ walk away from Redhill MRT station.

Nicholas Mak, director of research and consultancy at Knight Frank said: ‘The relatively high level of developers’ interest and the strong bids reflect that developers are still bullish on the Singapore property market in 2008.’

Leonard Tay, director of research at CB Richard Ellis (CBRE), pointed out that the top bid is 31 per cent above the reserve price of $489 psf ppr and 83 per cent above the price of $350 psf ppr paid for the adjacent The Metropolitan site in November 2005.

‘This price of $639 psf ppr will translate into an estimated breakeven price of about $1,000 psf for the future condominium project to be built on this site, and it is likely that units will sell between $1,100 and $1,200 psf,’ Mr Tay said.

Sub-sales of units at The Metropolitan are currently at around $900-1,100 psf, CBRE said.

The 99-year leasehold site has a maximum gross floor area of 451,400 sq ft. The site could yield about 360 to 400 condominium units, said Knight Frank’s Mr Mak.

Market watchers said that the upcoming development could see strong demand from occupiers of older private residential projects – especially home owners who had benefited from collective sales.

There might also be some potential for upgraders from the HDB estates in the vicinity, as HDB flats in the Bukit Merah and Queenstown area typically sell for among the highest prices in the HDB resale market, CBRE’s Mr Tay said.

According to HDB’s data for the third quarter of 2007, five-room flats in Bukit Merah have a median resale price of $530,000, while five-room and executive flats in Queenstown have median resale prices of $603,000 and $719,000 respectively.

Wing Tai and UE’s bid is 6 per cent higher than the second highest bid of $602 psf ppr put in by Lafe Technology.

The partners’ bid is also 28 per cent higher than the lowest bid of $501 psf ppr put in by GuocoLand.

Source : Business Times – 28 Dec 2007

Residential site in Alexandra Road attracts strong bids

Filed under: Developer News,Land Sale — Propertymarketupdates @ 11:55 pm

Wing Tai teams up with Greatearth Construction for $288m top offer

A RESIDENTIAL plot in Alexandra Road has attracted a bullish top bid of $288.4 million despite recent talk of a cooling market.


Developer Wing Tai Land teamed up with building company Greatearth Construction to submit the top bid for the plum site near Redhill MRT Station and just outside the Central Business District.

The bid works out to $639 per sq ft (psf) per plot ratio (ppr), which broadly refers to the amount of floor space.

The site – which is likely to feature a mid-market condominium – has a gross floor area of 451,428 sq ft, which consultants estimate will yield about 400 homes in blocks of up to 40 storeys high.

At the close of the tender yesterday, the 0.86ha, 99-year leasehold site had attracted five other bids from big players including Frasers Centrepoint, GuocoLand and Billion Rise – believed to be linked to Hong Kong giant Cheung Kong Holdings.

A joint bid was made by Sunny Vista Developments and TID. The second-highest bid of $271.6 million, or $602 psf ppr, came from a relative unknown – Lafe Development, a unit of listed manufacturer Lafe Technology. The tender will be awarded later.

In November 2005, an adjacent residential plot – where The Metropolitan is being built – fetched $350 psf ppr.

Property consultants said the strong response to this latest tender bodes well for the market. Knight Frank’s head of consultancy and research, Mr Nicholas Mak, said: ‘It gives a certain indication of how developers feel about the market in the coming 12 months or so. They expect current prices to continue to grow, especially in the mid-tier segment.’

Sluggish results for recent land sales had fuelled talk that developers were turning cautious because of the United States sub-prime crisis.

Two residential plots in Enggor Street in Tanjong Pagar recently drew no more than three bids and lower-than-expected prices, while another in Marina View attracted just two interested parties. In Tampines, a transitional office site drew only one offer.

Savills Singapore’s director of marketing and business development, Mr Ku Swee Yong, said: ‘It’s a good closing to the year. It means the year didn’t end on a whimper.’

Both Mr Ku and Mr Mak felt the Wing Tai-Greatearth team had been able to pip the rest of the field because they could rein in building costs with the latter aboard.

Surging construction costs had recently forced the Government to delay at least $2 billion worth of public sector projects to ease the pressure on building resources.

CB Richard Ellis’ director of research, Mr Leonard Tay, expects the Alexandra project to benefit from ‘potentially strong demand’ from residents living in older private homes on the city fringes, especially those who have just sold their homes collectively.

‘There might also be some potential for upgraders from the HDB estates in the vicinity, as HDB flats in the Bukit Merah and Queenstown areas typically sell for among the highest prices in the HDB resale market,’ he added.

In the July to September period, five-room flats in Queenstown were going for a median price of $603,000.

Mr Tay and Mr Ku both estimated a breakeven price of about $1,000 psf for the future condo on the Alexandra plot, which would mean the future units could sell for $1,100 psf to $1,200 psf.

Mr Mak put his estimate of the breakeven cost at $1,020 to $1,100, which could mean a three-bedroom unit would go for $1.5 million.

Source : Straits Times – 28 Dec 2007

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