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Developers Slash Private Condo Prices By 5-10%

Posted by Singapore Property Launch on 16th August 2018 in Blog
UOL The Tre Ver crop

A crowd of buyers at the recent launch of The Tre Ver in Potong Pasir. (Photo: UOL Group)

Private condominiums launched before and after the introduction of new property curbs are trimming their unit prices by around 5.0 to 10 percent, reported TODAYonline.

“The price sweeteners are there to cushion the immediate impact of cooling measures and create an urgency to buy,” said Dr Tan Tee Khoon, executive director at Knight Frank.

For instance, Daintree Residence in Upper Bukit Timah reduced its average price by 5.0 percent from $1,800 psf to $1,710 psf. This is the first private residential project in Singapore to be rolled out after the new cooling measures took effect on 6 July

At The Tre Ver at Potong Pasir, units were sold at an average price of $1,550 psf during its launch on 4 August. This means condos there are 10 percent cheaper than those in the nearby Park Colonial, which sold units at an average price of $1,750 psf. Notably, the latter’s developer brought forward the project’s launch to the evening of 5 July before the new curbs took effect

Moreover, Affinity @ Serangoon in Yio Chu Kang is offering 5.0 percent and 7.0 percent discounts for its one-bedders and two-bedroom condos respectively. But this only applies to the next 20 units sold since July 12, while Martin Modern in River Valley is also giving out a 5.0 percent discount for select units taken-up since that date. Lastly, a $20,000 discount is available at Queenstown’s Margaret Ville.

Even though property developers have slashed prices at their private residential projects, Knight Frank’s Tan and Huttons Asia’s research head Lee Sze Teck both believe that units prices are unlikely to fall further in the coming months as construction and land costs are already locked in, with residential sites acquired at “unprecedented prices”.

credits: propertyguru

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PM Lee Praises Kampung Admiralty As “Model For Future Public Housing”

Posted by Singapore Property Launch on 12th August 2018 in Blog
Kampung Admiralty resize

Kampung Admiralty features housing for the elderly, a medical centre and childcare facilities. Source: HDB

Prime Minister Lee Hsien Loong lauded Kampung Admiralty as a “model for future public housing” during his National Day Message on Wednesday (8 Aug), reported Channel NewsAsia.

Located next to Admiralty MRT station, the 11-storey project in Woodlands features a medical centre, community garden, childcare centre, a supermarket and a hawker centre, as well as 104 HDB flats.

Nearly all units were sold when they were launched for sale by the Housing and Development Board (HDB) in July 2014. Almost half of the flats were taken-up under the Studio Apartment Priority Scheme (SAPS) and the Senior Priority Scheme (SPS), which prioritises providing housing to elderly residents who want to age in place and those who want to live near their parents or married children.

Touted as Singapore’s first integrated housing project for seniors, these units come with elder-friendly fittings like grab bars and non-slip tiles, as well as a retractable outdoor and indoor clothes drying system.

Moreover, PM Lee revealed that Kampung Admiralty is an example of what the authorities want to accomplish in terms of providing housing, education and healthcare to Singaporeans.

“When people express concern over the cost of living, these are three significant items they worry about,” he explained. Hence, the government ensures that the services it offers related to these three are not only of high quality but also affordable.

“This is how we’ve helped families to manage their cost of living, and given an extra hand to those who need it,” he noted, adding that this approach has worked well for over 50 years.

Furthermore, HDB will continue to develop other innovative housing concepts like Kampung Admiralty. For existing HDB estates, these will be maintained and enhanced.

“Though the leases still have many years to run, we should think ahead about how we can keep older estates in good living condition, and also start to redevelop them, in order to build new homes and towns for future generations,” PM Lee added.

credits: propertyguru

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Collective Sales Success Rate Down Despite Increased Activity

Posted by Singapore Property Launch on 10th August 2018 in Blog
Collective sales success rate down despite increased activity

Property developers in Singapore have become more selective with their acquisitions.

Despite the increased activity in the collective sales market, the success rate for en bloc sales has fallen significantly compared to 2016 and 2017 levels, reported Singapore Business Review citing Savills Asia.

This comes as developers have become more selective with their acquisitions even as more sites have been launched for sale.

“Developers’ buying interests have shifted to freehold sites in the high-end and mid-tier markets with a quantum of less than $500 million,” said Savills Asia senior director of research Alan Cheong.

Investment sales of residential sites and homes fell 14.5 percent quarter-on-quarter to $6.88 billion in Q2 2018, although they continued to make up the bulk of total sales at 65 percent. Of the 21 private residential sites sold during the quarter, 16 were transacted via en bloc sales.

Transaction values for such sites, however, continued to increase. Given the 18 sites sold in the first quarter, developers acquired a total of 34 en bloc sites at a total value of $9.84 billion. The figure exceeds the $8.24 billion spent in the whole of 2017 for 29 sites.

Meanwhile, Singapore emerged as one of three countries that registered double-digit growth in prime property prices, revealed Knight Frank’s latest Prime Global Cities Index.

The city-state was ranked second in the index as prime property prices rose 11.5 percent. Guangzhou topped the list with a 11.9 percent hike, while Madrid settled in third place with a 10.3 percent increase.

“High land bids by developers has translated into higher new-build values,” said Knight Frank’s international residential research partner Kate Everett-Allen.

The upward trend in prices was also seen in the Urban Redevelopment Authority’s data.

“Luxury prices in Singapore have rebounded strongly but recent stamp duty changes may [cause] impact,” she added.

The Singapore government introduced its latest round of property cooling measures, which included  higher Additional Buyer’s Stamp Duty (ABSD) and tighter lending rules in July to curb price inflation.

credits: propertyguru

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Market Barely Had Time To Respond To New Cooling Measures

Posted by Singapore Property Launch on 15th July 2018 in Blog
Panoramic view of the Singapore skyline at dusk

The Singapore government departed from its recent practice of announcing sensitive information on Fridays when it introduced its latest round of cooling measures on 5 July, which is a Thursday – barely giving the market time to think.

In a note, Withers KhattarWong partner Kenneth Szeto said announcements were supposed to be released on Fridays to provide a weekend buffer prior to the stock market reaction, reported Singapore Business Review.

“Buyers and sellers themselves barely had five hours to react to the announcement before implementation, and property launch show flats were immediately flooded, as buyers rushed to issue their sale options before midnight to come within existing rules – to either pay less Additional Buyers Stamp Duty (ABSD) or obtain higher quantum home loans,” he said.

“The ink has barely dried on the rules and regulations, and the usual accompanying tax guides are still being written. For parties who are engaged in ongoing deals, it will be necessary to look carefully at the impact of the new rules, and seek the necessary clarification with the tax authorities on how ongoing deals will be affected.”

Szeto noted that the revised housing loan limits will see first time home buyers fork out an additional five percent cash down payment on their purchases.

He expects this to “rein in buyers’ demand for both new launch properties as well as resale properties, just as the asking prices in the market are starting to gather momentum after four consecutive years of flat-lining or decline”.

So far, the latest round of ABSD rate increases are the highest. Szeto believes the new 25 percent ABSD payable by corporate entities, including property developers, will cool developers’ interest in purchasing en bloc sites for redevelopment.

“In recent months, even before the implementation of the measures, Singapore-based developers have already been observed to be more selective with site selection, and more conservative with bid prices,” he added.

credits: propertyguru

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En Bloc Plans Push Through While Others Put On Hold Amid New Curbs

Posted by Singapore Property Launch on 12th July 2018 in Blog
Dalvey Court crop

Homeowners of Dalvey Court have been advised to extend the tender closing date in light of new cooling measures by the government

Homeowners eyeing to go on en bloc have put their plans on hold or went back to the drawing board to devise new strategies amid the uncertainties brought about by the fresh property cooling measures rolled out by the government.

Described by some analysts as “heavy-handed”, the measures are expected to dampen the en bloc market as land acquisition costs for developers increase – reducing the bullishness of tender bids, reported Channel NewsAsia.

Developers face a non-remissible five percent Additional Buyer’s Stamp Duty (ABSD) when they acquire en bloc properties for redevelopment under the new property curbs.

Aside from this, residential developers also have to contend with a 15 percent to 25 percent increase in remissible ABSD, which can only be waived once all units in the new project are sold within five years from purchasing the site.

“Homeowners are definitely very concerned; one of the first comments I heard was ‘It’s game over’,” said Cushman & Wakefield capital markets director Christina Sim.

With this, her company plans to advise the sales committee for Dalvey Court condominium to have the tender closing date extended by one month. With a price tag of $160 million, the freehold property’s tender is set to end on 2 August.

JLL also plans to suggest a one-month extension in the tender closing period for Horizon Tower, which carries a reserve price of $1.1 billion.

Since developers need more time to digest the new measures, JLL capital markets regional director Tan Hong Boon said it is “prudent for us to advise the owners to extend the tender closing period to ensure sufficient time is given for the developers’ assessments of the market and the site”.

The plan to go en bloc this week for Waterloo Apartments, on the other hand, was shelved, said Cushman & Wakefield’s Sim.

“We were thinking if we should wait for authorities to get back to us on our outline planning permission (OPP) for the site to be zoned for hotel use, or launch it as a residential site as soon as possible,” she said. “I think now, we will most likely wait.”

Meanwhile, some homeowners decided to push through with their plans.

Fortune Park, for instance, will be going ahead with its en bloc attempt on Thursday (12 July), with a reserve price of $126 million.

“We have no plans to hold back the launch or change our tender period,” said Huttons Asia investment sales head Terence Lian.

In fact, the agency will be keeping the tender periods for Blossom Mansions and Jansen Mansion, which are due to end on 31 July and 2 August respectively.

“While we received a lot of enquiries about how these cooling measures will impact the ongoing collective sales, we are not that worried because we think the measures will not affect small- and medium-sized projects,” explained Lian.

“The number of units that a small site can be redeveloped into will be comparatively lesser than a mega site. So even if developers have to pay the additional five percent ABSD, they may be spared the 25 percent penalty since they have a higher chance of clearing the units within five years,” he added.

Fortune Park is a freehold condominium in Kovan with 68 units. Blossom Mansions and Jansen Mansions, are much smaller, with 20 and 12 units respectively.

credits: propertyguru

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No Rationale For New Property Cooling Measures, Says REDAS

Posted by Singapore Property Launch on 10th July 2018 in Blog
No rationale for new property cooling measures, says REDAS

The Real Estate Developers’ Association of Singapore (REDAS) sees no rationale in imposing new property cooling measures considering that the Singapore property market is still in the “early stages of a recovery and the recovery is in line with economic fundamentals”, reported Channel News Asia.

Among the new curbs imposed by the government are a five percentage point increase in Additional Buyer’s Stamp Duty (ABSD) rates for Singapore citizens and permanent residents (PRs) purchasing their second homes and a five percentage point tightening for loan-to-value (LTV) limits for all residential property loans granted by financial institutions.

REDAS noted that Singapore’s property market began to see improved sentiments last year, on the back of brighter economic forecasts. The Singapore economy grew 3.5 percent by end-2017 and 4.4 percent during the first quarter of 2018.

Nonetheless, the sale transaction volume is not high and remained within market expectation given that the property market had been in the doldrums since 2013, it said.

This comes as buyers remained price-sensitive as the existing sizable ABSD (Additional Buyer’s Stamp Duty) and TDSR (Total Debt Servicing Ratio) continued to restrain foreign buyers and Singaporeans.

With this, the industry body feels that the property market “should be allowed time to find its own course and reach a sustained equilibrium”.

REDAS does not also see the need to impose additional measures on developers.

“As is, in the purchase of sites from the GLS (Government Land Sales) programme or private collective sites to replenish their land bank to keep operations going, developers are constrained by a confluence of financial considerations as well as tough and unfriendly business policies including the existing ABSD on developers and the Qualifying Certificate (QC) punitive conditions on majority of developers (who are deemed foreign companies),” it said.

“It is in the interest of the country to have a vibrant real estate industry and a steady growth in real estate value for home owners and investors in the long term.”

credits: propertyguru