CPF REVISED HOUSING REFUND POLICY

For full article:  http://mycpf.cpf.gov.sg/CPF/News/News-Release/N_10Sept2012_MF2.htm

	New Housing Refund Policy
	To ensure that the distribution of proceeds from the sale of property reflects the amount of CPF savings used by each co-owner, refinements will be made to the current housing refund policy for transactions where the legal completion is on or after 1 January 2013.
	Specifically, we will require all members to refund the P+I into their CPF when they sell their property, regardless of their age. This means that for members below age 55, there is no change in the housing refund policy. However, for members aged 55 and above, the full P+I refund will now also be made (instead of just the MSD), with the refund used to set aside the Minimum Sum that is applicable to them in their RA and the required amount in their Medisave Account (MA). Any remaining housing refunds will be automatically disbursed to the member in cash. This is consistent with the existing requirement that applies to all members past age 55 when they apply to withdraw their OA and SA savings in excess of the MS. This refinement will ensure that housing proceeds received from the sale of the property are distributed in a manner that is proportional to or reflects the amount that each co-owner had contributed towards the property, while at the same time not require older members to retain in their CPF more refunds than are necessary. The example below illustrates the difference between the current policy and the revised policy that will take effect on 1 Jan 2013. Example:Mr and Mrs Tan are co-owners of a 3-room HDB flat and they have contributed equal amounts of CPF savings to pay for the flat. They are selling their HDB flat for $300,000 and have an outstanding housing loan of $120,000.                                     Mr Tan, 56 years old P+I = $80,000 MSD = $20,000 Mrs Tan, 54 years old P+I = $80,000 Existing housing refund rule Required refund for: 1) members > 55: MSD or     P+I, whichever is lower 2) members < 55: P+I Required CPF Refund = $20,000 Required CPF Refund = $80,000 Computation of cash proceeds: Selling price: $300,000 Less outstanding housing loan: $120,000 Less total CPF refund: $100,000 Cash proceeds left: $80,000 Assuming Mr and Mrs Tan split the remainder cash proceeds in a way that ensures each of them receives a total amount (in CPF and cash) that is commensurate with what they had contributed, Mr Tan and Mrs Tan will receive $70,000 and $10,000 in cash respectively. They will each receive a total amount of $90,000 (in CPF and cash). Mr Tan: $20,000 (CPF) + $70,000 (cash) = $90,000 Mrs Tan: $80,000 (CPF) + $10,000 (cash) = $90,000 However, assuming Mr and Mrs Tan be unable to agree on the above outcome, and they end up splitting the cash proceeds equally among themselves, each member will receive $40,000.  The total CPF and cash received by each will be unequal. Mr Tan: $20,000 (CPF) + $40,000 (cash) = $60,000 Mrs Tan: $80,000 (CPF) + $40,000 (cash) = $120,000 New housing refund rule Required refund for members, regardless of age: P+I Required CPF Refund = $80,000 Required CPF Refund = $80,000 Computation of cash proceeds: Selling price: $300,000 Less outstanding housing loan: $120,000 Less total CPF refund: $160,000 Cash proceeds left: $20,000 Assuming Mr Tan and Mrs Tan split the cash proceeds equally among themselves, each member will receive $10,000. Mr Tan: $80,000 (CPF) + $10,000 (cash) = $90,000 Mrs Tan: $80,000 (CPF) + $10,000 (cash) = $90,000 For Mr Tan, the CPF refund of $80,000 will be credited into his CPF account and used to make up his MSD and Medisave Required Amount. Thereafter, the excess housing refunds will be automatically disbursed to him. Public Enquiries For more information, please visit www.cpf.gov.sg or call the CPF Call Centre at 1800-227-1188.

Source: CPF (Media Factsheet Central Provident Fund Board 10 September 2012--)

Singaporeans should not be traumatised over $1m flat price :Khaw

Minister Khaw said that there will always be ideal units that will fetch high prices but the more important thing is keeping prices for most units affordable. 

SINGAPORE - Speaking at dialogue with Sembawang grassroots leaders yesterday, National Development Minister Khaw Boon Wan urged Singaporeans not to be traumatised over rumours of a flat being sold for $1 million.
Minister Khaw said that there will always be ideal units with fantastic views that will fetch high prices, as in the case of the executive maisonette in Queenstown.
Its sale is still in the works with the price rumoured to hit $1 million including a cash-over-valuation (COV) of $195,000.


Pointing out that the larger picture is more important, Mr Khaw said that in the last few months the Government managed to keep prices for most units affordable with the pricing of the new Build-to-Order (BTO) flats.
At the same time, Minister Khaw noted that the record resale price is indicative of the fact that public housing can provide very good living conditions, reported The Straits Times.

dassa@sph.com.sg

Source: AsiaOne Sun, Sep 09, 2012

Resale prices and rentals rise across the board

Both public and private housing segments fared well in August, with private resale prices up 4.5 per cent and 1.8 per cent for HDB flats. 

The property market has seen an increase in the prices of resale homes and rental rates, the Singapore Real Estate Exchange said yesterday.


Both public and private housing segments fared well in August, with private resale prices up 4.5 per cent from July and 1.8 per cent for HDB flats.
The average price of resale housing in the private market was up 1.2 per cent from Q2 to $1,134 per sq ft (psf).


Rental rates for condominium units increased by 2.4 per cent as well.
The median price of HDB homes also rose by 1.8 per cent to $448,000, which is a new high for the segment. Rental rates for HDB flats rose 4.3 per cent from $2,300 to a $2,400 average.

In a Straits Times article, analysts were quoted as saying that buyers have become more interested in the resale market as they are looking for alternatives to the high prices set by recent developer launches. New launches were also credited for raising the prices of resale homes around them. A number of resale flats have made headlines recently for the high prices they commanded, including a $980,000 maisonette in Bishan and a $1 million flat in Queenstown. ljessica@sph.com.sg

Source: AsiaOne Sat, Sep 08, 2012

Shoebox homes might make bad investment idea

Shoebox units in suburban places might not yield rental rates which are as high, analysts say. 

Shoebox homes might not be the best place to invest your money, Maybank Kim Eng has suggested in a recent report on real estate in Singapore.

The research arm of the bank has done an analysis on shoebox units, and found that the largest number of such units have been sold in the Balestier, MacPherson and Geylang areas.


While shoebox apartments may fare well in the rental market for urban centres, those in suburban places might not yield rental rates which are as high, analysts say.
In their report, Maybank Kim Eng questioned the viability of suburban shoebox units, which they say developers are "rushing to price at $1,500 to $2,000 per sq ft".
Minister for National Development Mr Khaw Boon Wan has warned on numerous occasions that the shoebox market for suburban areas remains untested and risky.
Echoing this sentiment, the Urban Redevelopment Authority (URA) said recently that it would intervene in the number of units developed in suburban estates.
From November 4, new guidelines to curb the development of shoebox units outside the central area will take effect. A total of 11,000 shoebox units are expected to be developed by 2015, with about 3,800 of them built outside the city centre.
Excessive development of shoebox units could also result in a strain on infrastructure, the URA said.

ljessica@sph.com.sg

Source: AsiaOne Sat, Sep 08, 2012

Bishan flat smashes record with $980,000 sale

This year alone, five HDB flats were sold for $900,000. There have been a total of seven such sales overall. 

An executive maisonette has been sold for a record $980,000 on the first day of its open house.

The sale smashed a previous record of $910,000 for the most expensive HDB flat sold in Singapore set by the sale of an executive flat in Toa Payoh in May.
The Bishan flat's new owners paid a $200,000 cash over valuation (COV), which is believed to be the highest COV ever paid for a flat.
The 1,800 sq ft flat is located on the 19th floor in Bishan Street 13 and is 25 years old. It also comes with a 150 sq ft roof terrace.
Schools, amenities, Bishan MRT station and the bus interchange are located nearby.


Dennis Wee Group property agent Thomas Hee told The Straits Times that there are only 48 maisonette units with open terrace roofs in Singapore.
The sale is undergoing processing and will be finalised in two months.
At about $550 per sq ft, the flat is about half the price of a similar condominium unit in the area.
According to ST, a condominium unit of the same size in Bishan would fetch $1,300 psf.
Analysts the paper spoke to also indicated that the rare sale was unlikely to affect resale flat prices or COV rates.
This year alone, five HDB flats were sold for $900,000. There have been a total of seven such sales overall.
ST also reported that an executive maisonette in Queenstown might soon be sold for $1 million.
Flats which have sold for $900,000 or more were from Bishan, Queenstown, Kallang and Toa Payoh. These are all mature estates with good access to infrastructure and amenities.
The units are between 1,180 sq ft to 1,850 sq ft in size.
Analysts say that homeowners who choose to pay top prices for premium flats tend to be downgrading from private-property and can afford to pay high COV rates.
An executive maisonette owner recently told The New Paper that he paid $168,000 in COV for his Tampines flat, and it was worth every cent.

ljessica@sph.com.sg

Source: AsiaOne Fri, Sep 07, 2012

Hong Kong to restrict foreign homebuyers from 2013

The move is seen to be targeting mainland buyers who have been blamed for pushing up property prices. -AFP 

HONG KONG - Hong Kong on Thursday announced the first step in a policy aimed to restrict foreigners from buying property, in a move seen to be targeting mainland buyers who have been blamed for pushing up property prices.
Chief executive Leung Chun-ying said only Hong Kong permanent residents will be able to buy flats to be built on two sites that will provide around 1,100 homes next year under a so-called “Hong Kong land for Hong Kong people” policy.
Resale of the residential units will be restricted to locals for 30 years and incorporated companies will also not be allowed to purchase them.
The policy was part of Leung’s election promises to tackle the housing woes in the city of seven million before he was elected into office in March.
“Hong Kong’s land for property is rare and precious resource, when using this land, we must make it a priority to fulfil the housing needs of the Hong Kong permanent residents,” Leung told reporters.
“This plan is the first of its kind because we have never had a policy like this in the past,” Leung said while standing in the construction site where the residential buildings will be built.
The units will be built on two sites of the combined size of 1.6 hectares (3.95 acres) in an area that used to be the site of Hong Kong’s former Kai Tak airport.
The announcement came after Leung unveiled a series of measures last week to cool the red-hot property market, including to provide around 65,000 new units on the market in the next three to four years.
Other measures include boosting land supply by converting 36 sites meant for government and public use to residential property to provide space for nearly 12,000 units.
Property prices in the southern Chinese city, famous for its sky-high rent, have surged over the past few years due to record low interest rates and the flood of wealthy people from mainland China snapping up homes.

Thu, Sep 06, 2012
AFP

Source: AsiaOne

$808,080 HDB sale hits the roof

Homeowner paid $808,080 for his executive maisonette in Tampines, including a $168,080 in COV. Worth every cent, he said. 

Just how much are people willing to pay for an HDB flat?
Mr Freddy Choo paid $808,080 for his executive maisonette in Tampines.
Worth every cent, he said.
The price includes a whopping $168,080 in cash over valuation (COV).
That's among the largest COVs paid since the financial crisis in 2008, said real estate agents.


One of the previous reported highs was about $200,000 for an HUDC flat in Shunfu. It was sold at $1.1 million in July, 2010.
Mr Choo, 46, said he was willing to pay a premium as his new home was renovated just five years ago and came fully-furnished.
The real estate agent had come across the unit, on the eighth storey of Block 146, Tampines Avenue 5, in April.
The 150 sq m flat is two bus stops away from the Tampines MRT station and Tampines Mall.
Mr Choo said it was valued at $640,000.
The median resale price of executive flats in Tampines was $640,000 as of the second quarter of 2012, according to HDB's website.
The father of two said the final amount - $808,080 - was also an auspicious number.
It is the highest price paid for an executive HDB flat in Tampines in the past year, according to HDB's website which shows transacted prices.
Mr Choo is married to another real estate agent, and they have a daughter, nine, and a son, 13.
Mr Choo said his family had previously owned a condominium penthouse in Geylang, which he sold for $1.4 million.
To pay for his new place, Mr Choo has taken out a 24-year loan of $560,000, saying: "You can always earn more money.
"But it's not easy to find a suitable flat which you can call home."
"I searched for a month and looked at six units before I decided on this one."
The block is about 600m away from St Hilda's Secondary which Mr Choo's son attends.
His daughter, Schermaine, attends the nearby St Hilda's Primary School.
She said: "I can walk to school in 10 minutes. There's also a park, shopping mall and playground nearby for me."
Mr Choo's family was also drawn by the extensive renovation to the unit.
He said the previous owner had spent $200,000 and had fittings such as a water feature in the living room, and glass banisters.
And Mr Choo claimed the owners left behind furniture worth $100,000.Some of the furniture they included a custom-made bed, Japanese-style tabletop and a Swarovski crystal chandelier worth $3,000.
They also left electrical appliances like a flat-screen TV, fridge and speakers.
Said Mr Choo: "They were also a Singaporean family who upgraded to a condominium. They initially wanted a COV of $240,000, but I managed to bargain down."


The previous owners could not be contacted as Mr Choo said he does not have their telephone number.
The transaction was approved in May and Mr Choo's family moved in two weeks ago.
He said: "All my friends who have seen my place say it is worth the amount I paid."
Good buy?
Mr Albert Lu, key executive officer of property firm C&H Properties, told TNP: "On the surface, the figure definitely looks like a lot.
"But if what Mr Choo says about the renovation and furnishings is true, it is actually a good buy."
Most flat owners, he said, spend under $100,000 on renovations.
"For someone to spend $200,000, the renovations would have been very 'high-class'."
Mr Mohamed Ismail, chief executive officer of PropNex, agreed.
He said: "In this case, the transaction seems value-for-money, considering the value of the renovation and furnishing the previous owner left behind."
COVs have exceeded $160,000 before, said Mr Ismail. For example, he encountered two such flats - one in Yishun and another in Jurong East - in 1996.
Indeed, it was previously reported that resale prices had hit a high in 1996, with the median COV going as high as $42,000 in the third quarter of 1996.
Since the economy recovered after the 2008 financial crisis, it is possible for some COVs to have returned to such "spikes", Mr Ismail added.
Mr Chris Koh, director of property firm Chris International, said Mr Choo's case is the largest COV transaction he has come across since 2008.
It was previously reported that in 2007, some home-owners were asking for COV sums of more than $150,000 in certain mature estates.
"But if the flat was well-renovated and well-furnished, as claimed by Mr Choo, I can understand why he agreed to pay such a large amount of COV."
Half of all flats sold are renovated, he estimated, but only about 20 per cent have good furniture for buyers to use, he said.
"Most owners tend to bring their furniture along with them when they move out."
Only about 5 per cent of all flats can command such high COVs, he added.
All three did not think this case was reflective of housing prices in general.
Mr Koh said: "This is a resale flat, which is more expensive than a Build-to-Order (BTO) one.
"The BTO flats are still affordable, and there are many schemes to help young couples get these flats quickly."
For example, a four-room flat in Tampines Alcoves and Tampines Green Terrace - BTO projects launched earlier this year - was reported to cost $292,000.
Mr Ismail warned that the transactions like Mr Choo's are "one-off" and are not reflective of general prices.
He said: "It would not make sense to pay such large COVs for flats which do not have comparable furnishings and renovations."
COVs have fallen to an average of $25,000 island-wide, he noted, so buyers should exercise caution before paying large amounts over valuation.
"They should also remember that if the property market corrects itself, like during an economic downturn, whatever COV you pay will mean nothing."


Get The New Paper for more stories.

Benson Ang
Wed, Sep 05, 2012
The New Paper

Source: AsiaOne

Government to intervene in market for shoebox apartments

From November 4, new guidelines will be introduced to prevent a disproportionately large portion of small units in the housing market. 

The number of units which can be developed on non-landed suburban private residential developments will soon be restricted, the Urban Redevelopment Authority (URA) said today.
From November 4, new guidelines to curb the development of shoebox units outside the central area will take effect.


The decision to impose guidelines on the development of shoebox apartments stems from the need to prevent a disproportionately large portion of small units in the housing market, URA said.
In a statement released on Tuesday, the authority added that it had been monitoring public feedback on the development of shoebox units in non-central areas of Singapore.
According to URA data, the number of shoebox units will increase by more than four times from 2,400 at the end of 2011 to about 11,000 units by the end of 2015.
In its survey, URA found that shoebox apartments were more popular among small households and singles and that their development is useful in meeting diverse lifestyle choices.
On the other hand, the smaller units are not conducive for couples with children and larger families.
The government has also observed that an increasing proportion of new developments consist predominantly of shoebox units. Some developments have a shoebox unit proportion as high as 80 per cent, the URA said.
Furthermore, strains on local road infrastructure could result from the excessive development of shoebox units in non-city areas.
Minister of National Development Khaw Boon Wan had on previous ocassions warned that the Government would not hesitate to intervene in the shoebox apartment market should there be any signs of unsustainable investor demand.
Commenting on the URA's new guidelines to curb shoebox unit developments, Mr Khaw said that although the regulators try not to intervene in the market, some intervention is needed if the market outcome contradicts public interest.
In a September 4 post on the Ministry for National Development (MND) blog, the minister said: "Unlike the central area, the suburbs are largely for families. While there is a need for smaller units...too many in the same locality cannot be optimal."
He also added that the new URA guidelines will be "moderate" and assured that the demand for shoebox units will not be neglected.
Citing previous times when the authorities received good response for intervening in the property market, Khaw says that he is confident that the new guidelines will be welcomed by both developers and property buyers.

ljessica@sph.com.sg

Source: AsiaOne Tue, Sep 04, 2012

Condos sell despite Hungry Ghost taboo

Developers report healthy sales made in the past week, proving that buyers are less affected by superstition than before. 

New condominium launches have fared well in the past two weeks despite the Hungry Ghost Festival, property analysts say.

It is common for buyers to hold out until the end of the Chinese festival when investing in property as the seventh month of the lunar calendar is traditionally deemed inauspicious. However, property developers are reporting healthy numbers for sales made during the Hungry Ghost month this year. V on Shenton, which is selling at an average of $2,200 per sq ft (psf) sold 27 units in just one week, The Straits Times (ST) reported. General manager of UIC, Mr Michael Ng, told ST that sales were given a boost after the announcement of the Thomson MRT line as a station for Shenton Way will be located just behind the estate. Another 15 units for Parc Centros at Punggol were also sold for prices of $800 to more than $1,000 psf. About 85 per cent of the condominium has been taken up since its launch in July. While Far East Organisation also reported 34 units from various projects sold in the past week, Upper Changi condominium Parc Olympia sold 15 units in the past week at an average price of $840 psf. Observers say that younger buyers are less interested in following superstition and are more inclined on buying based on prices and investment opportunities. Mr Png Poh Soon, head of research at Knight Frank, told ST that earlier generations of property buyers were more cautious when it came to superstition. “For the younger and more affluent buyers, their concern is really the affordability and investment opportunity,” he said. The Hungry Ghost month started on Aug 17 and will end on Sept 15. ljessica@sph.com.sg

Source: AsiaOne  Tue, Sep 04, 2012

COVs for resale flats rising again

For transactions in the last two months, the overall median cash-over-valuation (COV) paid was $30,000. -AsiaOne  SINGAPORE - Cash premiums for resale flats are slowly rising, after it fell in the first two quarters this year from Q4 last year, The Straits Times reported. Data from property firms for the last two months revealed that for latest transactions, the overall median cash-over-valuation (COV) paid was $30,000. This is up from the average of $26,000 paid in the first two quarters this year, but still lower than the $34,000 average in the fourth quarter of last year. But recent transactions have also seen astounding figures. A five-room flat in Holland Drive was sold last month with a premium of $135,000, while an executive apartment in Woodlands transacted at $130,000 above-valuation. But according to ERA Realty key executive officer Eugene Lim, these are exceptions to the rule, and tend to occur in mature towns where there are fewer new flats. Government had promised about 25,000 new flats this year, and at least 20,000 next year. candicec@sph.com.sg Sat, Sep 01, 2012 Source: AsiaOne

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