Singapore private home sales up 18% in October - Channel NewsAsia

Property developers sold 765 new private homes last month, up from the 648 units sold in September, according to the Urban Redevelopment Authority.

SINGAPORE: The private housing market picked up pace in October, with sales of new homes rising 18 per cent from the previous month.

Excluding executive condominiums (ECs), developers sold 765 new units last month, up from the 648 units sold in September, data from the Urban Redevelopment Authority (URA) showed on Monday (Nov 17). Including ECs, 855 units were sold in October, up from 707 units in September.

The improved sales came as more units were launched for sale. A total of 649 units were launched in October, up from the 514 units launched in the previous month.

Sales in October were driven by the newly-launched Marina One Residences. The project sold about 330 units - about half of October's sales volume - at a median price of S$2,228 per square foot (psf).

DEVELOPERS CLEARING EXISTING STOCK

Older projects Coco Palms and Lakeville also managed to clear units without developers having to offer discounts. Coco Palms cleared 34 units at a median price of S$1,039 psf, while Lakeville sold 32 units at a median price of S$1,340 psf.

Marina One Residences was the only new project launched last month, and property watchers said this is a sign that developers are focusing on clearing old stock.

According to URA, there were 19,270 unsold units in the market.

ERA Realty's key executive officer, Eugene Lim, said: "The loan curbs and ABSD (Additional Buyer's Stamp Duty) framework have somewhat dried up buying momentum in the market and developers would prefer to focus on clearing existing stock rather than introduce more new stock into the market."

Developers were also launching their projects in phases, noted Desmond Sim, head of research at CBRE Singapore. He added: "Going forward, developers will be eye-balling each other, timing themselves accordingly by putting slow launches into the market so that it will be slowly absorbed and not overcrowd the market."

However, a further spike in buying activity is expected in November as ECs make a comeback after almost a year. Already, all 546 units at the Lake Life EC have been sold.

- CNA/cy/ac

Source: Channel NewsAsia (17 Nov 2014)

TDSR Running Out of Steam? - SRX

One conclusion that we can draw from the Cooling Measures is that placing limits on borrowing is more effective than levying stamp duty taxes at bringing Singapore property prices down.

According to the SRX Property Index for Private Resale Flats, the first Additional Buyers Stamp Duty (ABSD1) did little to impact both resale volume and prices. 

While the foreign buyer surcharge of 10% discouraged some investment from overseas, diverting money originally destined for Singapore to other international property markets like London and New York, ABSD1 actually spurred the local investment market.

ABSD1 did local investors a favor because it removed some foreign competition for private properties while creating expectations for lower prices.  Singaporeans thought that they could take advantage of the lower demand by foreigners to get a better price.

However, things didn’t go according to plan because of low interest rates.  As a result of the low interest rate environment, property was a much more attractive asset class than cash and bonds.  Furthermore, financing property investments was cheap.

As a result, enough Singaporeans, armed with inexpensive financing and less competition from overseas entered the market, to keep driving prices upward.

Recognizing ABSD1 did little to discourage local demand for private property, the government introduced ABSD2, levying a 15% tax on most foreigners and a 7% stamp duty on Singaporean purchasing a second property.

ABSD2 reduced the resale volume range from 781-1,439 units in 2012, excluding Chinese New Year, to 581-734 range during the first half of 2013, excluding Chinese New Years and January.

ABSD2 didn’t cause a meaningful decline in price because sellers, believing that Cooling Measures would not last forever, were willing to give a little on price but not that much.

Remember, transacting real estate requires a willing buyer and a willing seller.  Sellers knew that the stamp duty taxes had not altered the fundamental value of their homes.  As such, sellers could justify selling at the price plateau – since prices were high and were unlikely to go up.  In enough instances, they resisted going below the price plateau by exiting the market and sitting on the sidelines.

The government clearly recognized the stamp duty taxes, even when applied to Singaporeans, were not doing the trick so it introduced the Total Debt Servicing Ratio (TDSR) in January 2013 in an effort to limit Singaporeans from over-extending themselves with debt.

TDSR worked. 

It took a while but finally private, resale prices capitulated in July 2014 when private resale flat prices declined 5.6 % from their peak. 

Since then, prices have reached a new plateau, bouncing around the 168.8 and 169.8 range of the SRX Price Index for four consecutive months.  (As of October, SRX Property reports that prices have declined 5.2% on a slight increase of 0.4% since September.)

This new plateau suggests a new support level for prices in the private, non-landed market.  In other words, prices seem to be stuck.

In addition, in looking at the SRX Property graph, since March 2014, resale volume seems to have achieved a new equilibriumaround 400 units transacted per month.

This new equilibrium in resale volume, coupled with the price plateau, suggests that the TDSR might have run out of steam in terms of its effectiveness in reducing prices further.

Therefore, for prices to continue to decline, something must be introduced into the equation to alter the market’s dynamics. 

So, the first question, is the government satisfied with a 5% decline?

If not, then what additional policy tools do they have available?

Given that the Cooling Measures have proven that price is a stubborn variable in the property market, if the government wants the price to drop further in the private resale market for non-landed properties, the only way to do this is to increase supply. 

Demand, at its current level, is about as far down as Cooling Measures can push it.

posted on 20 Nov 2014

Source: SRX (20 Nov 2014)

6 months to sell a condo, 3 to offload a flat - SRX

PRIVATE condominium sellers are taking nearly six months to secure a sale, the longest wait in over two years, new data shows.

It also takes far longer now to find a buyer for a Housing Board flat - with a three-month wait on average.

Data compiled by the Singapore Real Estate Exchange (SRX) shows that private non-landed units spent a median of 120 days on the market in the first quarter, rising to 137 days in the second quarter and 154 days in the third.

Last month, they spent 172 days - almost six months - on the market before being sold. It is a far cry from 88.5 days, or less than three months, a year back.

The median wait to sell HDB units has grown as well, from more than 60 days per quarter in 2012 and last year to 91 days in the third quarter this year.

These long waits reflect weakened demand, consultants say. Upcoming increases in total residential stock will further pressure owners to sell, said Century 21 chief executive Ku Swee Yong.

In the HDB market, resale demand has suffered owing to factors such as the large number of new Build-To-Order flats, giving first- and second-time buyers a more affordable option, said PropNex CEO Mohd Ismail.

There has also been growing supply in the HDB resale market from people collecting keys to second homes, leading to sliding prices in the past five quarters.

For private homes, the total debt servicing ratio and additional buyer's stamp duty have discouraged buyers.

New private home sales are not expected to exceed 9,000 this year, far lower than last year's 17,590 annual sales figure.

The median price spread - the difference between asking and transaction prices - has also risen in both public and private residential markets, SRX found.

In the HDB market, the median price spread rose from 4.7 per cent in the first quarter to 4.9 per cent in the second and 5.9 per cent in the third. It was 3.8 per cent in the third quarter last year and 2.1 per cent a year earlier.

For private non-landed properties, the spread went from 6.3 per cent in the first quarter to 7.3 per cent in the second and 8.2 per cent in the third. It was 4.9 per cent in the third quarter last year and 4.1 per cent a year earlier.

While median days on market is expected to rise, price spreads may keep edging up though they are likely to stabilise soon, said OrangeTee research manager Wong Xian Yang. Valuations could be adjusted and sellers are likely to lower asking prices.

Private condo owners tend to have more holding power, but weak leasing demand for newly completed mass market condos may pressure some owners to sell, said R'ST Research director Ong Kah Seng.

The longer waits and growing price spread do not necessarily mean prices will soften further, said Savills Singapore research head Alan Cheong.

"Usually, (this could be the case) for more liquid markets like equities... Fortunately, real estate is not a homogeneous product with factors including location and unit size... all having an effect on pricing. Still, with a negative economic indicator such as increased days on market, creditors may feel compelled to quickly act against delinquent loans."

posted on 19 Nov 2014

BY RENNIE WHANG

Source: SRX (19 Nov 2014)

Leasing volume up 15% in Q3: Savills - PropertyGuru

The leasing market was buoyant in the third quarter of the year, according to a recent report by Savills Research, Singapore.

Leasing volume of private homes reached a new record of 17,775 cases, registering a quarterly increase of 15.2 percent or an 11 percent growth year-on-year, citing Urban Redevelopment Authority (URA) data.

From January to September 2014, there were a total of 46,632 leases inked, 8.7 percent higher than last year’s 42,899 leases recorded over the same period.

However, rents throughout all regions continued to soften by 0.8 percent quarter-on-quarter, after a dip of 0.6 percent in the second quarter. Core Central Region (CCR) saw the widest decline by 1.9 percent, followed by the Rest of Central Region (RCR) which weakened slightly by 0.2 percent while rents in the Outside Central Region (OCR) saw no change.

Rents of non-landed residential properties reduced by 1.1 percent in Q3 compared to the 0.2 percent drop in the previous quarter.

The average monthly rent of high-end condominiums continued to fall, with average monthly rents down by 2.2 percent quarter-on-quarter to $4.66 per sq ft.

The report also noted the softening rent is most evident in the CCR especially among luxurious residential units, and a possible reason is the shrinking housing budgets in a market where there is an ever increasing supply of new homes.

Alan Cheong, Head of Research at Savills said, “With leasing numbers still rising strongly, landlord sentiment will be supported and although rents may soften somewhat, we are still not too concerned with the onslaught of supply.”

Photo by Muneerah Bee

Muneerah Bee, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email muneerah@propertyguru.com.sg

Source: PropertyGuru (19 Nov 2014)

Declining private OCR rents may affect HDB market - PropertyGuru

Declining rents for private homes in the Outside Central Region (OCR) may have a spillover effect on the HDB rental market, according to OrangeTee.

“As rents in the OCR become more affordable, some tenants may consider moving to private condominiums. This would sap demand from the HDB market and put downward pressure on rents,” the consultancy said.

However, a sharp correction in rents is not expected in the short term, as Singapore’s economic outlook is still bright and landlords will likely resist any sharp drops in rents.

Overall private rents across the country are expected to continue falling in view of increasing supply, especially in the OCR segment, where rents are expected to experience increasing pressure on the back of record supply in the pipeline in 2015 and 2016.

Muneerah Bee, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email muneerah@propertyguru.com.sg

Source: PropertyGuru (13 Nov 2014)

Fernvale all abuzz over arrival of new Seletar Mall - SRX

Separated from the rest of Sengkang by the Sungei Punggol river, Fernvale is the youngest neighbourhood in the estate and quiet compared with Anchorvale, Rivervale and Compassvale, which are named after the sea.

But the tranquil and green neighbourhood nestled between Jalan Kayu and Sungei Punggol is on the verge of growing livelier.

The opening of the gleaming new Seletar Mall on Nov 28 looks set to transform this corner in the north-west of Sengkang.

Sited next to Fernvale LRT station, the new complex will offer more than 130 brands over four storeys and two basement levels.

Anchor tenants include supermarket FairPrice Finest, Japanese clothing brand Uniqlo, department store BHG and Shaw Theatres, which will be opening Sengkang's first cinema.

A joint venture between media group Singapore Press Holdings and property firm United Engineers Developments, the mall is comparable to Compass Point, near Sengkang MRT station, which has a bigger floor space but about the same number of brands.

"The mall has come at a very good time. Other than a few small shops and coffee shops, the entire area seems quite dead," said Mr Amos Tan, marketing and retail lecturer at Singapore Polytechnic.

He believes the tenant mix will appeal to the area's demographic of newlyweds and young families.

Mr Alan Cheong, senior research director of property agency Savills, said the mall was "the first and without competition within a 4km radius".

"The mall should have enough catchment to ensure footfall success and, at the same time, bring greater human activity to the neighbourhood," he said.

Seletar Mall is the latest development in Fernvale, where various condominiums have sprung up in recent years. Two new condominiums, Riverbank @ Fernvale and RiverTrees Residences, saw strong launches in February, with RiverTrees selling 220 of the 300 units released and Riverbank selling more than 200 out of 250.

All this is a far cry from the vegetable and pig farms of the area's past, before Sengkang New Town was built in the late 1990s.

For a long time, Fernvale has not had much luck in shaking off its "boondocks" reputation, which has come about mostly because of its lack of amenities.

Residents make do with Fernvale Point, a one-storey complex of small shops, including a FairPrice outlet, a wet market and an open-air Koufu foodcourt.

The nearest malls include Greenwich V in Seletar Close and Compass Point, leaving residents hardly spoilt for choice.

"I have to go to Orchard to buy socks," said Mr Sean Wilde, 23, a student at James Cook University.

It is no wonder that even before Seletar Mall's opening, the neighbourhood is already abuzz with anticipation.

National serviceman Bernie Tay, 21, currently has to go to nex mall in Serangoon for his movie fix. "It will be really good to have a cinema around," he said.

Housewife Cindy Tan, 36, said: "I'm excited about having a FairPrice Finest within walking distance. It will also be nice to have more choices of restaurants with air-conditioning. The weather is so hot."

But not everyone is thrilled at the prospect of a new mall on the block. Some shopkeepers see the mall as stiff competition.

Mr Mohammed Haris, 24, supervisor at Danisha Trading, a provision store at Fernvale Point, said: "Business is good here now, but we are expecting a drop."

Madam Pang Li Lian, 60, who runs a snack shop selling sweets and soft drinks at the entrance of Fernvale LRT station, said the rental for her kiosk has gone up by 50 per cent. "They say it is because more people will come," she lamented in Mandarin. "But even if more people come, it does not mean they will buy from me."

Others prefer to look on the bright side. Mr Abdul Rahman, 40, who runs Koufu's Indian and Muslim food stall, said: "I don't think the mall will affect my business too much. The food inside will be more expensive and customers will come back."

Madam Lily Tan, who has managed the Fernvale branch of Tampines Optical and Contact Lens Centre since 2006, is confident her regulars will not abandon her.

"The people in this neighbourhood are friendly and supportive," said the 62-year-old in Mandarin. "I have had whole families as my customers. They tell me wherever I go, they will follow."

Some residents worry that they will have to trade serenity for convenience.

Engineering consultant Wayne Tan, 39, fears traffic congestion is imminent. "There are already too many cars here," he said. "Traffic is going to get even worse. I hope the authorities widen the roads."

Ms Rathiga de Hanabell, 32. a freelance enrichment teacher, likes to take her daughter on walks around the estate at night. "I like how it's very peaceful here. Once the mall is up, I guess we can't do that any more," she said.

Nevertheless, she is looking forward to taking her daughter to the mall, which will have a range of children's enrichment and tuition centres. "There's definitely a lot of excitement about this."

BY OLIVIA HO

Straits Times - 7 Nov 2014 

Source: SRX (07 Nov 2014)

Property curbs: Which should stay and which should go? - SRX

EVERY few months, property industry players renew their call for cooling measures to be lifted, pointing to the sluggish property market.

The most recent suggestion came, albeit indirectly, from the Real Estate Developers' Association of Singapore.

In September, it warned that if cooling measures cause consumer sentiment to decline too much, "there could be a broader impact on the economy".

But it stopped short of calling for specific changes - unlike property developers in August, who did not hold back.

Each time the topic is broached, however, the Government reiterates its stance that it is still too early to do so.

Of course, the cooling measures will be relooked "sooner or later", as National Development Minister Khaw Boon Wan put it during a Chinese news programme last week. There has been much speculation about when this might happen.

But apart from timing, there is another question about this eventual relaxation: Exactly which measures will or should be lifted?

A whole range of policies are referred to as "cooling measures", but some are arguably important not just as short-term moves to bring a soaring property market down, but as basic safeguards.

Even if prices cool as planned, some measures may be worth keeping.

One is the 35-year cap on the tenure of home loans. At its introduction in October 2012, the Monetary Authority of Singapore (MAS) said it was part of the "broader aim of avoiding a price bubble and fostering long-term stability in the property market".

In other words, it was important not just as an immediate cooling measure, but also as part of a more stable property market.

The cap was also meant to protect both borrowers and lenders.

The MAS noted then that low initial monthly repayments, made possible by long tenures and low interest rates, might lead borrowers to take a larger loan than they can truly afford, and to have the repayments stretch over a longer period.The number of residents aged 65 and over with outstanding private mortgages has almost tripled since 2008, reaching 15,506 this July.

While some may be financing investment homes and are not in financial difficulties, others may be in danger of being saddled with a loan they cannot afford to keep servicing. The 35-year loan tenure cap for private property should help avoid that situation.

R'ST Research director Ong Kah Seng considers the cap "a good measure to keep, irrespective of market conditions".

Similarly, other cooling measures that keep homeowners from overstretching themselves should be retained for that purpose.

"Loan-related measures should be removed last, as these measures encourage financial prudence," says OrangeTee managing director Steven Tan.

Take the Total Debt Servicing Ratio (TDSR) of 60 per cent, introduced last June. This means financial institutions cannot extend a home loan if prospective borrowers' monthly repayments - for all their loans - exceed 60 per cent of their gross monthly income.

This protects borrowers from over-extending. It also reduces the risk of bank overexposure to bad loans by filtering out borrowers more likely to default, notes PropNex Realty chief executive office Mohamed Ismail Gafoor, who also thinks it should remain.

Playing a similar role to the TDSR is the Mortgage Servicing Ratio limit of 30 per cent. This is the proportion of gross income that can be used to service a loan for a Housing Board flat.

As it promotes financial prudence, it would make sense to retain this- at least in part - to ensure that buyers do not overstretch themselves.

In contrast to these cooling measures are those which seem to aim simply at reducing demand. These include the Additional Buyer's Stamp Duty (ABSD), introduced in 2011 and increased last year.

Singaporean property owners must pay 7 per cent on their second property, and 10 per cent on subsequent ones. The duty is higher for permanent residents and foreigners, with the latter paying 15 per cent on any property bought.

Experts point to this as the first of the cooling measures that should be tweaked or removed.

As a tax on property purchases, it merely discourages buyers.

Administratively, removing ABSD is also the easiest move if the Government wants to adjust any cooling measures, notes SLP International Property Consultants head of research Nicholas Mak. It will not affect existing properties, unlike loan curb changes which have implications for refinancing, for instance.

After ABSD, the next cooling measure which could be relooked is Seller Stamp Duty, say experts.

Payable on properties sold within four years of their purchase, it aims to discourage speculation and "flipping" of properties. "In times of a downturn, the SSD can prove to be a double-edged sword, amplifying losses for investors who need to liquidate their property investments," says Mr Tan.

BY JANICE HENG

Source: SRX (7 Nov 2014)

Falling HDB prices led to higher EC vacancy - PropertyGuru

Falling prices in the HDB resale market has resulted in more vacant Executive Condominiums (ECs), according to Century 21’s Chief Executive Ku Swee Yong in a media report.

At the end of September, there were 14,624 completed ECs, of which a total of 2,941 units came from six projects completed in the first three quarters of 2014. However, 16.2 percent or 2,375 units out of the overall figure were vacant, he said.

This means 2,941 ECs were added this year, but the number of vacant units significantly increased to 2,375 in Q3 2014.

“One reason for the slow take-up of ECs despite the Minimum Occupation Period (MOP) is that upgraders and second-timers are finding it challenging to sell their current HDB flats,” he said.

“Four years ago, when these ECs were launched, a typical plan for upgraders was to buy the EC — many on deferred payment schemes — in the expectation that HDB resale prices will rise during the time that the new home was being built.”

By the time the ECs were completed, they thought they could gain a sizeable windfall from the sale of their HDB flats, which could be used to pay off a portion of the loan for the EC unit.

“However, the tide has turned against them. HDB resale prices have dropped for the past five quarters and recent changes to valuation rules and to purchases by Permanent Residents have made it even tougher to sell the current units at market prices,” Ku explained.

While some HDB sellers, especially upgraders, accepted below-market prices, some are still waiting for better offers. However, there are some who postpone collecting their EC keys as they hold out for better prices.

“So, in the EC segment, potentially about 2,300 families concurrently own two taxpayer-subsidised housing units: the HDB flat that they currently own and possibly occupy, and one completed EC that they have yet to move into,” Ku said.

Because each family can only posses one subsidised home under the law, upgraders are compelled to sell their HDB flat as quickly as possible. “The pressure to sell may worsen, with EC completions expected to total 2,854 next year, 6,371 in 2016 and 2,505 in 2017,” he added.

Muneerah Bee, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email muneerah@propertyguru.com.sg

Source: PropertyGuru (7 Nov 2014)

Don't let the big picture distract - AsiaOne

Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam recently said that there was some way to go before a "meaningful correction" in the property market here.

He also pointed out that over the last few years, there had been a sharp run-up in property prices.

Mr Tharman was referring to macroeconomic numbers for the real estate market, in reference to private and HDB resale prices.

According to the SRX Property Price Index, HDB resale prices are off 8.9 per cent since their peak in April 2013, while private, non-landed resale prices have declined 5.6 per cent since their peak in January this year.

These macroeconomic numbers are aggregated indicators that help policymakers gauge the performance of the economy. Other indicators include gross domestic product, household income and unemployment rates.

However, these indicators are very general in nature as they only show what is happening at the national level and may not reflect events at the micro level.

In some cases, the pain being felt by sellers is much more than what the macroeconomic numbers suggest.

For example, units at the private residential project Domus at Irrawaddy Road were trading at an average of $934 psf during the Global Financial Crisis in 2009. It is now going for $820 psf, which is about 12 per cent below its average during the crisis five years ago.

In fact, according to SRX Property, 21 private projects have units which recently transacted below how much they were going for during the financial crisis.

In contrast, there are 175 private condominiums that have achieved peak average psf price this year. For instance, Eden View in District 19 has performed well despite the 

Government's cooling measures.

This private condo in Serangoon has seen its average psf price more than double from $455 when it launched about 10 years ago to $1,095 now.

What this shows is that the property market's current macroeconomic downturn impacts homes and people in different ways.

Buyers who have paid sellers below what the latter would have received during the financial crisis have benefited greatly from the cooling measures. The sellers on the other end of these deals have lost money since the crisis.

At the same time, there are sellers who are making good returns despite the cooling measures.

All real estate is local. What is happening on your street or in your block may not necessarily reflect what is happening at the national level.

Therefore, whether you buy, sell, rent or invest in Singapore, it is critical that you get the best available detailed information that properly reflect what is going on at the local level, with respect to your individual circumstances, not what is happening at the national level.

Sam Baker is co-founder of SRX, an information exchange formed by leading real estate agencies in Singapore to disseminate market pricing information and facilitate property listings and transactions. For more details on the data used in this article, visit SRX.com.sg/price-index.

Monday, Nov 03, 2014

Sam Baker

The New Paper

Source: AsiaOne (3 Nov 2014)

Lower supply of public, private homes next year - Today

SINGAPORE — To prevent a glut in the public and private housing markets, the Government will further reduce the supply of Build-to-Order (BTO) flats and land sales for private properties.

Minister for National Development Khaw Boon Wan announced the reduction in BTO supply during his appearance on Channel 8’s Hello Singapore programme yesterday.

The supply of BTO flats for this year was reduced to 22,400 units, from 25,000 per year in the previous three years.

Mr Khaw said the number of new BTO flats launched next year would be cut by another 25 per cent to about 16,000 flats, with the number of BTO exercises reduced from the current six a year to four.

There will be a BTO exercise once every quarter instead of once every other month. The number of flats per exercise will hold steady at 4,000.

Speaking to reporters after the programme, Mr Khaw said: “As you know, because of the great shortage, we had to ramp up (supply) very rapidly … But obviously, we cannot carry on like this, it may cause a big problem. So this year, we have started to taper … Then next year, we have decided to further reduce by another 25 per cent.”

He added that the amount of land offered under the Government Land Sales (GLS) programme would also see further cuts. Details were not provided, but the minister said the Government would “have to be careful not to overdo it”.

“The (HDB and private property) markets are linked. So, just as we need to reduce BTO, we have also been progressively bringing down the Urban Redevelopment Authority land sales for executive condominiums, for private condos. So this year, we made a small adjustment of reduction. Next year, we will go a bit further,” he said.

The Government announces the amount of land for sale under the GLS twice a year. In the latest launch in June, the sites on offer could yield an estimated 3,915 private homes, down from the estimated 4,630 units previously.

Despite the recent decline in private property prices, the figures are still around 50 per cent above the lows in 2009.

Hence, it is still not the right time to wind down cooling measures, said Mr Khaw, adding that there is still room for prices to moderate, given that income levels had grown only 30 per cent during the same period.

“Cooling measures are something we will have to relook sooner or later, but I think now is not the time yet … Prices have come down, the market is turning into a buyer’s market and sellers now have to be more realistic,” he said.

Analysts whom TODAY spoke to said the move by the Government is timely, as pent-up demand for HDB flats would have been met by the more than 77,000 flats that came into the market between 2011 and last year.

Associate Professor Sing Tien Foo, deputy head (administration and finance) at the National University of Singapore’s Department of Real Estate, said: “It is time to adjust the stock. The Government has been pumping up the supply of new flats for the past three years, so this is timely. Looking at the last BTO launch, the (application rates) look quite comfortable so, moving forward, it’s good to supply at a more moderate pace.”

“If we look at the number of marriages per year, it’s about 15,000 to 16,000, so I think the 25 per cent reduction is still quite comfortable,” he added.

On the private-property front, Century 21 chief executive Ku Swee Yong cautioned that with developers still hungry for land, a decrease in supply might instead drive up prices.

“The GLS programme is actually a good tool to keep prices in check for the long-term stability of the market. If developers know there won’t be as many sites on offer, that may push up land prices and this cost will be passed on to consumers,” he said.

BY

LEE YEN NEE

leeyennee@mediacorp.com.sg

PUBLISHED: 4:03 AM, OCTOBER 21, 2014

SOURCE: TODAY (21 OCT 2014)

Last quarter likely to be quiet - PropertyGuru

Prices of private residential property could show slowing declines in Q4 2014, especially for the mass-market segment, according to Knight Frank’s Director and Head of Consultancy and Research Alice Tan.

She predicts prices of non-luxury homes in Outside Central Region (OCR) to fall by another 0.5 to 0.8 per cent in Q4 2014, while prices in the Core Central Region (CCR) are expected to fall by another 1 to 2 per cent quarter-on-quarter. Meanwhile, prices in the Rest of Central Region (RCR) are expected drop by around 0.4 to 0.5 per cent from October to December.

The last quarter of the year is also likely to be a quiet period for project launches in view of the upcoming year-end holiday season. Tan said, “Going forward, the number of new unit launches could remain at current levels, with a marked fall in total number of residential units being made available under the H1 2014 GLS programme, of just 4,600 units.”

Additionally, volumes of the private residential property market are not anticipated to rebound strongly in Q4 2014, but HDB resale transactions may rise, according to OrangeTee.

“However, we expect resale volumes to continue to increase as more and more residential projects (BTO, EC and private) attain TOP and these buyers would have to sell their existing flats within six months, as some private property upgraders would sell to finance their upgrade and to claim ABSD rebate,” Steven Tan, Managing Director of OrangeTee.

By the end of 2014, 17,000 to 18,000 units are likely to be completed, according to JLL, and the supply in each of the next two years is expected to be around 20,000 units or more. “This will intensify competition in the leasing market and exacerbate the softening in rentals,” JLL said.

Muneerah Bee, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email muneerah@propertyguru.com.sg

Source: PropertyGuru (31/10/2014)