New private home sales up 9.4% on-month in June

New private home sales up 9.4% on-month in June

By Yasmine Yahya & Wong Siew Ying

SINGAPORE: Sales of uncompleted private homes continued to climb in June as improving sentiment in the market spurred homebuyers to snap up more units. 1,825 new private homes were sold last month – a 9.4 per cent rise from May.

The strongest sales were seen at 8@Woodleigh, a condominium at Potong Pasir, where units were sold at a median price of S$804 per square foot. All 330 units at the property were snapped up last month, accounting for almost a fifth of all private home sales.

Market-watchers said on Wednesday that June’s record private home sales were largely driven by pent-up demand, with one in two buyers being upgraders from the public housing segment.

Chua Yang Liang, head, Research & Consultancy, Jones Lang LaSalle, said: “The gap between these two markets right now is at a historical low of about 58 per cent – the peak was 67 per cent. The large liquidity that was built up over the past few years is also driving the market.”

Observers also noted that buyers are getting more interested in high-end apartments.

Martin Place Residence, Nathan Residences and Vista Residences, which are in the prime districts and city fringe areas, all sold between 60 and 90 units each. Median prices for these units ranged from S$1,047 to over S$1,500 per square foot.

One Devonshire, located at River Valley, sold 146 units at a median price of S$1,771 per square foot.

But some warned of signs of speculation and said a property bubble would be formed if buying is not supported by fundamental growth.

Tay Huey Ying, director, Research & Advisory, Colliers International, said: “The investors have been drawn out in a big way from the sidelines and this is on the back of home prices that remained largely at a discount, compared to the peak prices.

“I think there is a little bit of froth forming in the market at this point in time, we are seeing speculators coming back into the market although… the level of speculation has not reached a level that warrants concern.”

Developers launched a total of 1,637 units in June, up 41 per cent from May.

Going forward, developers are expected to launch more mass market and mid-tier properties with marginal upturn in prices.

Market-watchers said the good sales momentum may be sustainable at between 1,000 and 1,200 units a month for the rest of the year. But they said sales volume may dip slightly in September due to the Hungry Ghosts’ Festival.

With Singapore snapping out of technical recession in the second quarter, observers said this may inject more confidence in the property sector.

Overall, 7,310 units were sold in the first half of the year, surpassing the over 4,200 deals for the whole of 2008.

- CNA/so

Source : Straits Times - 16 July 2009

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No need for additional stimulus, says minister

No need for additional stimulus, says minister

By Alvin Foo & Fiona Chan

THE economy is stabilising, and there is no need for Singapore to introduce further stimulus measures currently, Trade and Industry Minister Lim Hng Kiang said yesterday.

Mr Lim noted that none of the major economies are contemplating a second stimulus package ‘anytime soon’.

With unemployment in many economies still on the rise and the pace of recovery uncertain, some have called for a second round of stimulus in countries such as the United States.

But Mr Lim said he did not think the US administration ‘is anchoring their actions on that yet’, and noted that in Europe, there is no appetite for further stimulus.

Asked if Singapore needed a second boost, he said: ‘With the situation stabilising as we see it, this is not on the cards at the moment.’

Singapore’s economy pulled itself out of recession in the second quarter and is now forecast to shrink at a smaller rate than previously expected, although the Government warned of a subdued outlook for the rest of the year.

Mr Lim was speaking to the media ahead of next week’s meeting of trade ministers from the Asia-Pacific Economic Cooperation (Apec) which will be held at the Shangri-La Hotel.

Singapore is hosting this year’s Apec forum meetings on the 20th anniversary of the 21-member grouping.

Among the key issues on the trade ministers’ agenda will be assessing measures Apec members took to tackle the crisis and aid recovery. Discussing the more effective measures will help countries handle future crises.

But there is a flip side. In the worst part of the downturn, some countries resorted to steps that bordered on protectionism - such as encouraging their people to ‘buy local’ - which goes against Apec’s long-standing mission to free up trade flows.

Mr Lim said that while some of these actions were expected given the crisis’ severity, it was important not to let protectionism go on to ’such an extent that it invites a series of tit-for-tat’.

Apec, a non-binding forum, cannot enforce punitive measures on members that act contrary to its agenda of free trade. But Mr Lim said Apec members should ’shine the spotlight on some of these measures’ and ‘put some peer pressure on each other’ not to succumb to domestic calls for protectionism.

Another item on the trade ministers’ to-do list is looking at how to restart the stalled Doha round of global trade talks. Last week, leaders of several rich and developing nations targeted a 2010 deadline to conclude the trade deal.

Mr Lim said World Trade Organisation director-general Pascal Lamy will be present at next week’s meeting here and will brief trade ministers on how they can move forward following last week’s Group of Eight leaders’ meeting in Italy.

The meeting will also touch on socioeconomic strategies for the post-crisis world. One issue likely to be discussed is how countries can persuade their populations that freer trade and further liberalisation is not a threat.

Mr Lim said: ‘We have to demonstrate that globalisation is beneficial to everybody. And that means growth must be more inclusive.’

This can be done by having greater social resilience, he said.

Apec’s future: Picking right formula for leadership, Review

Source : Straits Times - 16 July 2009

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Record private home sales

Record private home sales

1,825 sold in June even higher than during peak of the boom in Aug 2007

By Joyce Teo, Property Correspondent

IT WAS another electrifying month for the private home market, with sales last month surpassing even levels seen at the height of the boom two years ago.

The recession-defying numbers for yet another month point to surging confidence among buyers and sellers, and signal that the worst is likely over.

Developers sold 1,825 units last month, up from the 1,673 moved in May and almost 100 more than the number shifted in August 2007, the peak of the boom.

Even more remarkable, the April to June sales of 4,714 units surpassed the total of 4,264 new private flats sold last year, said CB Richard Ellis.

It felt like the good old days were back for developers last month, with 1,637 units launched, 475 more than in May, Urban Redevelopment Authority data showed yesterday.

That was the second highest number of launches since August 2007.

Values are also responding to the heightened activity, with median prices at some projects last month higher than in May.

Property consultants cite the continued strong demand since February and June’s record sales to tip that the worst appears to be over. Some also expect a price recovery soon.

Colliers International’s Tay Huey Ying reckons that last month’s record number of primary home sales was driven by pent-up demand from both owner-occupiers and investors. This was helped by prices that remained largely at a discount from peak prices, even if they may have strengthened recently.

Knight Frank chairman Tan Tiong Cheng said the market had been shell-shocked for a period and sales fell off a cliff last year, but the perception now is that the worst is over.

‘Although it may still take a while for the economy to find its feet, as the Government has suggested, buyers are now prepared to make a decision,’ he said.

‘They feel that this is a window to buy. Interest rates are at the lowest ever, and there is a good selection of condos out there. Things are not getting better, but they are not getting worse.’

CBRE Research executive director Li Hiaw Ho added: ‘While 2007 was the climax of the bull-run in terms of sales volume, 2009 likely represents the turning point at the trough of the market.’

If the buying momentum is sustained and the economy strengthens gradually, the take-up for the whole year could reach up to 14,000 units, higher than the 2006 level of 11,147 units, he said. Sales in 2007 were a record 14,811 units.

The sales drive could also send prices up from a low in the second half of the year, added Mr Li.

City-fringe homes were the most popular last month, with 867 sold, including the 330-unit 8@Woodleigh in Woodleigh Close, which sold out at a median price of $804 per sq ft. The only sell-out project in June, its small, affordable units were a key attraction, experts said.

Large units are generally moving slower than the small ones, they said, due to the higher quantum price.

The return of interest in high-end deals priced above $2,000 psf was also noted last month, said CBRE Research.

A unit in the Ritz-Carlton Residences went for $3,404 psf, while one in The Orchard Residences was sold for $3,299 psf.

These made up the 23 high-end deals last month, up from 15 in May. That is still a very small number, but ‘a sign that there are high net worth individuals out there who are prepared to buy investment-grade properties despite uncertainties in the economy’, said Mr Li.

Jones Lang LaSalle said it was starting to see a return of interest from foreigners seeking opportunistic buys.

The narrower price gap is a major factor behind the bullish sentiment, especially among HDB upgraders, said Dr Chua Yang Liang, the firm’s head of research for South-east Asia and Singapore.

Its number-crunching shows that the price gap between non-prime residential projects and HDB resale flats are now similar to 2004.

‘As long as this gap remains tight, this stream of HDB upgraders into the private residential market is likely to continue,’ he said.

Nevertheless, these buyers are very price-sensitive. ‘There is some upward price movement, but there is no shortage of supply,’ said one expert.

DTZ’s head of South-east Asia research, Ms Chua Chor Hoon, added: ‘As the economy has not recovered, and many have taken pay cuts or were retrenched, demand, especially in the mass-market segment, is likely to be sensitive to price increases.’

Source : Straits Times - 16 July 2009

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In a class of their own

In a class of their own

Some 1,000 Singaporeans are said to own the majority of Good Class Bungalows here, reports ARTHUR SIM

VERY few people live in landed homes in Singapore and even fewer live in Good Class Bungalows (GCBs), which probably explains why they are so desirable. There are about one million or so homes here. These comprise terrace houses, semi-detached houses, bungalows and of course high-rise homes - condominiums, apartments and public housing flats.

Exclusive: While it is not inconceivable that there could be more GCB areas added in the future, given the need to intensify land use in Singapore, the likelihood is slim
But GCBs stand quite far apart from all of these in that they not only have to sit on land that is of a certain size - not less than 1,400 square metres - but also have to be located in areas that have been specially designated for them. Indeed, there are estimated to be less than 2,500 GCBs in Singapore.

GCB areas were officially gazetted in 1980 with 39 areas formally safeguarded. A spokesman for the Urban Redevelopment Authority (URA) explained that the purpose of the gazette was to ‘protect the high environmental quality of these established large bungalow areas from the intrusion of more intensive forms of housing such as semi-detached or terrace houses’.

Walk or drive around these GCB areas and often you will notice not only stately houses but stately trees as well with many protected for posterity. There are two zones in Singapore under the National Parks Board’s Tree Conservation Areas with the main zone covering central Singapore where most of the GCBs are located.

To control development in these areas, URA set certain guidelines for planning purposes. For instance, the minimum plot size for any newly created bungalow within the 39 GCB areas must be at least 1,400 sq m. For this reason, a GCB plot cannot be developed to accommodate more intensive forms of housing. And unless it is at least 2,800 sq m in size, it cannot be sub-divided into two GCB plots either.

Of the GCB areas, the best known are the Nassim, Cluny, Bishopsgate and White House Park estates. While it is not inconceivable that there could be more GCB areas added in the future, given the need to intensify land use in Singapore, the likelihood is slim.

URA’s spokesman said: ‘In drawing up our land use plans for Singapore, we aim to provide a variety of housing options for Singaporeans, from waterfront housing to garden living to city living. This includes low-density and landed housing, such as those found within existing GCB areas. The detailed housing form for future landed housing areas will be determined when the area is ready to be developed.’

URA said that there are currently no plans to release new sites or designate new areas as GCB areas. ‘Nevertheless, there is scope for the number of GCB plots within existing GCB areas to increase, for example through sub-division of larger GCB plots into several GCB plots, so long as each bungalow plot meets the minimum land size of 1,400 sq m,’ URA added.

Big GCB plots do not come by often. In 1994, a plum site in the Tanglin GCB area came up for sale by public tender. The 194,000 sq ft parcel was the official residence of the Australian high commissioner at White House Park/Dalvey Road. Property valuers had estimated that the site could fetch as much as $70 million, or around $400 per square foot (psf). The site eventually sold for $98 million or $505 psf.

In 1997, developer Wharf Group sold five units of the 11-unit development of GCBs at an average of $14.1 million each. Ten years later, in 2007, a house in this development sold for $28.8 million. There have been other public tenders of large sites.

In 2000, Hongkong and Shanghai Banking Corporation (HSBC) sold a 201,782 sq ft freehold bungalow site it owned since the 1960s in Jervois Road for $60 million, or slightly over $330 psf. Then in 2003, HSBC sold a 276,112 sq ft site at Bishopsgate for $69.8 million. Together, all three sites would have yielded less than 40 new GCBs.

Occasionally, individual GCB sites will come up for auction. In 2008, the Singapore Land Authority auctioned a site at Ridout Road which saw 34 bids lodged by three prospective buyers. The winning bid came in at $8.96 million or $579.55 psf. This was 22.6 per cent above the opening bid of $7.31 million or $473 psf. Being fresh government land sale sites, however, it came with a 99-year lease.

SLA also said that recently, three parcels of land have been sold under the Sale of Infill Sites programme on 99-year leases. ‘The owners have to comply with URA’s GCB guidelines as the land parcels are within GCB areas,’ it added.

Because the environment is an important factor in GCB areas, there are guidelines that control how big the house can be. For instance, the house cannot cover more than 35 per cent of the site. This is to ensure that there are adequate green buffers between each house.

There are also more prosaic restraints - childcare centres are not allowed in GCB areas for instance. But perhaps the most important constraint on GCB ownership to note is that foreigners are not allowed to own these, thus reducing the buying pool of GCBs.

Some 1,000 Singaporeans are said to own the majority of GCBs here and are mostly intent on holding on to them as long-term investments. If you have bought one through the open market, you can count yourself lucky indeed.

Source : Business Times - 16 July 2009

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More mortgagee sale properties in H2 unlikely: DTZ

More mortgagee sale properties in H2 unlikely: DTZ

The firm says it could be due to banks being less anxious to foreclose

By EMILYN YAP

BARGAIN hunters waiting for more distressed properties to show up at auctions could be in for a disappointment.

Real estate consultancy firm DTZ believes that the number of mortgagee sale properties will not rise in the second half of the year as the open market has improved.

‘The recent buying interest in the property market and stabilisation of prices across all sectors in Q2 2009 would have enabled cash-strapped owners to dispose of their properties,’ says DTZ in a report released yesterday.

Fresh data from the Urban Redevelopment Authority (URA) illustrates the renewed enthusiasm among home buyers.

Developers sold 1,825 new units in June, breaking the previous record of 1,723 units set in August 2007.

In fact, after a spike in February, the number of mortgagee sale properties put up for auction has tapered off.

‘The less than expected mortgagee sales in the current economic downturn could be due to banks being less anxious to foreclose now,’ DTZ says.

It explains that the government has been urging banks to give debtors more leeway to service their loans.

Banks are also not rushing to foreclose on properties if they have to accept lower prices and risk ending up with too much stock.

DTZ’s views on the number of mortgagee sale properties to surface differ slightly from another industry watcher’s.

Colliers International deputy managing director and auctioneer Grace Ng expects to see a ‘marginal increase’ in such cases at auctions.

Colliers’ report late last month notes that it can take six months or longer for a bank to repossess properties and put them up for auction, after owners default on their loans.

Banks may also give owners some time to sell the properties on their own.

As a result, more mortgagee sales may only enter the market in the second half of the year.

DTZ and Colliers share similar views on most other trends in the auction market.

For instance, the value of properties sold through auction has certainly picked up tremendously since last year.

According to DTZ, major auction houses in Singapore posted $72.5 million in transaction value in the first half of this year.

This already surpasses the transaction value in the whole of 2008, which was $65.5 million. In particular, buying interest soared in March and remained buoyant up till June.

June was the most active month, accounting for 34 per cent of the total number of properties sold in the first half of the year.

The proportion of properties successfully sold through auctions also rose between March and June.

The success rate in that period was 26 per cent, compared with just 5 per cent between January and February.

Source : Business Times - 16 July 2009

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Q2 earnings may spring a happy surprise

Q2 earnings may spring a happy surprise

Analysts bet on tech and property; still wary of S-chips

By CHEW XIANG

(SINGAPORE) Companies are likely to post better- than-expected earnings as the second-quarter results season gets under way, analysts say.

‘We think there could be upside surprises for earnings, largely coming from banks,’ said Chua Hak Bin, Citigroup’s head of Singapore research.

CIMB analyst Donald Chua said property counters are also likely to perform strongly. ‘Interest in residential properties has been more organic than speculative, led by upgraders and local buyers,’ he said in a report last week. ‘Meaningful price cuts have also attracted some foreign demand.’

The tech sector could also throw up some surprises after three quarters of poor results, said analyst Jonathan Ng of CIMB. ‘For sure, Q2 will be better than Q1 but most of the companies will still see year-on-year declines,’ Mr Ng said. ‘We think some of them will return to year-on-year gains only from Q4 onward.’

He is bullish about companies with ’strong free cash flow and strong balance sheets’ such as Venture Corp, Meiban and Armstrong Industrial Corp.

Bullish quarterly growth estimates this week from the government show a recovery in manufacturing, albeit led by the highly volatile pharmaceuticals segment. Yet inventory restocking since mid-March has contributed to strong orders for local tech companies, Mr Ng said. ‘A lot depends on the sell-through in the third quarter, if the economy stabilises and job losses aren’t too heavy.’

Creative Tech and Chartered Semiconductor are still sell-calls, he said, but ‘Chartered has left off a bit since, so we may be upgrading to a ‘neutral’,’ he said.

For Citi’s Mr Chua, the consensus forecasts for the three local banks are ‘too gloomy’ as they do not see much change from the first quarter. ‘Loan growth is holding up far better compared to past recessions, while local banks are benefiting from repricing of loans and the pullback of foreign banks from corporate lending,’ he said. ‘The seizure in bond markets has shifted business towards direct bank lending, while the NPL (non-performing loan) cycle is turning out to be relatively benign.’

Sectors such as the oil- and-gas support industry ‘could come on really strong’ this quarter on the back of good orders, said Roger Tan of Sias Research. However, S-chips - China companies listed here - could disappoint as corporate governance issues are still present. Four S-chips issued profit warnings this week. ‘I would be very cautious over their performance,’ Mr Tan said. On the other hand, mass-market property counters should do well on the back of strong interest from HDB upgraders, he said.

Analysts say the wider economic picture supports stronger equity performance in the present quarter. A DBS report this week noted that the benchmark Straits Times Index ‘has been in limbo for the past two weeks while awaiting H2 corporate guidance to come through’. Yet, it has ’shown resilience despite recent weaknesses in US indices and the volatility in property stocks’.

‘We believe that this is because valuations have dipped closer to levels that mid- to long-term investors will consider buying in again, which is at 2,100,’ DBS said. ‘We believe that investors have not turned bearish but are just hoping to buy cheaper.’

A BCA report this week said equity prices face a critical test this quarter but could emerge stronger. ‘Currently, there is an intense standoff between reflationary forces and debt-deflation pressures, creating corrective pressures on global stocks and risky assets. However, our bet is that reflationary policies will ultimately win out, allowing global equity prices to break higher in the coming months,’ BCA said.

Source : Business Times - 16 July 2009

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Home sales hit new highs on silent buying frenzy

Home sales hit new highs on silent buying frenzy

Developers sold more units in June than in 2007 peak but the momentum may not last

By UMA SHANKARI

(SINGAPORE) The buying frenzy in Singapore’s property market has now eclipsed even the dizzy heights of the last property boom. Developer sales of new private homes in June hit 1,825 units - topping the previous peak of 1,723 units homes sold in August 2007 at the property market peak.

But analysts are unsure if the buying momentum can continue for much longer.

June marks the fifth straight month where the number of transactions has exceeded 1,000. To capitalise on the bullish sentiment, developers increased supply by 41 per cent month-on-month to launch 1,637 units in June.

In the first half of 2009, developers sold more than 7,300 units in all. If this momentum is sustained, new home take-up for the full year will exceed 14,000 units.

That figure could be met, some analysts said. In 2007, a record 14,811 units were sold, in what one analyst said was ‘the climax of the bull run in terms of sales volume’. CB Richard Ellis (CBRE), for example, said that it is likely that the whole year’s new home take-up will be around 12,000-14,000 units.

The trend, at least, looks set to continue in July. Analysts said that several other luxury units have also changed hands so far this month.

But others are more doubtful. DBS Vickers analyst Adrian Chua expects developers to sell just 9,000 new homes in 2009. That figure is itself an upgrade from his previous assumption of 6,000 units.

Colliers International’s director for research and advisory Tay Huey Ying noted that June’s record number of primary home sales is driven by pent-up demand from both owner- occupiers and investors, and was also helped by the fact that home prices remained largely at a discount from their peaks despite recent signs of strengthening. Official data shows that private home prices fell 14.1 per cent in Q1 2009 and another 5.9 per cent in Q2.

‘As the primary market is perceived to have bottomed, people have rushed in to buy ahead of sharp price increases and the Hungry Ghosts Month,’ Ms Tay said. ‘Nevertheless, buyer sentiment and buying momentum remain susceptible to downside risks as well as runaway home prices as buyers remain price-sensitive, given the lack of economic and income growth.’

But analysts are encouraged by two factors: firstly, the fact that the high-end market seems to be picking up. Colliers’ analysis showed that some 11 units were transacted at more than $2,500 per square foot (psf) in June, up from just three units in May. By contrast, no new homes were sold for more than $2,500 psf in the first four months of the year.

In addition, the $3,000 psf mark was breached as well. UOL managed to sell one unit at Nassim Park Residences at $3,813 psf, which is the high watermark price for the year so far. A unit in the Ritz-Carlton Residences was sold at $3,404 psf while another in The Orchard Residences was sold for $3,299 psf. In fact, seven units at The Orchard Residences were sold in the price range of $2,700-$3,299 psf.

The trend, at least, looks set to continue in July. Analysts said that several other luxury units have also changed hands so far this month.

And, secondly, some are optimistic as this rally is a bottom-led recovery, which analysts said should be more sustainable than the previous boom. The 2006-07 run-up was led by investment interest in the high-end segment.

‘This time, mass market projects (supported by the relative stability of the HDB resale market, which is still seeing limited supply) are driving the market bottom- up,’ said DBS Vickers’ Mr Chua. ‘Also, smaller units continue to be snapped up first, in contrast to the penthouses and larger units in the 2006-07 run-up. We believe the current run-up is still largely premised on affordability (with investment interest skewed towards rental yields) whereas the 2006-07 run-up was based on an investment interest premised on capital appreciation and the luxury scarcity factor.’

And there still appears to be support at the bottom. According to an analysis by Jones Lang LaSalle (JLL), the price gap between non-prime residential projects and HDB resale flats has come off from the peak of 67 per cent in 2007 to a low of 54 per cent in 2009. ‘In our opinion, the narrower price gap is a major factor behind the bullish sentiment, especially among HDB upgraders. As long as this gap remains tight, this stream of HDB upgraders into the private residential market is likely to continue,’ says Chua Yang Liang, JLL’s head of research for South-east Asia and Singapore.

Source : Business Times - 16 July 2009

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Meadows @ Pierce

Meadows @ Pierce at Upper Thomson Road
Name Of Project = Meadows @ Pierce ( former Green Meadows)
Address = 101 Tagore Avenue Singapore (787691)
District = District 26
Type of Property: Condominium / Apartment
Tenure = Freehold
Total Numbers Of Units = 479
Completion Year = 2015
Builder / Developer = UOL Development Pte Ltd

Meadows @ Pierce Unit Types Size :

1 bedroom = 517 sq ft ( 48 square meter )
1+1 bedrooms = 635 sq ft ( 59 square meter )
2 bedrooms = 915 - 1195 sq ft ( 85 - 111 square meter )
3 bedrooms = 1184 - 1518 sq ft ( 110 - 141 square meter )
3 bedrooms = 1195 sq ft ( 111 square meter )
4 bedrooms = 1625 - 2077 sq ft ( 151 - 193 square meter )
5 bedrooms = 2497 - 2680 sq ft ( 232 - 249 square meter )
Ground Maisonette = 2659 - 2702 sq ft ( 247 - 251 square meter )
Penthouse = 2045 - 3068 sq ft ( 190 - 285 square meter )

Meadows @ Pierce Facilities:

24×7 security
BBQ
Car park
Gymnasium
Playground
Swimming pool

Buy, Sell, Rent, Invest, In Singapore

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