$8k cap stays; offer of more exec condos

$8k cap stays; offer of more exec condos

THE $8,000 household income ceiling for public housing benefits will stay, despite growing calls for a review.

However, the Government will be offering more executive condominiums (ECs) to address the needs of middle-income buyers in the $8,000 to $10,000 monthly income bracket.

The moves were announced by National Development Minister Mah Bow Tan yesterday.

The initiative to offer more ECs will allow those earning between $8,000 and $10,000 a month to take advantage of government grants and buy a home suitable for their budget, he said.

ECs are built with condo facilities but have sale restrictions similar to those for public housing.

They were introduced in 1995 to bridge the gap between public housing and private apartments. First-time buyers whose incomes are under $10,000 can apply for a $30,000 grant.

‘We are going to put up more executive condominiums for sale. We will probably be launching some fairly soon,’ said Mr Mah.

As for the current income ceiling, $8,000 is ‘a very high income ceiling and we’ve reviewed it regularly’, he said. ‘We need to maintain a certain level of subsidy, a certain cut-off (point).’

Currently, households earning below $8,000 monthly can apply to HDB directly for a new flat at subsidised prices, or apply for a housing grant if they purchase an HDB flat.

Mr Mah noted the concern that those earning above $8,000 may not be able to afford private housing, yet they are blocked from buying new HDB flats.

‘So this is a concern we will address through the provision of more ECs,’ he said.

JESSICA CHEAM

Source : Straits Times - 02 October 2009

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HDB ramping up supply of flats

HDB ramping up supply of flats

7,000 units will be released over the next three months

By Jessica Cheam

The Nautilus@Punggol (left) is a development of build-to-order HDB flats. Flat supply under the build-to-order scheme for the year will be ramped up to 9,000 from about 8,000 announced previously. About 5,000 units will be launched for sale in various areas, including Punggol. — PHOTO: HDB

THE Housing Board will unleash about 7,000 flats onto the market over the next three months in an aggressive step to tackle rising concerns over supply and affordability.

The 7,000 homes exceed the 6,450 units released for first nine months of this year.

They also include 2,132 units in 24 estates across the island that have just been finished, or are near completion. They were launched yesterday in what was the Housing Board’s single largest sales exercise in recent times.

National Development Minister Mah Bow Tan announced the move yesterday, on a day when new figures showed that HDB resale flat prices rose 3.2 per cent in the third quarter over the second quarter to reach another record high.

The price surge follows an increase of 1.4 per cent in the second quarter over the first three months of the year.

Mr Mah told the media yesterday: ‘I want to assure everybody that there are sufficient flats available across the board for every budget.’

The high demand for housing, reflected in the price rises in yesterday’s flash estimates, is likely behind HDB’s move to lift housing stock.

Industry analysts say the steps to boost supply should have an impact on resale flat prices.

‘COV levels will likely dip due to the immediate addition of these flats,’ said PropNex chief Mohamed Ismail.

COV refers to ‘cash over valuation’ - the cash a buyer pays over and above a flat’s valuation.

But Ngee Ann Polytechnic real estate lecturer Nicholas Mak says a dip in COV levels is unlikely to be sustained if the buying momentum continues.

‘It will slow down the pace of price increase only temporarily. In the past three years, an average of about 3,200 resale flats were transacted each quarter, which is about 50per cent more than the 2,132 flats offered for sale,’ he said.

HDB’s move to increase supply comes amid growing discontent among buyers priced out of the market by high demand and limited supply.

HDB resale prices have risen by a hefty 31.2 per cent in the past two years.

An online petition to Mr Mah started circulating last month to collect 1,000 signatures calling for lower flat valuations and more affordable homes.

As of last night, it had received 1,079 names.

The minister added yesterday: ‘The Government has made a commitment to provide our people with quality, affordable housing.

‘This is a commitment that we will keep… and if there is a necessity, we will step up the building programme even further.’

The new flats earmarked for the rest of the year are being released under two main schemes.

Flat supply under the build-to-order (BTO) scheme for the year will be ramped up to 9,000 from about 8,000 announced previously.

About 5,000 units under the BTO programme will be launched for sale in Punggol, Sengkang, Jurong West, Sembawang, Bukit Panjang and Dawson.

The highly-anticipated 1,700 flats by award-winning architects at Dawson estate in Queenstown, which were to have been launched last month, will now be released in December, said HDB.

The Housing Board also unveiled a new scheme called Sales of Balance Flats (SBF), which will replace the existing balloting, quarterly sales and half-yearly sales exercises.

It offers flats from earlier BTO exercises, the Selective En-bloc Redevelopment Scheme and repurchased flats and will be launched as and when sufficient flats accumulate, said HDB.

The aim is to simplify the flat application process and provide buyers with a wider choice of flats across a range of locations in one exercise.

The 2,132 flats launched yesterday fall under this new scheme. They range from studio apartments to executive flats, priced from $97,000 to $643,000.

Analysts are expecting a rush, especially as the prices of three-, four-, and five-roomers are about half of their respective resale prices, noted Mr Mak.

Home buyer Lynn Koh, 28, is one person preparing to apply.

‘COV has risen in Whampoa, where my parents live, so I hope to be successful,’ she said.

As of 5pm yesterday, HDB had received 2,038 applications for the 2,132 flats. Applications close on Oct 14.

A COMMITMENT TO PROVIDE AFFORDABLE HOMES

‘The Government has made a commitment to provide our people with quality, affordable housing. This is a commitment that we will keep… and if there is a necessity, we will step up the building programme even further.’

National Development Minister Mah Bow Tan

Source : Straits Times - 02 October 2009

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More new HDB flats as resale prices climb

More new HDB flats as resale prices climb

HDB resale prices are now at their highest level ever

By UMA SHANKARI

(SINGAPORE) The Housing and Development Board (HDB) is stepping up its supply of new flats to meet increased demand for public housing. The news came as flash estimates showed that prices of resale HDB flats rose 3.2 per cent in Q3.

The price increase comes after a 1.4 per cent rebound in Q2 following a marginal drop of 0.8 per cent in Q1. This means HDB resale prices are now at their highest level ever. The previous two peaks were in Q4 2008 and Q4 1996.

Analysts attributed the growth to the greater demand for resale flats in recent months.

Observed Eugene Lim, associate director for ERA Asia Pacific: ‘The surge in demand for HDB resale flats and the consequent rise in prices have been fuelled by a mix of upgraders, downgraders and the increasing population of permanent residents.’

There is also a ‘trickle-down’ effect from the growth in private property prices, which climbed 15.9 per cent in Q3.

Potential home-buyers can look forward to another 5,000 new BTO flats over the next three months in various locations. This translates to an average of 1,500 new flats monthly, with at least two BTO project launches each month.

But plans to boost the supply of new flats could mean that the price increase in the resale price index could see some moderation in future, said Minister for National Development Mah Bow Tan, who announced HDB’s plans yesterday.

With the good response to recent build-to-order (BTO) launches, HDB will increase its supply of BTO flats from the 8,000 units previously planned for this year to 9,000 units instead. HDB launched 3,945 BTO flats from Jan to Aug 2009.

Now, potential home-buyers can look forward to another 5,000 new BTO flats over the next three months in various locations. This translates to an average of 1,500 new flats monthly, with at least two BTO project launches each month.

In addition, HDB also launched an exercise yesterday to sell leftover units from previous sales exercises. Under this scheme, 2,132 ‘balance flats’ will be offered for sale. HDB expects these flats to be especially popular as most of them are either completed or close to completion, and a large chunk of them are in mature estates.

The new supply could take some pressure off the resale market, market watchers said.

‘The grouses of many first-timers will be soothed as the introduction of these flats should, at least temporarily, ease the demand of resale flats,’ said PropNex chief executive Mohamed Ismail.

Mr Ismail expects cash-over-valuation (COV) levels to dip slightly due to the immediate addition of the 2,132 balance flats to the market, and feels that this will actually encourage sustainable long-term growth of the HDB resale price index.

However, the increase in the supply of new HDB flats under the BTO scheme may not have the immediate effect of slowing down the price increase of resale flats because these flats would not be available immediately, said Ngee Ann Polytechnic real estate lecturer Nicholas Mak.

Transaction volumes and resale prices are expected to continue climbing in Q4.

ERA, which said it has a 45 per cent market share of the HDB resale market, observed that its transaction volume continued to increase by some 10 per cent in Q3, after surging by 52 per cent in Q2 over Q1.

‘With the current market momentum likely to follow through till year-end, we are likely to see a similar price increase of 2-3 per cent for the last quarter.

For the whole year, HDB resale prices would probably have increased by 7-8 per cent,’ said ERA’s Mr Lim.

Mr Mak likewise said that for the whole of 2009, average HDB resale flat prices could increase by 5-9 per cent year-on-year as demand is still expected to remain healthy.

Source : Business Times - 02 October 2009

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Numbers confirm bounce in property’s step

Numbers confirm bounce in property’s step

15.9% q-o-q jump in Q3 could mark the end of one of the shortest downcycles ever

By KALPANA RASHIWALA

(SINGAPORE) Property cycles seem to be getting shorter and with sharper price swings, mirroring the trend in general economic cycles. In one of the quickest upturns in recent years, the official private home price index jumped 15.9 per cent quarter-on-quarter (q-o-q) in Q3 this year. The four quarters of price drops that preceded this mark the shortest downcycle in the past 18 years - assuming, of course, that prices do not decline in coming quarters.

The increase in Urban Redevelopment Authority’s (URA) flash estimate of its Q3 2009 private home price index was the biggest change since a 27.2 per cent increase in the index in Q1 1981.

Jones Lang LaSalle also pointed out that the turn in the index - from a 4.7 per cent q-o-q contraction registered in second quarter this year to the 15.9 per cent jump in Q3 - was the sharpest since the series began in 1975.

The unprecedented loss of confidence last year from the global financial crash and the collapse of Lehman Brothers led to the unwinding of risky investments. By Q1, investors were awash with liquidity and looking for a trusty place to park their funds. ‘Singapore real estate certainly fits the bill as a safe depository of wealth,’ observes Real Estate Developers Association of Singapore CEO Steven Choo.

Also, the wealth accumulated by Singapore households - from en bloc sales, savings stashed away from wage rises and bonuses from earlier years and from the surge in the stock market after its March bottom - soon made its way into the property market as investors developed a strong dislike for structured products after the Lehman minibonds fiasco. The low interest rate environment and price cuts by developers in the first quarter also helped to draw property buyers from the sidelines.

URA’s flash estimates yesterday also showed that price indices of non-landed private homes in the three geographical regions also posted the biggest gains since Singapore’s planning authority started releasing these sub-indices in 2004.

In the Core Central Region - which covers the prime districts, CBD and Sentosa Cove - the index jumped 16.2 per cent q-o-q in Q3. The surge was even higher, at 19.1 per cent in the Rest of Central Region (RCR). The index for Outside Central Region, which covers typical mass-marketing housing locations, also rose 15.4 per cent in Q3. In contrast, respective indices for the regions had posted q-o-q declines of 5.2 per cent, 4.4 per cent and 2.3 per cent in Q2.

CB Richard Ellis executive director Li Hiaw Ho said new projects in RCR that sold well in Q3 and contributed to the steep rise in the price index for the region were Vista Residences in the Balestier area, Parc Imperial in Pasir Panjang, Ascentia Sky on Alexandra Road and Trevista in Toa Payoh.

Putting the latest numbers in perspective, property consultancy Knight Frank chairman Tan Tiong Cheng notes that the sharp jump in URA’s Q3 headline private home price index probably reflects some ‘catching-up effect’ after the index posted a surprising decline in Q2 of 4.7 per cent. ‘The Q2 drop had confounded property analysts, developers and the buying public as they had seen substantial price increases in Q2 over the preceding quarter. Major property consultants’ data showed price gains in Q2 ranging from 10 to 20 per cent for new launches and an average price increase of about 5 per cent for secondary-market transactions,’ Mr Tan recalled.

However, the latest index levels captured in URA’s Q3 flash estimates are more in sync with consultants’ indices and average price computations than they were for Q2, analysts say.

The strong price gains shown in URA’s flash estimates reflect the kind of market exuberance that led the government to announce measures last month to cool the market - including banning the interest absorption scheme and promising to restart state land sales in the confirmed list in first-half 2010.

DTZ’s SE Asia research head Chua Chor Hoon noted that the pick-up in private home sales and prices that began in the mass-market segment in Q2 soon spread to the mid-market, then to prime districts and even landed market.

Initially, the buying was led by owner-occupiers and investors but speculators soon made their presence felt.

Just how strongly sentiment-driven the property market had become is also reflected in DTZ’s analysis which showed that in Q2 this year, there was no time lag between the benchmark Straits Times Index and DTZ’s average price for prime-district freehold condos. Typically the STI leads the physical property market by three to six months.

Property consultants reckon the house-buying frenzy seen in Q3 has probably peaked and that sales will moderate over the next three to six months. However, prices are not likely to slide unless a ‘double dip’ manifests in the economy, they suggest.

DTZ’s Ms Chua is forecasting a 0 to 5 per cent price increase generally. Colliers International’s director Tay Huey Ying predicts a 5 to 10 per cent q-o-q rise in URA’s overall private home price index in Q4.

Source : Business Times - 02 October 2009

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7,000 HDB flats to be made available in next three months

7,000 HDB flats to be made available in next three months

By Hoe Yeen Nie

SINGAPORE : The Housing and Development Board (HDB) will release 7,000 new flats in the next three months, to cope with strong market demand.

This is more than that offered in the first nine months of the year.

From now to December, the HDB will launch 5,000 new flats for sale under its Build-to-Order (BTO) scheme.

These will be in both new and mature towns, including 1,700 units in Dawson estate in Queenstown.

The Dawson developments will be part of the HDB’s Remaking Our Heartlands programme.

This is the second time this year that authorities are bumping up the supply of new flats, and the move should please some first-time homebuyers.

In July, National Development Minister Mah Bow Tan announced that the HDB will build 8,000 flats this year, up from the original target of 6,000. But speaking to reporters on Thursday, he said continued strong demand from homebuyers in July and August has prompted his ministry to revise its target upwards once more.

One homebuyer said: “We have been searching for a flat for more than one year already….now (that) HDB is getting more flats, I think it is better, because we can stand a better chance.”

Eugene Lim, associate director, ERA Asia Pacific, said: “The HDB is also responding to market feedback in the sense that there were concerns amongst many people that, ‘you are releasing new flats but they are all in the same location….so where else are you releasing new flats?’”

The move comes as resale prices for HDB flats hit an all-time high.

HDB flash estimates for the Resale Price Index for the third quarter of 2009 placed the figure at 144.7, based on 1998 prices.

Although higher resale prices are unlikely to affect the demand for new HDB homes as that market is mostly closed off to resale buyers, analysts caution that new HDB units could see higher prices as a result.

This is because the HDB prices new flats based on resale prices for similar units nearby. However how much increase homebuyers will see depends on the location of the new BTO projects.

The government said prices are monitored closely, but buyers have to lower their expectations too.

HDB figures also show that average prices for new flats under the BTO programme range from S$150,000 for a three-room unit, to S$330,000 for a five-room flat. The average household income for applicants of five-room flats is S$4,800, which HDB says is well within the S$8,000 ceiling for first-timer subsidies.

Mr Mah said: “A flat that is in a place of their choice, a specific flat is not affordable, that I grant. But there are other flats that are affordable. So the question is, can the government assure people that a flat of your choice is available, that is the difficult part.”

Another option for homebuyers is to consider what is known as balance flats.

Previously, all unsold new flats would be regularly offered to the market in separate sittings depending on the flat type. Now however, they would be sold under one combined exercise, and only when HDB has accumulated enough to sell.

As many of these flats are located in popular areas, one may expect demand to be very high. But authorities said that nine in 10 would be reserved for first-time buyers.

But some feel that the flats would not be good enough.

One homebuyer said: “As a first-time homebuyer, I won’t look at balance flats, because they are (on) low floors, bad location. That is why they are leftovers which people did not want in the first place.”

A total of 2,132 units will be on offer in October. - CNA/yb/ms

Source : Channel NewsAsia - 02 October 2009

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Marina Bay Sands lifts first piece of SkyPark in the air

Marina Bay Sands lifts first piece of SkyPark in the air

By Gladys Ow

SINGAPORE: The first bridge of the Marina Bay Sands SkyPark was lifted 200 metres above ground on Thursday, and put in place between two of the three 55-storey hotel towers of the integrated resort.

Being among the highest heavy lifting operations ever done in the world, it took up to 24 hours to lift each piece to the top and slide it into place - as wind conditions can affect the process.

Additional cables were used and a detailed analysis was done to minimise swinging during lifting.

Over the next three months, 13 similar steel structures will be hoisted 200 metres above the ground.

The 7,000-tonne SkyPark will be big enough to hold four A380 jumbo jets. It will also house a public observation deck, landscaped gardens, outdoor pools and restaurants.

- CNA/sc

Source : Channel NewsAsia - 02 October 2009

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Integration of Kallang River area and Bishan Park in 2011

Integration of Kallang River area and Bishan Park in 2011

By Lynda Hong

SINGAPORE: The Kallang River area bordering Bishan Park will be widened and converted into a meandering river to integrate with the park in 2011.

The move is all part of the PUB’s ABC Waters Programme for ‘Active, Beautiful, Clean Waters’.

Under the programme, the Kallang River will be developed and serve as an attraction where recreational and communal bonding activities can take place.

Besides transforming the Kallang River, the programme will also see the addition of a River Promenade for events and three new playgrounds. - CNA/de

Source : Channel NewsAsia - 02 October 2009

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Private home prices rise 16% in Q3 flash estimates

Private home prices rise 16% in Q3 flash estimates

By Ng Baoying

SINGAPORE : Singapore private property prices in the third quarter saw the steepest quarter-on-quarter increase since 1981.

The Urban Redevelopment Authority’s (URA) flash estimates showed private home prices rose 15.9 per cent in the third quarter - a sharp turnaround from the 4.7 per cent fall in the second quarter, and snapping four straight quarters of decline.

Overall, prices are back to where they were at the start of the year. And analysts said the data affirms the generally positive mood among buyers.

Brisk home sales in recent months, especially for units above S$2,000 per square foot, have seen overall prices recording their highest turnaround on record, since the data was first collected in 1975.

Analysts said it is mainly sentiment that is driving higher the demand and price increases.

Elaborating on the factors, Donald Han, managing director, Cushman & Wakefield, said: “In general, the feel good factor, the convergence of a few positive factors, particularly the stock market turnaround - we saw the green shoots come out from some economic indicators.

“Globally, we did not see any fallout of any major financial institutions. No bad news, is good news. Plus, on top of that, very low interest rates, conducive for bank borrowings.”

Homes in locations just outside the central region saw the highest price increase, at 19.1 per cent. Analysts said this is because most of the new launches were near major activity spots and train stations, which command price premiums.

In the core central region, prices went up 16.2 per cent, while prices climbed the least in the suburbs, up 15.4 per cent.

Going forward, analysts said price growth is unlikely to be sustained, in part because the full impact of government measures announced earlier this quarter will be felt in the fourth quarter.

Mr Han said: “If you’ve asked me the same question one, two months ago, I think the price increase of 15 per cent on a per quarter basis is unrealistic. To expect the momentum to go through 15 per cent, double-digit, I think that is not realistic as well because that is out of pace with economic growth.”

He noted that the global economy is only just beginning to pull itself out of a recession.

Meanwhile, public housing prices are also at a high. The Housing and Development Board’s Resale Price Index registered an all-time high in the third quarter.

According to flash estimates, the index is now at 144.7, which means resale flats cost nearly 45 per cent more than a decade ago. - CNA/yb/ms

Source : Channel NewsAsia - 02 October 2009

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