Foreign banks offering more attractive home loans

Foreign banks offering more attractive home loans

By Jo-ann Huang | Posted: 17 March 2011

SINGAPORE : Foreign banks are turning up the heat in the mortgage loan war among banks.

They are now offering more attractive mortgage loan packages compared to their local counterparts.

Analysts said the foreign banks are leveraging on the low interest rate environment to increase their market share here.

However, they added that a rise in interest rates will likely cause these banks to quickly reverse their expansion efforts.

Home buyers are spoilt for choice when it comes to home loan rates.

Maybank, HSBC, ANZ and CIMB Bank are just some of the foreign banks offering the most attractive interest rates.

Most home loans here are pegged to the Singapore Interbank Offered Rate (SIBOR), which currently stands at 0.44 per cent.

Maybank, for instance, offers a SIBOR-pegged loan package with an additional 0.5 per cent interest for the first year of the loan. This translates to an interest rate of 0.94 per cent per annum.

HSBC has a SIBOR-loan package with an additional 0.9 per cent interest, giving a rate of 1.34 per cent per annum.

DBS’s SIBOR-loan package, by contrast, charges a premium of 1.25 per cent over SIBOR, which works out to 1.7 per cent in total interest.

All three banks are offering the loans with floating rates. Maybank’s and HSBC’s 3-month SIBOR home loans have tenures of two years.

Analysts said foreign banks are looking to expand their market share in Singapore.

Alfred Chan, director, Financial Institution, Fitch Ratings, said: “You can’t take Singapore out of the equation if you want to be an ASEAN or a regional player. To be a regional player, you have to build presence not just among the businesses but also the retail space.

“And probably through mortgages, they feel that they can enhance their presence in Singapore. And Singapore being a financial hub is being seen as a stop centre for many countries in the region.”

Experts said offering the most attractive home loans are the only way they can compete with local banks.

“The foreign banks have a much smaller market share than all the local banks. The local banks are more entrenched in the Singapore market, so most of them have majority market share,” said Dennis Ng, chief executive officer of www.HousingLoanSg.com.

“So for the foreign banks to actually compete with the local banks, they have no choice but to entice consumers or home buyers to switch to them by offering very attractive packages,” he added.

However, analysts said interest rates in Singapore are poised to rise due to healthy economic data from the US.

The SIBOR is pegged to US interest rates. With US unemployment reaching a two-year low at 8.9 per cent, experts said the cheap credit environment may soon be a thing of the past.

Mr Ng said: “Foreign banks do not have a very large deposit base to draw their Sing dollar funds from. So most of the foreign banks are net borrowers in the Singapore interbank market.

“So if the Singapore interbank or SIBOR goes up, it means that the foreign banks have to pay more to borrow from the interbank market, in order for them to offer home loans.”

He added: “This is the reason why when the SIBOR rate goes up, the foreign banks are affected more adversely than the Singapore banks, which have a large depository base they can borrow from.”

Despite moderating property sales, experts said the home loans market here should remain strong, adding that the refinancing segment in Singapore is worth S$100 billion.

- CNA/al

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Prime Orchard site put up for tender »« URA proposes property regulatory changes

URA proposes property regulatory changes

URA proposes property regulatory changes

By Ryan Huang | Posted: 16 March 2011

SINGAPORE: Seven key regulatory changes to the property sector have been proposed by the Urban Redevelopment Authority (URA) to make the industry more transparent and raise protection for property buyers.

This follows last week’s announcement in Parliament by Minister for National Development Mah Bow Tan, that moves would be taken to enhance the Housing Developers (Control & Licensing) Act (HDCLA) and the Housing Developers Rules (HDR).

This was to give property buyers better access to accurate and timely information about the market and units that they plan to buy.

The new changes being proposed include the need for showflats to depict actual units accurately.

This means the floor area of the showflat must be the same as the actual unit, and all external and structural walls must be erected.

Also, among the proposals is the requirement for developers to provide more mandatory information.

This includes the estimated land area for a property, a drawn-to-scale location plan, and specifications such as the type of finishing.

The URA said this would help property buyers make more informed decisions.

Developers will also be required to make available the price list of units at least two days before a project is launched for sale.

Other information that will be necessary for developers to provide is their track record, with details on at least one completed project.

New developers who have not completed any project will have to indicate their lack of track record.

These changes were worked out in consultation with the Real Estate Developers Association of Singapore (REDAS).

Mr Wong Heang Fine, president of REDAS, said: “REDAS supports the government’s efforts to take steps to help purchasers make more informed decisions.

“As a body representative of a large community of property developers, REDAS is committed to continually promote good practices and professionalism among developers to deliver better and higher quality homes for all”.

The proposals are open for public feedback from Thursday until April 18, 2011 on the URA website.

The final changes to the HDCLA and HDR will take effect by the third quarter of this year.

-CNA/wk

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Foreign banks offering more attractive home loans »« Three properties launched for collective sale

Three properties launched for collective sale

Three properties launched for collective sale

By Jo-ann Huang | Posted: 16 March 2011

SINGAPORE : Three properties in Newton, Braddell and Bukit Timah were launched for collective sale on Wednesday.

Freehold apartment Newton Lodge at 41 Newton Road has a reserve price of S$40 million and a development charge of S$2.18 million.

That is according to CB Richard Ellis, the marketing agent for the site.

The price translates to S$1,407 per-square-foot-per-plot-ratio (psf ppr) for the 16-unit, 21,409-square-foot apartment with a plot ratio of 1.4.

If a developer maximises the bonus 10 per cent balcony space, the price works out to be S$1,340 psf ppr, with a breakeven price of S$1,860 psf.

Newton Lodge is 300 metres away from Novena MRT Station, and is well served by a number of shopping malls and medical centres.

CB Richard Ellis said some boutique developers and high-net-worth investors have already expressed interest in the site.

The tender for Newton Lodge closes at 3pm on April 30.

Meanwhile, apartment developments Braddell Park and Coronation Grove are also going enbloc.

That is according to their marketing agent Credo Real Estate.

Braddell Park is a 45-unit apartment complex off Braddell Road and Upper Serangoon Road. Credo is expecting offers of S$90 million to S$100 million for the site.

This translates to a land rate of approximately S$674 to S$746 psf ppr for redevelopment up to a gross plot ratio of 1.4.

Braddell Park, which is 350 metres away from Woodleigh Station, has a land area of 91,360 square feet. And with the sale of an adjoining piece of state land of 6,540 square feet, the total size of available land adds up to about 97,900 square feet.

With a total gross floor area of 150,766 square feet, the site may be redeveloped into 145 apartment units with an average size of 1,000 square feet.

As for Bukit Timah property Coronation Grove, the marketing agent expects offers of S$86 million to S$90 million for the 45-unit, 62,011-square-foot property.

This translates to SS$1,387 psf to S$1,451 psf over the land area.

The site is zoned for three-storey semi-detached houses, which could be developed into 28 strata semi-detached houses or 11 bungalows.

Coronation Grove is easily accessible by Farrer Park MRT Station and Tan Kah Kee Station, and is a short distance from shopping malls like Coronation Shopping Plaza.

Both Braddell Park and Coronation Grove were built in the 1980s.

The tender for Braddell Park closes on 14 April 2011 at 2.30 pm, while the tender for Coronation Grove closes on 18 April at 2.30 pm.

- CNA/ms

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

URA proposes property regulatory changes »« HDB receives 9 bids for Sengkang site

HDB receives 9 bids for Sengkang site

HDB receives 9 bids for Sengkang site

By Jonathan Peeris | Posted: 15 March 2011

SINGAPORE : The Housing and Development Board (HDB) has received nine bids for a residential site at Sengkang Square/Compassvale Road at the close of tender on Tuesday.

The highest bid came from Keppel Land Realty at S$286.8 million. This translates to about S$502 per square foot per plot ratio.

The next highest bid of S$274.3 million was submitted by joint bidders Sunmaster Holdings, Garden Estates and TID Residential.

The 99-year leasehold land parcel has a site area of 17,700 square metres and a maximum gross floor area of 53,100 square metres.

Executive director of CBRE Research, Li Hiaw Ho, said he expects the new residential project on the site to be able to fetch around S$1,000 per square foot.

He added that a ready pool of upgraders in Sengkang, Hougang and Punggol new towns will be attracted to the project.

A similar development, H2O Residences at Fernvale Link, was recently launched, with more than 200 units sold over two weekends.

The Sengkang Square site was launched for public tender on January 21 and is slated for a condominium housing development with some 530 dwelling units.

HDB said it will evaluate the bids and announce the final results within the next two weeks.

- CNA/al

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Three properties launched for collective sale »« HDB to launch tender for Pasir Ris DBSS site

HDB to launch tender for Pasir Ris DBSS site

HDB to launch tender for Pasir Ris DBSS site

By Jonathan Peeris

SINGAPORE : The Housing and Development Board (HDB) is launching the tender for sale of a residential land at Pasir Ris Central under the Design, Build and Sell Scheme (DBSS).

The tender, which will be launched on March 16, will close at noon on May 31.

The 16,388-square-metre site has a maximum allowable gross floor area of over 45,800 square metres.

HDB estimates that 460 dwelling units can be built on the site, which is located near the Pasir Ris MRT station and bus interchange.

The lease is for 103 years, including a 48-month construction period.

So far this year, HDB has sold one DBSS land parcel in Clementi town with an estimated yield of 770 units.

Other than the current site, another two DBSS sites will be launched for tender within the next few months.

One land parcel is at Fernvale Link, which can yield 790 units, and the other is at Bendeemer Road, where about 700 units can be built.

HDB plans to launch enough sites for 4,000 or more DBSS flats this year, provided there is sustained demand.

- CNA/al

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

HDB receives 9 bids for Sengkang site »« Site at Jurong Lake District to be released for sale by public tender

Site at Jurong Lake District to be released for sale by public tender

Site at Jurong Lake District to be released for sale by public tender

Posted: 15 March 2011

SINGAPORE: A white site at Jurong Lake District will be released for sale by public tender in two weeks time.

The Urban Redevelopment Authority (URA) said the land parcel was made available for sale through the Reserve List System in October 2010.

The sale process was triggered when the URA received an application from a developer to put up the land parcel for tender.

The unnamed developer has committed to bid at a price of not less than S$510 million for the land parcel.

According to URA, the 1.8 hectares land parcel located along Boon Lay Way is next to the Jurong East MRT station and is suitable for mixed-use development.

URA said a minimum 40 per cent of the maximum permissible gross floor area of nearly 99,000 square metres is to be set aside for office use, while the remaining area may be developed for additional office use or other uses, such as commercial, hotel, and residential.

The site is also the second land parcel to be released for sale at Jurong Gateway.

URA will announce the exact launch date later, while the tender period for the land parcel will be about eight weeks.

-CNA/ac

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

HDB to launch tender for Pasir Ris DBSS site »« MINISTRY WILL REVIEW SPECIAL EMPLOYMENT CREDIT SCHEME

MINISTRY WILL REVIEW SPECIAL EMPLOYMENT CREDIT SCHEME

MINISTRY WILL REVIEW SPECIAL EMPLOYMENT CREDIT SCHEME

by Cheow Xin Yi

SINGAPORE – The Ministry of Manpower (MOM) will review the implementation of the Special Employment Credit – which provides incentives for employers to hire older workers – to consider if the one-off scheme should be extended.

Members of Parliament have urged that the new scheme, which gives employers up to S$420 a year for each qualifying employee aged 55 and older, to be made a permanent fixture.

They, like Jurong GRC MP Halimah Yacob, are concerned that the Government’s good intentions will be wiped out after three years when the scheme ends.

She asked yesterday: “Doesn’t the ministry want to give a strong signal to employers that it cares about the long-term employment of older workers?”

But Senior Parliamentary Secretary (Manpower) Hawazi Daipi said MOM preferred to give the scheme the opportunity to progress and to monitor any teething problems. “We may need to improve on the programmes we have just rolled out,” he added.

Mdm Halimah also asked if MOM could do away with the 5- to 10-per-cent co-payment required of low-wage workers who go for training under the Workfare Training Support (WTS) scheme.

While she acknowledged the need for workers to assume personal responsibility for training – as pointed out by Mr Hawazi – Mdm Halimah said some workers might not even have the cash.

When it was suggested that those in difficulty can ask for financial assistance, she argued that they would prefer not to be treated as social assistance cases. “That itself might become a deterrent,” she said.

In reply, Manpower Minister Gan Kim Yong said his ministry will help workers access training programmes on a case-by-case basis, so long as they are “responsible for the outcome of the training”.

In an update, MOM disclosed that as of last month, more than 34,000 low-wage workers have benefited from the WTS since it was rolled out in July.

Source : TODAYonline – MediaCorp Press Ltd’s copyright

Site at Jurong Lake District to be released for sale by public tender »« LARGEST EN BLOC SITE’ PINE GROVE PUT UP FOR SALE

LARGEST EN BLOC SITE’ PINE GROVE PUT UP FOR SALE

LARGEST EN BLOC SITE’ PINE GROVE PUT UP FOR SALE

by Millet Enriquez

SINGAPORE – The 660-unit Pine Grove near Holland Village has been called by its marketing agent Jones Lang LaSalle “the largest en bloc site” for sale by tender.

The site – measuring 893,219 sq ft and zoned for residential use, has a plot ratio of 2.1. It can be redeveloped into a residential project of up to 24-storeys with a gross floor area of nearly 1.88 million sq ft – subject to the approval by the relevant authorities and the payment of a differential premium. That translates to some 1,500 apartment units with sizes of about 1,200 sq ft.

Jones Lang did not give an indicative price for the site when it announced the tender yesterday but a Channel NewsAsia report in November estimated the reserve price at S$1.7 billion.

Mr Nicholas Mak, executive director of research at SLP International, said developers might find the Pine Grove tender daunting, given the hefty investment required and the differential premium to refresh the 99-year lease.

Ms Christina Sim, director of Investment for Cushman & Wakefield, said: “It’s a bit too rich for anybody to buy.” She estimates Pine Grove’s per square foot per plot ratio to likely exceed S$1,300, with the breakeven for the developer at around S$1,700.

Developers may buy the site for landbanking as it will take a long time to completely sell 1,500 apartments, some analysts said.

“Although prices have been creeping up, the sales volumes have not been as good (in the high-end segment),” said Mr Colin Tan, head of research and consultancy at Chesterton Suntec International. “Whoever will bid for this site now is taking a gamble. If they guess right, the rewards are great, if not, it will prove very costly.”

The tender will close on April 19.

Source : TODAYonline – MediaCorp Press Ltd’s copyright

MINISTRY WILL REVIEW SPECIAL EMPLOYMENT CREDIT SCHEME »« THIRD BITE OF THE HDB CHERRY, FOR THOSE CAUGHT IN THE MIDDLE?

THIRD BITE OF THE HDB CHERRY, FOR THOSE CAUGHT IN THE MIDDLE?

THIRD BITE OF THE HDB CHERRY, FOR THOSE CAUGHT IN THE MIDDLE?

by Esther Ng

SINGAPORE – The waiting time for rental flats has been shortened from 21 to eight months. But for households which fall through the cracks, could more be done to help them own a flat, asked Members of Parliament yesterday.

Such households include those too poor to buy an HDB flat but who earn too much to qualify for rental housing, or those who sold off their flats and no longer qualify for subsidised loans.

Madam Ho Geok Choo (West Coast GRC) and Dr Ahmad Magad (Pasir Ris-Punggol GRC) called on the Government to offer this group of households a “third bite of the cherry” – subsidised loans tied to a longer minimum occupation period (MOP) of 10 years before they can sell their flats.

Mdm Ho proposed that the HDB shorten the debarment period on rental housing for these households, while Dr Ahmad said these households could sell their “third flat” back to the HDB at the “original purchase price”, or at the “price determined by HDB” if they were to sell their flat within the MOP.

In his response, National Development Minister Mah Bow Tan said: “Families must also exercise personal responsibility when they decide to sell their flat.”

For those who are ineligible for rental flats, the HDB can refer them to interim rental housing, he added.

Mr Cedric Foo (West Coast GRC) proposed that a higher Special Housing CPF Grant (SHG) be given to those households who are prepared to fulfil a longer MOP.

Mr Mah said the Government will take it into consideration when it reviews the SHG. The SHG is a new initiative to help low-income families buy their first flat. This grant will range from S$5,000 to S$20,000 for families with household incomes up to S$2,250.

However, Mr Mah said: “Housing grants alone are not a panacea for all problems faced by low-income families.” ESTHER NG

Source : TODAYonline – MediaCorp Press Ltd’s copyright

LARGEST EN BLOC SITE’ PINE GROVE PUT UP FOR SALE »« MORE HDB FLATS TO GET HIP

MORE HDB FLATS TO GET HIP

MORE HDB FLATS TO GET HIP

by Esther Ng

SINGAPORE – Enhancing the living environment of Singapore homes will get an accelerated boost.

Minister for National Development Mah Bow Tan announced in Parliament yesterday that the Government will double the number of projects selected for the Home Improvement Programme (HIP) as another major programme, the Lift Upgrading Programme (LUP), tails off.

Responding to Members of Parliament who had asked for an update on the progress of upgrading programmes and whether seniors would have to wait a long time for elderly-friendly improvements to their flats, Mr Mah said the Government would be “increasing” the pace for HIP which replaced the earlier Main Upgrading Programme.

It has already doubled the number of projects selected for the Neighbourhood Renewal Programme – which provides new community facilities for residents – and HIP from 7 to 14 per cent over the last two years.

The number of projects selected will be increased to 28 next year and further increased to 35 projects annually by 2014.

“These are very large programmes, and their pace depends on the financial resources available,” said Mr Mah.

Over the next five years, the Government will offer HIP to 60 per cent of eligible precincts remaining after this year’s selection.

About 160,000 more households, including the elderly, will benefit from HIP.

Said Mr Mah: “If we continue at this pace and if the budget is available, we should be able to finish offering HIP to all eligible precincts in 10 years or so.”

Giving a stock take on the LUP, Mr Mah said since it was launched a decade ago, 4,900, or 96 per cent, of Housing and Development Board (HDB) blocks have been fitted with lifts that stop at every floor, benefitting Singaporeans, especially the elderly. The initial target set in 2001 was 4,400 blocks.

Mr Mah said the Government is on track to complete the LUP for all eligible blocks by 2014 and the final batch of precincts will be selected this year.

Dr Lim Wee Kiak (Sembawang GRC), Ms Jessica Tan (East Coast GRC) and Nominated MP Paulin Straughan wanted to know what the Government was doing to support a growing population and yet preserve a good quality of life for Singaporeans.

Mr Mah said the Government will intensify the use of existing land, expand Singapore’s rail and road network and create new HDB towns.

“We’ll be injecting more housing units across the island, especially in the Central and West areas to improve the job-worker distribution,” he said.

To catalyse the growth of Jurong Lake District, the Ministry of National Development, the Agri-Food & Veterinary Authority and the Building & Construction Authority will relocate to the area as the anchor tenant in Lend Lease’s development at Jurong Gateway Road.

It is part of a master programme – Remaking Our Heartlands – which aims to rejuvenate Singapore’s town and neighbourhood centres. The initiatives include the building of mixed developments of commercial and residential, expanded outdoor recreational spaces for residents, and upgrading of homes.

Source : TODAYonline – MediaCorp Press Ltd’s copyright

THIRD BITE OF THE HDB CHERRY, FOR THOSE CAUGHT IN THE MIDDLE? »« MORE HELP FOR LOW-INCOME FAMILIES TO BUY THEIR FIRST FLAT