Private home market should be left to market forces: REDAS

Private home market should be left to market forces: REDAS

by Linette Lim 04:46 AM Jul 29, 2011

SINGAPORE – Given that the private housing market accounts for only 15 per cent of the overall market, the prices of private homes should be left to market forces without government intervention, said Real Estate Developers’ Association of Singapore (REDAS) president Wong Heang Fine.

REDAS – which has taken issue with Government intervention in the residential sector before – said it supports the Government’s aim to ensure a healthy property market, but property prices should move in line with economic growth, to avoid negative spillover effects on other sectors of the economy.

Instead of intervention, a more transparent market could be developed, said Mr Wong, who was speaking at the annual REDAS property prospects update seminar.

“I think URA (Urban Redevelopment Authority) is also going to adopt a more transparent stand. I think in the latter half of this year, developers will have to file some of those information quite readily,” said Mr Wong, who is also chief executive officer of CapitaLand Residential.

Information on the property market is also available to the public through National Development Minister Khaw Boon Wan’s blog but Mr Wong advised caution when interpreting property data: “I think the concern is really people are reading (between) the lines so much, and misinterpreting what the minister’s intention is.”

While REDAS sees demand as “quite strong”, with around a thousand units sold each month, developers are not too upbeat on the prospects of the suburban residential market, according to the Real Estate Sentiment Index that has been developed by REDAS and the National University of Singapore, given the greater supply of housing coming up and the number of unsold units in the market. LINETTE LIM

Source : TODAYonline – MediaCorp Press Ltd’s copyright

Bank lending up, home loans robust »« MAS revises inflation forecast upwards

MAS revises inflation forecast upwards

MAS revises inflation forecast upwards

Higher COE and housing prices prompt move, which economists say was within expectations

by Teo Xuanwei 04:46 AM Jul 22, 2011

SINGAPORE – Higher property prices, rentals and car prices are among the factors that have prompted the Monetary Authority of Singapore (MAS) to revise its inflation forecast for this year to between 4 and 5 per cent, up from between 3 and 4 per cent.

In its annual report released yesterday, the MAS noted that the “tight labour market will continue to exert upward pressure on costs and prices, while global oil and food prices are likely to remain firm given supply shocks and strong demand as the global economy slowly recovers”.

And amid the global inflationary pressures, significant risks in the global economy and financial systems could derail growth, MAS managing director Ravi Menon cautioned at a press conference.

The MAS and the Ministry of Trade and Industry are reviewing Singapore’s Gross Domestic Product growth forecast for this year.

For now, the MAS said the earlier 5 to 7 per cent growth forecast remains intact. But Mr Menon added that the economy could expand in the lower half of the range if the pick-up from the downturn in the second quarter is weaker than currently expected.

Speaking to Today, CIMB regional economist Song Seng Wun ruled out the prospect of stagflation – high inflation and low economic growth – as the “primary source of inflation are from two sources, and not broad-based”.

Mr Song noted that prices outside of housing and transport are “relatively stable”.

At the press conference, Mr Menon reiterated that the MAS’ projection for the year’s core inflation, which does not factor in car and housing costs, remains unchanged at 2 to 3 per cent.

According to economists, the upward revision was within expectations.

Barclays Capital senior regional economist Leong Wai Ho told Channel NewsAsia: “The reasons for the revision are … the higher Certificate of Entitlement prices and higher rental contracts during this period. These are drivers that will hit out at mainly middle-income consumers rather than the lower-income.”

Mr Song, who has revised his inflation forecast from 3.8 to 4.7 per cent, said housing and car costs made up some 40 per cent of the higher consumer prices. Still, Credit Suisse’s regional economist Robert Prior-Wandesforde told the Wall Street Journal that “the tightness of the labour market means core inflationary risks are high and rising”.

Mr Menon pointed out that the much lower 2.2-per-cent inflation rate in April and May partly reflected that MAS’ pre-emptive tightening of monetary policy “has helped to dampen some cost increases”.

He added: “A stronger Singapore dollar has helped, not just by filtering oil and food price increases, but also by providing a restraining effect on the economy.”

On a day when the Singapore dollar hit a record, Mr Menon also noted that the policy stance of allowing the Singapore dollar to appreciate “remains appropriate”.

Deputy Prime Minister Tharman Shanmugaratnam, who is also Finance Minister and MAS chairman, wrote in the MAS annual report that this tighter policy “will ensure price stability over the medium term and keep growth on a sustainable path”.

Economists expect the MAS to keep the policy unchanged. Capital Economics’ Vishnu Varathan said: “There’s no real reason to panic or have an alarmist reflex at the moment.”

On the global outlook, Mr Tharman noted that “the ongoing sovereign debt crisis in the European periphery poses significant risks – both to global economic growth and financial stability”.

Mr Menon said the “prognosis for global economy has taken on a more cautious tone” for the second half of the year.

The disruption to regional supply chains, in the aftermath of the earthquake in Japan in March, has been more severe than initially expected, he said.

Global demand has also slowed because of the increase in oil prices and there are greater uncertainties now in the US and Europe compared with three months ago, he added. Still, Mr Menon said: “But we expect growth in our external markets to continue, albeit, at a slow and uneven pace.

Source : TODAYonline – MediaCorp Press Ltd’s copyright

Private home market should be left to market forces: REDAS »« Small units increase house price volatility: IRES

Small units increase house price volatility: IRES

Small units increase house price volatility: IRES

By Millet Enriquez | Posted: 28 July 2011 1937 hrs

SINGAPORE: From January to May last year, prices of small apartment and condominium units rose 11.1 per cent compared to apartments and condominium units (or non-landed homes) in the prime and non-prime regions which saw lower gains of 5.4 per cent and 6.2 per cent respectively.

According to data from the Institute of Real Estate Studies (IRES) at the National University of Singapore, prices of small units grew 6.9 per cent from March to May after the cooling measures of January this year.

The prices of non-landed units in the central and non-central regions both gained only 3.0 per cent in the same period.

“Our analysis presents evidence that small units increase house price volatility. Further, price changes of these units potentially have spill-over effects on the price movements of other market segments that would require more detailed study,” said IRES in a news release.

Associate Professor Lum Sau Kim of the IRES-NUS added that the creation of a sub-index for small units can help better capture and measure price movements on the ground.

These small units, which measure 47 square metres (506 square feet) or less, have increased in importance since 2009, with their prices trending higher compared to non-landed properties in the central and non-central regions during the past two years.

As such, IRES said it will introduce a separate index – apart from its Singapore Residential Price Index (SRPI) – to measure the prices of “shoe box” units as their price volatility has a significant impact on overall housing prices.

Based on June flash estimates, the SRPI Small Units rose 1.2 per cent month-on-month. This is much higher than the overall increase in the SRPI – at 0.7 per cent for the same period.

Excluding small units, prices of non-landed homes in the central region fell 0.6 per cent, while those in the non-central region rose 1.5 per cent in June.

Using the old methodology, the overall SRPI showed home prices rose 2.5 per cent month-on-month in May compared to April’s 1.1 per cent increase and March’s 0.2 per cent rise.

Beginning June, the SRPI will now feature the SRPI_Small index that reflects the price movement for small housing units. This means that the SRPI will now consist of two regional sub-indices: one that excludes small units and a small unit sub-index.

The IRES said it hopes that by having a good measure of the prices for small units, the new indices can help buyers make better investment decisions and manage their real estate investment risks.

- CNA/fa

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

MAS revises inflation forecast upwards »« Mapletree Industrial prices new units at S$1.09 each

Mapletree Industrial prices new units at S$1.09 each

Mapletree Industrial prices new units at S$1.09 each

By Amanda Feng | Posted: 28 July 2011 2310 hrs

SINGAPORE: Mainboard-listed Mapletree Industrial Trust (MIT) has priced an offering of new units at S$1.09 a unit, in relation to the private placement of 48.5 million new units in the company.

This was a discount of 2.2 per cent to the adjusted volume weighted average price of S$1.115 a unit on July 27, MIT said.

It has also priced its preferential offering at S$1.06 a unit.

Citigroup and DBS Bank were the joint bookrunners and underwriters for the placement and preferential offering to raise around S$175 million.

In connection with the equity fund raising, the MIT intends to declare an advance distribution for the period from 1 July, 2011 to the day before the new units are issued.

The cumulative distribution (comprising the 1QFY2011 distribution and advance distribution) is estimated to range from 3.09 cents to 3.12 cents per unit. The cumulative distribution will only be distributed in respect of the existing units.

-CNA/ac

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Small units increase house price volatility: IRES »« Enhanced rulings on sale of investment products

Enhanced rulings on sale of investment products

Enhanced rulings on sale of investment products

SINGAPORE: The Monetary Authority of Singapore (MAS) is introducing stronger measures and enhanced requirements to further safeguard customers’ interests.

From January next year, financial institutions will be required to formally assess a retail customer’s investment knowledge and experience before selling them certain investment products.

The requirement will apply to Specified Investment Products (SIPs).

These include futures and exchange traded funds, as well as investment-linked insurance policies.

Market players welcome the move but are concerned that this will raise costs.

Wong Sui Jau, general manager of fundsupermart.com, said: “You may see the number of players in this particular space, the online unit trust space shrink. Or at the very least perhaps, maybe there is no new entrant into this space because the increased cost of compliance in this area.

“What we are actually going to do is we are going to hire client investment specialist and these are the people who will be on hand to give one on one investment advice to the people who have failed their knowledge assessment test. So that to us is an increase, so you could take the easy way out but what you are going to be doing is outright rejecting business.”

The financial institution will have to inform the customer if he is assessed not to possess the relevant knowledge or experience.

If the customer still intends to proceed with the transaction, he must be advised.

MAS said it would not allow “execution only” service in such cases.

Safeguards, such as a lower trading limit than what the institution would otherwise have imposed, will also be put in place before the customer is allowed to proceed with the transaction.

This new requirement will be applied to both new and existing customers.

In line with the new requirements, all representatives who deal in or provide advice on SIPs must pass additional examinations on product knowledge and analysis.

MAS is working with the Institute of Banking & Finance and the Singapore College of Insurance to introduce the additional examinations by the end of the year.

- CNA/al

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Mapletree Industrial prices new units at S$1.09 each »« Singaporeans first, not Singaporeans only

Singaporeans first, not Singaporeans only

Singaporeans first, not Singaporeans only

Higher education: Don’t close door to foreigners, says Tony Tan

by Tan Weizhen 04:45 AM Jul 20, 2011

SINGAPORE – Presidential hopeful Tony Tan – who is synonymous with the growth of the Republic’s university sector – has come out to make clear his stance on the universities’ recruitment of foreign students, which has been a subject of discussion as the Presidential race heats up.

Speaking at a Singapore Management University (SMU) lecture yesterday, Dr Tan said: “I have been asked more than once in recent weeks whether I favour a ‘Singaporeans first’ policy in higher education. I do.

“But ‘Singaporeans first’ is different from saying ‘Singaporeans only’. Singapore is an international city and it would be a grave mistake to close our doors.”

Dr Tan, who was a former Deputy Prime Minister, spent seven out of his 19 years in the Cabinet helming the education portfolio. He was also the Minister-in-charge of the university sector for more than two decades.

Dr Tan’s involvement in the higher education sector – in particular, his push for the globalisation of the universities – has been discussed online in various forums as well as on his Facebook page. One Facebook user, for instance, criticised Dr Tan’s “pro-foreign talent policy” which he instituted at the universities.

Dr Tan said yesterday: “I understand that some people believe that our higher education sector should only educate Singaporeans. In addition to the inherent problems of protectionism, closing our doors would limit the talented individuals who presently contribute much to Singapore.”

He added: “Closing our doors would also restrict our ability to engage in the kind of collaborative research that has put Singapore universities in the very top ranks of universities in the world.”

Dr Tan stressed that the country’s primary responsibility is to Singaporeans.

The Government should “continue to monitor carefully the proportion of foreign students in our educational institutions to ensure that the proportion matches the present and future needs of the country, and that Singaporeans are the main beneficiaries of our education policy”, he said.

In the 1980s, Dr Tan, who was the Education Minister then, had spoken out against the graduate mothers’ scheme, which gives priority to children of graduate mothers during school registration. The unpopular scheme was ultimately scrapped.

Speaking to reporters after the SMU event, Dr Tan explained his stance: “I looked at the reasons why it was launched, and I felt it was not fulfilling its purpose. It was disadvantaging unfairly certain segments of our children … that was why I decided to change course.”

On hindsight, Dr Tan said the decision to scrap the scheme was right. But he urged people to move on.

“The point is one looks at the issue when one has the authority to do something about it. The important thing is that when you have the authority, you should exercise it wisely.”

And whether or not he is elected as President, Dr Tan’s involvement with the education sector looks set to continue.

During the Q&A session after his lecture, Dr Tan – who chairs the International Academic Advisory Panel – was asked what the President can do for education in Singapore.

Dr Tan replied that the President can make an impact in schools through his patronage and interaction with principals, teachers and students.

He added: “While the President doesn’t have executive authority, through his influence, through the areas he concentrates on, through the causes he champions, he can make a great impact in the area of education.”

Source : TODAYonline – MediaCorp Press Ltd’s copyright

Enhanced rulings on sale of investment products »« BTO launches to be combined

BTO launches to be combined

BTO launches to be combined

by Ong Dai Lin 04:45 AM Jul 19, 2011

SINGAPORE – A day after sharing data which showed that larger Build-To-Order (BTO) launches would enhance the chances for applicants to select a unit, National Development Minister Khaw Boon Wan said yesterday the Government will hold back next month’s BTO launch and combine the units with the projects slated to come on stream in September.

The HDB has traditionally launched at least one BTO project each month.

But Mr Khaw noted: “Each time you release a few hundred units, everybody will rush for those few hundred units, and many will get disappointed for sure. That is why I will move away from a monthly launch, and do a combined launch.”

Pointing out that 3,556 BTO units were launched in seven locations last week, Mr Khaw added: “I do not think we would do any (BTO launch) in August. I am trying to combine with September to have a bigger launch … 4,000 units or even more … I think that will do a lot to calm the market and reduce disappointment.”

But this does not necessarily mean that BTO launches from now on will be bimonthly, said Mr Khaw. The determining factor of when to conduct the launches is having “a sufficient critical mass” of unit, he added.

Mr Khaw was speaking to reporters yesterday after a visit to the HDB Hub at Toa Payoh. The minister reiterated that the key to giving couples a higher chance to select a flat is to roll out a wider range of flats in more quantity. With bigger launches, Mr Khaw is confident that repeated applicants “will not have to suffer too long”.

While time is needed to address the housing demand, “at least the solutions are in sight, and you know it is a matter of time before the problem will be largely resolved”, said Mr Khaw, who added that he “can sleep a lot more better now”.

The prices of the BTO units launched last month were generally lower, compared to earlier launches. Prices for units launched this month started from S$137,000 for a three-room flat, S$217,000 for a four-room flat and S$274,000 for a five-room flat. In May’s launch of 4,000 new flats, the starting prices were S$166,000, S$264,000 and S$335,000 for the same flat types respectively.

But Mr Khaw rejected the suggestion that the prices have dropped as a consequence of him taking on the portfolio in May. Many factors are at play, including location, said Mr Khaw.

He added that prices for BTO flats have stabilised and he expects them to remain steady.

Mr Khaw said: “Prices are not increasing, but (they are) also not dropping sharply because there is no reason (for them) to drop sharply unless our cost actually drops or the market begins to drop. Hopefully, that would be reassuring to Singaporean buyers, young couples.”

SLP International head of research Nicholas Mak noted that Mr Khaw’s idea of combining the launches was an innovative solution. But he said he was unsure of its effectiveness, given that the overall BTO supply for the year remains unchanged at 25,000.

Still, Chesterton Suntec International research and consultancy director Colin Tan said combined launches will help to better gauge the demand, given that repeated applications for BTO projects would be reduced.

Source : TODAYonline – MediaCorp Press Ltd’s copyright

Singaporeans first, not Singaporeans only »« Private home sales slump in June

Private home sales slump in June

Private home sales slump in June

by Linette Lim 04:45 AM Jul 16, 2011

SINGAPORE – New private home sales slumped in June, falling by 25 per cent from the previous month to 1,182 units despite an increase in the number of new launches in the month.

Data released yesterday by the Urban Redevelopment Authority (URA) showed that 1,614 units were launched last month, up from 1,215 in May.

Most analysts attribute the decline in sales to the seasonal effect of the June holidays as well as the Government’s moves to increase public housing supply. These factors, combined with the uncertainties in the external environment such as the euro zone and United States sovereign debt crises, appeared to have doused buying sentiment.

Of the private homes sold last month, 833 units were located in the suburban areas, compared with 227 units in the city fringe and 122 units in the central areas. Including Executive Condominiums (EC), the total sales volume would have been higher at 1,394.

Ms Chia Siew Chuin, director of research and advisory at Colliers International, noted that price increases had been moderating for seven consecutive quarters.

“So you can see that there is some resistance in buyers’ responses to continued price hikes. In view of the possible dampening effects on buying demand, we are likely to see prices moderate further or hold stable,” she added.

But while the number of transactions fell last month, some analyst expect full-year sales to be healthy.

Highlighting EC sales of about 200 units, Mr Liang Thow Ming, head of residential services at Credo Real Estate, said that by extrapolating the combined sales figure over a full year, “We’re still hitting in excess of 14,000 to 15,000 units this year”.

Chalking up the best sales last month was Woodhaven at Woodgrove Avenue, where 155 units were sold at a median price of S$981 per sq ft. The best selling EC was Belysa at Pasir Ris Drive 1, where 153 units were sold at a median price of S$700 psf.

Meanwhile, the most expensive property sold in June was at Le Nouvel Ardmore in Ardmore Park, where a unit was sold at S$4,362 psf.

Singapore’s private home prices rose 1.9 per cent in the second quarter, the smallest gain in two years, according to URA data on July 1.

“This is further evidence that the cooling measures are having an effect,” said property consultant SLP International executive director Nicholas Mak,. The fourth round of cooling measures – introduced in January – include seller stamp duties as high as 16 per cent and a loan-to-value limit of 60 per cent on second and subsequent mortgages.

“The cooling measures don’t take effect overnight, they take a couple of months to show effect,” he said.

WITH AGENCY REPORTS

Source : TODAYonline – MediaCorp Press Ltd’s copyright

BTO launches to be combined »« Ritz-Carlton Residences offers bird’s eye view of BKK

Ritz-Carlton Residences offers bird’s eye view of BKK

Ritz-Carlton Residences offers bird’s eye view of BKK

SINGAPORE: PACE Development on Wednesday announced its Singapore roadshow for Thailand’s super luxury Ritz-Carlton Residences development.

The Thai residential property developer, which focuses exclusively on prime-location projects, said that strong interest from Singapore investors led them to stage the roadshow for the Ritz-Carlton Residences, Bangkok.

The Ritz-Carlton Residences, to be located in Bangkok’s central business district, will offer rare bird’s eye views of the city and Chaophraya River.

It will also be one of Bangkok’s most luxurious and prestigious buildings when completed in 2014.

CEO of PACE Developement, Sorapoj Techakraisri said that the Ritz-Carlton Residences will offer “world-class quality and service” in an “outstanding location”.

“Thailand is a sought after market for investors due to its strong economy, as well as an active real estate market and stable politics,” he added.

The roadshow, by appointment only, will be held at The Ritz-Carlton Hotel, Singapore from July 23 – 24, from 11am to 7pm.

- CNA/ck

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Private home sales slump in June »« HDB launches 7 BTO projects offering 3,600 new flats

HDB launches 7 BTO projects offering 3,600 new flats

HDB launches 7 BTO projects offering 3,600 new flats

By Mustafa Shafawi

SINGAPORE: The Housing and Development Board (HDB) has launched seven Build-to-Order (BTO) projects offering 3,600 new flats.

It has combined the BTO launches originally planned for June and July in Thursday’s launch, giving flat buyers more housing options.

These 3,600 new flats are located across various towns, in Sengkang, Punggol, Tampines, Jurong West, Yishun and (two BTOs in) Bukit Panjang.

Most of the flats on offer are four and five-room units.

The price of four-room units start at S$217,000 and five-room units go from S$274,000.

At least 95 per cent of the flat supply (excluding Studio Apartments) will be set aside for First-Timer households.

Lower income applicants can also enjoy various housing grants including the Additional CPF Housing Grant and the Special CPF Housing Grant to reduce the cost of owning a new BTO flat.

With Thursday’s launch, HDB said it has released about 15,500 BTO flats in the first seven months of this year.

HDB said it is on track to deliver 25,000 BTO flats this year.

- CNA/cc

Source : Channel NewsAsia – MediaCorp Pte Ltd Copyright

Ritz-Carlton Residences offers bird’s eye view of BKK »« Singapore prime office rents stay stable