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07 August 2012

7th August, Tuesday




Second-timers on the prowl

Source: Today

Even as the Government shifts its focus on meeting the housing needs of second-timers, the number of such applicants has crept up - after a sharp downward trend in recent months - based on figures from the latest Build-to-Order (BTO) exercise.

Application for the 4,200 units on offer closed Monday. As at 5pm Monday, the application rate of second-timers - who are mostly upgraders, according to property analysts - was 11.4 while that of first-timers stood at 1.7.

While property analysts said the higher second-timer application rates were not a cause for concern - given the attractive locations of some of the BTO projects - some believe tweaks are imminent to allocate more BTO flats to second-timers.

An analyst said he expects the allocation for second-timers in non-mature estates to be increased to between 20 and 25 per cent, while another analyst suggested increasing the proportion further, to 30 per cent.

For mature estates, they felt the increase, if any, would be marginal to 15 per cent.

On the latest application rate for second-timers, analysts noted the attractiveness of the locations of the BTO projects, particularly those in the mature estates. In particular, the projects at Bukit Merah and Clementi would be popular with upgraders despite being relatively pricier.

Noting that there have been few new BTO projects in these two estates, DWG Research and Consultancy Senior Manager Lee Sze Teck said: "Unlike first-timers whose main concern would be the affordability ... second-timers are looking for what they need and usually it is bigger units for their bigger families."

One analyst noted that ultimately, a balance has to be struck between meeting the needs of young couples and families looking to upgrade. He said: "I do not think there is any way to ease the demand by second-timers ... the Government will have to decide how to distribute scarce resources."


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HDB to launch at least 20,000 new flats in 2013

Source: Business Times

Even as success rates for first-timer applications stabilise and second-timer applications improve, the Housing Board intends to build at least 20,000 new flats next year.

This is in addition to the 8,000 new flats and 3,000 balance flats that will be launched by the end of this year, said Minister for National Development Khaw Boon Wan in his blog.

Said Mr Khaw: "By the end of this year, we would have launched 50,000 flats over 2011 and 2012. The increased supply is clearly helping out flat buyers, and having an impact on application rates."

He added that he would focus on second-timers to improve their chances this year.


Links to the story:,000-new-HDB-flats-to-be-built-next-year



Parents 'renting' their way to popular schools?

Source: The Straits Times

As the race for Primary 1 places heats up, allegations of parents "renting" their way to coveted spots in popular schools have resurfaced.

Applicants who live near the schools stand a better chance of snagging places during balloting.

In response to queries from The Straits Times, the Ministry of Education (MOE) said children who gain entry into schools through distance priority should be living "in the address used for registration during their primary school education".

As for whether pupils have to reside at the same address for all six years of their primary education, an MOE spokesman said it will assess instances on a case-by-case basis.

There are very few proven cases of parents who use false addresses, said the spokesman. But any parent found to have done so will be referred to the police for investigation, and the child transferred to another school.

Schools said cases of parents trying to circumvent the rules on addresses are rare, as they would not want to risk their children being expelled.

Besides, the intention of parents who rent and move out shortly after cannot be determined for sure, said a principal of a popular primary school in the north.

He said: "Even if they move out when the child is in the middle of Primary 1, or even just as he starts Primary 1, there is no way to determine that the parents' intention was to get a place in the school." It could be due to other reasons, such as not being able to pay the rent, he added.

An analyst noted that leasing on a short-term basis is still uncommon as tenants would usually have to sign a lease of at least a year.

Besides if the family moves away after the lease is up, it will also be hard on the child, who would have to wake up earlier and travel a longer distance to get to school, said a parent.


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50-year home loan not advisable: Experts

Source: The Straits Times

While a 50-year home loan helps ease the cash flow for young couples, the interest paid on it will eventually reduce the potential profit that can be made on a property, said most financial advisers Monday.

Such long-term loans, with their lower monthly payments, may also lure couples to spend beyond their means in the meantime, they added.

What they should do when starting out is to buy a smaller flat within their means and upgrade later when they can afford it.

10 financial planning experts interviewed Monday unanimously advised against taking a 50-year home loan.

The reason? The cash burden is less heavy and should interest rates rise, the monthly payments would still be manageable.


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Property developers get creative

Source: Channelnewsasia

Property developers are becoming more creative with their projects.

They are coming up with new designs and lifestyle themes for their developments to differentiate their projects amid the growing competition.

From waterfront units to condominiums designed by renowned architects, and more recently, 'sports-themed' apartments, developers are chasing new lifestyle concepts to draw home buyers to their door - and it looks like it is working.

Experts said developers' move towards creativity and differentiation has little to do with the declining number of housing units sold.

Analysts said constructing themes like these will help developers get the 'first cut' of sales amidst this flood of property options in the market.

While this trend is not new, themed projects are likely to be more prevalent in the near future.


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Investment Sales


Industrial site in Toa Payoh up for grabs

Source: Business Times

A 60-year leasehold industrial property was put up for an expressions-of-interest exercise Monday.

Occupying a total land area of around 44,906 sq ft, the site along Lorong 5 Toa Payoh comprises a four-storey light industrial building with a gross floor area and net lettable area of about 83,342 sq ft and 58,194 sq ft, respectively, at an indicative asking price of about $23 million to $25 million.

Zoned "Business 1" according to the Master Plan 2008, the site, which is a stone's throw from Toa Payoh Central (where the Toa Payoh MRT station and the bus interchange are located), has a plot ratio of 2.5 which translates into an allowable gross floor area of around 112,265 sq ft.

The expressions-of interest exercise closes at 3pm on 18 September.


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Govt keeping close eye on industrial property

Source: The Straits Times

The rising number of investors flipping their industrial units for a profit has caught the eye of the Government.

It has warned that fresh measures might be introduced if prices do not moderate.

A Ministry of Trade and Industry spokesman told The Straits Times it has observed a "rising incidence of short-term flipping in the industrial property market in tandem with rising prices".

The once-unglamorous industrial segment has hogged headlines in recent months as prices and rents continued to defy gravity, raising concerns that the sector is getting a bit too frothy.

Prices of factory and warehouse space have rocketed about 16 per cent in the first half of this year while rents for these properties are up by about 5 per cent.

This has been partly attributed to the investors diverted into the industrial segment on the back of residential cooling measures introduced since September 2009.

But an analyst cautioned that as prices rise, so do downside risks, especially in times of economic uncertainty. "There are some agents in the market who are also using the fact that there is no seller's stamp duty for industrial units to market them to investors as well."


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International Markets


UK house prices slip in June with market strained

Source: Business Times

UK house prices fell in July for the first time in three months, according to a mortgage lender, which said it expects "little change" in values for the rest of the year.

Values dropped 0.6 per cent from the previous month.

The property market is under strain as banks curtail access to credit and the deepening recession deters prospective buyers.

"Looking forward, we expect little change in prices over the remainder of 2012 so long as the economic climate in the UK does not worsen substantially," said the mortgage lender.


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