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20 August 2012

20th August, Monday




HDB rents soar as tenants flee private flats

Source: The Straits Times

Tenants moving into Housing Board flats to escape pricey private accommodation have driven up rent levels.

Overall median HDB rents rose 10 per cent in the 12 months to June, to $2,200 a month, according to the Singapore Real Estate Exchange (SRX) - the highest since it started collecting data in the first quarter of 2006.

Demand from permanent residents (PRs) is also propping up rents, as the slew of residential cooling measures has made renting, rather than buying, the preferred choice for some.

PRs must dispose of their overseas properties within six months of an HDB purchase. This has deterred many PRs from buying flats, with many choosing to stay in rented units instead.

HDB flats have also become popular with foreigners because private home rents have gone up. Housing budgets are also being reduced across the board due to firms tightening their belts, prompting many employees to opt for the more affordable HDB option.

HDB rents are expected to hold firm over the next six months, despite competition from an increasing number of private home completions. Tighter immigration policies are also likely to cap further rental gains.


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International Markets


China new-home prices rise in more cities

Source: Business Times

China’s July housing data showed that prices of new homes rose in the largest number of cities in 14 months, as sentiment improved after interest rate cuts and incentives for first-time buyers.

Prices climbed from a month earlier in 49 of the 70 cities tracked by the government, the National Bureau of Statistics said on its website on Saturday. That was the most since May last year and compared with 25 cities in June. Prices fell in nine cities and were unchanged in 12.

Buyers, buoyed by two interest rate cuts since June, have returned to the market even as the government pledges to maintain real estate curbs to make housing more affordable.

The data "show demand from first-home buyers is very strong and the interest-rate cuts had a big impact on the market", said an economist. "The government may issue new tightening measures, but they would be mild because it's facing a big dilemma of balancing economic growth and property curbs."


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