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29 August 2012

29th August, Wednesday




15 developers vie for Farrer Road site

Source: The Straits Times

A prime residential site has led to stiff competition among 15 developers - and the highest bid for a 99-year leasehold site offered at a state tender in recent years.

The site, within 1km of Nanyang Primary School and near other popular primary and secondary schools, is likely to yield homes that are a draw with parents who have school-going children.

The top bid of $45.8 million for the Farrer Road site, which beat market expectations, was from Far East Soho, a unit of property giant Far East Organization. It works out to $1,108 per sq ft per plot ratio (psf ppr), a key price measure. This beats a previous record of $1,048 psf ppr lodged in June by a unit of Singapore Land, for a Farrer Drive site.

Mr Lee Sze Teck, Dennis Wee Group's senior manager of training, research and consultancy, said that the key attraction of the site lies in its district 10 address.

"It is near to the Botanic Gardens and Farrer Road MRT stations. There are amenities like schools in the Bukit Timah area and retail amenities in Orchard. The CBD is a short 10 minutes' drive away," he said.

He estimated a selling price of some $1,800 to $1,900 psf.

Mr Chng Kiong Huat, executive director, property services at Far East, said: "This compact site gives us the opportunity to expand our Far East Soho brand... It will comprise a mix of one- and two-bedroom apartments with high ceilings, with the majority of units being two-bedroom apartments to cater to young families who appreciate trendy and flexible spaces in an urban setting."


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Singles twist puts boot in shoebox units

Source: Business Times

Shoebox homes will likely see a drop in demand if the government allows singles to directly purchase new flats from the housing board, say property consultants that BT spoke to.

The extent of the drop will depend on the strength of the restrictions that these experts believe will likely be placed on singles purchasing built-to-order (BTO) flats.

Eligibility restrictions in areas such as income will also mean that the impact on the HDB resale market may be limited.

Another factor that will impact singles' demand for BTO flats is the type of homes that the HDB will allow them to buy, and the supply of such new flats.


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Non-landed private home resale prices dipped last month

Source: Today

Prices of completed non-landed private properties fell 1.1 per cent last month from the previous month, according to the flash estimate of the Singapore Residential Price Index (SRPI) published by the National University of Singapore Tuesday, as large developer launches diverted attention away from the resale market.

The July flash SRPI showed prices of homes in the central region fell 1 per cent from the previous month, while those in the non-central region fell by a steeper 1.3 per cent.

However, prices of units smaller than 506 sq ft bucked the trend, rising by 1.1 per cent last month.

Mr Lee Sze Teck, Senior Manager for training, research and consultancy at property consultancy DWG, said: "In July, there were a few large developments like Parc Centros and Parc Olympia launched in the non-central region of Singapore and V on Shenton in the central region of Singapore.

"These new launches could have diverted interest away from the resale market."

He said the large number of completed homes in the central region continued to pressure housing prices there, with sentiment also undermined by lingering fears over the euro zone.

Another analyst said: "In the remaining months of 2012, prices of resale properties are expected to be fairly stable, in part due to smaller number of choices from fewer projects that will be launched in the quieter year-end period."


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'Balance' flats: Priority for couples with young kids?

Source: The Straits Times

Public flats that are close to completion could be earmarked by the authorities for couples with young children, property analysts predicted.

These units, left unsold in previous launches, could figure in changes to housing policy as the Government seeks to raise fertility rates, they added.

More chances could be given to couples with young children to entice them to start bigger families. Another modification could come in the form of adjusting the third-child priority scheme.


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Singles don't expect same chance as couples

Source: The Straits Times

Prime Minister Lee Hsien Loong may have hinted at the National Day Rally that singles will soon be allowed to buy new flats from the Housing Board (HDB) - but singles are not holding their breath.

While they welcomed the prospect of having access to brand new, subsidised flats and not just being confined to the resale market, they do not expect to be put on a level playing field with married couples.

In fact, observers predict that given the HDB's longstanding goal of using public housing to encourage marriage and child-bearing, the policy change for singles will come with many caveats.

An analyst said: "Singles may be able to join the queue to buy new flats for the first time, but they will be put at the back of the queue." He predicted that singles will be allowed to buy only three- room or smaller flats, and perhaps only in certain areas, such as the less popular non-mature estates.

Another analyst said it is possible that the HDB will sell new flats to singles at a marked-up price to what couples pay.


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Foreigners reacquiring taste for housing market

Source: The Straits Times

Foreigners are streaming back into the housing market as developers dangle incentives to take the sting out of the recent cooling measures.

Overseas buyers - excluding permanent residents (PRs) - snapped up 7 per cent of all private homes in the three months to June, up on the 5 per cent market share in the first quarter, according to a consultancy.

In terms of absolute numbers, foreign purchases rose 73 per cent to 611 units in the second quarter, led largely by renewed interest in city centre and city fringe homes.

The report also noted that Malaysians topped the table again with a 27 per cent market share of all foreign purchases, edging out mainland Chinese buyers for the second consecutive quarter.

Chinese buyers made up 19 per cent of the market, down from 23 per cent in the first three months of the year.

Notably, there were more purchases made by buyers from the US, Japan and the Philippines. For instance, American buyers bought 58 homes in the second quarter, more than their quarterly average of 32 last year.

"(This) could be due to (them) having the same ABSD treatment as Singaporeans while enjoying the same incentives given by developers. Hence, they will be paying less compared to the pre-ABSD days," the report said.

The ABSD does not apply to Americans under terms of the free trade deal the nation has with Singapore.

The same applies to buyers from Switzerland, Liechtenstein, Norway and Iceland.

Mr Lee Sze Teck, senior manager for training, research and consultancy at real-estate firm Dennis Wee Group, agreed that American buyers appeared to have benefited from the exemption from paying ABSD.

“But this level of buying is still far off the record 140 transactions in 2Q 2007,” he said.

The number of transactions by citizens from Switzerland have returned to pre-ABSD levels. Purchases from the other three countries (Norway, Iceland and Liechtenstein) exempted from ABSD were insignificant.

“Singapore is still one of the best places in the region to invest in properties because of its clarity in ownership of properties, low tax environment, absence of capital gains tax, low interest rate and stable government,” he said.


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myPaper, A20



Value of residential leasing contracts at all-time high

Source: Channelnewsasia

Leasing statistics from the URA showed the value of residential leasing contracts reached an all-time high in July.

Market watchers noted that a record S$24.5 million from 4,717 contracts was signed. The number of contracts signed was the second highest since 2007.

But analysts tell Channel NewsAsia not all market segments enjoy the same bull run.

Dwindling number of foreign manpower and expatriates has impacted the rental property market in Singapore.

Their reduced numbers mean fewer tenants are available for the rental market.

Experts said locals may have been supporting the market, after having sold their homes in an enbloc sale, or investors waiting to buy homes at lower property prices.

Noting that July is the traditional peak season for the rental market, some analysts forecast the number of leasing transactions to drop over July's numbers.

Over at the high end market, current rentals of S$4 to S$6 per square foot in the city could see prices softening by about two to five per cent.


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Investment Sales


2 Little India en bloc deals

Source: The Straits Times

Two freehold properties within walking distance of each other in Little India have been sold en bloc.

Sam Leong Mansion, off Jalan Besar, has been acquired by KSH Holdings for $40.3 million.

The other plot, made up of two adjoining sites in Race Course Lane, was snapped up by Sysma Holdings for a combined sum of $22.8 million.

In the first deal, units of KSH Holdings, Tee International and Heeton Holdings, along with Futuris Holding and ZAP Piling, will jointly redevelop Sam Leong Mansion. The 12,362 sq ft site has a plot ratio of about 3.0 and is zoned for redevelopment into a commercial development.

Based on the maximum gross floor area of about 37,087 sq ft, the price works out to $1,086.84 psf per plot ratio (psf ppr).

KSH and Tee will each own 35 per cent of this project, while Heeton, Futuris and Zap will take up the remaining 15 per cent, 10 per cent and 5 per cent respectively.

At Race Course Lane, Sysma Holdings' subsidiary, Sysma Properties, has acquired options to Serangoon Mansion and adjoining site No. 23. The sites are a combined 7,641 sq ft. Under the 2008 Master Plan, both sites are designated as residential with commercial units on the ground floor.

With a gross plot ratio of 3.5, that can yield potential gross floor area of some 26,745 sq ft; the land cost translates to $853 psf ppr.

Sysma intends to redevelop the site. No development charge is expected to be payable.


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