Real News‎ > ‎2012‎ > ‎September 2012‎ > ‎

08 September 2012

8th September, Saturday




Fancy a million-dollar HDB apartment?

Source: Business Times

An executive maisonette on Queenstown's popular Mei Ling Street could become the first public housing apartment to be sold for a million dollars.

The first appointment with the Housing & Development Board (HDB) has yet to be completed, though the buyer and seller have come to an agreement on the price, said Lee Sze Teck, senior manager at DWG's research and consultancy division.

DWG is brokering the deal, under which the Singaporean buyer has agreed to pay a cash premium of $195,000 for the flat, which is located near the Queenstown MRT Station. No details were given on the size of the apartment.

Experts, however, say there is no bubble in the market. Homes transacting at such prices are usually located in popular areas, and may have highly sought-after design features that are rare for public housing.

Mei Ling Street, for instance, is just opposite Queenstown MRT Station, said Mr Lee. "This is a very popular area. Many residents say they enjoy an unblocked view and it is very near the MRT station."

Buyers of homes along the street have given reasons such as the good view and home layout as reasons for their willingness to splash on their apartment of choice, added Mr Lee. Some have even cited good fengshui as a reason.

For an executive maisonette in Bishan that was sold at close to $1 million, the home came with a roof terrace, which is rare for public housing.

According to an SRX report issued Friday, the median resale price of homes in Bishan compiled on 5 August was $520,000, and in Marine Parade it was $532,500. The median resale price of HDB apartments in Queenstown was $517,500. In contrast, homes in Ang Mo Kio fetched a median resale price of $398,000, while for those in Bedok it was $412,000.

Homes in highly sought-after areas also tend to see higher cash premiums, noted Mr Lee.

When it comes to median cash over valuation (COV), Bishan homes had a $47,000 cash premium, based on data compiled on Aug 5, said the SRX report. In Marine Parade, this was $45,000, and in Queenstown, $38,944. Houses in Ang Mo Kio and Bedok registered a median COV of $30,000.


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S$200,000 COV record could be broken soon

Source: Today

The cash-over-valuation (COV) component in HDB resale transactions is rising and it could hit over S$200,000 soon.

Real estate agents said the median COV paid for HDB resale flats has risen by about 12 per cent to S$30,000 in the third quarter so far.

But for a Bishan unit, the COV has hit a record high of S$200,000. The executive maisonette at Bishan Street 13 was sold for S$980,000 including the S$200,000 COV.

Mr Lee Sze Teck, senior manager of training, research and consultancy at Dennis Wee Group, said: "Our agents actually closed a couple of deals in Bishan, one with about S$200,000 COV, the other S$250,000 COV. Both are for executive maisonettes."

Once the sale is completed, the S$250,000 COV will surpass the S$200,000 paid for the Bishan unit at Street 13.

"There is another on-going transaction in Queenstown, where an executive maisonette is transacted at S$1 million and the COV is S$195,000. According to the buyer, he has bought into this unit because of the fengshui and also for the unblocked view from the bedroom," added Mr Lee.

Property agents said those who pay high COVs are typically buyers who are downgrading from private landed properties.

Six-figure COVs are very rare and only for choice units with excellent attributes, they said. Market watchers said these large price tags are not likely to swing HDB resale prices significantly, because there are not many such cases.

Overall, they said HDB resale prices are inching up because valuation has been climbing. Prices could go up by some 1.5 per cent this year, they added.

The COV portion is also likely to trend higher, as more buyers are entering the market, especially for attractive units in mature towns, said property agents.

For the third quarter, analysts expect a total of 6,800 to 7,000 units of HDB resale flats to be sold - similar to the number of deals done in the second quarter.

Real estate agents advise buyers to be prudent and consider the upside potential of any home purchase as it is a long-term commitment.

Another consideration is the large supply of new HDB flats that will come on-stream in the next few years. Home buyers should also think about whether they will be able to ride out the market cycle if the economy hits a bad patch.


Links to the story:$200,000-COV-record-could-be-broken-soon  



Resale prices, rents rise for private and public housing

Source: The Straits Times

Resale home prices and rents have climbed across the board after a lull in July, according to data out Friday.

The public and private segments both posted strong showings, and indicate that the third quarter might be a more buoyant one for the property market.

Private resale prices were up 4.5 per cent last month over July, said the Singapore Real Estate Exchange, which collates sales by major property agencies, accounting for about 85 per cent of resale transactions.

This puts the average resale prices in July and last month at $1,134 per sq ft (psf), 1.2 per cent more than $1,121 psf in the second quarter. Condominium rents increased by 2.4 per cent in the same period.

The same positive sentiment was seen in public housing, with overall median Housing Board (HDB) prices increasing by 1.8 per cent to a record $448,000. Median monthly HDB rents gained 4.3 per cent to $2,400, after holding steady at $2,300 in the last four quarters.

Experts say that interest in the resale market has returned as potential buyers scout for alternatives in the light of sky-high prices at developer launches. Some of these new launches have also lifted the prices of resale homes in surrounding estates.

But they hold varying views on how sharply prices might move this quarter.


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It may not pay to invest in shoebox units

Source: The Straits Times

A recent report has identified hot spots across Singapore for "shoebox" homes but has questioned the viability of these tiny homes as investments.

Even before the Government's move this week to restrict the ballooning number of shoebox units outside the central area, market experts were raising a red flag.

These homes of less than 50 sq m used to be mainly in the central areas, but many small studio apartments are now springing up on the outskirts.

An analysis found that the highest number of new shoebox apartments has been sold in Balestier, MacPherson and Geylang. Since 2005, 2,401 tiny homes have found buyers in these areas. This is followed by the city and south-west areas with 1,371 units, and the East Coast area with 1,359 units changing hands.

The stock of completed shoebox units is expected to reach 11,000 units by the end of 2015, with 3,800 of these in suburban areas, the Urban Redevelopment Authority said.

Experts note that while shoebox units with affordable price tags, typically less than $1 million, are usually bought for investment, those in suburban areas might not pull in rental yields similar to centrally located units'.

However, data from the Singapore Real Estate Exchange (SRX) found that rental yields for shoebox homes in suburban areas were 4.77 per cent in the second quarter of the year.

This is comparable to the yields of 4.75 per cent for shoebox units in the city centre and 4.86 per cent for similar units in the city fringe regions.

But experts say these yields might not hold in the long run as a slew of new suburban shoebox units get built.

An analyst said that as the completions gain momentum, yields are likely to be compressed across the board but suburban shoebox units far from MRT stations and amenities are likely to be the most vulnerable.


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Condo cluster in the east still attracting buyers

Source: The Straits Times

It is one of the older condo clusters around but Bayshore Park, Costa Del Sol and The Bayshore just off Upper East Coast Road are still attracting buyers - even without an MRT station nearby.

There is plenty to attract, from the impressive sea views many high-floor units enjoy to the quiet, private surroundings, the proximity to the beach and the rental potential.

The lack of amenities in the area also does not seem to deter. Most residents wanting a supermarket or choice of restaurants head to nearby Siglap, although the condos have some shops and eateries within the grounds.

The nearest MRT and bus interchange is in Bedok. There is an upcoming Eastern Region Line, slated for completion in 2020 at the earliest. Details of station locations have not been disclosed yet.

Broadly speaking, prices at the condos are about 5 per cent higher than those in nearby Upper East Coast Road.

Rents ranged from $3 to $3.80 per sq ft (psf) a month in the first six months of the year. Rents tend to be lower at The Bayshore, where the sea views are blocked.

Several upcoming condos such as Uber 388 and Suites @ East Coast will pop up in the area in the next couple of years, with these two adding over 200 units alone. Both were over 80 per cent sold by July, with prices averaging $1,487 psf at Uber 388 and $1,382 psf at Suites @ East Coast.


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Properties close to Thomson Line MRT stations reaping benefits

Source: Today

Properties located close to upcoming Thomson Line MRT stations are enjoying greater interest from potential buyers.

A condominium project at Rosewood Drive in Woodlands saw sales almost double a week after the announcement of the new MRT line.

Some property analysts say noise from the construction of the new line could have downward pressure on the prices, but it should not be a problem in the long term.


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Investment Sales


Property fund buys former convent

Source: Business Times

Home-grown property fund management outfit Lucrum Capital has bought the former CHIJ St Joseph's Convent premises at Hillside Drive off Upper Serangoon Road for $34.4 million.

Lucrum's purchase price works out to $422 per sq ft based on a land area of 81,467 sq ft. The property is being sold on a 103-year leasehold tenure by its registered owner, The Lady Superior of the Convent of the Holy Infant Jesus in Penang, Business Times understands. The church holds 999-year leasehold title on the site starting December 1878.

On site are the former school premises, which are thought to be around 70 years old but which have been vacant when the school moved to Sengkang around 10 years ago.

Lucrum Capital said the property will be a "rental income play". The plan is to stick to the property's current "education" use. Lucrum is mulling whether to spruce up the building and lease it out for rental income or to redevelop the site and build a new structure on it to be leased out for educational use.

However, market watchers say that under Master Plan 2008, the site is zoned for residential use with a 1.4 plot ratio (ratio of potential gross floor area to land area). This means that the plot can be redeveloped into a private residential project up to five storeys, subject to payment of a development charge (DC) to the state for the change of use.

Based on a conversion to residential use, Lucrum's purchase price would translate to a unit land price of $648 per sq ft per plot ratio (psf ppr) including an estimated DC of $39.5 million.


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Freehold Mt Elizabeth condo sold for $92.2m

Source: Business Times

The freehold Chateau Eliza on Mount Elizabeth is being sold through a collective sale for $92.2 million to Newfort Realty Pte Ltd, a consortium of private investors.

The price works out to $1,743 per sq ft per plot ratio (psf ppr), assuming Newfort redevelops the 17,997 sq ft plot into a new project that matches the existing development's gross floor area (GFA) of 52,887 sq ft.

For Chateau Eliza, its existing GFA figure reflects a plot ratio of 2.939 - higher than the 2.8 plot ratio for the site under 2008 Master Plan. No development charge (DC) is payable if the new development is built up to the existing GFA.

However, if the developer were to build an additional 10 per cent GFA for balconies, taking the total GFA to about 58,176 sq ft, it would have to pay a DC of about $4 million, translating to a unit land price of $1,654 psf ppr based on Newfort's acquisition price.


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