Real News‎ > ‎2014‎ > ‎April 2014‎ > ‎

19th April 2014

Singapore Real Estate

Surge of project launches expected

Source: Straits Times

Home seekers had lean pickings in the first quarter with few launches to whet appetites, but there could be a surge of sorts over the next three months. As many as 11 new projects are expected to begin previews or go on sale between now and the end of June, market watchers said.

Upcoming condo revives interest in Commonwealth

Source: Straits Times 

The upcoming launch of a new condominium in Commonwealth has given the mature estate renewed vitality. Residential demand is likely to remain firm for the district due to its city fringe location, consultants say.

Keen interest to restore Cashin House

Source: Straits Times

Companies are sparring to come up with the winning plan to restore a colonial-era bungalow on Singapore's north-western coast and link it by trails to the Sungei Buloh Wetland Reserve. At least five teams of consultants had said they were interested in developing the old Cashin House and its surroundings into a western extension of the reserve on Singapore's north-west coast.

Regulatory framework for large dormitories

Source: Straits Times

Large dormitories for foreign workers here will come under a regulatory framework, the Ministry of Manpower said yesterday. Acting Manpower Minister Tan Chuan-Jin said that the ministry held a dialogueon Thursday to gather feedback from the likes of the Dormitory Association of Singapore, the Singapore Contractors AssociationLimited and PSA.

Real Estate Companies' Brief

Property stocks rally after takeover bids

Source: Straits Times

Singapore-listed property developers have rallied after takeover offers were unveiled for two big companies in the sector. The FTSE ST Real Estate Holding and Development Index, an 18-member gauge that includes big names like CapitaLand, City Developments, Keppel Land and UOL Group, gained 5.6 per cent this week. This caps its rise over the past few weeks, bringing the index up 11.9 per cent from its recent low on March 20.

Why CMA investors may be cool to CapLand offer

Source: Straits Times

Capitaland has enjoyed a good run-up in its share price since it launched a $3.06 billion buyout of the rest of mall operator CapitaMalls Asia (CMA), in which it already holds a 65.3 per cent stake. It closed five cents up at $3.18 on Thursday, giving it a rise of 8.9 per cent for the week.


Source: Straits Times 

Capitaland has made a voluntary conditional cash offer of $2.22 a share for the rest of CapitaMalls Asia (CMA) shares it does not own. This deal is positive for CapitaLand in the medium term. It would allow CapitaLand to fully integrate CMA and enhance its competitive strength in integrated developments. -

Keppel Land

Source: Straits Times

There were no surprises in KepLand's results - first-quarter core earnings per share was 24 per cent of our full-year forecast and consensus. Development sales in China and Singapore were soft in the quarter. Given the weak outlook for the market in China and Singapore, we think slow sales will persist in the 2014 financial year.

First Reit

Source: Straits Times 

First Reit reported first-quarter gross revenue of $22.5 million, which translates into a 28.3 per cent year-on-year growth. First Reit's main focus will remain on the Indonesian health-care market. We conservatively expect contribution from its new Siloam Hospitals Purwakarta to commence on July 1 this year (pending unitholders' approval).

Ezra Holdings

Source: Straits Times

Ezra announced second-quarter "reported" net profit of US$19.6 million (S$24.5 million), 34 per cent lower year-on-year. Adjusting for US$16.6 million one-off gain from associate, EOC Limited, resulting from the sale and leaseback of Lewek Champion, second-quarter earnings were about US$3 million. Second-quarter sales rose 22 per cent year-on-year to US$300 million, mainly driven by higher subsea business contribution.

Views, Reviews & Forum

Housing: Measures to boost supply and ease prices lauded

Source: Straits Times

In 2011, soaring housing prices was one of the hottest issues during the general election. But an unprecedented number of new HDB flats and a slew of cooling measures have since reined in home prices. More Singaporeans can now afford them, leading many to laud housing as the Government's biggest achievement.

Global Economy & Global Real Estate

Iskandar losing shine due to rising costs, labour issues

Source: Straits Times

The Iskandar region has long been touted as a cheaper destination for Singapore companies grappling with escalating costs at home, but the shine seems to be fading. Industrialists cite the rising cost of real estate and labour, a lack of skilled workers and low labour productivity as among the reasons holding them back from shifting to the sprawling development across the Causeway.

China's home price rise cools to 8-month low

Analysts say this shows stabilisation and expect easing trend to continue this year

Source: Business Times / Top Stories

CHINA'S home price inflation slowed to an eight-month low in March, extending to a third month a loss of momentum in a property market that has been a strong spot in the world's second-largest economy.

Average new home prices in China's 70 major cities rose 7.7 per cent in March from a year earlier, easing from the previous month's 8.7 per cent rise, according to Reuters calculations based on data released by the National Bureau of Statistics (NBS) yesterday. In month-on-month terms, prices rose 0.2 per cent in March, slowing from February's rise of 0.3 per cent.

Analysts said the cooling of the property market is an initial indication of stabilisation and they expect the easing trend to continue this year.

-Beijing, China

China March New Home Price Increases Ease on Tighter Credit

Source: Bloomberg / Luxury

China’s new-home price increases eased across the country last month amid tighter credit that prompted developers to give discounts.

Home prices from the first-tier cities to those less affluent all weakened in March, according to the National Bureau of Statistics. Prices in the capital city of Beijing rose 10 percent from a year earlier, the slowest since April last year, while those in Shanghai added 13 percent, the smallest since June. The eastern city of Wenzhou fell 3.9 percent from a year ago, according to today’s data.

Developers including Agile Property Holdings Ltd. (3383) and Wharf Holdings Ltd. cut home prices in some eastern Chinese cities this year as market sentiment weakened on tight liquidity. China’s broadest measure of new credit fell 19 percent in March from a year earlier and money supply grew at the slowest pace on record, central bank data showed this week.

“Mortgage availability is really constrained,” Michael Klibaner, greater China research head at Jones Lang LaSalle Inc., said in a Bloomberg Television interview in Hong Kong with Rishaad Salamat. “Right now, the buyers are still willing, they’re just constrained because they can’t get the debt. If sentiments start deteriorating, that’s a much bigger problem.”

Prices rose in 56 cities in March from a month earlier, compared with 57 in February, according to today’s data.

Shares Gain

Among China’s second-tier cities, the eastern city of Hangzhou, the provincial capital of Zhejiang, posted a 7.8 percent gain from a year earlier, the slowest since July. Prices in the northwestern city of Xi’an rose 8.3 percent, their smallest increase since August, the statistics bureau’s data showed.

The Shanghai Stock Exchange Property Index rose less than 0.1 percent at the close, reversing a decline of 1.1 percent.

“There are definitely risks in the property market of China’s smaller cities,” Lan Shen, a Beijing-based economist at Standard Chartered Plc, said in a phone interview today. “The property market will be a big factor that presses the country’s economic growth this year.”

China’s expansion moderated to the weakest pace in six quarters and property construction plunged, testing leaders’ commitment to keep reining in credit as risks mount of a deeper slowdown. Gross domestic product rose 7.4 percent in the January-to-March period from a year earlier, the statistics bureau said this week, compared with the 7.3 percent median estimate in a Bloomberg News survey of analysts.

Regulate Differently

Premier Li Keqiang said last month the government will regulate the housing market differently in different cities to take into account local conditions.

Existing home prices rose 13 percent in Beijing last month from a year ago, and those in Shanghai increased 9.5 percent, according to the data.

Home sales fell 7.7 percent in the first quarter to 1.1 trillion yuan ($177 billion) in the first quarter from a year ago, the statistics bureau data showed this week.

Sheng Laiyun, a spokesman for the statistics bureau, said in a briefing this week that “relevant departments will closely follow the changes in the property market and improve property macro-control policies accordingly,” in response to a question on whether housing-market policies would be relaxed.

Beijing and Shanghai, the country’s financial center, as well as the southern business hubs of Guangzhou and Shenzhen are considered “first tier” by the statistics bureau. The four “are characterized by high levels of international business connectivity, deep corporate bases and well-developed international grade stock, and they are the country’s most liquid and transparent markets,” according to Jones Lang LaSalle.

-By Bloomberg News

Thai builders seeking opportunities abroad

As govt contracts dry up amid political unrest, firms are turning to neighbouring countries for infrastructure projects

Source: Business Times / World

BANGKOK'S Democracy Monument was erected to commemorate the 1932 coup that ended Thailand's seven-century reign of kings, and became a rallying point last year for protesters seeking to oust the government. Now, the landmark's builder is going abroad for the first time in its 84-year history as political instability saps demand at home.

"Because of the uncertainty, government projects are on hold and some have been cancelled," said Khushroo Wadia, managing director at Christiani & Nielsen Thai. "We are looking for opportunities in neighbouring countries like Myanmar, Laos and Cambodia as a way to diversify our risk."

Thai companies have endured eight straight years of political tension marked by violent street clashes, making them increasingly desperate as orders decline and capacity is idled. With no end in sight to the unrest that began late-October to unseat Prime Minister Yingluck Shinawatra, the danger is more firms may follow Christiani & Nielsen in search of new markets as the monetary authority and the World Bank cut growth forecasts and ratings companies warn of potential downgrades.

-From Bangkok, Thailand

Britons struggling to save for home down payments

Source: Business Times / Wealth

MOST Britons between the ages of 20 and 45 who want to buy a home are not able to save money to put towards a down payment, excluding them from the strongest UK property market in 3½ years.

Those who say they're unable to save anything for a deposit on a home rose to 57 per cent from 42 per cent a year earlier, according to a survey by mortgage lender Halifax. One in five UK residents between the ages of 23 and 27 has no interest in buying somewhere to live, the survey of more than 8,000 people showed.

Record-low interest rates, credit-boosting programmes and a lack of supply are fuelling price increases, making it harder for first-time buyers to make a down payment.

-London, UK

Britons Struggle to Save for Home Down Payments as Prices Surge

Source: Bloomberg / Luxury

Most Britons between the ages of 20 and 45 who want to buy a home aren’t able to save money to put towards a down payment, excluding them from the strongest U.K. property market in 3 1/2 years.

Those who say they’re unable to save anything for a deposit on a home rose to 57 percent from 42 percent a year earlier, according to a survey by mortgage lender Halifax. One in five U.K. residents between the ages of 23 and 27 has no interest in buying somewhere to live, the survey of more than 8,000 people showed.

Record-low interest rates, credit-boosting programs and a lack of supply are fueling price increases, making it harder for first-time buyers to make a down payment. While the government’s Help-to-Buy plan assists homebuyers with deposits, encouraging higher loan-to-value mortgages in the current market is “extremely reckless,” Citigroup Inc. Chief Economist Willem Buiter said this month.

“We may be heading towards the point where the aspiration to own a nice home will be replaced by the aspiration to simply live in one,” Halifax Mortgages Direct Craig McKinlay said in the report. Halifax is a unit ofLloyds Banking Group Plc. (LLOY)

U.K. house prices climbed 7.2 percent last month to an average of 262,291 pounds ($441,000), the largest annual gain since September 2010, Acadata said in an April 11 report.

More Mobility

A preference for renting in Britain, where home ownership has long been a goal for most people, could create better labor mobility and could improve economic growth, Halifax said in the report. It might also lead to fewer homes than necessary being built because demand for properties would be less stable, the mortgage provider said.

Homeownership in the U.K. is falling for the first time in more than a century, according to government statistics. The number of people who live in their own property declined to 64 percent in 2011 from 69 percent in 2001.

Renting a home in the U.K. now costs almost 1,500 pounds a year more than owning one, according to data compiled by Halifax. Average rents have increased by more than 1,200 pounds since 2009, while the cost of owning is relatively unchanged, it said.

-By Neil Callanan and Scott Hamilton