singapore property weekly issue 191

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CONTENTS

p2 3 Property Investment Mistakes You

Should Avoid In 2015

p6 Singapore Property News This Week

p11 Resale Property Transactions

(December 31 – January 6 )

Welcome to the 191st edition of the Singapore Property Weekly.

Hope you like it!

Mr. Propwise

FROM THE

EDITOR

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SINGAPORE PROPERTY WEEKLY Issue 191

Page | 2Back to Contents

By Property Soul (Guest Contributor)

No matter what your New Year resolutions

are, it’s time you said goodbye to your bad

habits in property investment. If you are

buying a private home in 2015, avoid making

these three common mistakes.

Mistake #1: Rush in and get burnt

According to the URA, there are 88,627

uncompleted private residential units

(including ECs) in the pipeline. As at 3rd

Quarter 2014, 28,120 units (excluding ECs)

have been launched but remain unsold. For

public flats, the HDB will launch another

16,900 BTO flats this year.

Do the math. Ninety percent of resident

households already own their homes.

Population growth in Singapore is a record-

low 1.3 percent in 2014.

3 Property Investment Mistakes You Should Avoid In 2015

https://propertysoul.files.wordpress.com/2015/01/2015.jpg



For the past five years, the annual increment

in the number of resident households ranges

from 3,000 to 22,500. Assuming there are two

persons in each new household, every year

only 1,500 to 11,250 new homes are needed.

Among the 81.9 percent of HDB dwellers who

have plans to upgrade to condominiums, the

sale of their home is difficult due to falling

HDB resale prices. Furthermore, buyers of

HDB flats and ECs have to pass the 30

percent Mortgage Servicing Ratio, just like

many owners with multiple properties have

their hands tied by the Total Debt Servicing

Ratio.

Foreign buyers have to bite the bullet for a

higher Additional Buyer Stamp Duty and

lower Loan to Value. In 2014, the growth of

foreigners has slowed down to 2.9 percent.

Foreign employment growth also dropped to

3 percent.

Even if you build, they won’t come.

Let developers solve their own problem. But

don’t let their problem become yours. You

don’t want to be left holding a hot potato.

The property market slowdown is just starting.

Patience is key if you are looking for a real

bargain. Sit back and wait for the demand to

dry up.

Mistake #2: Be caught unprepared

We've heard the Fed talking about raising

interest rates too many times. Just when

everyone grows tired of the cry wolf game,

the untamable animal is getting ready to

attack in 2015. It stalks the prey silently in the

dark. And when it finally attacks, it bites

agilely and furiously, pouncing on it

repeatedly in a short period of time.

Take an example from one of my rental

properties.



In mid-2005, I was still paying an interest rate

of 1.3 percent. After three to four rounds of

interest rate revisions, with the step-up rate of

a variable-rate loan, the rate had already

been raised to 4 percent by the end of 2006.

If you are contemplating buying a private

home, rather than using the arbitrary 3.5

percent interest rate from TDSR, you are not

being too conservative to use 4 percent for

your calculations.

For those who have an existing home loan,

call the banks now to ask for their latest

housing loan packages. Don't wait till your

bank sends you the letter on an interest rate

revision.

Paying higher interest takes effect the

following month, but repricing and refinancing

will take time to process. Even after approval,

it needs another three months to be effective.

You have no choice but to pay higher interest

before the adjustment takes place.

Mistake #3: Expect to get rich quick with

properties

If someone tells you that you can buy

properties with little money or using other

people’s cash, don’t be too carried away.

They promise to share with you where the

money is. But these ‘profitable investment

opportunities’ and ‘undervalued assets’ are

most likely unsold units of overseas property

projects being marked-up and marketed to

you.

I have received countless proposals from

overseas developers who want to market

these projects to my Property Club Singapore

members. Some even put forward the

commission they will offer right in their first

message.

http://www.propertyclubsg.com/







You can close one eye, buy any property and

still make a handsome profit in a growing

market. But prices in many foreign property

markets are currently at their all-time highs.

There are also countries with structural

economic problems but no turnaround in

sight.

Frankly, real property investors will keep quiet

about which projects they are buying. Instead

of buying jointly with complete strangers

without any background checks, they only

invest with people they know very well.

Besides, what make you think that you too

can become a property millionaire, without

the punishing discipline to save, and the

enormous effort to do all the legwork?

The problem of these get-rich-quick property

seminars is that they tend to over-simplify the

strategies. There is no short-cut and no magic

pill in property investment. And you really

don’t have to pay so much for a course and

go around in circles to learn that.

Lastly, don't be distracted by all the noise

around you. Make sure that all the

fundamentals are sound before you make any

decision.

By guest contributor Property Soul, a

successful property investor, blogger, and

author of the No B.S. Guide to Property

Investment.

http://propertysoul.com/

http://aktive.com.sg/store/no-b-s-guide-to-property-investment/














http://www.anthonyrobbinssg.com/propwise


Singapore Property This Week


Residential

230 private homes sold in December 2014

In December 2014, developers sold 230

private homes. This was significantly lower

than the 423 units that were sold in

November last year. According to the

Business Times, the lack of launches and

marketing effort could have affected sales of

private homes in December. Not only so,

weak market sentiments could have affected

demand of private homes, said Alice Tan from

Knight Frank. Nonetheless, the sale of new

homes in December last year was

comparable to the 259 units sold last year,

year-on-year, according to the Urban

Redevelopment Authority. Market experts

predict that there will be fewer units sold this

year, and theyexpect developer sales to

reach 7,000 to 10,000 units this year. Prices

of private homes are expected to fall by 5 to 8

percent, compared to 2014. Nonetheless,

Ong Teck Hui from JLL is optimistic about the

property market in 2015 because he believes

that as the government ease the cooling

measures, buyers will attempt to time their

purchases.

(Source: Business Times)



SRX: Dec’s non-landed private residential

rent falls by 0.8%

From November to December 2014, rents of

non-landed private residential properties have

fallen by 0.8 percent. According to Singapore

Real Estate Exchange, this is the 10th month

that non-landed private residential rents have

fallen. Ong Kah Seng from R’ST Research

believes that this falling trend will continue

into 2015. He expects rents to fall up to 8

percent by the end of 2015. As foreign labour

supply shrinks, demand for private residential

properties will likely weaken further, said Ong.

Residential rents in the core central region

have fallen by 1.2 percent in December from

November in the last year. On the other hand,

rents in the rest of central region and outside

central region had experienced a smaller fall

of 0.6 percent and 0.3 percent respectively.


Dec’s private condos resale prices

increase by 0.1%

According to SRX Property, there was a 0.1

percent rise in resale prices of private condos

in December. However, market experts

believe that this was a blip. Resale prices in

December had been driven by transactions in

suburban areas, according to the Business

Times. Resale prices from units in the outside

central region had increased by 0.5 percent in

December. Nonetheless, transactions in the

core central region and rest of central region

had fallen by 1.1 percent and 1.2 percent

respectively. The SRX non-landed private

residential price index has fallen by 4.2

percent in December, year-on-year. Prices

have fallen by 6.1 percent from January to

December 2014. Christine Li from OrangeTee

said that the current total debt servicing ratio

(TDSR) favours the mass market segment,



as buyers from that segment have a lower

quantum. Li said that the year-on-year

increase in sales volume could mean that

buyers and sellers are adjusting to the TDSR.


Property prices expected to fall by 3% per

year in 2015 and 2016

Residential property prices are expected to

fall in 2015 and 2016. According to Fitch

Ratings, private and public home prices are

likely to slip by 3 percent per year. On the

other hand, mortgage rates are expected to

increase from 1.5 percent to 2 percent.

Despite the increase in mortgage costs, debt

burdens are still considered low due to a

strong labour market. Singapore’s macro-

prudential policies are also likely to cool

demand in the property market.


URA: Geylang will be rezoned for

commercial and institutional use only

Lorong 4 to Lorong 22 at Geylang will

undergo a rezoning exercise, according to the

Urban Redevelopment Authority (URA). The

rezoning exercise will stretch across 14 ha of

land. Under this exercise, residential projects

will no longer be approved for development

within the 14 ha stretch. Instead, the rezoned

section may only be developed for

commercial or institutional use. Nonetheless,

the maximum plot ratio remains at 2.8. Also,

existing residential projects will be allowed to

remain as they are. The rezoning is expected

to boost land values in the locale and

increase collective sales, said market experts.

URA believes that the rezoning exercise will

decrease friction on the ground between

residents and other users of the area.



Mary Sai from Knight Frank believes that in

the short run, residential value in Geylang will

not improve due to the rezoning. However,

when the commercial developments in the

area matures, residential property value may

increase.


Units at Marine Blue sold for $1,800-

$2,000 psf

Marine Blue, which is located near the Grand

Mercure Roxy Hotel at Marine Parade Road,

has been put up for sale. Of the 50 units

released, 31 have been sold for an average

price that is between $1,800 and $2,000 psf.

These include one-bedroom-plus-study, two-

bedroom units and a penthouse. According to

the Business Times, the average selling price

is about 10 percent lower than the listed

price. The 120-unit condominium is expected

to attract young professionals and families

due to its proximity to amenities and schools.


Commercial

JTC: industrial space will be built to meet

demand

To ensure that supply will meet demand, JTC

Corporation will be building a new industrial

space. The site will target niche

semiconductor firms, and will consist of

facilities to cater to corporations from the

aerospace, biomedical and chemical

industries. JTC will work with trade

associations, industrialists and partner

agencies to design a ready-built facility to

cater to the specific needs of such

companies. The industrial building is

expected to be four stories high. It would

comprise of common utilities such as bulk



gases and chilled water to help ease upfront

capital costs for companies, according to

JTC. The site will be located at Tampines

High Tech Park. It would have a total gross

floor area of 22,700 sqm and a plot ratio of

1.7. It is expected to be ready for use in 2017.


3 office floors at Anson Rd sold for $30

million

3 floors on Hub Synergy Point, a 28-storey

freehold office block on Anson Road has

been sold for $30 million. The 26th level was

sold for $9.97 million or $2,400 psf while both

levels 27 and 28 were sold for $20 million or

$1,512 psf. The 26th level had a strata area of

4,155 sq ft and the levels 27 and 28 had a

total strata area of 13,299 sq ft. With the sale

of these three levels, Donald Han said that

the building is now under a single ownership.

This would allow the owner to reposition or

redevelop the building.


Fewer bids made for site at Yishun

A mixed-use site at Yishun attracted only five

bids. This was lower than expected.

Previously, market experts had predicted that

there would be between six and eighteen

bidders. Market experts also expected the

highest bid to be about $650 psf ppr.

However, the site was won by Northern Resi

and Northern Retail for $185.09 million or

$629.24 psf ppr. The site has a gross floor

area of 27,327 sqm, and uses prefabricated

prefinished volumetric construction (PPVC)

technology. Due to the mandatory use of

PPVC, most of the bidders were developers

with a construction arm, said Desmond Sim

from CBRE.




Non-Landed Residential Resale Property Transactions for the Week of Dec 31 – Jan 6

NOTE: This data only covers non-landed residential resale property

transactions with caveats lodged with the Singapore Land Authority.

Typically, caveats are lodged at least 2-3 weeks after a purchaser

signs an OTP, hence the lagged nature of the data.

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

1 THE CLIFT 1,076 1,900,000 1,765 99

3 ASCENTIA SKY 1,012 1,620,000 1,601 99

4 THE INTERLACE 1,055 1,608,000 1,524 99

9 THE COSMOPOLITAN 1,679 3,250,000 1,935 FH

9 ASPEN HEIGHTS 1,109 1,650,000 1,488 999

10 THE HORIZON 1,561 2,320,000 1,486 FH

10 THE TESSARINA 1,615 2,250,000 1,394 FH

10 TANGLIN REGENCY 1,292 1,715,000 1,328 99

10 GLENTREES 1,991 2,410,000 1,210 999

11 THE ARCADIA 3,810 3,880,000 1,018 99

12 THE CITRINE 1,141 1,240,000 1,087 FH

14 BLISS VILLE 1,163 1,310,000 1,127 FH

14 THE WATERINA 1,130 1,230,000 1,088 FH

14 THE TRUMPS 1,356 1,439,000 1,061 99

14 CENTRAL MEADOWS 969 950,000 981 FH

15 STILLZ RESIDENCE 1,001 988,000 987 FH

16 EASTWOOD REGENCY 452 635,000 1,405 FH

16 THE BAYSHORE 969 900,000 929 99

18 TROPICAL SPRING 1,528 1,350,000 883 99

21 PARC PALAIS 990 1,050,000 1,060 FH

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

23 HILLVIEW REGENCY 1,119 995,000 889 99

23 PARKVIEW APARTMENTS 1,119 900,000 804 99

23 NORTHVALE 1,087 860,000 791 99

25 ROSEWOOD 1,173 950,000 810 99

27 ORCHID PARK CONDOMINIUM 893 712,000 797 99

http://propertymarketinsights.com/

singapore property weekly issue 191

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