Singapore Property News: 16th to 31st August 2016

Real Estate News

Property Market Activities

Condo prices in central region inch higher in July (ST, 30 August 2016)

Prices of completed apartments in the central region rose a touch last month after a similar increase in June, prompting experts to tip that the segment may be hitting bottom soon. Values rose 0.7 per cent in July from June, and follow June’s 0.9 per cent lift but they are still down 1.3 per cent from a year earlier. The non-central region has not fared as well; prices were down 2.3 per cent year on year, according to NUS Singapore Residential Price Index (SRPI) data.

Singapore condo resale prices fall 0.4% in July, erasing June’s gain (BT, 10 August 2016)

Resale prices of non-landed private homes in Singapore eased 0.4 per cent in July 2016 over the previous month, based on SRX Property’s flash estimate for July. The drop contrasts with a revised 0.4 per cent month-on-month gain in the index for June 2016. Prices contracted 0.5 per cent in Core Central Region (CCR), 0.6 per cent in Rest of Central Region (RCR) and 0.3 per cent in Outside Central Region (OCR). Year on year, the July 2016 overall resale price index for non-landed private homes inched up 0.1 per cent compared with July 2015.

Surprise 3.6% fall in Singapore’s July factory output (BT, 27 August 2016)

Singapore’s manufacturing output surprised by shrinking 3.6 per cent year on year in July – reversing four consecutive months of expansion, and disappointing the market’s hopes for a 0.8 per cent increase. The worst-performing cluster was transport engineering, which posted a 21.8 per cent decline in output year on year. In seasonally adjusted month-on-month terms, manufacturing output declined 4 per cent in July – the third straight month of contraction. This was also a far worse showing than private-sector economists had forecast; they had foreseen an expansion of 0.3 per cent.

Factory-converted dorms to meet 4 new conditions by Jan 2017 (BT, 25 August 2016)

The Ministry of Manpower (MOM) has introduced four new conditions for all operators of factory converted dormitories (FCD). The new conditions are:

  • Provision of feedback channel for workers to report issues related to the housing conditions of the FCD.
  • Provision of personal locker for each worker.
  • Provision of at least one sick bay in the FCD. Alternatively, the operator can develop a contingency plan to deal with cases of infectious diseases.
  • Provision of Wi-Fi within the FCD.

These conditions will kick in from Jan 1, 2017.

Buying interest steady for Good Class Bungalows (BT, 27 August 2016)

The number of sales of Good Class Bungalows (GCBs) remains below the level they were at before the Total Debt Servicing Ratio was imposed in mid-2013, but there remains buying interest for this rare type of property. Based on caveats lodged and including the two GCB plots in Nassim Road, 19 sites in GCB areas have been sold so far this year, with a total value of $438.17 million. This is comparable with 19 sites and a total value of $470.99 million sold in the same period last year, according to an analysis by CBRE. Thirty-three of these sites with a total value of $714.78 million were sold last year, up from 28 sites worth $626.14 million in 2014.

3-month Sibor falls to 12-month low amid Singdollar strength (BT, 24 August 2016)

Local interest rates are falling as the strong Singapore dollar is attracting inflows. The key three-month Sibor (Singapore interbank offered rate) used to price home loans is at a 12-month low of 0.87192 per cent, a level it reached on Aug 19. The three-month Sibor is now some 30 per cent lower than the year’s high of 1.254 per cent on Jan 19. The low interest rates are due to the continued strength of the Sing dollar, which attracts inflows.

Jump in recurring revenue cushions drop in property sales (BT, 22 August 2016)

Like other property groups here, Far East Organization (FEO) has seen its property sales in Singapore ease significantly in the past few years due to the property cooling measures. Near quadrupling of recurring revenue has provided some cushion against the ups and downs of property cycles. Recurring revenue includes rental income from the group’s portfolio of leasing properties.

Singapore’s July exports down 10.6% year on year, far below forecasts (CNA, 17 August 2016)

Non-oil domestic exports (NODX) were hit by a decline in both electronic and non-electronic exports, according to latest figures released by International Enterprise (IE) Singapore on Aug 17. Overall, exports of electronic products fell 12.9 per cent in July, following the 1.7 per cent contraction in the previous month. Economists commented that the poor July figures have added on to the economic gloom.

Public Housing

Hougang project most popular in August BTO exercise (ST, 24 August 2016)

Contrary to expectations, new Housing Board flats in Tampines were not the top draw in this month’s Build-to-Order (BTO) launch. Instead, Buangkok Woods in Hougang was the most popular project, with 4.4 applicants for each three-room flat and 4.3 for each four-room flat. Experts said the high supply of Tampines flats might explain the lower application rates this time. For some buyers, price is a factor.

HDB launches over 4,800 units for sale under August BTO exercise (BT, 17 August 2016)

The Housing & Development Board (HDB) launched 4,841 flats for sale under the August 2016 Build-To-Order (BTO) exercise. The flats are spread across five projects – three in the non-mature towns of Hougang, Sembawang and Yishun, and two in the mature town of Tampines. It is the third BTO launch in 2016. So far, 12,781 BTO units have been offered this year. HDB has offered a total of 17,951 flats in 2016, including the 5,170 balance flats offered in May 2016.

Government Land Sales

Central Boulevard site likely to attract keen interest (ST, 31 August 2016)

Developers are expected to show keen interest in a plum 1.1ha Marine Bay site in Central Boulevard launched for sale by the Urban Redevelopment Authority. Property consultants expect more than 10 bids from a mix of local players and joint ventures with foreign developers. There might be investment money from China and the Middle East looking to buy in the Asia Pacific, especially after the Brexit vote in June.

Sengkang EC site draws land-hungry developers (ST, 24 August 2016)

Land-hungry residential developers made a beeline for an executive condominium (EC) site in Anchorvale Lane, Sengkang. The site drew 16 bids, a whopping turnout not seen for an EC site since July 2013. The top bid of S$355.07 per square foot per plot ratio (psf ppr) from a Hoi Hup Realty – Sunway Developments tie-up exceeded all expectations and is the highest offer for an EC site since a Choa Chu Kang Drive plot (coming up as Wandervale) fetched S$361 psf ppr in September 2014. Competition was also fuelled by the plot being the only EC site on this year’s confirmed list of the Government Land Sales (GLS) Programme.

Investment Sales

Yun Nam boss picks up GCB at Brizay Park (BT, 31 August 2016)

Yun Nam Hair Care boss Andy Chua is understood to have picked up a Good Class Bungalow (GCB) along Brizay Park off Old Holland Road for S$33 million. The price works out to S$1,108 per square foot (psf) on the freehold land area of nearly 29,800 square feet. Inclusive of the latest deal, at least 23 GCB transactions have taken place this year at a total of S$531 million.

69 industrial units on sale for about $38m (ST, 25 August 2016)

Ruby Group, the original developers of Ruby Warehouse Complex, is selling its stake in the building. This consists of 69 strata-titled units, or about 53 per cent of the development by share value. The guide price is $37.5 million to $38.8 million, or about $280 to $290 per sq ft. The units are fully tenanted and had been held by the company as investment properties. Investors are said to enjoy a net return above 6.3 per cent a year. The entire portfolio, which makes up about 133,892 sq ft in all, would be preferably sold to a single purchaser.

The tender for the industrial units closes on Oct 6.

ValueMax chief executive buys Katong freehold bungalow for S$30 million (BT, 25 August 2016)

The chief executive of listed pawnshop ValueMax Group, Yeah Hiang Nam, has lodged a caveat to buy a freehold bungalow along Wilkinson Road in Katong for S$30 million. It sits on a land area of 2,453 square metres. The transaction price translates to about S$1,136 per square foot (psf) of land. Property consultants said that the transaction price was in line with recent deals closed in the vicinity, but the land size caused the total quantum to balloon to a hefty figure.

Former HUDC estate could be put up for collective sale (ST, 24 August 2016)

Sources say owners of the 175-unit Raintree Gardens in Potong Pasir Avenue 1 have got the minimum consent level required for the site to be launched for sale. The 201,405 sq ft plot, next to Kallang River and near Potong Pasir MRT station, has just over 70 years of lease left. It is zoned for residential use with a 2.8 plot ratio. Property experts believe the owners could get over $315 million, or about $1.8 million per unit.

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