Singapore Property News: 16th to 31st December 2015

Real Estate News

Property Market Activities

Prices of completed small condos down in November (BT, 29 December 2015)

Prices of completed small condo units and apartments (up to 506 square feet) islandwide slipped 1.2 per cent in November over October. This was based on the latest flash estimates from the National University of Singapore for its Singapore Residential Price Index (SRPI) series. It followed a price drop of 0.4 per cent in October. Year-to-date, the SRPI for small units islandwide has fallen 4.1 per cent.

Industrial land supply for H1 2016 at 8-year low (BT, 29 December 2015)

The Singapore government has continued to moderate the supply of industrial land for the first half of 2016 in the face of a looming industrial space glut. Marking an eight-year low, there will be six sites on the Confirmed List and four sites on the Reserve List with a total site area of 12.24 hectares under H1 2016 industrial government land sales programme (IGLS).

Private home prices to drop 5-15% over 2016-2017: OCBC (BT, 19 December 2015)

OCBC Investment Research said it expects private home prices to slip 5 to 15 per cent over 2016-2017 and 2016 primary residential sales to remain muted at between 6,000 and 9,000 units as well as residential rents to drop 8-15 per cent over two years. A price crash in excess of 20 per cent is “improbable” as there will be significant demand from buyers entering the market at lower price points.

S’pore consumers to see loan repayments go up as Fed hikes rate (Today, 18 December 2015)

With the United States’ Federal Reserve raising interest rates for the first time in seven years, consumers in Singapore may see lending costs increase but those who save may also benefit from higher deposit rates, analysts said. The three-month SIBOR has risen from around 0.4 per cent at the beginning of the year to around 1.1 per cent currently, while the three-month SOR has inched up from around 0.8 per cent to close to 1.6 per cent during the same period. The rates will likely rise further, which means greater burden on borrowers in financing their loans.

Properties put up for auction at highest since 2010 (ST, 18 December 2015)

The number of properties being repossessed and put up for auction this year has hit a seven-year high since 2009. These mortgagee listings are put under the hammer by banks and other financial institutions after the borrowers defaulted. Their numbers surged by 51.6 per cent to 241 this year, from 159 last year. There were 555 owner listings in 2015, which pushed the total auction listings to 796, the highest since 2010, and a 50.5 per cent jump from the 529 total auction listings in 2014.

Big-ticket deals set to be the lowest in 6 years (BT, 17 December 2015)

CBRE and Savills Singapore showed that 2015’s tally of investment sales of property, big-ticket transaction of at least S$10 million, is set to be the lowest in six years. Still, the tally will not be as bad as that for 2009, when transactions dived during the Global Crisis. Savills’ numbers reflect S$16.7 billion of deals so far this year (up to Dec 16), about 11 per cent lower than the S$18.8 billion clocked last year. CBRE’s numbers show a similar trend, with S$16.5 billion of transactions from 1 Jan to 16 Dec 2015, a drop of 15 per cent from 2014’s S$19.4 billion.

Good location, pricing push up sales of new private homes (ST, 16 December 2015)

There were 759 private homes sold in November, up 39 per cent from the 546 moved in October, according to the Urban Redevelopment Authority. The rise in new home sales shows the market’s resilience, but buyers still need to be lured by well-located developments at attractive prices, said analysts. Without any new launches this month, most analysts expect new private home sales to remain muted until after Chinese New Year.

Private home resale prices up 0.6% in Nov: SRX (Today, 16 December 2015)

Resale prices of non-landed private homes rose 0.6 per cent in November from October, the latest flash estimates from SRX Property showed on Dec 8, but analysts attributed the rise to month-to-month fluctuations and said it was not strong enough to signal a market recovery. Prices in the Core Central Region, or city centre, jumped by 3 per cent from the previous month, while those in the Rest of Central Region, or city fringes, rose by 1.3 per cent. Prices in the Outside Central Region, or suburbs, slipped 0.8 per cent. Market experts foresee that the downward trend will continue going into 2016.

Public Housing

BTO flat supply to rise to 18,000 next year (ST, 31 December 2015)

The number of new Housing Board Build-To-Order (BTO) flats will be ramped up to 18,000 next year to provide for a rise in demand. This is about 3,000 flats more than the 15,100 units launched this year, National Development Minister Lawrence Wong revealed. About 26,000 new HDB flats were completed in 2015. And while noting that resale flat prices seem to be stabilising, he maintained that it is “too early” to unwind property cooling measures.

Government Land Sales

Yio Chu Kang exec condo site up for tender (BT, 30 December 2015)

The government launched two executive condominium (EC) sites – one at Yio Chu Kang under the confirmed list for public tender, and another at Sumang Walk for application under the reserve list. The confirmed list site is located at Yio Chu Kang Road. The 18,422.9 square metre site has a permissible gross floor area of up to 51, 584.12 sq m, and can generate about 520 units, according to the Housing & Development Board. The tender will close at 12 noon on Feb 18, 2016. Consultants are expecting anywhere from 5 to 14 bids, with the winning bid ranging from S$260 to S$340 per square foot per plot ratio (psf ppr).

Industrial sites at Tampines, Tuas go on sale (BT, 29 December 2015)

Two Confirmed List sites at Tampines Industrial Drive (Plot 5) and Tuas South Link 2 (Plot 9) have been launched for sale by public tender, JTC announced on 29 Dec. The 0.51 ha site at Tampines Industrial Drive (Plot 5) and the 0.48 ha site at Tuas South Link 2 (Plot 9) are zoned for Business-2 development. Both have a 20-year tenure with a maximum permissible gross plot ratio of 1.4.

1.1-ha reserve list site at Marina Bay excites market (BT, 17 December 2015)

The 1.1-hectare white site along Central Boulevard is now available for application on the reserve list, 99-year leasehold site can be built up to 50 storeys, with a maximum gross floor area (GFA) of 141,309 sq m (1.52 million sq ft), of which at least 100,000 sq m or 70.77 per cent must be put to office use. In addition, up to 5,000 sq m GFA can be set aside for retail use. The balance may be utilised for additional office, hotel, serviced apartment or residential uses. The entire development, excluding the GFA for hotel, serviced apartment and residential use, can have no more than three strata lots.

Investment Sales

Old Seagate building gets top bid of S$250m (BT, 29 December 2015)

The former Seagate building at 7000 Ang Mo Kio Avenue 5 has received six bids from potential buyers through an expression of interest, with the top bid crossing S$250 million or in excess of S$300 per square foot of net lettable area (NLA). Ho Lee Group, owner of the property, is seeking to divest the hi-tech industrial building through a share sale of the property’s holding company 7000 AMK Pte Ltd. It had in 2011 acquired the building from Seagate Technology International for S$91.5 million. It further spent in excess of S$10 million to upgrade the building.

The Verge sold for S$317m, to make way for serviced residences (BT, 23 December 2015)

The Verge, a struggling mall in Little India, is being sold for S$317 million to a company controlled by Keith Tang, grandson of CK Tang founder Tang Choon Keng and who owns a chain of hotels and serviced apartments in Australia and New Zealand. Mr Tang is expected to assemble a consortium for the purchase and redevelopment of The Verge, which is on a site with about 80 years’ balance lease. He plans to redevelop the property into “Studio by Tang” serviced apartments, a mall and a Signature block which is likely to be offices or retail but could also include medical suites. The proposed scheme will also feature an urban beach.

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