15 Feb Singapore Property News: 1st to 15th February 2014
Property Market Activities
DBS sees home prices falling by 10-15% this year (BT, 15 February 2014)
DBS Bank chief executive Piyush Gupta expects home prices to fall by 10-15 percent this year, more than the 10 percent forecast by property consultants. But this decline would not make a material impact on the bank’s loan book. As for the higher interest rates expected with the shrinking of monetary stimulus policy by the US, it’s not expected to have any effect on DBS. The pressure will likely start coming when unemployment rises, more than when property prices change.
More than 200 Riverbank units snapped up (BT, 15 February 2014)
More than 200 units at Riverbank @ Fernvale in Sengkang were sold when 250 units of the 555-unit condominium project were released for sale on 14 Feb. Developer saw strong take-up for one, two-bedroom and loft units. Units at Riverbank @ Fernvale were sold for an average of slightly over $1,000psf.
Developers sweetening deals to woo home buyers (ST, 14 February 2014)
Developers appear to be becoming nervous about the slowing property market, with at least two projects dangling sweeteners to stir interest among wary buyers. Developers offer various promotions. Some provide discounts on cars if buyer purchases a unit, while some offer direct cash rebate on selling prices.
Refinancing reprieve for homeowners who bought before last June 29 (BT, 11 February 2014)
MAS announced revised measures with immediate effect that refinancing of loans for owner-occupied homes bought before June 29 2013, will be exempted from TDSR cap, under which a borrower’s monthly instalments for all debt servicing including mortgage payments cannot exceed 60 per cent of gross monthly income. However, an investment property borrower has to carry out the refinancing by June 30, 2017, and must also commit to a debt reduction plan at the point of refinancing. For HDB and ECs which are owner-occupied and were bought before their respective MSR implementation dates, the 30 percent cap will also not apply to the refinancing of loans.
Resale of non-landed homes in Jan down 70% (BT, 11 February 2014)
Flash estimates from the SRX shows that resale transactions of non-landed private residential homes tumbled 70.2 percent to 310 in January, from 1,039 deals a year ago. It was also 9.1 percent lower than December’s 341 transactions. But resale price index rose 2.3 percent from the December level. The rise in the resale price index was led by gains in CCR and OCR, which marked respective increases of 2.1 percent and 2.4 percent for the month, while RCR index softened by 0.9 per cent.
Home launches and sales in suburbs shrink dramatically (ST, 8 February 2014)
Suburban projects saw a sharp slowdown in 2H2013. Both unit launches and unit sales in the six-month period plunged to their lowest levels since the depths of the financial crisis in 2H2008. The take-up rate for mass market private homes in July through December 2013 also slid to its lowest point since 1H2008. New suburban homes sold came up to 2,228 units in 2H2013, shrinking 64 percent from the 6,143 units that were moved in 1H2013.
Redas-NUS index throws up mixed signals (ST, 7 February 2014)
Developers’ sentiment may have improved marginally in 4Q2013, but concerns over potential declines in residential property prices and rising costs continue to cap their outlook. In the latest Real Estate Sentiment Index survey, the Composite Sentiment Index that captures the overall market sentiment of property developers increased to 4.0 in 4Q of 2013, up from 3.9 in 3Q. But 62 percent of the developers surveyed anticipate a moderate decrease in residential property prices in the next six months.
Demand for homes in core central region may pick up (ST, 3 February 2014)
Some market watchers said demand for homes in the core central region could pick up as early as the second half of this year, as prices continue to moderate. Home prices in the core central region fell 1.9 percent in 2013 and some analysts expect to see another 5 percent drop this year. Some unsold units in the city were even transacted at below valuation.
January COV falls to level not seen since 2009 financial crisis (BT, 7 February 2014)
The median COV for HDB resale flats fell to $3,000 in January, matching the previous low in June 2009 during the global financial crisis. Analysts expect the COV to fall further, with 24,300 BTO flats slated to be launched this year. In January, 893 HDB resale flats were sold, a slight drop from the 910 units sold in December. On a year-on-year basis, January’s resale volume was a 34.6 percent drop.
New subletting quota likely to affect Simei, Yishun, Bt Merah first (ST, 3 February 2014)
HDB announced the quota on subletting of whole flats to non-citizen subtenants some two weeks ago. The quota is set at 8 percent per neighbourhood and at 11 percent per block. The new subletting quota for foreigners is likely to hit estates such as Simei, Yishun and Bukit Merah earlier than other areas. This is because a larger non-citizen crowd is employed in offices and other places of work located in these estates.
Government Land Sales
Anchorvale Crescent EC site draws keen interest (ST, 14 February 2014)
The 99-year leasehold site at Anchorvale Crescent drew 12 bids at the close of its tender period yesterday, with the top bid of $366.91 psf ppr by SingHaiyi Group’s Phoenix Real Estate. This is 0.98.8% higher than the second highest bid of $363.3 psf ppr, put up by MCL Land. It shows that developers’ confidence in EC remains strong. The site has a maximum GFA of 525,708 sqft, expected to yield 656 units.