17 Oct Singapore Property News: 1st to 15th October 2015
Property Market Activities
Normanton Park condo to go enbloc, largest deal in Singapore since 2007 (ST, 15 October 2015)
Normanton Park condominium located near Kent Ridge Park will be put up for collective sale next Thursday (22 Oct) after more than 80 per cent of the owners agreed to the sale. There are 488 units in the condominium project – made up of eight low-rise blocks and five 23-storey towers. The Straits Times understands that the reserve price is in the region of S$840 million, making it one of the largest enbloc deals to be launched in Singapore in recent years. With 61 out of the 99 years left, the marketing agent said each owner will stand to pocket S$1.6 million to S$1.7 million on average if the deal goes through.
Market volatility seen driving up mortgagee sales (BT, 15 October 2015)
The sell-off in equity markets, price fluctuations of commodities and the weaker rental market seem to have driven up the number of homes put up for mortgagee (or lender) sale in 2015. Close to 55 homes were put up for mortgagee sale from January to September 2015. Mortgagee sales occur when financially stretched borrowers face difficulties repaying their loans and cannot secure buyers for their properties, so financial institutions have to repossess these properties and put them up for auction. Property auctions thus become a good place for opportunistic buyers to get distressed assets at good prices.
Weakness in private condominium rents persists in September (BT, 15 October 2015)
Weak leasing conditions for private condominiums continued to weigh on rents in September but this failed to lift rental volumes from the preceding month. According to SRX Property flash estimates, rents of private non-landed residential units declined 0.3 per cent in September from a month ago, dragged by the city fringe and suburban areas. Still, rental volume dipped 4.1 per cent. SRX Property estimated that there were 3,758 rental transactions in September, compared to 3,919 in August. The rental decline in the OCR to increased completions of suburban condominiums in recent times, presenting more choices for tenants.
Raised EC income ceiling hits private resale market (Today, 14 October 2015)
A total of 446 non-landed private homes were resold last month, SRX Property estimated in its monthly flash report. This was down from 468 units in the same month last year and down 10.6 per cent from the 499 units resold in August. Resale prices slipped 1.2 per cent last month from September a year earlier and 0.1 per cent from August. Core central region (CCR) segment may be enjoying buyer support as there have been no new launches within the area for some time, but he added that the overall market will extend its gradual decline. Analyst expects for the whole of 2015, resale prices are expected to decrease by about 2 per cent based on the SRX resale price index, as loan restrictions and policy measures continue to be in place.
UOL, Kheng Leong to sell first phase of Alexandra condo at over S$1,600 psf (BT, 10 October 2015)
Citing upside potential in new condominium project Principal Garden that may defy tepid market conditions, developers UOL Group and Kheng Leong Company said that they are contemplating the launch of its 663 units in phases. The units start from S$770,000 for a one-bedder, S$1.18 million for a two-bedder and S$1.7 million for a three-bedroom unit. Located on the fringe of a good class bungalow area, Principal Garden will also have an extensive greenery landscape. Its greenery to built-up space ratio of 80:20 is touted as “exceptional” given that developers tend to maximise built-up space for newer condominium projects.
Developers’ calls to extend project deadline meet with a “no” (BT, 8 October 2015)
The government has rebuffed calls by some developers to extend the five-year deadline for them to complete a residential project and sell all its units – part of a slew of property cooling measures introduced in recent years. The five-year deadline is meant to encourage developers to complete the development and sale of the residential units so as to increase the supply of housing units and help moderate residential property prices. A spokeswoman from Ministry of Finance said that they do not see a need to relax this condition as the deadlines remain relevant and reasonable. However, the introduction of the 15 per cent additional buyer’s stamp duty (ABSD) had produced an unintended deterrent to en bloc sales, which is the main option for rejuvenating old estates. Owners of older estates are also seeking a fair chance for a successful collective sale.
Windsor Park GCB sold for $21.8m (ST, 8 October 2015)
The freehold property at 122 Windsor Park Road, off Upper Thomson Road, has a land size of 20,383 sq ft, which works out to a price of about $1,070 per sq ft (psf). This is just below the two transactions in January 2013, when 2 Windsor Park Hill was sold for $25.3 million or $1,125 psf; while 55 Windsor Park Road, a new house, went for $27 million, or $1,400 psf.
Competition for land still strong despite tepid market (BT, 7 October 2015)
Developers may be bidding more cautiously now, factoring the difficulty of selling their units into their bidding prices, but the competition for land remains healthy. It may come as a surprise but tender exercises are seeing more bids per site as local players rush to replenish their land bank, foreign players look to invest in Singapore and construction players are bent on diversifying from the difficult construction market. Part of the reason could be because developers are anxious to restock following recent land supply cuts in the Government Land Sales (GLS) programme.
$16.3m house sold, price is highest at auction this year (ST, 1 October 2015)
A house in Tanjong Katong was sold at auction yeste rday for $16.3 million – the highest price fetched at auction this year. The single-storey bungalow at 25 Branksome Road sits on freehold land of about 13,844 sq ft, which works out to a pricing of about $1,177 per sq ft – below the median price of detached houses in District 15, which was about $1,246 per sq ft of land area in the second quarter.
Buyers return as HDB resale prices consolidate (BT, 9 October 2015)
SRX Property data shows resale transactions rise 3.9%, while prices slid 0.4% in September. Property consultants say the price decline is considered very gradual and stable. So far this year, theyhave only fallen 2.3 per cent. This is much milder than the 6 per cent drop in HDB resale prices in 2014 shown by official data. The slow moderation of prices is expected to continue in the last quarter of the year. For the whole of 2015, consultants are expecting an overall decline of 2-3 per cent. The still mild correction in public housing prices has quelled most suspicions that there might be any significant policy changes for public housing in the next six to 12 months.
Government Land Sales
Keen competition seen for sites near Redhill MRT, Sembawang Park (BT, 1 October 2015)
The launch of a 99-year leasehold site next to Redhill MRT Station on Wednesday is expected to draw strong interest, given the pullback in the Government Land Sales Programme and developers’ desire to replenish their land bank. The site is designated for private housing development with commercial use on the first storey. The Urban Redevelopment Authority said that the 0.84-hectare site can generate about 400 private homes. The tender for the site will close on Nov 12. The key selling points of this site include its proximity to an MRT station in a city-fringe location, and surrounding.