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Private housing prices down after three years

Apr 2nd, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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According to estimates released yesterday, overall prices fell 0.1% in Q1 2012, ending March 31. This marks the sector’s first drop since 2009’s global financial crisis, and a reversal from the 0.2% rise in Q4 2011.
(Private home prices have been tamed, save for the mass-market segment.
Image courtesy of Thinkstock.)

Experts say this decline is not surprising given price growths have been grinding to a halt, thanks to five rounds of cooling measures over the past two years.

They noted that the demand, weakened by bleak economic conditions, has affected sales activity and resale prices. Resale transactions in particular were halved across all housing segments this quarter—a sure sign of a slowing market.

The figures, provided by the Urban Redevelopment Authority (URA), also uncovered two diverging patterns: the slump of city centre and city fringe housing prices, and the surge of mass-market home prices.

City centre home prices dipped 0.9%, while its fringe counterparts fell 0.7%—the result of foreign demand held back by the 10% additional buyer’s stamp duty introduced in December 2011.

Meanwhile suburban home prices upped 1.2% this quarter—double the gain in Q4 2011. This was largely due to a multitude of suburban mixed-development projects and small apartments launches during this period. So far, suburban home sales account for over 80% of this year’s new home sales. In particular, mixed-use projects The Hillier and Watertown—priced $1,200 to $1,300 per sq ft—were responsible for driving up Q1 values.

Chia Siew Chuin, Colliers International research and advisory director, told The Straits Times, “The sustained price increase [for suburban homes] is underpinned by robust demand for new mass-market projects that is fuelled by low interest rates and the continued availability of project launches. Creative promotions and sweeteners dangled by developers to cushion the impact of the additional buyer's stamp duty have also enticed homebuyers to commit.”

Looking ahead, observers are divided over whether more cooling measures will result from yesterday’s figures. Dr. Chua Yang Liang, head of research for South-east Asia at Jones Lang LaSalle told The Straits Times that it is “challenging” for authorities to deal with a market moving in two directions.

He noted that there is a higher chance for more measures to be introduced, given the bustling suburban housing activity (new home sales hit a record high of over 3,100 units in February) that led to a higher-than-expected price jump.

Said Dr. Chua, “This divergent market is likely to continue into the second quarter of this year, unless there are further government interventions. In my opinion, the state could discourage excessive purchases by raising eventual holding costs, such as a temporary increase in residential property tax rate for investment purposes.”

Credo Real Estate executive director Ong Teck Hui chimed in. “Had the indices for the city centre, city fringe and suburban segments all declined, the risk of intervention might have been less.”

On the other side of the fence is Colliers’ Chia, who opined that further cooling measures are unlikely in the short term. She let on that a handful of factors are already in place to cool prices down: a slow resale market, a suffering high-end sector, a bumper release of state land, and buyers’ growing resistance towards climbing prices. She expects overall prices to slide 5% this year.

PropNex chief executive Mohamed Ismail expects city centre and city fringe prices to drop 5% this year, but suburban prices to increase 3% to 5%.

URA’s flash estimates are based on transactions in a quarter’s first 10 weeks. Figures will be updated in four weeks.

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Pay to back away?

Apr 2nd, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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Property agents have begun including an exit clause in their contracts in an attempt to ensure protection and compensation from insincere clients.

(Some agents are asking for monetary compensation from sellers who back away  from contracts. Image courtesy of Thinkstock.)

Some instances in which this clause could take effect include when an owner engages an agent to do home valuations and arrange for viewings, but later backs out, or when the owner refuses to sell his home after the agent finds a buyer willing to pay above the asking price.

According to industry watchdog Council for Estate Agencies (CEA), it is not illegal to insert such exit clauses for compensation if mutually agreed upon. And perhaps for good reason, too.

“Since the property market started booming last year, every month, at least two to three sellers have backed out on me because they only wanted to test the market and didn't want to sell,” lamented 38-year-old agent Eric Ng to The Straits Times. Ng adopted exit clauses since June last year, ensuring that owners who back out pay him for expenses incurred in marketing their homes.

No figures are available, but The Straits Times reported that at least 10 other agents have done the same.

The exit clause is additional to CEA’s estate agency agreement forms, which give the agent exclusive rights to sell the home and claim the agreed amount of commission. A typical exit clause dictates that if the seller backs out of the agreement with no valid reason, he is to pay consultation fees of $150 to $250 in addition to the sums spent on advertising and valuation reports. The total amount works out to an average of $500.

“I started putting in this clause about four months ago to deter home owners who are not serious. We have to let them know that, for us, there is also an opportunity cost for the hours we put in selling their homes,” said agent Dayangku Rozarita, who runs her own agency, to The Straits Times.

A CEA spokesperson told The Straits Times that inserting the clauses into estate agency agreements does not flout any regulation under the Estate Agents Act, because the clauses do not undermine the purpose of the agreement. “If the consumer and the agent wish to include mutually agreeable terms and conditions that are not printed in CEA's prescribed estate agency agreement, they should include these as additional terms in the space provided or on a separate pink sheet of paper.”

Understandably, these exit clauses have still managed to ruffle a few feathers. One seller only known as Mrs. Ong, who backed out of such an agreement, told The Straits Times she felt it unprofessional for her agent to introduce the cancellation fees.

“I backed out after only one week—it is fair for me to pay for the valuation report, but why should I pay $200 just because she did some paperwork for me? She met me to discuss the house only once,” said Mrs. Ong, referring to her Simei executive flat. She let on that she still dropped the agent as she felt more effort could be put into selling her home.

Meanwhile, industry analysts feel that such a clause could hurt the agent’s reputation and standing. “It sends a wrong and negative signal to sellers—that you just have to pay up to back out. I would prefer to sit down to talk things out, so that the seller and I end on good terms. It is better for future business,” noted Chris Koh, director of agency Dennis Wee Group.

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Resale HDB units in 2011 remain competitively priced, compared to condos

Mar 29th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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While prices of HDB flats on the resale market have risen in the past few years, they continue to be more affordable than condominiums, according to a report on property transactions in 2011 registered on iProperty.com Singapore, the country’s No. 1 property website and part of the iProperty Group. 

The iProperty iNsights 2011 consumer trends report reveals pertinent information on the state of the residential property market in Singapore, highlighting essential data such as average per square foot (PSF) prices for HDB apartments and condominium units across the island. Additional data from the popular property portal emphasizes the disparity in average PSF prices among private (non-landed) and public housing (resale flats). In general, the average PSF for HDB flats across all room types have steadily increased - yet they remain at least half as costly when compared to the average PSF of condominiums.

“We are proud to share our latest iProperty iNsights report, which serves as an enabler for property buyers in Singapore to make informed, timely choices. We maintain an expansive network of agents and partners whom we work with closely to obtain on-the-ground information and ensure accuracy on the property data which we publish. With this handy guide, we hope to smoothen the decision making process among buyers for all their property-related needs,” said Shaun Di Gregorio, CEO of the iProperty Group. 

Key highlights of iProperty iNsights 2011 Report 

1. Districts 

The top three most popular districts, based on total unique searches, were 15 (Katong, Marine Parade, Siglap, Joo Chiat, Tanjong Rhu), 19 (Serangoon, Hougang, Punggol, Sengkang) and 9 (Orchard, Cairnhill, Killiney, River Valley) while districts 10 and 16 continued to remain popular among buyers of private properties. 

Please refer to page 3 of the iProperty iNsights 2011 report.

2. Condominiums
 
- Condominium projects completed in the last few years in general fetched higher PSF prices, and this is even higher for city-based developments such as Icon (S$1,846) and The Sail @ Marina Bay (S$1,952). 

- Projects located in the suburban areas continued to be more attractive for buyers, such as Melville Park (S$709) and Northvale (S$736). 

Please refer to page 15 of the iProperty iNsights 2011 report. 

3. HDB 

- Based on total unique searches, the top three most popular HDB estates were Bedok, Bishan and Woodlands, while estates like Tampines and Yishun continued to remain popular among buyers of public housing. 

Please refer to page 17 of the iProperty iNsights 2011 report. 

4. Most popular keywords 

The highest portion of visitors to iProperty searched for the keyword ‘studio’, a reflection of continued interest in compact-sized apartments. This could be linked to the higher price tags attached to apartments of higher floor area, and to investors who are looking at reaping attractive rental income. 

Please refer to page 29 of the iProperty iNsights 2011 report. 

Conclusion

In general, resale HDB flats remained affordable for many Singaporeans, especially when compared with more established condominiums that tend to fetch lower prices. This gap can be seen when we compare the average PSF for older condominiums, which was at least twice those of HDB flats in general. 

For more information, please login and download the iProperty iNsights 2011 Report here for free.

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HDB upgraders have an uphill task

Mar 27th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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Want to upgrade from your Housing Board (HDB) flat to that glitzy condominium you’ve eyeing for a while? Experts say the cash-over-valuation (COV) figure of your flat might prevent you from doing so.


(HDB owner-occupiers looking to upgrade may experience a bleak resale market. Image courtesy
of Thinkstock.)
COV is the cash premium paid on top of a flat’s valuation, and experts say that with falling COV figures amid a slowing resale market, HDB dwellers are finding it increasingly harder to ‘upgrade’ into the private market.

Although official figures are no longer available, data based on PropNex Realty’s February resale deals) reveal that median COVs are falling by $3,000-7,000 in all flat types except three-room units. Based on its January resale deals, the median COV across all types dropped $3,000-6,000.

Observers estimate the current median COV figure across all types to be $25,000, compared to $35,000 in Q4 last year.

Chua Chor Hoon, Asia Pacific research head at DTZ, told The Business Times that lower COVs are making it harder for HDB dwellers to upgrade to private homes because they receive less cash on hand—a cause for concern among industry players as upgraders constitute a major source of demand for mass-market developments.

Chua noted that the general fall in COVs suggests a weaker HDB resale market, which observers say is caused by a multitude factors holding both demand and supply back.

Speaking to The Business Times, Knight Frank consultancy and research head Png Poh Soon said, “Prices of resale flats have appreciated significantly. For existing owners, there is no reason for them to sell at a lower price as private properties are not cheap either. To upgrade and avoid taking excessive financial burden, many need to sell off their existing HDB.

“[On the other hand] buyers with financial constraints will turn to BTOs (build-to-order flats) because it is cheaper [while] those who can afford ECs (executive condominiums) believe they are getting a better deal as the price quantum between some resale flats and ECs are very close. Existing HDB owners looking to sell their units are therefore caught in a bind.”

Indeed, the ramping up of BTOs and ECs has afforded buyers more choices, thereby sponging off demand for resale HDBs. In particular, the price quantum between resale HDBs and condominium-styled ECs have fallen to a mere 10-15%, according to Knight Frank’s Png.

ERA Realty key executive officer Eugene Lim noted in a February report that recent policy changes have further pushed buyers away from the resale market: the increase in monthly household income ceiling from $10,000 to $12,000 made the EC more appealing, while the National Development Minister’s promise to re-modify BTO balloting rules to benefit second-time buyers encouraged them to hold back on resale purchases.

Said Lim, “Should the new rules substantially increase the number of BTO flats made available to second-time buyers, the HDB resale market may be greatly impacted since these buyers form the bulk of the resale market. When that happens, demand for resale flats will come only from families that have immediate housing needs, those downgrading from private properties, and singles and permanent residents who do not qualify to buy new HDB flats.”

Other factors sifting demand from the resale market include August 2010’s property cooling measures (which dictate that foreigners have to sell their private homes within six months of purchasing an HDB resale flat), and the shrinking price gaps between HDBs and new condominiums (because of the smaller areas of the latter).

Meanwhile, another factor cutting down supply of resale HDBs is the buoyant rental market—sellers may be convinced to rent out their HDB homes instead of selling them.

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New condos at lower prices?

Mar 26th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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A series of new projects could hit the market this week, with some of them priced slightly below average.


(A string of brand new condominiums are slated to hit the property market this week. Image courtesy of Thinkstock.)

Market watchers are expecting a slew of new projects to launch this week, including Ripple Bay near Pasir Ris Beach, Palm Isles at Flora Drive, Natura at Hillview Terrace, and Hillsta at Choa Chu Kang Road.

Natura, a joint venture between Roxy-Pacific Holdings and Macly Group, made recent headlines with its small 635-sq-ft three-room units. The 10-storey freehold development is said to have an average price of around $1,250 per sq ft (psf), and will comprise one- through three-room units and penthouses.

Meanwhile Ripple Bay, MCL Land’s 679-unit 99-year-leasehold project, is said to be priced at just above $850 psf after early-bird discounts. Situated a stone’s throw away from Pasir Ris Beach, it is a surprise that absolute prices start from $415,130 for a 484-sq-ft one-room unit ($858 psf), and from $795,500 for a 990-sq-ft three-room unit ($805 psf).

The prices are lower than that of the Seastrand, located just behind it and a further distance from the beach. Seastrand was released last June at a median price of $879 psf, according to its developer’s declarations to the authorities. The following month saw its median price surging to $935 psf. Current prices remain above the $900-psf marker.

These cautious prices suggest a sense of urgency among developers to push out launches. SLP International managing director Peter Ow told The Business Times that developers are launching projects quicker due to a growing concern that another batch of cooling measures might be whipped up to remedy the record number of new private homes sold last month.

“To ensure a good take-up rate, developers are likely to price new mass-market condo launches say about $10-15 psf below existing nearby projects,” said Ow. However, he commented that there is no need for more cooling measures; speculation has been dealt with via the seller’s stamp duty, and foreign buying staved off significantly following the introduction of the 10% additional buyer’s stamp duty.

Ow added that there is also plenty of available supply.

At Flora Drive sits Fraser Centrepoint’s Palm Isles, which boasts 28 ‘garden homes’, each with its own garden and private parking lots. The 429-unit project has an expected average price of $850-880 psf, slightly lower than that of nearby development Hedges Park. The latter launched in April 2011 at a median price of $889 psf, but last month saw eight of its units going for a median price of $873 psf.

At its launch last week, Tuan Sing’s Seletar Park Residence had 90 of its 276 units sold for an average $1,100 psf price. Excluding the project’s ground-floor units and penthouses, the average price rose to $1,200 psf. In terms of absolute prices, a one-room unit spanning 528-sq-ft starts from $634,000. Buyers were mostly Singaporeans.

Last week World Class Land, a freehold mixed development at the Bedok and Upper Changi Road vicinity, sold almost all of its 90 residential units at around $1,400 psf average.

DTZ’s Asia Pacific research head Chua Chor Hoon told The Business Times that there is still a significant pool of buyers due to current low interest rates and persisting inflation fears. She said, “Demand will be stronger for small units as there are many investors with sizeable bank balances looking to park their money in property.”

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Singapore’s shrinking homes

Mar 20th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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New private homes are getting smaller, but there hasn’t been a three-bedroom flat as tiny as one apartment in Bukit Batok.


(The estate of Bukit Batok. Image courtesy of mailer_diablo.)

The latest new condominium development to hit the estate is Natura at Hillview Terrace, a joint venture between Roxy-Pacific Holdings and Macly Group. Here, a three-room unit measures a mere 635 sq ft—that’s smaller than a squash court and only slightly larger than five Housing Board parking lots.

This is a stark contrast from what insiders say is the typical size for a three-bedder: 1,000 to 1,500 sq ft.

Property analysts tell The Straits Times that Roxy-Pacific could be at the forefront of a trend that sees three-room units shrinking. Treescape in Telok Kurau, another project of the firm’s, also has tiny three-roomers starting from 603 sq ft. All 32 of such units were sold during the project’s launch and among them, 25 went last month for a median price of $1,401 per sq ft (psf).

But Treescape is a boutique development, and Natura on the other hand is a full-fledged condominium with 193 apartments and all the regular facilities. Market watchers say it is virtually unheard of for a mass-market project to have three-room homes of such compact sizes.

In defence of the apartment size, Macly Group projects director Ken Yeo told The Straits Times, “We've designed the building in such a way that the wall can be taken out, so that you can open up the living room to be of a bigger space. That's what we mean by ‘efficiently designed’.”

Yeo added that all Macly’s previous ‘shoebox’ projects were sold out within a month of their official launches, and that the company has not received complaints that their “Mickey Mouse apartments are not liveable”.

He also noted that owner-occupiers who favour these shoebox units tend to be singles or childless couples, whose lifestyles are suitable for the smaller living spaces.

Meanwhile, observers are still left in the dark as to how consumers will react to these tiny private homes. Said head of research and consultancy at OrangeTee Tan Kok Keong to The Straits Times, “If you use Hong Kong as an example, yes it's liveable, but whether it's the kind of quality of life that people can get used to is something we actually won't know until the project is completed.”

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How to Know You Are Ready to Buy A HDB BTO Flat

Mar 20th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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Are you and your partner planning to apply for a HDB BTO (Build-To-Order) flat this year? If so, you are not alone – for many Singaporeans, a BTO flat is their number one choice of first home, mostly due to its lower price tag as compared to homes on the open market, as well as the various grants and subsidized pricing offered. However, as a first-time homebuyer, you may find that applying for and selecting a new HDB flat can be an intimidating experience. Below are some helpful tips to help you successfully select the right BTO HDB flat and come out a winner.

Understand latest HDB Policies & Developments

For those who have not been actively following local property news, it is very important that you start now.  Recent policy changes such as the extension of the MOP (minimum occupancy period) from 3 to 5 years may have significant implications on your decision to apply for a BTO flat. Also remember that the loan term for HDB flats can be significantly shorter than that for private properties: private banks can offer loan terms of up to 40 years, while the HDB concessionary loan is only available for 65 years minus the buyer's age or 30 years, whichever is shorter. Also, although you may not be thinking of buying a 2nd residential property now, do bear in mind that HDB flats cannot be used for getting a 2nd mortgage to leverage or “cash-out” for financing another property purchase - unlike private homes.

Timing Your Application for A BTO Flat

If after considering all the factors involved with buying a BTO flat, and you still decide to go ahead and apply, bear in mind one of the most critical factors: your timing. To give some background, prior to around May 2011, HDB would usually release smaller batches of BTO units on a monthly basis, a process which would result in a frantic rush where everyone would apply for the next consecutive month’s BTO release, without even knowing if they had been successful in the previous exercise. The good news HDB has since revised the system to put up flats in bigger, less frequent releases, meaning that the applicant to flat ratio has been much improved. This is good to know of course, but how can you use this to your advantage?

Maximizing Your Chances of Getting a Good ‘Q’ Number

While luck certainly matters, there are steps you can take to maximize your odds of getting the best queue number. Although the tangible cost of submitting a BTO application is only S$10, and HDB does not limit the number of BTO exercises you can participate in, the larger, less implicit cost lies in how multiple applications will be used “against” you. In a move to discourage buyers from being “picky”, HDB has programmed its balloting system to place applicants who have rejected an invitation to select a flat more than twice at the back of the queue. Because of this, it may not be advisable to apply for a neighborhood which has been oversubscribed over 10 times for a popular release, as your chances of being able to get a good queue number are very small.  You might be better off applying for another neighborhood to increase your odds of getting a better queue number instead.  Bear in mind that HDB’s offer to you to select a 2nd floor, rubbish-dump facing unit also counts as an invitation, making it even more important you use your application chances wisely.

Use the Tools at Your Disposal

With over 25,000 BTO flats slated to be released in 2012, make sure you don’t miss out on any of them by signing up for HDB alerts on the HDB website. HDB will send you an SMS or email prior to the release of a new BTO launch, when full details of the units, including indicative pricing, are available.  Keeping abreast of latest releases is even more critical now that the time frame for submitting your application online has been reduced to one week. Many have missed the deadline for a BTO launch by not keeping track of when applications close – make sure you are not one of them.

Your Patience Will Be Rewarded

In your desire to quickly ‘secure’ a new home for you and your partner, the urge to quickly apply for every BTO exercise there is can be overwhelming. However, do bear in mind your goal is to maximize your chances of getting a good flat, not just any flat - which means it pays to wait for the right launch at the right time. In particular, those eyeing popular areas such as Clementi and Bedok might want to wait for new flats in these areas to be released rather than simply applying for every launch and being invited to select a flat for an area you don’t actually want.

The SBF (Sale of Balance Flats) Exercise (Or HDB’s Special “Bonus” Exercise)

For those with a little more patience (and time on their side), it may be well worth your while to wait for the announcement of the SBF exercise. This may be conducted on an annual basis, but really depends on the number of ‘surplus’ flats HDB has built up in its reserve. The key benefit of the SBF exercise is the absence of the 2-3 year construction period, as SBF flats are typically already completed or near completion. The September 2011 SBF exercise was a good example of how good things come to those to wait: units in highly sought-after areas such as Queenstown and Tiong Bahru were released to 1st-timers, who were able to collect their keys to these completed units within 6 months after applying. With the hot competition for SBF completed flats, it becomes even more apparent why it is important that you ‘conserve’ your chances so you can use them at a time when it really matters.

Keeping An Eye on the Competition

Once you have decided you are interested in a particular launch, watch the live updates on the HDB InfoWEB website like a hawk once HDB starts accepting applications. Do not submit your own application yet. Why? Very simple: By identifying the neighborhoods which have the least number of applicants, you maximize your chances of getting a good queue number. Checking the number of applications versus the number of units available on the day before applications close will give you a good idea of what your likelihood of drawing a good queue number is, and help you decide if you should use one of your precious first-timer ‘chances’ during this particular launch.

Scoping Out the Site

Buying a property off-plan, while having the benefit of ensuring you get a brand-new unit, does mean that the buyer has to do additional due diligence because they will not have the benefit of inspecting the actual unit. For example, you will have to rely on materials such as floor plans and the SLA (Singapore Land Authority) announced plans for the next several years to figure out if a 40-storey high-rise will be built on the plot directly in front of a BTO site, or if an MRT or Chinese temple will be constructed near-by. Tip: going over to the nearly existing blocks in the neighborhood and taking the lift up to the highest floors will give you an idea of the view the new flats will have when they are finally constructed.

Choosing Your Unit: Balance Out Your Must-Haves vs. Nice-to- Have

So you have submitted your BTO application – and lucky you - have received a good queue number. What to do next? Before breaking out the champagne to celebrate, bear in mind that your work has just started at this point. Preparing for your selection date involves doing your homework by understanding the features on the different units offered, including potential negatives such as the amount of afternoon sun the bedrooms will face as well as the extent of street noise that will travel up. While going over the pricing list, if the main reason for your preference for a unit on a high floor is for the view, bear in mind that you may be able to choose a unit on the 20th floor vs. one on the 40th floor and yet still be able to enjoy the view you desire. As HDB charges a substantial incremental for higher floors, the money you save may be better used toward other expenses such as paying for your granite kitchen countertops or customized floor-to-ceiling shoe cabinets -  or any 'what-ifs' that may come up during the 30 years you will be financing your flat for.

What To Do on Selection Day

As there may be around 8-10 couples selecting their flat that day, be mentally prepared for the possibility that your choice flat may already be taken up by the time you get to the front of the queue. To mitigate the anxiousness you will feel when sitting in front of HDB sales officers and not knowing which remaining unit to select, make sure you show up early for your selection appointment slot, and more importantly, fall in love with 15 units instead of just one or two beforehand. Also bring detailed reference information and photos of each site you're interested in to avoid panic because the units you had your eye on are all already taken up.

Do you have other tips for first-time BTO flat buyers? We encourage and welcome any tips you may have to add in the “comments” section below.

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Experts: new HDB scheme could be abused

Mar 13th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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In a bid to encourage multigenerational living, policymakers are giving public housing buyers greater chances of obtaining a flat if they move in with their parents.


(Industry watchers warn that buyers might misuse the new pro-family scheme, which encourages couple to buy a home with their parents or move near them. Image courtesy of Thinkstock.)

Starting alongside this month’s Build-To-Order (BTO) launch, the pro-family scheme is an enhancement to the Married Child Priority Scheme (MCPS). While the MCPS granted first-time buyers four ballot chances and second-timers two, the enhanced scheme allows first-timers six ballots and second-timers three.

However, the scheme only applies to applicants who choose to live with or within two kilometres of their parents. There is a minimum five-year occupancy period, and parties cannot own or buy other properties if they are listed as the essential occupiers.

But property agents warn that buyers could misuse this new Housing Board (HDB) scheme to bid for popular homes. Their concern: with MCPS’ popularity (National Development Minister Khaw Boon Wan revealed last June that 40% of first-timers in May 2011’s BTO launch were MCPS applicants), a sizeable number of buyers could be tempted to abuse the new scheme, by declaring that they live with their families and going on to live elsewhere.

Suntec Chesterton International’s Colin Tan said he expects highly sought-after areas like mature estates to see more of such cases. “There will be some who will resort to this in order to be successful,” he told The Straits Times.

“The onus then is on the HDB to conduct spot checks regularly—not just once—to deter such abuse.”

Making the matter more pressing is the government’s intention to increase the proportion of mature-estate flats to 30% of all launches this year. Last year’s figure was 14%.

Current measures to deter misuse can be found in the terms and conditions of HDB’s latest BTO project, which states that eligibility of such living arrangements is assessed based on official records. According to some agents, HDB also conducts random checks to ensure rules are adhered to. Those who flout the rules can be punished with a financial penalty.

ERA Realty key executive officer Eugene Lim told The Straits Times that apprehending offenders will be tough as excuses can be easily conjured up, adding that “the problem lies also in getting irrefutable evidence in order to act”.

There are also sensitivity concerns. Said Dennis Wee Realty’s Lee Sze Teck to The Straits Times, “You cannot expect HDB to knock on every door of every household under the scheme, as some might complain that it is intrusive.”

Family sociologist Paulin Straughan told The Straits Times that the country should still continue pushing for such “progressive policies”.

She elaborated, “It promotes a three-generation living arrangement, which leads to stronger family ties, and frees the state from having to put up social infrastructure to catch those falling through the gaps.”

Straughan suggested for HDB to design flats that allow each individual some privacy. “It's not up to the state to manage personal relationships, but [it can] build spaces creatively so the family members can live contentedly.”

Tan agreed, “If we try and cram too many people of different attitudes and views in too small a space, the chances of social disharmony become even greater, and it will run counter to the original objective of fostering closer ties.”

Alternatively, couples can apply for a home near their parents’ through the new Multi-Generation Priority Scheme, giving them priority on flat selection. Under this scheme applicants and parents can purchase a flat and a studio apartment (or two-room unit) to enjoy simultaneous privacy and closeness.

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Strong land sales, but landbanks are healthy

Mar 7th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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Despite fiery home sales, one study says developers have still managed to keep a significant land stockpile in their ‘landbanks’, due to the bumper supply of new land sites the government has released. According to DTZ Research, most major players have thousands of homes in their landbanks.


(The ramped-up GLS supply has increased competition for land among developers, which might be beneficial to end consumers. Image courtesy of Thinkstock.)

A landbank consists of units from projects (including executive condominiums) that either already have or are pending planning approval.

According to DTZ, City Developments has the largest landbank of 6,053 homes, comprising land parcels in Pasir Ris, as well as projects under construction like Bartley Residences and Hedges Park.

At 2,592 units, the second-largest landbank belongs to Far East Organization. Other big developers are left trailing behind, with Frasers Centrepoint, Allgreen Properties, CapitaLand and Keppel Land having fewer than 2,000 homes each, and UOL Group, GuocoLand and Wheelock Properties with fewer than 1,000 units each.

CapitaLand’s landbank mostly comprises d’Leedon units in Leedon Heights (1,255 unsold and unbuilt), and units from the upcoming Sky Habitat in Bishan (509). Allgreen Properties has an Upper Serangoon site with an 860-homes yield, on top of its yet-to-launch RV Residences and Riverbay projects.

Among the top ten highest landbanks are a few new overseas players who have ridden the new wave of government land sales (GLS) onto the local market. The final two spots are taken up by Chinese firm Qingjian Realty (ninth position), and Malaysian-based IOI Corp (tenth position). Fellow Chinese firm MCC Land secured the twelfth spot.

DTZ’s Asia-Pacific research head Chua Chor Hoon told The Straits Times, “Some of these foreign developers started out as construction companies and, seeing the good sales and profit margins to be made, it is a natural step for them to become developers. Others are also diversifying out of their own countries.”

It is these sales that have ensured that landbanks are not depleted amidst the record number of new homes sold. In the last two years, over 32,300 new home sales were closed.

The keen land competition among developers also meant that some small and mid-sized local players have also made top ten. One such firm is Sim Lian Group (sixth position) with 1,550 units—double its figure in a similar 2010 study.

According to The Straits Times, a healthy landbank depends on the developer’s size and business model. For developers handling high-end homes, replenishing landbanks is not not a priority, especially since the prime home segment is currently lacklustre.

Chua noted, “Some developers aim to be the top few developers, so they have a larger landbank which they continually build up through [GLS] and private purchases. Developers with a smaller team and funds will have a lower landbank so that they can be more focused on one or two projects each time.”

Chesterton Suntec International’s research head Colin Tan explained to The Straits Times that a large landbank is a double-edged sword—advantageous in a flourishing market, and but a bane should the market turn.

Tan also noted that developers like Far East and Frasers turn around sites quickly because they have smaller-than-expected landbanks that allow them to rapidly launch projects despite purchasing many GLS plots.

Roxy-Pacific executive chairman and chief executive Teo Hong Lim told The Straits Times, “We've sold quite a lot of units and will have to keep replenishing our landbank […] But it's not just about securing land for the sake of doing so; you have to ensure that it's at the right price and right timing.”

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HDB to go ahead with Toh Yi studio apartments

Mar 7th, 2012
by Singapore Property Resources and Guides, HDB, Districts and Archived listings.
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Sticking to its aim of serving the less fortunate, the government’s Housing Development Board (HDB) is standing firm on its decision to construct a block of studio apartments for the elderly; its Build-to-Order exercise will be launched later this month.


(HDB will be going ahead with plans to build a Toh Yi studio apartment block, despite residents' protests of the loss of views and communal facilities. Image courtesy of Thinkstock.)

Despite protests and petitions, the controversial HDB block will still be located at the junction of Toh Yi Drive and Toh Yi Road. According to residents, the block would be standing on the area that currently houses a basketball court, a running track, and a garden.

HDB said it had looked into suggestions from some 230 unhappy residents, but found that the alternative sites were unsuitable. One suggested site is about 20m away, near Block 17, whose residents also promptly organised a petition of their own against being the alternative.

Toh Yi residents The Straits Times spoke to remained disgruntled at HDB’s final decision, bringing up concerns of the loss of facilities and views, and insisting that the site’s many slopes are not suitable for the elderly.

The Toh Yi saga mirrors a similar incident that occurred recently, when Woodlands residents protested against the setting up of an eldercare centre at their void deck. This led to a nation-wide debate on Singaporeans’ Not In My Backyard mindset and indifferent attitude towards the more vulnerable members of society.

Currently some 6,800 studio apartments can be found across various housing estates, with 2,000 more to be added to their ranks this year. Studio apartments are public housing options that cater specially to the needs of a growing elderly population, with have fittings such as grab bars and alarms.

However, HDB assured Toh Yi residents that it is not turning a deaf ear to their worries. It revealed plans to construct a playground and garden on the second storey of the studio apartment block, which can be used by all. A replacement jogging path will also be built. These facilities will come in addition to regular neighbourhood facilities like an elderly fitness corner. Furthermore, 50 more parking spaces (excluding the 16 parking lots reserved for studio apartment residents) will be added to relieve the parking lot shortage.

To deal with the slopes, HDB will also add more foothpaths to connect the studio apartment block with the rest of their neighbourhood. The Toh Yi Drive footpath will come with rest areas.

HDB explained that the Toh Yi site had long been reserved for eventual development. It thus ceded to the Bukit Timah Citizens Consultative Committee’s request to temporarily use the area as a basketball court and garden, as there was no need to develop the site then.

It added that this specific site was used because there are no studio apartments in the Bukit Timah estate. “A studio apartment project would benefit many elderly residents in Toh Yi, who could consider staying in [a studio apartment] while continuing to live in a familiar neighbourhood,” it said.

HDB eleborated that Sim Ann, MP for Holland-Bukit Timah GRC, requested for it to give Bukit Timah’s elderly residents priority when applying for the studio flats. In response to her request, National Development Minister Khaw Boon Wan announced the Ageing in Place Priority Scheme in Parliament last Friday. Said HDB, “Elderly residents of Toh Yi will be among the first to benefit from this new scheme.”

Commenting on the saga, Sim said, “Most residents I have spoken to told me they do not object to having studio apartments in the estate. The key question has always been about the site and a minority of residents have voiced objections.”

Posted in: Uncategorized.

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