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Issue 255

Copyright © 2011-2016 www.propwise.sg. All Rights Reserved.

CONTENTS
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FROM THE

EDITOR

Is it Time to Jump in to the Singapore

Welcome to the 255th edition of the
Singapore Property Weekly.

Property Market?
Hope you like it!

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Singapore Property News This Week

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Resale Property Transactions

Mr. Propwise

(March 26 – April 1)

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SINGAPORE PROPERTY WEEKLY Issue 255

Is it Time to Jump in to the Singapore Property Market?
By Gerald Tay (guest contributor)
We know property prices have gone down,
albeit just an 8% dip since the peak in
2013.There're plenty of arguments from
"experts" (who mostly argue against) on
whether the Singapore Property Market will
face further severe price correction, perhaps
to the lows seen during the 1997 Asian
Financial Crisis, the economic stagnation
period between 2002 and 2005, and the 2008
Global Financial Crisis.
Time to jump in?
Prospective buyers who are eagerly waiting
on the side-lines are looking for answers can
be easily misled.
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SINGAPORE PROPERTY WEEKLY Issue 255
Some arguments suggest buyers, instead of
waiting for the "impossible" scenario of a
bloody market, should take advantage of the
"discounted" prices by developers who are
desperately clearing stock today.
Those who argue that buyers should jump
in now cite the following reasons:
1. A low employment rate of 1.8%.
2. The economy is projected to grow
positively, albeit at a modest pace of 2% to
4%.
3. The Government has already acted early
against over-leveraging with prudent lending
measures such as the Total Debt Servicing
Ratio (TDSR)
4. Higher interest rates are already expected
and will be manageable.

The best lies are seasoned with a bit of
truth
If you read local property reports or watch the
financial news, they often have a
sophisticated panel of “experts” to predict the
market direction and tell buyers and sellers
what to do. They look the part with their
slicked-back hair, fancy suits and snazzy
market efficiency theories. What’s not to
believe?
The problem is that these “experts” are
famous for collectively never having predicted
a recession or a property market plunge
before it happened. None predicted the 1997
Asian Financial Crisis (AFC), 2000 dot-com
bubble-burst, September 11, SARS, Asian
economic stagnation of 2002 to 2005, and the
2008 Global Financial crisis.
Our government could not prevent any of it.

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SINGAPORE PROPERTY WEEKLY Issue 255
Major corporations were too blinded by profits
to even notice.
Asian Financial Crisis – A Period of Mass
Hysteria
The period leading up to 1997 AFC saw
unprecedented economic growth and high
spending from consumers in Singapore, just
like Japan in the 1980s before their own
bubble burst. There were clear signs of frothy
valuations and plenty of speculation in the
local property market. A capital gains tax was
implemented in response, causing massive
panic among both buyers and sellers.
Between 1996 and 1997, local property prices
plunged 45%. When the giant financial
tsunami hit our shores between 1997 and
1998, all markets sunk to the deepest levels
of the abyss. There was prevalent mass
hysteria and blood in every financial and real
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estate market in Asia.
Local property price levels never recovered
until late 2006. The aftermath of the 1997
AFC went on to create more unfortunate
financial losses in the years after. For almost
10 years between 1997 and 2006, apart from
a couple of short-lived recoveries, the
Singapore economy was in the doldrums.
This gloomy period coincides with high
unemployment rates, plenty of job losses,
income losses and stagnation and plenty of
FEAR in the markets.
My experience
devastation

witnessing

financial

As a young adult back in those tumultuous
years, I witnessed the financial devastation
from personal interactions with its victims. My
family’s fortunes dwindled drastically and
wealthy businessmen I knew had their
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SINGAPORE PROPERTY WEEKLY Issue 255
fortunes wiped out overnight.
Personal and corporate bankruptcies were
not uncommon, businessmen became taxi
drivers, stock brokers became broke for and
unemployed property buyers and even
property agents themselves who could no
longer afford mortgage payments had to let
go of properties way below what they paid for
it at the peak.
Many went from Rich to Poor – and some
from Poor to Rich. But for every darkness,
there is a glimpse of light if you know where
to shine the torch. Opportunistic buyers who
knew how to take advantage of FEAR
became wealthy. I was one of the privileged
ones.
During periods of distressed prices between
2002 and 2005, interest rates were as low as
0.8% per annum – the market had NO
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buyers.
between
4% per
markets
houses!

During the price-spike periods
2006 and 2008, interest rates were
annum – yet buyers stormed the
like herds of pigs to the slaughter

Reckless Affluent Buyers
In reality, the real danger to today’s property
market does not lie with higher interest rates,
but with a dark macroeconomic outlook, a
slowing economy, and an overleveraging of
the affluent.
In Singapore, the number of affluent middleclass private property buyers grew rapidly
since 2008. From 2009, the number of private
properties and Executive Condominiums
launched and sold in the Mass Market region
were the largest ever seen since 1975. This
growing number will be further supplemented
by a massive upcoming supply this
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SINGAPORE PROPERTY WEEKLY Issue 255
year and in 2017.
This is not a coincidence with endless
Quantitative Easing and stimulus since 2008.
This has led to easy credit and low borrowing
costs. Going forward, that will be less and
less the case. Interest rates are already
negative in certain major economies. They
cannot go any lower.
Currently, the group of property buyers
consists of primarily HDB “Upgraders” and
Executive Condominium (EC) buyers. Many
investors have left the scene. This is a
worrying sign.
HDB “Upgraders” benefited financially from
the price appreciation of HDB flats in the
recent years. New EC buyers whom are
mostly millennials (born after 1981) grew up
with instant gratification and expensive life
aspirations. These two groups have benefited
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the most from zero interest rate policies and
the artificial bubble and “recovery” since
2008.
The clear lack of financial judgment is
extremely disturbing especially for buyers
who bought at the peak of 2013 and onwards.
So what will happen to the property
market in Singapore?
And guess who will lose the most wealth in
this next, larger crash? The top 0.1%, 1%,
10%, 20% and 30% because they own almost
all of the financial assets that have been
favoured in this bubble period with endless
QE and zero interest rates.
The S&P Global Luxury Index which
specifically measures the spending of affluent
consumers
on
global
luxury
goods
plummeted 16% year-on-year from the peak
of 2014.
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SINGAPORE PROPERTY WEEKLY Issue 255
What this means effectively is, we’re
seeing lesser spending from affluent
consumers who have been the pillars of
global economic growth in past years. This
will be a major cause of concern for world
markets. Less spending means lower growth.
And lower economic growth means bad news
for real estate markets.
Worse, it’ll be years before buyers see
another great boom in the overall local
property market – not until 2022 and later
optimistically. Based on my observation and
analysis, the recovery won’t be like the
booms and price-spikes we saw between the
periods 1975 and 1984, 1985 and 1995, 2006
and 2008, 2009 and 2013.

In my next post I will go through the reasons
why I think property prices will continue to
struggle going forward and when the best
time to enter the market will be.
By guest contributor Gerald Tay, who is the
founder and coach at CREI Academy Group
Pte Ltd, an organization dedicated to
empowering retail property investors with
smarter investing philosophy and strategies.
He is a full-time investor with over 13 years of
solid experience in building his wealth
through Property Investment and is financially
wealthy today.

Not even close.

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SINGAPORE PROPERTY WEEKLY Issue 255

Singapore Property This Week
Residential
Retail rental falls due to weak demand
According to data from DTZ, retail rental fell
in Q1 due to weak demand. Vacancies have
also climbed that quarter as occupancy fell
1.6% from 2015 to 91.9%. The average
monthly first-storey rents have dropped 1.2%
quarter-on-quarter to about $30.15 psf in Q1
this year, which is the fourth quarter of decline
since Q2 2015. Year-on-year, rentals have
been down by 7%. According to DTZ,
increase in visitor arrivals in Orchard/ Scotts
Road area had increased by 0.9% in 2015.
However market experts pointed out that this
increase was because of the low base in
2014, following a series of aviation accidents.
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Experts added that rents were affected by
weak business sentiments and also the large
impending supply of retail spaces that were
slated for completion.
(Source: Business Times)
HDB resale prices remain flat in March
SRX Property’s flash estimates for March
showed that its HDB resale price index fell by
just 0.1% month-on-month despite a 37.6%
month-on-month increase in the number of
HDB resale transactions to 1,651 units.
Market experts believe that resale prices will
continue to remain flat for the rest of the year.
Since April 2013, the HDB resale price index
has fallen by 11%.
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SINGAPORE PROPERTY WEEKLY Issue 255
Due to the slowing economy and loan curbs,
experts believe that prices will continue to
stabilise in the coming months. ERA expects
that the official HDB resale price index will fall
about 1% this year compared to the 1.6%
drop last year. According to SRX, HDB resale
prices have fallen by 0.3% month-on-month in
March in mature estates while the index
remained unchanged for non-mature estates.
Prices have however increased by 0.3% yearon-year in mature estates and 0.1% in nonmature estates in that same time period.
(Source: Business Times)
OUE offers 15% discount for Twin Peaks
condo

Located near Leonie Hill Road, a high-end
condo project, Twin Peaks is on sale. After a
discount of 15%, prices now begin at $2,300
psf for units on the lower floors. To attract
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more buyers, a deferred payment scheme
was also set up to allow buyers to defer
payment of the balance sum, which is 80% of
the total price, by 2 to 3 years. Buyers will
have to pay another $1,000 to exercise the
option to purchase (OTP) within 2 weeks and
pay relevant stamp duties and $1,000 to take
vacant possession of the unit within 8 weeks
from the option date. In another scheme,
buyers may exercise their OTP by the end of
this year. Both schemes are offered under
private treaties as the project has already
received
its
Certificate
of
Statutory
Completion.
(Source: Business Times)
Commercial
Plum site at Cuscaden Road for sale
A 25,741 sq ft freehold site located at
Cuscaden Road has been put up for sale and
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SINGAPORE PROPERTY WEEKLY Issue 255
owners are expecting offers between $160170 million. The site is flanked by St Regis
Residences Singapore and Tanglin Shopping
Centre. It has been zoned for hotel use with a
4.2 plot ratio under the 2014 Master Plan.
According to JLL, the marketing agent for the
property,
URA
may
consider
other
redevelopment proposals. Market experts
predict that interest will be strong due the
prime location. Also, the site may be
redeveloped into a mid-scale to upscale hotel
with around 300 rooms, added market
experts.
(Source: Business Times)
CBD office rents fall by 3.9% in Q1

Quarter-on-quarter, office rents in the CBD
have fallen by 3.9% in Q1 to $9.90 psf per
month for the third consecutive quarter.

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Market experts believe that this is due to the
global economic slowdown. According to the
Business Times, Marina Bay office rents were
the most affected as prices decreased 5%
quarter-on-quarter to $11.90 psf per month.
Office occupancy also fell by 0.4% to 93.9%.
This is likely because tenants have moved
out of Marina Bay and also due to the 1.9
million sq ft of office space at Marina One
which is expected to be completed within
these 2 years. Rents for Grade B offices in
Shenton Way and Tanjong Pagar area had
fallen 4% to $7.30 psf per month. Rents in
that area however had only fell by 2.3% to
$10.50 psf per month. According to DTZ, this
was due to the area’s high occupancy rate of
97.4% and a lack of new office supply.
(Source: Business Times)

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SINGAPORE PROPERTY WEEKLY Issue 255
Sembawang Park site won for $51.07
million
A 99-year leasehold 0.7-ha private housing
site near Sembawang Park has attracted 9
bids in a tender. The site’s highest bid stood
at $51.07 million or $481 psf ppr. This was
higher than the expected top bid of $470 psf
ppr. The site may be developed into a partthree storey and part-seven storey project.
The site may also yield 130- 140 units. The
average selling price is expected to be
between $1,000- 1,100 psf. While the site is
not located near transportation nodes or
amenities, market experts believe that it is still
attractive as it is the only non-landed project
within a 2-km radius in a precinct that is
predominantly landed.
(Source: Business Times)

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SINGAPORE PROPERTY WEEKLY Issue 255

Non-Landed Residential Resale Property Transactions for the Week of Mar 26 – Apr 1
Postal
District
3
3
4
4
5
5
5
5
5
7
8
8
8
8
9
9
9
9
9
9
9
9
10
10
10
10

Project Name
THE REGENCY AT TIONG BAHRU
TANGLIN VIEW
REFLECTIONS AT KEPPEL BAY
THE INTERLACE
THE MAYLEA
CARABELLE
CARABELLE
VILLA DE WEST
PARK WEST
BURLINGTON SQUARE
CITYLIGHTS
CITY SQUARE RESIDENCES
CITY SQUARE RESIDENCES
CITY SQUARE RESIDENCES
SCOTTS 28
ASPEN HEIGHTS
8 @ MOUNT SOPHIA
ASPEN HEIGHTS
ASPEN HEIGHTS
PARC EMILY
THE REGALIA
HORIZON TOWER
ST REGIS RESIDENCES SINGAPORE
JUNIPER AT ARDMORE
THE ARC AT DRAYCOTT
THE TESSARINA

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Area Transacted Price
Tenure
(sqft) Price ($) ($ psf)
1,281 2,050,000 1,600
FH
872 1,120,000 1,285
99
872 1,480,000 1,697
99
1,873 2,080,000 1,111
99
1,023 1,255,000 1,227
FH
2,077 2,400,000 1,155 956
1,292 1,400,000 1,084 956
1,012 1,090,000 1,077
FH
1,894 1,250,000
660
99
883 1,050,000 1,190
99
560
920,000
1,644
99
1,216 1,730,000 1,422
FH
1,216 1,620,000 1,332
FH
1,238 1,600,000 1,293
FH
1,658 3,130,000 1,888
FH
1,324 2,030,000 1,533 999
861 1,270,000 1,475 103
1,324 1,940,000 1,465 999
1,582 2,280,000 1,441 999
980 1,400,000 1,429
FH
1,270 1,790,000 1,409
FH
2,303 2,500,000 1,085
99
2,153 4,750,000 2,206 999
3,520 7,280,000 2,068
FH
1,130 2,150,000 1,902
FH
1,313 2,070,000 1,576
FH

Postal
District
10
10
11
11
12
12
13
14
14
14
14
15
15
15
15
15
15
15
15
16
16
16
16
16
16
17

Project Name
THE SIXTH AVENUE RESIDENCES
CHARLESTON
THE PARK VALE
HILLCREST ARCADIA
RIVERBAY
CALARASI
AVON PARK
SUITES @ EUNOS
GUILLEMARD EDGE
SIMSVILLE
SIMSVILLE
16 @ AMBER
THE WATERSIDE
PARADISE PALMS
OCEAN PARK
TANJONG RIA CONDOMINIUM
THE ELEGANCE @ CHANGI
VILLA MARTIA
FERNWOOD TOWERS
WATERFRONT KEY
WATERFRONT WAVES
CHANGI GREEN
WATERFRONT WAVES
EAST MEADOWS
BAYSHORE PARK
FERRARIA PARK CONDOMINIUM

Area Transacted Price
Tenure
(sqft) Price ($) ($ psf)
1,636 2,180,000 1,332
FH
1,023 1,328,000 1,299
FH
1,485 1,940,000 1,306 999
2,325 2,030,000
873
99
926 1,183,000 1,278 999
1,184 1,200,000 1,013
FH
1,270 1,420,000 1,118
FH
366
590,000
1,612
FH
409
600,000
1,467
FH
969
915,000
945
99
1,249 1,050,000
841
99
667 1,150,000 1,723
FH
2,142 2,520,000 1,176
FH
1,152 1,328,000 1,153
FH
3,261 3,750,000 1,150
FH
1,399 1,510,000 1,079
99
646
695,000
1,076
FH
1,335 1,368,000 1,025
FH
1,636 1,520,000
929
FH
1,518 1,628,000 1,073
99
1,292 1,368,000 1,059
99
872
820,000
940
FH
1,378 1,290,000
936
99
1,238 1,050,000
848
99
2,196 1,700,000
774
99
1,249 1,100,000
881
FH

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SINGAPORE PROPERTY WEEKLY Issue 255
Postal
District
18
18
18
18
18
18
19
19
19
19
20
20
21
21
21
22
22
23
23
23
23
23
23
27
28

Project Name
MODENA
LIVIA
LIVIA
THE TROPICA
MELVILLE PARK
ELIAS GREEN
KOVAN MELODY
THE SUNSHINE
THE VUE
CHUAN PARK
BISHAN POINT
FABER GARDEN CONDOMINIUM
JARDIN
SOUTHAVEN II
KISMIS VIEW
THE MAYFAIR
PARC VISTA
HILLVIEW HEIGHTS
HAZEL PARK CONDOMINIUM
HILLVIEW REGENCY
THE WARREN
PALM GARDENS
HILLTOP GROVE
THE ESTUARY
H2O RESIDENCES

Area Transacted Price
Tenure
(sqft) Price ($) ($ psf)
958
860,000
898
99
1,259 1,038,000
824
99
1,259 1,010,000
802
99
1,227 958,000
781
99
1,410 965,000
684
99
1,518 860,000
567
99
1,292 1,385,000 1,072
99
1,249 1,220,000
977
FH
1,087 975,000
897
FH
1,851 1,658,000
896
99
1,184 1,200,000 1,013
99
2,120 2,050,000
967
FH
1,808 3,350,000 1,853
FH
1,313 1,358,000 1,034 999
2,250 1,500,000
667
99
1,227 960,000
782
99
1,615 1,200,000
743
99
1,668 1,720,000 1,031
FH
1,378 1,290,000
936
999
904
811,000
897
99
1,066 835,000
784
99
1,216 890,000
732
99
1,485 1,050,000
707
99
1,195 850,000
711
99
1,389 1,388,000 1,000
99

NOTE: This data only covers non-landed residential resale property
transactions with caveats lodged with the Singapore Land Authority.
Typically, caveats are lodged at least 2-3 weeks after a purchaser
signs an OTP, hence the lagged nature of the data.

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