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Singapore Property News This Week Singapore Property Prices Defy Gravity to Reach an All-Time High Resale Property Transactions (June 13 June 19)
FROM THE
EDITOR
Welcome to the 58th edition of the Singapore Property Weekly. Hope you like it! Mr. Propwise
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Signs of change have already been seen, with transactions in the outside central region (OCR) and rest of central region (RCR) in the range of $1,200 - $1,300 psf and transactions in the core central region (OCR) in the range of $1,600 - $1,700 psf. The number of OCR shoebox units could inflate by 450% by 2015, potentially leading to a 10-20% fall in rents.
Six levels of AA Centre at River Valley Road up for sale by expression of interest Together, the first six levels of freehold AA Centre at River Valley Road is asking for $90100 million. The 32 vacant serviced apartments on these levels have a total strata area of 55,574 sq ft and are part of a 14storey mixed-used development on a
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SINGAPORE PROPERTY WEEKLY Issue 58 33,751-sq-ft site with a 127,712 sq ft gross floor area. The building also includes 90 car parking lots located in the basement level for common use. Zoned for residential use with an allowable plot ratio of 2.8, the site can be built up to 10 storeys. The expression of interest closes on Aug 7. budget. Units in the Central Region, however, are mainly catering to investors and foreigners with deeper pockets affected by the ABSD and the negative global economic outlook. Shoebox apartments remain attractive since their lump sum price is more affordable. The overall SRPI increased 1.5% in May from April, with the sub-index for small apartments islandwide having increased by 0.9% and the sub-indices for the Central Region and NonCentral Region having increased by 0.8% and 2.2% respectively. 99-year Pheng Geck private condo site draws $114.8m top bid The site located at Pheng Geck Avenue near Potong Pasir MRT Station attracted a total of 13 bids with the winning bid of $114.8 million or $628.22 psf ppr from Santarli Corporation. The high number of bids reflects the developers' confidence in sustained demand
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SINGAPORE PROPERTY WEEKLY Issue 58 for developments near MRT stations. There is also a parcel of land opposite the plot which is zoned for commercial development and it could support a shopping mall the size of Nex. Santarli plans to launch a 240-unit 18-storey development with mainly two and threebedroom units and some one- and fourbedroom units in nine months. The estimated breakeven cost and average selling price are around $1,000 psf and $1,300 psf respectively. Faber Drive Bungalow up for sale at $12.5m A two-storey bungalow with a swimming pool sitting on an 11,719 sq ft land at Faber Drive is up for sale by expression of interest, with an indicative price of $12.5 million or $1,067 psf. Located near The Clementi Mall, Clementi Bus Interchange/ MRT Station, and the National University of Singapore, the plot could be subdivided subdivided into two
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smaller plots with houses of at least 4,305 sq ft. The expression of interest will close on July 20 at 3pm.
Commercial
Bugis Cube units selling well 85% or 77 out of the 91 units launched at 999year Bugis Cube have been sold, with an average unit size of 355.2 sq ft. The remaining 14 units (27 sq m to33 sq m on average) can be found on the second and third floor. The development located opposite Bugis Junction and near Bugis Junction offers units ranging from 129 to 635 sq ft at $2,900 to $7,500 psf over six floors. Each unit offers a water point while F&B units will come with a grease trap. Office capital values to fall by 5% in 2012 The average capital values of Grade A office space in the Raffles Place/New Downtown
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SINGAPORE PROPERTY WEEKLY Issue 58 micro-market fell by 0.5% from $2,459 psf in Q1 to $2,447 psf by end June though the market has been seeing much activity from new releases and en bloc sales of strata office units. The whole of 2012 could see a 5% fall in office capital values. Meanwhile, rents of Grade A office space islandwide fell by 1.2% in Q2, with the average monthly gross rents in the Raffles Place/New Downtown micro-market decreasing by 3% to $9.47 psf from Q1 to Q2 and rents in other micro-markets adjusting in the range of -2.4 - 0% in Q2. The rents are likely to fall by up to 15% in 2012, especially with the increase in supply of 150,000 sq ft of space released upon lease expiry. ft to 360,000 sq ft at the end of this year. 48% of the 285,000 sq ft shadow space in Q2 was in Raffles Place where the average gross face rent for prime office space fell by 3.1% to $9.50 psf per month from Q1 to Q2. Rents on Shenton Way, Robinson Road and Cecil Street fell 2.6% to $7.55 psf per month in the same period. The rents in the CBD are likely to continue falling despite the below-average net increase in supply of 1.1 million sq ft of office space in 2012 since nearly 610,000 sq ft of existing office space will become available as occupiers vacate their current premises. The average occupancy rate for office space at Raffles Place fell 0.7 percentage points in Q2 to about 92% while the average occupancy rate on Shenton Way, Robinson Road and Cecil Street rose by 1.3 percentage points to 95% in Q2. The largest increase of 4.5 percentage points came from Marina Bay to 72%.
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SINGAPORE PROPERTY WEEKLY Issue 58 It appears that the strength of property demand has outweighed concern over the slowing economy, the worrying global economic situation especially with the troubles in Europe and weak growth in the US, and the dampening effect of multiple rounds of government measures. The rate of price growth differed across the various market segments. In the Core Central Region, prices of non-landed private residential properties increased by 0.6% versus a decrease of 0.6% in the previous quarter. Prices were flat in the Rest of Central Region, while they increased by 0.4% in the Outside Central Region, a slowdown from the 1.1% increase in the previous quarter. statistics will be updated four weeks later, and past data have shown that the difference could be significant, especially when the change is small. Sharp Decline, Recovery? Gradual Decline, or
Do note that the URAs flash estimates are compiled based on transaction prices given in caveats lodged during the first ten weeks of the quarter. The actual second quarter
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SINGAPORE PROPERTY WEEKLY Issue 58 The uncertainty is whether we will see a sharp decline as during the 1997-1998 Asian Crisis and 2008-2009 Financial Crisis, whether it will be a more gradual decline as we saw during the 2000-2004 Post-Dotcom Bubble and SARs era, or whether we will have a continued property bull market.
I believe that we will only see significant levels of price declines if there is an external crisis to cause a sense of panic, which we had in each of the previous 3 declines (e.g. Asian Crisis, Dotcom Bubble, Global Financial Crisis). This is because the abundant global liquidity situation could support Singapore property prices. Led by the European Central Bank and Fed, governments around the world have been easing monetary policy and keeping interest rates low to prevent another crisis triggered by too much debt.
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Figure 3 Straits Times Index We saw the Straits Times Index (STI) correct in May to a low of 2,737 points, followed by a recovery in June to 2,878. Even then, it is still down 4% versus the last quarter. If you believe that the stock market is a leading indicator for the property market, then we could see downward pressure on property prices in the coming quarters.
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SINGAPORE PROPERTY WEEKLY Issue 58 Additional Rounds of Property Cooling Measures? The sales volume of new residential homes by developers fell by 23% in May after a 12% fall in April. This suggests that the prices of new homes are likely under some pressure, especially given that the NUS monthly resale price index was up in April to May. Thus even if the prices of new launches correct, the strengthening prices of resale units could take up the slack. cooling measures would comprise merely of refinements to the current measures (e.g. increase ABSD?) or be something brand new. Many analysts are still predicting a 10% drop in property prices this year. Given that property prices for the first half of 2012 are still marginally up, these forecasts may not come true unless there is a significant correction in the coming months.
This resilience of property prices despite the previous five rounds of government measures increases the probability of a sixth round of property measures to further cool sentiment. This is especially so given that the harsh Additional Buyers Stamp Duty (ABSD) put in place in December 2011 seems to have not dampened sentiment that much. It is not clear right now whether a potential sixth round of
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Non-Landed Residential Resale Property Transactions for the Week of Jun 13 Jun 19
Postal District 1 4 4 4 5 5 5 5 5 5 5 5 7 9 9 9 9 9 9 9 9 10 10 10 10 Project Name EMERALD GARDEN CARIBBEAN AT KEPPEL BAY MOUNT FABER LODGE TERESA VILLE THE PARC CONDOMINIUM BOTANNIA THE SPECTRUM BLUE HORIZON VARSITY PARK CONDOMINIUM FABER CREST PARK WEST VISTA PARK THE BENCOOLEN HELIOS RESIDENCES THE PATERSON EDGE SCOTTS HIGHPARK CAIRNHILL CREST URBANA RIVERSHIRE UE SQUARE PEACE CENTRE/MANSIONS CUSCADEN ROYALE BOTANIC GARDENS MANSION SPRING GROVE TANGLIN RESIDENCES Area (sqft) 926 1,281 3,703 1,356 667 1,561 1,119 926 1,894 1,141 872 710 883 2,002 840 1,744 1,733 1,313 1,690 1,485 2,605 936 1,399 1,668 4,930 Transacted Price ($) 1,500,000 1,850,000 4,520,000 1,528,000 880,000 1,785,000 1,250,000 968,000 1,920,000 1,080,000 825,000 670,000 1,150,000 6,961,100 2,000,000 3,900,000 3,000,000 2,200,000 2,780,000 2,200,000 1,775,000 2,300,000 2,500,000 2,620,000 7,700,000 Price Tenure ($ psf) 1,620 999 1,444 99 1,221 FH 1,127 FH 1,319 FH 1,144 956 1,117 FH 1,046 99 1,013 99 947 99 946 99 943 99 1,303 99 3,477 FH 2,382 FH 2,237 FH 1,731 FH 1,675 FH 1,645 FH 1,481 929 681 99 2,456 FH 1,787 FH 1,570 99 1,562 FH Postal District 10 10 10 10 10 10 10 10 10 11 11 11 11 11 12 12 12 13 14 14 15 15 15 15 15 Project Name THE TESSARINA VALLEY PARK GLENTREES DUCHESS CREST KELLOCK LODGE CASABELLA JERVOIS JADE APARTMENTS JERVOIS JADE APARTMENTS JERVOIS JADE APARTMENTS SOLEIL @ SINARAN LION TOWERS AMANINDA MINBU VILLA THOMSON 800 THE ARTE KIM KEAT LODGE BALESTIER POINT SENNETT ESTATE THE VINES ATRIUM RESIDENCES AMBER RESIDENCES VERSILIA ON HAIG SANCTUARY GREEN COSTA RHU NEPTUNE COURT Area (sqft) 958 1,216 1,345 1,367 893 2,131 1,044 1,141 2,056 1,722 1,862 614 2,336 1,787 1,873 2,024 3,961 1,033 1,066 1,044 1,163 1,130 1,399 1,345 1,270 Transacted Price ($) 1,390,000 1,750,000 1,815,000 1,835,000 1,190,000 2,570,000 1,220,000 1,310,000 2,170,000 3,185,700 2,668,000 852,000 2,360,000 1,780,000 2,290,000 1,710,000 2,710,000 750,000 1,050,000 970,000 1,618,800 1,380,000 1,600,000 1,380,000 1,106,000 Price Tenure ($ psf) 1,451 FH 1,439 999 1,349 999 1,342 99 1,332 FH 1,206 FH 1,168 99 1,148 99 1,055 99 1,850 99 1,433 FH 1,389 FH 1,010 FH 996 FH 1,223 FH 845 FH 684 FH 726 FH 985 FH 929 FH 1,393 FH 1,221 FH 1,143 99 1,026 99 871 99
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Postal District 21 21 21 22 23 23 23 23 23 23 23 23 26 26 27 27 27 28 28
Project Name SIGNATURE PARK SIGNATURE PARK SHERWOOD TOWER PARC OASIS CASHEW HEIGHTS CONDOMINIUM GUILIN VIEW CASHEW HEIGHTS CONDOMINIUM HILLVIEW RESIDENCE CHESTNUT VILLE NORTHVALE PARKVIEW APARTMENTS NORTHVALE THOMSON GROVE CASTLE GREEN YISHUN SAPPHIRE YISHUN SAPPHIRE YISHUN SAPPHIRE MIMOSA PARK SUNRISE GARDENS
Area (sqft) 1,367 1,055 1,830 1,765 1,227 861 1,658 1,238 1,658 1,270 1,119 1,087 1,539 1,152 1,206 1,184 1,313 1,755 1,270
Transacted Price ($) 1,380,000 1,020,000 1,358,000 1,450,000 1,239,270 795,000 1,520,000 1,075,000 1,340,000 970,000 850,000 820,000 1,390,000 930,000 840,000 800,000 845,000 1,430,000 980,000
Price Tenure ($ psf) 1,009 FH 967 FH 742 99 821 99 1,010 999 923 99 917 999 868 999 808 999 764 99 759 99 754 99 903 FH 807 99 697 99 676 99 643 99 815 FH 772 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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