Singapore Property News & Prices

Big turnaround after blip of last year’s Q4; choice locations feel the buzz too

The private housing market has entered the year on a firm footing, with developers’ home sales in January rising to 1,476 units – three times as high as the previous month. They also hit their highest level since August last year.

Of the units launched in January as well as units sold in the same month, about half were in the Core Central Region, reflecting a revival in activity in the choicest housing locations in Singapore. Another interesting statistic gleaned from the latest monthly data released by the Urban Redevelopment Authority (URA) yesterday is that 76 per cent of the total units sold in January were priced at at least $1,000 per square foot (psf). Such a high proportion has not been seen since URA began releasing such data in June 2007, observes property agency PropNex CEO Mohamed Ismail.

Industry players expect this trend to continue for the rest of 2010, pointing to high land prices achieved at state tenders late last year, which would translate into higher target selling prices by developers.

As a developer put it: ‘Increasingly, people will accept that $1,000 psf is not a shocking price for mass-market private homes anymore.’ He acknowledged, however, that further price increases in this segment will be checked by what HDB upgraders can afford.

Also, many expect sales volumes and price gains this year to shift to the mid and higher price segments, hence supporting a bigger proportion of higher-priced transactions.

It was not price reduction but more launch activity that helped raise developers’ January sales volume, notes real estate lecturer Nicholas Mak. ‘Average prices in many recently launched projects either increased marginally or remained unchanged,’ he added.

A brighter economic outlook and pent-up demand after low sales in Q4 last year also gave January numbers a push, felt CB Richard Ellis (CBRE) executive director Li Hiaw Ho. ‘The 1,476 units sold in Jan 2010 alone is about 80 per cent of the 1,860 new homes sold in the entire fourth quarter of 2009,’ he said.

House-hunters also moved after noting that the government’s property-cooling measures last September did not translate into price reductions, noted Knight Frank chairman Tan Tiong Cheng.

CBRE’s Mr Li said the stronger sales volume in January was also partly driven by anticipation of a possible price hike in the mid and high-end segments this year.

The 1,476 private homes (excluding executive condos) developers sold last month was triple the 481 units sold in December last year. The latest January number is nearly 14 times the 108 units sold in January last year.

Developers launched 1,424 private homes last month, almost double the December figure of 734 units, according to URA.

Industry observers also say private home-buying activity is being driven mostly by investment demand rather than owner occupation. ‘We’re getting a lot of interest from mainland Chinese buyers because luxury home prices in Singapore have not recovered to the extent seen in gateway Chinese cities and Hong Kong,’ says DTZ executive director Ong Choon Fah.

CBRE predicts URA’s overall private home price index could appreciate 8 to 10 per cent in 2010 after last year’s 1.8 per cent rise.

Developers are expected to rev up launches in the coming weeks. ‘Some developers who were supposed to have released projects before Chinese New Year held back their launches, for greater clarity on the price of land when the first few state land tenders this year close,’ said a senior executive with a major developer. Assuming land costs remain firm, that will give developers greater confidence in pricing their end units, he added.

Low interest rates and improving sentiment will support buying interest from Singapore residents as well as foreigners this year, he argues.

January’s top-selling projects in the primary market were Cube 8 at Thomson Road (167 units), The Shore Residences in the Katong area (144 units), RV Edge along River Valley Road (91 units), Urban Suites in the Cairnhill area (88 units) and Parvis at Holland Hill (73 units).

The lowest psf price for a developer sale last month was for a unit sold at $544 psf at Oasis @ Elias; the highest price, $3,243 psf, was for an Orchard View unit.

Source : Business Times – 18 Feb 2010

SINGAPORE’S private property market is off to a strong start this year, with new-home sales in January coming in at a record-setting pace.

The Urban Redevelopment Authority (URA) said yesterday that 1,476 new homes were sold last month, sharply higher than the 481 units sold in December and 601 sold in November.

It is also the first time monthly sales figures have risen since July last year.

In fact, January’s sales were so exuberant that buyers bought more units than the number launched by developers that month.

They also set a faster pace than the average 1,230 units sold per month in 2007 – a year which saw a record 14,811 new homes snapped up.

Property analysts said yesterday that this has set the tone for this year. Demand for new homes is expected to be strong, especially in the higher-end segments of the market.

URA figures seemed to confirm this trend. Almost half of the new homes sold – 699 units – were in prime areas such as Cairnhill and Holland Road, otherwise known as the core central region.

The region saw the largest jump in number of units launched and sold. Developers launched almost five times the number of units – 690 in January, up from 126 in December – while the number sold tripled in January from 218 in December.

By comparison, mass market or suburban condominiums, which drove the property boom last year, accounted for just 29per cent of the units sold last month.

PropNex chief executive Mohamed Ismail said: ‘The middle- to high-end markets are certainly moving. Some 76per cent of homes were sold at above $1,000 per sq ft (psf), a proportion not seen for over 30 months.’

CBRE Research executive director Li Hiaw Ho said that a positive economic growth forecast for this year and pent-up demand following sluggish sales in the last three months of last year could have contributed to the sterling start.

Prime property sales were led by RVEdge in River Valley, where 91 units were sold at a median price of $1,696 psf, and Urban Suites in Cairnhill, where 88 units were sold at a median of $2,506 psf.

URA’s figures showed that another 350 homes sold were in the city-fringe areas, led by City Developments’ Cube8 in Thomson Road – January’s top-seller. Out of 177 Cube8 homes launched, 167 units sold at a median price of $1,286psf.

Far East Organization’s The Shore Residences, in the East Coast, also did well, with 144 units sold out of 202 launched, at a median psf price of $1,200.

CBRE’s Mr Li noted that, in general, the smaller one- or two-bedroom units continued to be popular because they cost less in absolute terms.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak added that based on caveats that have come in for January so far, the resale market is also showing similar strong volume.

But for now, prime properties are nowhere near the record-breaking levels of the last property peak in 2007. Last month’s sales did not see any homes priced above $4,000 psf, he noted.

In a separate report released yesterday, property consultancy DTZ Research said that the move towards higher-priced homes was already evident in the last quarter of last year, when home purchases of $3million and above made up 8per cent of all transactions, inching up from 7per cent in the previous quarter.

DTZ agreed that the high-end segment will see greater price appreciation this year. But it said that a runaway increase in prices is not likely as concerns like credit tightening in China and weak consumer demand in the US and Europe remain.

Following the Chinese New Year holiday, developers are expected to launch more projects, such as The Estuary in Yishun and Sentosa Quayside.

Source : Straits Times – 18 Feb 2010

Far East said to be top seller in January; Lippo and MCL may release some units

EVEN as developers have gotten off to a good start this year, selling well over 1,000 private homes in January, their launch machinery remains well oiled for more roll-outs in the near future.

Lippo Group is expected to preview Centennia Suites on the former Kim Seng Plaza site, diagonally opposite Great World City, later this week. The average price for the District 9 freehold project is being touted at $2,000 per square foot or even higher.

This is higher than recently achieved prices in the secondary market for nearby projects such as The Trillium and The Cosmopolitan but Lippo is probably banking on the exclusivity factor to market its latest offering. The 36-storey freehold Centennia Tower comprises a single tower with just 97 units, comprising two, three and four-bedroom apartments and two penthouses.

The two bedders are relatively large at slightly over 1,200 sq ft. Three bedders come in five variations but all around 1,800 sq ft; four-bedroom apartments also have five variations of roughly 2,250 sq ft. Centennia’s two penthouses are around 3,300 sq ft and 4,400 sq ft. BT understands that the project is being marketed by CB Richard Ellis and Jones Lang LaSalle.

Agents are also busy gathering interest for MCL Land’s The Estuary, a 608-unit condo at Yishun Ave 1/2. Some market watchers say that they would not be surprised if MCL releases some units before the Chinese New Year break.

For the month of January, Far East Organization is believed to have been the top seller, with sales of close to 300 units. Its bestseller was The Shore Residences, a 103-year-old condominium project on the former Rose Garden site in Katong. Far East is understood to have sold over 140 units in the project last month.

City Developments sold 243 units in January, the bulk of which were in Cube 8 at Thomson Road (167 units) and Livia in Pasir Ris (59 units), a CDL spokeswoman said.

Fellow property giant CapitaLand also did brisk sales. Its 165-unit Urban Suites condo in the Cairnhill area is said to be left with fewer than 30 units.

Frasers Centrepoint sold a total 102 units last month, including 43 units at its Residences Botanique in the Yio Chu Kang/Sirat roads area.

Frasers Centrepoint’s and Far East’s sales numbers are inclusive of about 35 units sold at their two joint-venture condominium projects along Bedok Reservoir, Waterfront Waves and Waterfront Keys.

Allgreen Properties is also believed to have sold a total 62 units from its preview of Holland Residences last week. The average price is $1,625 psf.

CB Richard Ellis executive director (residential) Joseph Tan says: ‘Generally, buyers are showing more interest and there’s acceptance that prices have bottomed out with a strong likelihood of growth. Developers in their pricing policy should also leave room for capital appreciation for investors.’

A Morgan Stanley report dated Jan 27, on a survey of the Singapore private residential sector involving Singapore-based respondents, concluded that, generally, respondents are expecting prices to trend upwards gradually in the medium term rather than spiking in the next 12 months.

As for developers, DTZ executive director Ong Choon Fah says: ‘When there’s a window of opportunity like what we’re seeing now, developers want to capitalise on it and try to push out projects as soon as possible; they can always restock land at government tenders.

‘After all, most economists are still calling for a note of caution on the sustainability of the global economic economy – for instance, if interest rates rise and as governments withdraw their stimulus measures.’

Source : Business Times – 2 Feb 2010

Private previews of The Shore Residences (the former Rose Garden enbloc site) by Far East Organization in December followed by an official launch on Jan 1 drew crowds to the showflat on weekends. The new 408-unit development opposite Katong Shopping Centre has seen close to 200 units sold at an average price of $1,175 psf as at last week.

What’s more, the project has also spurred renewed interest in the Marine Parade-Amber Road neighbourhood in East Coast, according to the URA Realis database of caveats lodged from Dec 18 to Dec 23.

The development that has seen close to half a dozen units change hands at prices ranging from $920 to $1,000 psf in December was the 612-unit Cote D’Azur, a 99-year leasehold condominium completed in 2004 by Fraser Centrepoint Homes. The highest transacted price at Cote D’Azur last month was for an 840 sq ft, fourth-floor apartment, which was sold for $840,000 ($1,000 psf), according to a Dec 1 caveat. The seller had bought the apartment only eight months earlier for $690,000, or $822 psf, hence seeing a 22% capital appreciation in that short period. It shows just how dramatic the turnaround in the market was last year.

Two 1,141 sq ft apartments — one on the 18th floor of Block 68 and the other on the seventh floor of Block 66 — were sold for $1.088 million ($954 psf) and $1.05 million ($920 psf), respectively in December. The owner of the 18th-floor unit had purchased it for $687,300 ($602 psf) in July 2002 when the project was first launched. Thus, the seller saw a 58.5% capital gain after seven years. Likewise, the owner of a seventhfloor unit had also purhased it from the developer for $662,070, or $580 psf, thus seeing a 58.6% gain over the same period.

Two fourth-floor apartments in Block 66 were sold in late December, according to caveats lodged on Dec 21 and 22. One was a 904 sq ft unit that was sold for $836,000 ($925 psf), while the other was a 1,539 unit that went for $1.52 million ($987 psf). The owner of the 904 sq ft unit had purchased it from the developer in August 2004 for $472,000, or $522 psf. At that time, the property market was at the bottom of the cycle, thus the owner saw a 77% gain from the sale after five years.

The owner of the 1,539 sq ft apartment had purchased the unit in July 2002, when the project was launched, for $854,340, or $555 psf. He enjoyed a 78% price appreciation after seven years.

Across the road from Cote D’Azur is the 546-unit freehold condo The Sea View by Wheelock Properties, which was completed in 2008. In December, two apartments at the high-end project were sold at prices in the $1,400 psf range.

A sixth-floor apartment of 1,410 sq ft at Block 37 of The Sea View was sold for $2 million ($1,418 psf). The last time the property changed hands was in a sub-sale in July 2006, when it was sold for $1.18 million ($838 psf). The first owner had purchased the unit for $1.08 million ($769 psf) when the project was first launched in July 2005.

A 19th-floor, 1,216 sq ft apartment at Block 31 of The Sea View was sold for $1.726 million ($1,420) in December. The owner had purchased the property in a sub-sale in April 2008 for $1.568 million ($1,290 psf).

Also in the neighbourhood is One Amber, a 562-unit development by joint developers UIC, Singapore Land and UOL Group. The project is expected to receive its temporary occupation permit in 1Q2010. The most recent transaction was that of a 15th-floor apartment in one of the four 23-storey blocks. The unit was sold for $1.47 million ($1,120 psf). The owner had purchased the 1,313 sq ft apartment for $1.01 million ($769 psf) in December 2006, hence enjoying a 46% gain.

From the transaction prices in the secondary market, it is clear that prices in the Marine Parade-Amber Road neighbourhood are heading back to the peak levels seen in mid-2007.

Source : The Edge – 18 Jan 2010