Monday, 24 September 2012

News Update - 22 Sep 2012


RESIDENTIAL MARKET
'White' site near Novena set for sale
A PRIME "white" site at Thomson Road/Irrawaddy Road has been triggered for sale by public tender after a developer offered a bid of at least $211.3 million, or $700 per square foot per plot ratio (psf ppr).
It is classified as a "white" site, which means it can be put to commercial, residential or hotel use. But the Urban Redevelopment Authority (URA) requires that a minimum 30 per cent of maximum permissible gross floor area (GFA) be set aside for hotel use.
It has a plot area of 0.66 ha, which translates to a maximum permissible GFA of 301,852 sq ft.
Analysts expect keen interest in the site given the location's proximity to Novena MRT Station and several medical centres, including Tan Tock Seng Hospital, Novena Medical Centre and Mount Elizabeth Novena Hospital.
 The site is surrounded by many existing commercial developments, such as Velocity @ Novena Square, United Square and Square 2.
Given the site's flexibility in development options, analysts are uncertain about the exact nature projects will take but expect a combination of serviced apartments, hotel, and retail to cater to the various medical facilities in the vicinity.
URA will launch the public tender for site in about two weeks and the tender period will subsequently be for eight weeks.
Source: Business Times – 22 September 2012
 
Star Vista set to dazzle Buona Vista
THE one-north area is fast taking shape with the new Star Vista mall.
The CapitaMalls Asia outfit - the first major mall in Buona Vista - has about 100 shops, including some that are new to Singapore, like eatery Morganfield's.
The Star Performing Arts Centre, owned and managed by New Creation Church's Rock Productions, is above the mall.
Star Vista is within Vista Xchange, a cluster next to Buona Vista MRT station that houses Rochester Mall, Park Avenue Rochester Hotel and the upcoming Metropolis, which will have two office towers and retail space.
Lifestyle hub Rochester Park, with its trendy eateries, has been open for several years. Rochester Mall and the hotel are already operating, while the Metropolis is expected to be ready next year.
The one-north area - on the boundary of Buona Vista and Dover - is near the Buona Vista and one-north MRT stations. It is known for the science and research clusters Biopolis and Fusionopolis. Some phases of these two spots are completed, but more buildings will be added in future.
Mediapolis, which will house MediaCorp and other firms, is another cluster nearby that expects its first tenants soon.
Besides those, the Ministry of Education is headquartered in the area, as is Nanyang Technological University's Alumni Club.
The one-north development in its entirety will be finished in about 15 years, but the changes are already boosting condominiums in the area while rents are being sustained by the many enterprises, private and public, there.
Property consultants say there is "great investment potential", given the area's accessibility, limited new supply of units, capital appreciation and leasing demands.
There is a dearth of private projects, with the fully sold The Rochester, which was completed last year, being the newest. The 405-unit One North Residences was completed in 2009, while Dover Parkview and Heritage View are more than a decade old.
As far as experts know, there are no more projects to be launched in the one-north area. There are also no government land sales there this year.
Dover Parkview's resale prices have risen 3 per cent to about $949 per sq ft (psf) this year, while Heritage View next door posted an uptick of 6.8 per cent to around $1,093 psf.
The newer One North Residences saw resale prices inch up 3.6 per cent, averaging $1,436 psf.
Based on five-year trends, private home prices there have increased 2.9 per cent annually since 2007, beating the 2.2 per cent rise at condos in the neighbouring Holland and Farrer areas.
There have been at least 50 leases signed in the first two quarters this year at One North Residences, with monthly rents from $3.90 to $4.50 psf.
Source: The Straits Times – 22 September 2012
 
$1m HDB flat
What it's all about
HOME prices in Singapore continued to set new records this month, with the sale of a Housing Board flat hitting the psychological $1 million mark.
A resale executive flat in Queenstown is in the process of being sold for a mindboggling $1 million, beating a record set by a Bishan executive maisonette when it sold for $980,000 barely a week earlier.
Just a few days later, it was reported that a 1,680 sq ft HUDC maisonette along Shunfu Road was sold in July for $1.28 million, topping last year's $1.22 million sum for a 1,668 sq ft HUDC flat in the same area.
What's the buzz?
THE record prices have raised concerns that the housing market is still red hot, despite five rounds of cooling measures and the aggressive rollout of new HDB flats.
Analysts attribute the high prices to private-property downgraders who have cashed out and want to live in a flat of comparable size. But they have prompted many to ask: Is this an alarming trend or are these just outliers in a housing market where prices are stabilising?
Flash estimates from the Singapore Real Estate Exchange showed that HDB median resale prices rose 1.8 per cent in the third quarter, after rising 2 per cent in the second quarter.
In the wake of the record prices, National Development Minister Khaw Boon Wan had urged Singaporeans not to be "traumatised" by the sales.
It did not mean that home prices are all going to get exorbitantly high, he said, and urged people to look at general prices for most units.
Prices of new Build-to-Order flats have generally been affordable, he noted, and dismissed the need for additional measures to cool the housing market.
Why it matters
HOUSING prices have long been a hot political issue, though the Government's moves to clamp down on speculation and foreign investment, along with the promise to build 25,000 new flats this year, has taken the fire out of it. But if more record prices appear, it could well re-ignite the issue.
With the United States Federal Reserve launching QE3 - a third round of quantitative easing involving the printing of more money to pump-prime the economy - a flood of hot money is expected to hit Asia's shores again.
This money will be looking for appreciating assets like property to invest in, and will also keep interest rates - and therefore mortgage rates - depressed in Singapore.
And with no end in sight to the low interest rates, the effect of QE3 could be to bring forward demand from prospective buyers who were uncertain about the interest rate environment - thus driving up demand for homes and pushing up prices further.
What's next?
IN HONG KONG, the central bank said it will limit the maximum term on all new mortgages to 30 years, as part of further measures to cool the property market.
In Singapore, many property analysts are predicting home prices will continue rising, with some saying that more cooling measures will be needed.
Others, however, believe that too heavy a hand could kill the market, and plump for fine-tuning existing measures as the best way forward.
Source: The Straits Times – 22 September 2012
 
Property cooling steps net $500m for taxman
THE taxman has collected more than half a billion dollars from additional stamp duties imposed as part of property cooling measures.
The additional buyer's stamp duty (ABSD) has contributed the bulk of that - $450million between its inception on Dec8 last year and the end of last month.
A further $51million has come from the seller's stamp duty since it was implemented in February 2010, the Inland Revenue Authority of Singapore (Iras) said.
According to Iras' annual report, it collected $2.5 billion in stamp duty from sale and purchase agreements in its financial year ended March 31, 2011.
The ABSD take includes about $261million collected from foreigners who are not permanent residents (PRs), who bought about 1,400 homes in the nine months to the end of last month, Iras told The Straits Times. These foreigners comprised about one in four of the buyers who have paid the additional tax.
The figures seem to suggest that foreign buying interest has picked up again after the market initially cooled in response to the measures. In the first four months after the tax was introduced, foreigners paid $66.2million in ABSD on the purchase of 369 private homes.
Afterwards, the tax take - and transactions - shot up, with about $200million collected in the subsequent five months on more than 1,000 homes bought.
Experts said this trend is also borne out on the ground.
The Urban Redevelopment Authority's Realis website shows that non-PR foreigners bought 358 homes in the first three months of the year - or 5.4per cent of private home purchases. In the second quarter, they snapped up 637 homes - 6.7per cent of private home sales - led largely by renewed interest in city centre and city fringe homes.
These numbers are still well below the quarterly sales average of 1,369 foreign-bought units seen last year.
The tough cooling measures last December slapped a 10 per cent ABSD on all home purchases by foreigners. PRs had to fork out only an extra 3per cent on their second and subsequent home purchases, while Singaporeans had to do so only for their third home onwards.
Source: The Straits Times – 24 September 2012

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