RESIDENTIAL MARKET
Private home sales in November down 44%
Developers here sold 44.2 per cent fewer private homes in November compared with the month before, as they held back launches during the holiday season.
Data from the Urban Redevelopment Authority (URA) showed that 1,087 private homes, excluding executive condominiums (ECs), were sold last month, compared with 1,948 in October.
November's sales figures were the lowest since December 2011. Compared with the same period last year, transactions fell 36.1 per cent. The slump was largely due to a lack of major launches, market watchers said.
Analysts said developers were holding back until after the festive season, noting that the end of the year is traditionally a low season.
The latest round of property cooling measures may have played a part, too.
A total of 773 units were launched last month, down 53 per cent from the 1,633 units in October.
No new ECs were launched in November, but 179 such homes were sold from earlier launches. Including these hybrid units, 1,266 homes changed hands, down from 2,624 the month before.
Still, demand showed resilience, with homes sold exceeding those launched, analysts said.
The top-selling development last month was the Eco Sanctuary in Upper Bukit Timah. It sold 140 units for a median price of $1,050 per square feet (psf); d'Leedon in Farrer Road sold 133 units at a median of $1,431 psf, while Riversails in Upper Serangoon transacted 81 units at a median of $858 psf. Bartley Residences also sold well, as did the Waterbay EC at Punggol.
The highest psf price in November was for a unit in Scotts Square, which sold for $4,244 psf.
Eugene Lim, ERA Realty's key executive officer, noted that new home sales continued to be "dominated by the mass market". Units from Outside Central Region made up 65 per cent of sales, excluding ECs, last month.
For the first 11 months of 2012, developers moved 20,879 private homes (excluding ECs), adding to a record year. The previous mark for full-year sales was 16,292 units, set in 2010.
Analysts expect 21,000-24,000 homes to be sold for the entire 2012.
For ECs, 3,672 units were sold up to November, and some consultants expect full-year sales to cross the 4,000 mark.
In December, sales figures could be supported by new launches. Analysts predict transaction volumes of 1,000-1,300 units.
Besides the Echelon, Sennett Residence and Spottiswoode Suites, the likes of the Kingsford@Hillview Peak, Village@Pasir Panjang and the Whitley Residences could be launched. Three EC launches are also expected: City Life@Tampines, Forestville and The Topiary.
There remains potential drag from an uncertain economic outlook and cautious employment prospects. Some analysts are expecting transactions to slow to 16,000-18,000 units next year.
Source: Business Times –18 December 2012
Collective sales players in no hurry to bid for sites
Prudence is the word that springs to mind when one talks about the outlook of the collective sales market in 2013.
Given the less-than-buoyant demand for collective sales sites this year, market analysts expect the same in the coming months, with developers favouring smaller sites, as they did throughout 2012.
Although the ABSD might have resulted in more cautious transactions in the en-bloc market this year, a couple of records were still broken and new highs set.
For example, the sale of Thomson View condominium) at $712 per square foot per plot ratio (psf ppr) or $590 million, was the largest residential collective deal since June 2007 when Farrer Court on King's Road made headlines for its staggering $1.34 billion price tag.
While Thomson View gave a boost to a market that had seen mostly smaller collective sales of under $100 million in recent years, it was a one-off deal and did not set off ripples in the market. It was successful in its third collective sales attempt partly because of the newly announced Upper Thomson MRT station nearby (part of the upcoming Thomson Line), said market analysts.
The year-to-date value of transactions is expected to be around $2 billion, about two-thirds of last year's $3.2 billion.
This is from the 24 sites sold to date this year, compared with the 51 transactions recorded in 2011. Only three out of the 24 sites sold were in the prime districts of 9,10 and 11, with the rest mainly from sites in the suburban areas and city fringe.
Tracking sales trends over the years, the report found that 14,811 private residential units were sold by developers in 2007, with the core central region, rest of central region and outside central region, accounting for 33 per cent, 30 per cent and 37 per cent, respectively.
By 2010, 75 per cent of the 16,292 units sold by developers were attributable to the rest of the central region and outside the central region, while the core central region's share had slipped to 25 per cent.
Demand for homes outside prime districts strengthened in 2011, when nearly 90 per cent of the 15,904 units sold by developers were in the rest of central region and outside central region.
Not surprisingly, similar robust demand was seen in 2012 in the rest of central region and outside central region, which accounted for 95 per cent of developer sales, with the rest coming from the core central region.
Several of the bigger collective sales this year, besides Thomson View, were successful only after having been on the market more than once, evidence of the anxiety among developers to take on such projects in these uncertain economic times.
For example, Chateau Eliza, which was transacted in September at $9.2 million or $1,743 psf ppr, had been on the market three times previously.
The property was first put up for collective sale in 2007 at an indicative price of about $115 million to $120 million. It was then launched for sale again in December 2011 with a guide price of $111 million to $115 million, and a third time in May this year at a reserve price of $108 million before it was successfully sold in September.
Source: Business Times –18 December 2012
Property option fee: Woman loses appeal
A housewife submitted a cheque to pay a 1 per cent option- to-purchase fee concerning a $27.6 million Swettenham Road bungalow.
But the cheque for $276,000 bounced and the seller sued Madam Leong Miew Fong for the fee payable. She did not file her defence in the case and the High Court ordered her to pay the $276,000 by default.
She applied to the High Court last month to set aside the judgment but did not succeed.
Yesterday, she failed in her appeal to avoid paying the fee even though the sale had been aborted.
In March, she had forwarded a cheque signed by her husband to the seller Swettenham19, a private firm dealing in real estate.
The option-to-purchase fee would give her the right to proceed with the acquisition of the 16,800 sq ft double-storey property near the Botanic Gardens.
But the cheque bounced as funds which her husband had expected to come into his bank account did not arrive, according to court documents filed.
In April, Swettenham19 sued Madam Leong for the fee and won.
Last month, Assistant Registrar Kevin Tan dismissed her move to set aside the outcome, pointing out that her failure to pay the fee did not prevent the seller from enforcing the option-to-purchase transaction, based on the terms of the valid contract.
She appealed yesterday before Justice Tay Yong Kwang and said in court documents that she did not file a defence to the suit earlier because she was keen to negotiate and seek an amicable settlement with the owner.
She further claimed she did not want to "antagonise" the owner and had hoped the property would not be sold to another party.
Her lawyer Derek Kang urged the court to set aside the default judgment and allow Madam Leong to file her defence for a full hearing.
He argued the deal as claimed by Swettenham19 was a one-way deal and did not become a contract between both parties as no money had been paid by her.
This was an issue for the court to rule on in a trial, he said.
But lawyer George Pereira, representing Swettenham19, countered that Madam Leong's claim to have sought to settle the dispute amicably and therefore not filing a defence was not borne out by the facts.
He argued she could not take advantage of her own wrong by asserting that there was no contract since no payment was made when the cheque bounced.
Justice Tay agreed and dismissed her appeal with costs.
Lawyers said the case underscores the need to make clear in any option-to-purchase contract whether the deal takes effect only after the option-fee money is paid, to avoid a similar incident.
Source: The Straits Times –18 December 2012
COMMERCIAL MARKET
UEL buys Anson Road block for $410m
Infrastructure firm United Engineers (UEL) is buying a commercial block in Anson Road for $410 million.
The company has acquired the 23-storey property from the Central Provident Fund Board and fellow owner 79 Anson.
The block, known as 79 Anson Road, is linked to Tanjong Pagar MRT station and was valued by Colliers International at $430 million.
It is 99 per cent occupied, with technical consultants Kellogg Brown & Root Asia Pacific the anchor tenant.
UEL said in a statement yesterday that the Anson Road acquisition, which will be its first commercial property within the central business district, will provide a stable rental income with potential to increase rates.
It added that there is potential for capital growth given the property's location near the port land - at Tanjong Pagar, Keppel and Pulau Brani - which has been earmarked to become a waterfront city.
This deal also helps UEL build up a more stable base of rental income to smoothen its fluctuating development profits.
UEL, which formed the wholly owned unit UE Development (Anson) to make the transaction, said the purchase is not expected to have a material impact on the earnings per share and net tangible assets per share for this financial year.
Source: The Straits Times –18 December 2012
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