RESIDENTIAL MARKET
Govt unveils $2b package to reverse low birth rate
Being a parent in Singapore has never looked so attractive.
Married couples, with children under the age of 16, buying HDB flats for the first time will get priority allocation of new flats. Meanwhile, fathers will get paid paternity leave of one week in addition to the one-week leave they can co-share with their spouses.
These were some of the measures announced by the government yesterday as part of a bumper $2 billion Marriage and Parenthood package that it hopes will reverse the low birth rate here. As a side-effect, some see it helping to moderate prices in the HDB resale market and stabilising the HDB rental market.
The initiatives, announced by Deputy Prime Minister Teo Chee Hean, focused on five key areas - making it faster and easier to get housing to support early marriages and births; support for medical costs related to conception and delivery; further defraying child-raising costs; enhancing work-life measures and to signal to fathers to play a bigger role in bringing up their children.
On housing, the package introduced the Parenthood Priority Scheme by the HDB, to give priority allocation of HDB flats to first-timer married couples with children as it will set aside 30 per cent of Build-to-Order (BTO) flats and 50 per cent of Sale of Balance Flats (SBF) from the January 2013 HDB Sales Exercise.
In addition, the package also introduced another initiative to meet the housing needs of married couples in the form of the Parenthood Provisional Housing Scheme (PPHS), which will allow first-timer married couples with children to rent a flat from HDB while they await the completion of their new HDB flat. To do this, HDB will be launching about 1,150 units of three-room to five-room PPHS flats, with monthly rentals of between $800 and $1,900, in Ang Mo Kio, Bedok, Jurong West and Queenstown at the end of January 2013.
These measures could also have an effect on the HDB resale and rental markets. "The PPS will give first-timer married couples with children a higher success rate at the BTO and SBF flats. As this group has urgent housing needs, many of them have been turning to the resale market," explained Eugene Lim, key executive officer at ERA Realty.
He added that with lessened demand, resale market prices should continue to moderate, setting the stage for a long-overdue price correction while the PPHS initiative will also have a stabilising effect on the HDB rental market. The monthly rental range for PPHS flats is much lower than market rates for similar flats and so, by providing married couples with children the option to rent a flat from HDB, will take some pressure off the HDB rental market.
DPM Teo said a satisfactory outcome of this package would be if the TFR of Singapore could increase to about 1.4 or 1.5 over the next few years from 1.2 in 2011.
Source: Business Times –22 January 2013
Local real estate investors look abroad
The cooling measures unveiled this month appear to have made local investors look abroad, with roadshows for overseas projects enjoying keen interest on the weekend.
London property is clearly the flavour of the month although Australian real estate is also proving a strong draw for Singapore buyers looking for an alternative to the increasingly tough local market.
More than 70 homes at average prices of £1,100 (S$2,140) per sq ft (psf) have been sold here since the Thursday launch of the Battersea Power Station project which is being built on the south bank of the Thames.
Mr Rob Tincknell, chief executive of Battersea Power Station Development Company, said the interest from Singapore and the resulting sales "far exceeded expectations".
Fulham Riverside, another London project but on the north bank of the Thames, has also recorded "very healthy sales" here. Prices range from £450,000 to £2 million.
The demand for The Watermark and The Arc in London were very strong over the weekend.
More than 100 units across the projects were sold in both Singapore and Hong Kong.
Prices for a two-bedroom unit at The Arc near Tower Bridge start from £705,000, while prices for a similar apartment at The Watermark in East London start from £410,000.
Asia, including Singapore and Hong Kong, continues to be a key market for London and Australian developers, he added. Lucia in Melbourne, for instance, was also marketed here over the weekend with prices starting from A$737 (S$954) psf.
83 units at London's One Tower Bridge will be on sale here this weekend, the third time the project has been promoted in Singapore. Prices begin at £1,300 psf with apartments starting from £900,000.
Interest in overseas properties is expected to rise as the seventh and most extensive round of cooling measures take effect.
Experts say that the steps - which include tighter loan limits, additional stamp duties and the need to stump up more cash upfront for certain buyers - will likely divert liquidity abroad as investors look for alternative investments to park their cash.
Source: The Straits Times –22 January 2013
COMMERCIAL MARKETBuyers snap up units at Alexandra Central
Almost every unit of a mixed development launched in Alexandra yesterday has been snapped up - a stark sign that buyers are turning to commercial property in the wake of new cooling measures.
Only one of the 115 strata retail units released remained unsold as at 9pm yesterday after a dramatic day of sales that caught even the developer by surprise.
It was estimated that at least 20 buyers on average were competing for each unit at the 99-year leasehold Alexandra Central, while a shop space on the third storey had as many as 155 interested buyers submitting blank cheques for a ballot.
"I had strong confidence in the project but didn't expect it to do so well," said Chip Eng Seng group chief executive Raymond Chia.
The units were sold at between $4,000 and $8,000 per sq ft, said a spokesman from CEL Development, Chip Eng Seng's property arm.
Alexandra Central is next to Ikea and on the site of the former Safra building in Alexandra Road. CEL Development paid $189 million, or $789 psf per plot ratio, for the 85,517 sq ft site in 2011.
The project includes 31 food and beverage retail units and 85 shop units. The largest shop unit in the project was not launched for sale yesterday.
Mr Chia said Alexandra Central received an unexpectedly high level of interest when it was opened for preview over the weekend.
"We initially planned a soft launch on Wednesday but because the response was so overwhelming we decided to bring it forward to Monday," Mr Chia added.
When The Straits Times visited the showflat yesterday afternoon, it was packed with agents and buyers, some of whom had been there as early as 9am.
Some were genuine end-users hoping to secure shop space before prices rose further, while others said they were interested in investing in commercial property.
Investors were drawn to the project because of the recent cooling measures imposed on the residential and industrial sectors.
Alexandra Central will include a 450-room hotel managed by Park Hotel Group. Construction is expected to be completed by June 2016.
Source: The Straits Times –22 January 2013
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