Property rental markets are favouring tenants

The residential leasing market is gradually turning to favour tenants, even as there is likely to be strong demand over the next half a year.

The rental market was buoyant in the third quarter of the year. There were 15,083 rental transactions - a record number and an 11.6 per cent increase from the previous quarter.

This was attributed to factors such as the 5.1 per cent growth in GDP for Singapore year-on-year, lower unemployment rates, and foreign nationals bringing forward plans to relocate here in light of the Fair Consideration Framework (FCF) which will take effect next August.

The FCF will require every company with more than 25 employees to advertise job openings on a new government-sponsored job bank before applying for a new Employment Pass (EP).

While the framework applies to jobs with monthly salaries below $12,000, "it is foreseen that from the start of next year, the number of overseas nationals in Singapore will decline further, as EP holders will soon face more difficulties in getting approvals on both fresh and renewed applications”.

These factors come against a backdrop of higher vacancy rates and slower rental growths. In Q3, 6.1 per cent of private homes, or 17,459 units, were vacant, up from 5.6 per cent in Q2. This came on the back of several big projects such as the 1,040-unit The Interlace on Depot Road, the 429-unit Tree House on Chestnut Avenue and the 302-unit Cape Royale at Sentosa Island getting their temporary occupation permit.

As for rents, the overall index for private residential properties from the Urban Redevelopment Authority showed a 0.2 per cent growth in Q3, down from 0.3 per cent in Q2. The average monthly rent of high-end condominiums tracked by Savills was flat at $4.86 per square foot.

Source: Business Times – 26 November 2013

A property billionaire turns bearish

"[...]Up to 5% fall in property prices" is a very bold claim from the Chairman of City Developments Limited (CDL), a leading real estate developer in Singapore. 

Is he trying to talk the market down? Trying to manipulate market prices?

Read the below article and judge for yourself.

http://sg.finance.yahoo.com/news/property-billionaire-turns-bearish-130126516.html

Resale Prices of Resale Private Apartments down in May

Resale Prices of resale private apartments down in May amid weak transaction volumes, flash estimates from the Singapore Real Estate Exchange (SRX) show.

SRX said its Singapore Property Index (SPI) for resale prices for non-landed private residences eased 0.5 per cent to 175.7 last month from April.

In April, it had edged up 0.1 per cent from March.

Effects of Jan property curbs unclear: NUS

A paper from the National University of Singapore's Institute of Real Estate Studies (IRES) argues that it is unclear that the seventh instalment of cooling measures announced in January has had the desired impact of mitigating home price inflation.

It based this on an analysis of its Singapore Residential Price Index (SRPI) series, which tracks prices of completed non-landed private homes excluding executive condos.

Cooling measures for multiple properties starting to bite

The proportion of private housing loan applicants without any outstanding mortgages continued to rise in the first quarter of this year, according to latest figures from Credit Bureau (Singapore). This suggests that the January cooling package, with measures that discouraged multiple property ownership, is starting to bite, analysts say.

CBS data shows that of the 16,208 Singaporeans and permanent residents granted private home mortgages (including refinancing cases) in the first three months of 2013, 65 per cent did not have any outstanding home loans either for an HDB flat or private home.

Foreigners' share slips in private home deals

The proportion of private home transactions involving foreign buyers (including Singapore permanent residents, or PRs) slipped to 20.8 per cent in April, after recovering to 26.7 per cent in March.

In February, their share dived to 23.3 per cent following the seventh round of property cooling measures that took effect on Jan 12. In January, foreigners had accounted for 28 per cent of caveats lodged for private homes purchased in Singapore. Conversely, Singaporean buyers' share increased, from 72.5 per cent in March to 78.3 per cent in April - highest monthly share in a year.

Banks' property exposure makes up about 28% of their non-bank loans

Banks' property exposure makes up more than a quarter of their non-bank loans, it was revealed yesterday.

As of March 2013, property-related exposures accounted for 28 per cent of banks' total outstanding non-bank loans, Monetary Authority of Singapore Chairman Tharman Shanmugaratnam said in a written reply.

These exposures comprised housing loans at 17 per cent, and loans to property developers and construction companies, at 11 per cent. Of the housing loans granted, more than 70 per cent were for owner-occupation.

Non-landed private home owners profit from resales

Non-landed private home owners pocketed a total of $107 million in gross profit, from quick resales over the five quarters of Q1 2012 to Q1 2013.

Noting that the property market has "rebounded very strongly", high property prices - the overall private residential price index is now 60 per cent above the trough in 2009 - contributed largely to the profit in this sector, which includes private condominiums and apartments but excludes Housing and Development Board (HDB) executive condominiums.

In the current bull run, newly completed homes that were resold upon receipt of Temporary Occupation Permit (TOP) yielded good returns for purchasers.

HDB should set the price of public housing: Khaw

HDB should set the price of public housing, rather than take its cue from the resale market. Given that Housing & Development Board (HDB) is the chief supplier of homes.

No longer will HDB let "the tail wag the dog" as it did for decades when it used a market-based approach to price its Build- To-Order (BTO) flats, said National Development Minister Khaw Boon Wan.

This resulted in soaring new flat prices as the resale market spiked 80 per cent over the last six years.

Grange Road properties still in the spotlight

Grange Road Properties like the Spring Grove condominium which could undergo a $1.045 billion collective sale has put the spotlight on other residential blocks in the same street.

The high-end sector has been down in the dumps for months, so the prospect of a big payday for Spring Grove owners has raised eyebrows among property experts.

Grange Road, like many other prime city neighbourhoods, has come under the pressures of the additional buyer's stamp duty and the risk of more cooling measures.

First-time buyers support non-central condo prices

Amid the latest official flash estimate showing a slower quarter-on-quarter increase in private home prices in Q1 2013 than in Q4 last year, some property consultants believe that the latest cooling package in January will have a more lingering impact than the six preceding rounds.

However, prices in the widely watched Outside Central Region (OCR), home to suburban condos, are unlikely to fall this year given the strength of the first-time home-buyer pool, say some analysts.

Ho Bee leases out luxury units to ride out property troughs

The lacklustre market for high-end homes has prompted developer Ho Bee Group to lease out units at its completed projects.

Ho Bee has developed several pricey projects in Sentosa Cove, including Seascape and Turquoise, but sales have been hit by several rounds of cooling measures and a slowing economy.

The firm has responded by leasing out apartments, with 70 per cent of its unsold units in Sentosa already tenanted. Ho Bee chairman Chua Thian Poh told The Straits Times: "We hope by the time the market (is all right again), we can put the apartments on the market for sale again.

Property investment in Singapore to rise

Singapore can expect a significant uptick in property investment activity this year, on the back of an expected 15-20 per cent increase in global investment activity, which is likely to surpass US$1 trillion for the first time since 2007.

Cooling measures in Hong Kong (double stamp duty) and China (more aggressive implementation of capital gains tax) will generate strong investor sentiment for Singapore and Tokyo. This is a turnaround from last year, a slow year of investment trading, which is defined in the report as deals of US$5 million and above; last year, Singapore saw virtually no price growth.

Big drop in HDB resale deals as new cooling measures bite

The number of Housing Board resale flats changing hands dropped drastically last month - a sign that the new cooling measures announced at the start of the year are beginning to kick in.

There were around 750 resale deals last month, the lowest activity in any month since the Singapore Real Estate Exchange (SRX) started tracking prices in 2007. This is less than half the 1,740 transactions in February last year.

Non-landed resale prices on the rise in Jan

Resale prices of completed private apartments and condos fared slightly better in January compared to December, according to the latest figures from the National University of Singapore.

The university's January flash estimate for the Singapore Residential Price Index (SRPI) suggested that prices of small units (up to 506 sq ft) islandwide was the star performer for the month, rising 2.6 per cent, reversing a dip of 0.7 per cent in December.

Property Development charges projected to rise

Property development charges (DC) rates - payable for enhancing the use of some sites or building bigger projects on them - expected to head upwards come March 1 for all major use groups. They cite an appreciation in land values over the past six months. In some cases, the hikes could be in double digits.

DC rates, revised on March 1 and Sept 1 each year, are stated according to use groups - such as landed residential, commercial and hotel - across 118 geographical sectors. The Ministry of National Development, in consultation with the Chief Valuer, revises DC rates based on current market values. In addition to being tracked in property circles as they can impact redevelopment sites with a sizeable DC component, DC rates are seen as the government's reading of land and property values.

Indirect discounts for home buyers under review

Indirect discounts acting as sweeteners to home buyers by developers, to take the sting out of recent property cooling measures, is being reviewed by the Government.

It is concerned that sweeteners such as stamp duty rebates and furniture vouchers cause home prices to be artificially inflated. The Straits Times understands that the Urban Redevelopment Authority (URA) is looking into the practice and might act soon, as indirect discounts could make the cooling measures seem ineffective.

Latest Property Cooling measures won't hit banks heavily: Citi Research

The latest property cooling measures is unlikely to impact banks heavily, with mortgage and construction loan demand expected to remain resilient this year, though at a slower growth rate.

This is because data so far since the cooling measures were implemented suggests that demand for property is still strong, Citi Research said in a report yesterday.

It expects the mortgage growth rate to reach 9 per cent this year, compared with 16 per cent last year. It also predicts the growth rate for construction and non-bank financial institution loans to drop only slightly from over 17 per cent to about 15 per cent.

Singapore offers a glimpse of its future

A couple of days after projecting that the population could rise to upto 6.9 million by 2030, the government yesterday revealed how they might be accommodated without Singapore feeling the squeeze. Reclamation alone will raise the land area by up to 5,200 hectares or 7.3 per cent - much of it in Tuas Port, Pulau Tekong and Jurong Island. Some of the existing 10,000 ha stock of reserve land will be tapped. Old industrial areas and some golf courses will be recycled to achieve higher land productivity. Infrastructure permitting, land use can be intensified.

Singapore's current population of about 5.3 million live on 71,400 ha of land. By 2030, some 76,600 ha could be available.

Expat housing here 2.7% pricier this year

Expat housing - in terms of relocating staff to Singapore has increased 2.7 per cent to average US$5,510 per month this year - third highest in Asia and eighth globally.

Taking currency fluctuation into account, however, the cost of renting an apartment in Singapore in US dollars has fallen slightly, said Lee Quane, regional director, ECA International, Asia.

"(In US dollars), we actually observe a small decrease in rental price. This contrasts strongly with a year ago when the US dollar was a lot weaker against the Singapore dollar," said Mr Quane, noting that in 2011, rents increased more than 15 per cent once converted into the greenback.