Business Times - 14 Jun 2008
Prime condo prices heading for long, gentle decline
Cushman model shows subdued market until 2012 but firm argues it's still a good time to buy
By KALPANA RASHIWALA
(SINGAPORE) The prices of condos and private apartments in the Core Central Region (CCR) will inch downwards and are unlikely to touch their recent peaks for almost the next four years, a model developed by Cushman & Wakefield (C&W) shows. The extent of the fall will depend on how slowly the Singapore economy grows, but C&W expects these median prices to drop between 8 per cent and 17 per cent from their peak of Q1 2008, before recovering by some time in 2012.
Even so, it argues that now may be a good time to look at buying into new developments, as the developers are unlikely to slash prices dramatically. Instead, a gentler decline is on the cards.
The trigger for this is 'there's still a lot of private housing supply', says C&W's head of forecasting Lee Chong Yong, who developed the model.
Mr Lee points to the Urban Redevelopment Authority's projections that about 8,000 non-landed private homes will be completed this year, followed by another 12,000 units next year, around 16,000 in 2010, and some 20,000 in 2011, before the supply eases to around 8,000 units again in 2012.
'Some of these units have not been launched yet. As time goes on, the unsold or yet-to-be-sold stock will keep creeping up, until 2011. The extent to which there will be downward price pressure from this will depend on the pace of economic growth. The stronger the economic growth, the faster the supply can be absorbed,' Mr Lee says.
Assuming Singapore's GDP grows at a rate of 4 per cent a year between 2008 and 2012, the median per square foot (psf) price for non-landed private homes in CCR - which includes the prime districts 9, 10 and 11, Downtown Core location and Sentosa Cove - will fall a total of 17 per cent between the Q1 2008 high and Q1 2012.
Based on a higher 5 per cent GDP growth rate, the price decline will be a lower 12 per cent over the same period.
If GDP grows at 6 per cent, the median price will decline 8 per cent between early 2008 and Q3 2009 before recovering back to the Q1 2008 high by end-2012.
C&W also tracked developers' sales in 255 new condo projects across Singapore and constructed an islandwide non-landed private residential new sales price index, which showed a 2.2 per cent decline between the peak in December last year and May this year.
'From the start of the credit crunch in August 2007 through to May 2008, developers of only 10 per cent of the 255 new condo projects tracked have cut their prices by more than a fifth,' C&W said.
C&W argues that 'compared to the 1997-1998 Asian crisis, today's falling prices are at present moderate without any signs of panic from the developers'. During the Asian crisis, most developers cut prices by at least 20 per cent while some reduced asking prices by up to 40 per cent in 12 months, it said.
The property consultancy group says 'now would be a good time to consider buying into new developments'. It also notes that expats living in Districts 9, 10 and 11 have seen a doubling of rents over the past two years, while sale prices of many condos are starting to see a slow price decline. 'For expats expecting to stay in Singapore, it would be a good time to consider buying (a condo) to take advantage of this short-term dip in the market,' C&W's head of residential Connie Looi says.
But JPMorgan analyst Christopher Gee gave a different view, saying that compelling values were needed to get buyers back to the market. 'The fear of making a purchase now, only to have prices fall later, is what's holding buyers back at this stage. Developers too don't want to sell too cheap; if prices recover, then they would have missed out on making bigger profits.'
One property market watcher said that tempting buyers back would require mass-market condos to be launched at $600-$650 psf on average, compared with a price of $700-$800 psf last year.
In the mid-range category, a freehold condo in the Balestier area for instance would today need to be priced at $900-plus psf, instead of the $1,000-plus psf they're still being marketed at, based on last year's pricing. For freehold projects in the prime districts 9,10 and 11, what would lure buyers back today would be an average price of no more than $3,000 psf, instead of $3,500-$4,000 psf last year, another industry observer said.
Giving his take, an experienced property industry player said: 'How Singapore home prices will pan out will depend on both internal and external factors. Residential property prices have fallen in many markets across the globe, such as the US, Europe, UK, Australia, Vietnam and China. If we want to be in line with the rest of the world, we'll also see some slide.'
Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.
Saturday, June 14, 2008
A new haven in Sengkang
June 14, 2008
A new haven in Sengkang
THE sleepy Sengkang West neighbourhood is set to get a splash of life - the Sengkang Sports and Recreation Centre is almost ready.
Final touches are being made to the $28 million centre, complete with two swimming pools and water slides, as well as a sports hall and hockey field.
It is expected to be handed over to the Singapore Sports Council, which will manage the facility, early next month, and it should open soon after.
A spate of construction delays had caused the project to miss its early 2008 opening date, causing much disappointment.
Sengkang West, formed in the run-up to the 2006 General Election, is home to about 35,000 residents but is relatively undeveloped, compared to other parts of Sengkang and Punggol.
The sports centre is part of a multi-million-dollar makeover to transform the area into a recreation haven with eateries, parks and water-sports facilities.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
A new haven in Sengkang
THE sleepy Sengkang West neighbourhood is set to get a splash of life - the Sengkang Sports and Recreation Centre is almost ready.
Final touches are being made to the $28 million centre, complete with two swimming pools and water slides, as well as a sports hall and hockey field.
It is expected to be handed over to the Singapore Sports Council, which will manage the facility, early next month, and it should open soon after.
A spate of construction delays had caused the project to miss its early 2008 opening date, causing much disappointment.
Sengkang West, formed in the run-up to the 2006 General Election, is home to about 35,000 residents but is relatively undeveloped, compared to other parts of Sengkang and Punggol.
The sports centre is part of a multi-million-dollar makeover to transform the area into a recreation haven with eateries, parks and water-sports facilities.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Home prices in mid to low tier expected to stay stable: CapitaLand
June 14, 2008
Home prices in mid to low tier expected to stay stable: CapitaLand
PROPERTY giant CapitaLand expects prices of mid- to low-tier homes to remain largely stable this year despite signs of a weaker market.
Chief executive Liew Mun Leong reportedly said in Beijing on Thursday that demand for homes in Singapore is still holding up well.
Prices of lower-end homes will be 'marginally up or down', Mr Liew said in an interview at a press conference, Bloomberg reported.
He also noted prices of mid-market and lower-end homes, usually bought by HDB flat upgraders, have risen 3 per cent to 5 per cent this year.
His comments come against the backdrop of a much quieter property market, with many buyers keeping to the sidelines.
Industry sources say demand exists but only at lower price tiers. Home prices, particularly those for high-end projects, shot up to unrealistic levels during the property boom last year, they say.
The market turned silent this year, which has led some analysts to project that home prices will fall by as much as 40 per cent over the next two years.
Last month, CapitaLand reiterated its target of launching 800 to 1,000 units this year. Among those lined up for launch are Latitude in River Valley and the project on the Silver Tower site in Orchard. Projects in the pipeline include those on the Char Yong Gardens, Farrer Court and Nassim Hill sites.
CapitaLand also bought the huge Gillman Heights site. But the objecting owners are trying to overturn the sale and the High Court judge has yet to decide on the case.
On Thursday in Beijing, Mr Liew was also quoted as saying that the group is looking for distressed assets in Japan and China to aid its expansion in the two markets. CapitaLand is seeking such assets at a time when rising energy and commodity prices as well as a slowing global economy are putting additional financial stress on firms and stoking defaults worldwide.
Home prices in mid to low tier expected to stay stable: CapitaLand
PROPERTY giant CapitaLand expects prices of mid- to low-tier homes to remain largely stable this year despite signs of a weaker market.
Chief executive Liew Mun Leong reportedly said in Beijing on Thursday that demand for homes in Singapore is still holding up well.
Prices of lower-end homes will be 'marginally up or down', Mr Liew said in an interview at a press conference, Bloomberg reported.
He also noted prices of mid-market and lower-end homes, usually bought by HDB flat upgraders, have risen 3 per cent to 5 per cent this year.
His comments come against the backdrop of a much quieter property market, with many buyers keeping to the sidelines.
Industry sources say demand exists but only at lower price tiers. Home prices, particularly those for high-end projects, shot up to unrealistic levels during the property boom last year, they say.
The market turned silent this year, which has led some analysts to project that home prices will fall by as much as 40 per cent over the next two years.
Last month, CapitaLand reiterated its target of launching 800 to 1,000 units this year. Among those lined up for launch are Latitude in River Valley and the project on the Silver Tower site in Orchard. Projects in the pipeline include those on the Char Yong Gardens, Farrer Court and Nassim Hill sites.
CapitaLand also bought the huge Gillman Heights site. But the objecting owners are trying to overturn the sale and the High Court judge has yet to decide on the case.
On Thursday in Beijing, Mr Liew was also quoted as saying that the group is looking for distressed assets in Japan and China to aid its expansion in the two markets. CapitaLand is seeking such assets at a time when rising energy and commodity prices as well as a slowing global economy are putting additional financial stress on firms and stoking defaults worldwide.
About half of affluent in S'pore not ready for retirement
June 14, 2008
About half of affluent in S'pore not ready for retirement
By Chia Yan Min
NEARLY half of comfortably well off Singapore residents - or 46 per cent - have yet to start saving for their retirement.
This finding came out of the Zurich International Life (ZIL) Wealth Monitor, a report on the attitudes and future plans of Singapore's emerging affluent.
The trend emerged despite the fact that Singaporeans said they would like to retire at 53 and expats at 56.
A total of 200 residents and 200 expats were surveyed in face-to-face interviews in April and last month. Respondents were selected based on their ability to pay insurance premiums of $2,000 a month. Most were earning $8,000 to $10,000 a month.
Sixty-nine per cent of the respondents said they would rather save for their long-term future than spend excessively now, but few were actually doing so.
In fact, 27 per cent were not confident of attaining sufficient funds for their retirement. Only 8 per cent of Singaporeans and 7 per cent of expats were very confident of doing so.
'With populations living longer and society having increased financial needs compared to generations ago, it's clear that saving for retirement has to start at an early age,' said ZIL regional director Carlos Sabugueiro.
The survey also indicated that very few placed a high value on independent financial advice. Only 25 per cent of Singaporeans were turning to professionals for financial planning advice, preferring instead their friends and family.
'There's a timidness towards taking the first step in investing for the future, especially with the market volatility we're seeing today. People have to understand there are ways around that volatility. You simply need to put yourself in front of a financial professional you can trust,' said Mr Andy Robinson, ZIL's distribution head for South-east Asia.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
About half of affluent in S'pore not ready for retirement
By Chia Yan Min
NEARLY half of comfortably well off Singapore residents - or 46 per cent - have yet to start saving for their retirement.
This finding came out of the Zurich International Life (ZIL) Wealth Monitor, a report on the attitudes and future plans of Singapore's emerging affluent.
The trend emerged despite the fact that Singaporeans said they would like to retire at 53 and expats at 56.
A total of 200 residents and 200 expats were surveyed in face-to-face interviews in April and last month. Respondents were selected based on their ability to pay insurance premiums of $2,000 a month. Most were earning $8,000 to $10,000 a month.
Sixty-nine per cent of the respondents said they would rather save for their long-term future than spend excessively now, but few were actually doing so.
In fact, 27 per cent were not confident of attaining sufficient funds for their retirement. Only 8 per cent of Singaporeans and 7 per cent of expats were very confident of doing so.
'With populations living longer and society having increased financial needs compared to generations ago, it's clear that saving for retirement has to start at an early age,' said ZIL regional director Carlos Sabugueiro.
The survey also indicated that very few placed a high value on independent financial advice. Only 25 per cent of Singaporeans were turning to professionals for financial planning advice, preferring instead their friends and family.
'There's a timidness towards taking the first step in investing for the future, especially with the market volatility we're seeing today. People have to understand there are ways around that volatility. You simply need to put yourself in front of a financial professional you can trust,' said Mr Andy Robinson, ZIL's distribution head for South-east Asia.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Slide and hide
June 14, 2008
Slide and hide
Movable panels which conceal spaces and furniture doubling as storage are ways studio dwellers use to maximise their tiny home spaces
By Janice Tai
EVERY night for the past six months, IT consultant S.H. Yong slept in a room not much larger than a king-sized bed with his wife and two kids.
His maid didn't have much tossing room either - she slept in the bomb shelter the size of an HDB lift.
Their home was a tiny 570 sq ft studio apartment in Icon in Gopeng Street. And they are among a growing breed of Singaporeans who live in super small apartments.
In recent years, the space crunch in Singapore's prime districts has led to developers building increasingly smaller apartment units, with the sizes of such studios at around 500 sq ft each.
Projects completed this year include Parc Emily in Mount Emily Road, Viz@Holland in Queensway Road and Bellezza@Katong in Ceylon Road.
When Kent Residences in Kent Road was launched in March, one studio unit was as small as 312 sq ft - the size of about two Old Chang Kee kiosks.
Yet such studio apartments are being snapped up even though their prices are sky-high.
Units in areas such as Farrer Park, Balestier and Dhoby Ghaut go for around $1,000 per square foot (psf) and can even go up to $1,600 psf.
When Citigate in Rangoon Road was launched last week, all 18 of its studio units were sold during the preview, says Ms Peggy Ngiam, project director of Huttons Real Estate Group.
She says buyers of studios are a mix of locals and foreigners. Some are single professionals while others are investors looking for good rental yields.
Ms Charmaine Fang, a Propnex associate realtor, says studios can fetch at least $3,000 in rentals a month.
Expatriate online portal SingaporeExpats.com adds that studios in the city are popular among expatriates because they are near their work place and closer to the nightlife scene.
The average Singaporean enjoys one of the largest personal living spaces in the region.
Here, a family of five in the newer four- or five-room HDB flat would have a living space of about 190 sq ft to 235 sq ft per person. It is larger than that in Hong Kong, Tokyo and Seoul, where the average living space per person ranges from 75 sq ft to 160 sq ft.
So how have studio dwellers here adapted to such small living spaces?
Trading representative Teo Wen Shuen, 29, opted for space-saving furniture such as mounted LCD screens and a queen-sized bed for his 441 sq ft studio in Soho 188 in Race Course Road.
Others tried to make use of every nook and cranny.
Says Ms Emily Tan, 37, an administrator who also bought a Soho 188 unit recently: 'I will get a base for the bed that is hollow inside so that it can double as storage space.'
Even the ceiling has usable space for IT consultant Yong. Two ledges - each slightly bigger than an A4-sized piece of paper - can swing open from the ceiling to reveal a storage space.
Others such as housewife X.Y. Luo, 52, adopted visual trickery to make the space look bigger.
Her 549 sq ft unit in Parc Emily has an entire wall covered in mirrors to create the illusion of space.
She also boarded up a planter-box area with wooden planks and transformed it into an outdoor drinking spot.
'I have neighbours from much bigger units coming over and saying that my unit looks as big as theirs,' she says.
'At the end of the day, it's really about creating spaces or illusions through skilful arrangement and manipulation.'
jantai@sph.com.sg
How he did up his home
SPACE EXTENSIONS (above): When there is insufficient space on the coffee table in the living room, the two-piece TV console doubles as an extra table as it is extendable. It also has drawers to hide knick-knacks so that the living area is kept neat.
FOR six months this year, IT consultant S.H. Yong (above), 38, lived in his 570 sq ft studio in the Icon condominium (below) in Gopeng Street with his wife, two sons - aged four and two - and a maid.
He has since rented it out to a couple from Taiwan, and has moved his family to a two-bedroom condo in Alexandra Road which is twice as big.
'But when my son plays in the living room now, he can no longer talk to Mummy when she is cooking in the kitchen. The small unit actually helped my family grow closer,' he says.
How she did up her home
STACK AND SAVE: Behind the dining table in Ms Gn's apartment is a tiny kitchenette, which also houses a dryer on top of a washer to save space. The sofa in the living room is reclinable and can be used as an extra bed when necessary. -- ST PHOTOS: CAROLINE CHIA
BUSINESSWOMAN Olivia Gn (above), 52, owns a 495 sq ft condominium in Viz@Holland (below) in Queensway Road. She bought it in February as an investment and is now looking for a tenant.
She says: 'Studios are popular with investors because they are affordable, easy to do up and maintain, and the returns are quite high.'
DIVIDE AND CONQUER: A sliding partition separates the bedroom and the living area and helps to create privacy for the sleeping quarters when necessary. A flat-screen LCD mounted on the living room wall reduces the need for a TV console. Wooden ledges by the windows in both areas offer sitting and display space.
COOK, EAT, WASH AND HIDE: The cooking and washing areas can be concealed by a sliding panel which, when pulled down reveals a display cabinet above. -- ST PHOTOS: DESMOND LIM -- PHOTO: FAR EAST ORGANIZATION
THREE IN ONE: A custom-made narrow ledge next to the bed in the bedroom can be used as a shelf, display area or table-top.
SMALL IS ATTRACTIVE: With studios having the potential to fetch at least $3,000 in rentals a month, it is no surprise they are selling like hot cakes.
Take Soho 188 (below) in Race Course Road. Its units have been sold but the owners have yet to move into its studios (above) ranging from 300 ft to 500 ft. -- ST PHOTOS: MUGILAN RAJASEGERAN
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Slide and hide
Movable panels which conceal spaces and furniture doubling as storage are ways studio dwellers use to maximise their tiny home spaces
By Janice Tai
EVERY night for the past six months, IT consultant S.H. Yong slept in a room not much larger than a king-sized bed with his wife and two kids.
His maid didn't have much tossing room either - she slept in the bomb shelter the size of an HDB lift.
Their home was a tiny 570 sq ft studio apartment in Icon in Gopeng Street. And they are among a growing breed of Singaporeans who live in super small apartments.
In recent years, the space crunch in Singapore's prime districts has led to developers building increasingly smaller apartment units, with the sizes of such studios at around 500 sq ft each.
Projects completed this year include Parc Emily in Mount Emily Road, Viz@Holland in Queensway Road and Bellezza@Katong in Ceylon Road.
When Kent Residences in Kent Road was launched in March, one studio unit was as small as 312 sq ft - the size of about two Old Chang Kee kiosks.
Yet such studio apartments are being snapped up even though their prices are sky-high.
Units in areas such as Farrer Park, Balestier and Dhoby Ghaut go for around $1,000 per square foot (psf) and can even go up to $1,600 psf.
When Citigate in Rangoon Road was launched last week, all 18 of its studio units were sold during the preview, says Ms Peggy Ngiam, project director of Huttons Real Estate Group.
She says buyers of studios are a mix of locals and foreigners. Some are single professionals while others are investors looking for good rental yields.
Ms Charmaine Fang, a Propnex associate realtor, says studios can fetch at least $3,000 in rentals a month.
Expatriate online portal SingaporeExpats.com adds that studios in the city are popular among expatriates because they are near their work place and closer to the nightlife scene.
The average Singaporean enjoys one of the largest personal living spaces in the region.
Here, a family of five in the newer four- or five-room HDB flat would have a living space of about 190 sq ft to 235 sq ft per person. It is larger than that in Hong Kong, Tokyo and Seoul, where the average living space per person ranges from 75 sq ft to 160 sq ft.
So how have studio dwellers here adapted to such small living spaces?
Trading representative Teo Wen Shuen, 29, opted for space-saving furniture such as mounted LCD screens and a queen-sized bed for his 441 sq ft studio in Soho 188 in Race Course Road.
Others tried to make use of every nook and cranny.
Says Ms Emily Tan, 37, an administrator who also bought a Soho 188 unit recently: 'I will get a base for the bed that is hollow inside so that it can double as storage space.'
Even the ceiling has usable space for IT consultant Yong. Two ledges - each slightly bigger than an A4-sized piece of paper - can swing open from the ceiling to reveal a storage space.
Others such as housewife X.Y. Luo, 52, adopted visual trickery to make the space look bigger.
Her 549 sq ft unit in Parc Emily has an entire wall covered in mirrors to create the illusion of space.
She also boarded up a planter-box area with wooden planks and transformed it into an outdoor drinking spot.
'I have neighbours from much bigger units coming over and saying that my unit looks as big as theirs,' she says.
'At the end of the day, it's really about creating spaces or illusions through skilful arrangement and manipulation.'
jantai@sph.com.sg
How he did up his home
SPACE EXTENSIONS (above): When there is insufficient space on the coffee table in the living room, the two-piece TV console doubles as an extra table as it is extendable. It also has drawers to hide knick-knacks so that the living area is kept neat.
FOR six months this year, IT consultant S.H. Yong (above), 38, lived in his 570 sq ft studio in the Icon condominium (below) in Gopeng Street with his wife, two sons - aged four and two - and a maid.
He has since rented it out to a couple from Taiwan, and has moved his family to a two-bedroom condo in Alexandra Road which is twice as big.
'But when my son plays in the living room now, he can no longer talk to Mummy when she is cooking in the kitchen. The small unit actually helped my family grow closer,' he says.
How she did up her home
STACK AND SAVE: Behind the dining table in Ms Gn's apartment is a tiny kitchenette, which also houses a dryer on top of a washer to save space. The sofa in the living room is reclinable and can be used as an extra bed when necessary. -- ST PHOTOS: CAROLINE CHIA
BUSINESSWOMAN Olivia Gn (above), 52, owns a 495 sq ft condominium in Viz@Holland (below) in Queensway Road. She bought it in February as an investment and is now looking for a tenant.
She says: 'Studios are popular with investors because they are affordable, easy to do up and maintain, and the returns are quite high.'
DIVIDE AND CONQUER: A sliding partition separates the bedroom and the living area and helps to create privacy for the sleeping quarters when necessary. A flat-screen LCD mounted on the living room wall reduces the need for a TV console. Wooden ledges by the windows in both areas offer sitting and display space.
COOK, EAT, WASH AND HIDE: The cooking and washing areas can be concealed by a sliding panel which, when pulled down reveals a display cabinet above. -- ST PHOTOS: DESMOND LIM -- PHOTO: FAR EAST ORGANIZATION
THREE IN ONE: A custom-made narrow ledge next to the bed in the bedroom can be used as a shelf, display area or table-top.
SMALL IS ATTRACTIVE: With studios having the potential to fetch at least $3,000 in rentals a month, it is no surprise they are selling like hot cakes.
Take Soho 188 (below) in Race Course Road. Its units have been sold but the owners have yet to move into its studios (above) ranging from 300 ft to 500 ft. -- ST PHOTOS: MUGILAN RAJASEGERAN
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
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