Business Times - 17 May 2008
Fears of US recession overblown: analyst
By OH BOON PING
(SINGAPORE) The Federal Reserve is likely to cut interest rates by another 25 basis points, before pausing to monitor the key economic data in US, according to the National Australia Bank.
However, its group chief economist Alan Oster felt that fears of a major US recession is overblown at present and forecast a US GDP growth of 1.2 per cent this year and 1.7 per cent next year.
Since last September, the Fed has slashed its key interest rate by 3.25 percentage points to 2 per cent.
Mr Oster was speaking to BT on the sidelines of a lunch forum organised by the CPA Australia.
On the issue of liquidity trap, Mr Oster said that: 'Where the Fed is at right now, either they do one more or sit around for a while to see what the data says. We actually think they are very close to the bottom.'
In his presentation, Mr Oster also said that a slowdown in US consumption is still to come in 2008, while recovery is expected in 2009.
These forecasts are based on assumptions such as flat equity markets, 1.5 per cent growth in real disposable income, and that oil prices peak at about US$120 before falling to US$90 by later this year.
In Asia, growth is expected to slow only moderately as there are 'enough dynamics' in emerging economies of China and India.
In China, he sees slower growth in exports of around 20 per cent, while 'retail also a touch lower - mainly in real terms given accelerating inflation'.
Overall, Chinese economic growth is expected to slow moderately to 9.5 per cent this year and about 8.9 per cent in 2009.
This year, India's gross domestic product (GDP) could grow by 7.5 per cent, but drop to 6.4 per cent next year.
He remains optimistic about the economic prospects in Singapore, as the city state largely 'reflects what is happening in Asia'.
This year's GDP growth in Singapore is forecast at 5.2 per cent, while next year's could hit 5.8 per cent.
Globally, GDP growth is estimated at 3.4 per cent and 3.2 per cent next year.
On the run-up in commodity prices, Mr Oster said that commodities are 'close to the top . . . And so our forecast is some of them are clearly going to go down, particularly the agricultural side. So the wheat and the rice prices are expected to come down.'
'I am not sure if iron or coal is going to come down, but if China slows, they will.'
The bank sees commodity prices falling 20 per cent from current levels in two to three years' time.
Separately, Morgan Stanley said in a note yesterday that trade trends in Singapore are likely to continue to soften, while cyclical segments will likely face further pressures.
This came after Singapore economy posted higher exports and non-oil domestic exports last month.
Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.
Sunday, May 18, 2008
Further drop in new home sales and launches in April
May 16, 2008
Further drop in new home sales and launches in April
Prices also show signs of weakening as buyers adopt a more cautious stance
By Fiona Chan
THE private home market continued to weaken last month, with launches of new homes falling to their lowest level in at least 10 months.
Sales volumes and median prices also dipped, according to monthly figures released by the Urban Redevelopment Authority yesterday.
Developers launched only 271 homes last month, fewer than half the 642 units launched in March.
The number of homes sold also fell, to 274 in the month, from 322 previously. These figures exclude executive condominiums.
'It is clear that homebuyers were in no hurry to make purchases and were taking more time to assess the market,' said Mr Li Hiaw Ho, the executive director of CB Richard Ellis (CBRE) Research.
He attributed this trend to the continuing instability of financial markets and increasing concerns over the higher cost of living.
Perhaps as a result of the slowdown, prices have begun to show signs of strain.
An analysis by property firm Knight Frank found median prices of new homes sold last month had slid 9 per cent to $943 per sq ft (psf), from $1,035 psf in March.
One reason for the lower prices could be that most of the homes launched and sold were in cheaper mass-market developments.
Eight out of 10 homes sold in the month cost $1,000 psf or less. Only seven homes, or about 2 per cent of the total sold, fetched more than $2,000 psf.
This is a major reversal from previous months. As recently as in December, more than 70 per cent of the homes sold for the month cost more than $2,000 psf.
The strength of the mass-market segment last month was the bright spot in an otherwise dismal set of figures yesterday.
The best-selling project was a suburban development: Stadia in Yio Chu Kang Road, which sold more than 90 per cent of its 56 units within the month.
'Latent demand remains strong, especially for the mass-market projects that are reasonably priced between $750 and $850 psf,' said Mr Chua Yang Liang, the head of South-east Asia research at Jones Lang LaSalle.
On the other hand, only three units were launched in the prime core central region. Demand for homes in this high-end area and in the mid-tier city-fringes remained fragmented and weak, said Mr Chua.
Property consultants said they expect buying activity to remain slow in the coming months as the current gloomy sentiment persists.
But some, such as CBRE's Mr Li, expect sales to start improving next month as developers begin stepping up launches.
Mr Ku Swee Yong, Savills Singapore's director of business development and marketing, said buyers are starting to return to the market.
'I dare say last month's sales numbers will be the lowest we will see this year,' he said.
'Showflat crowds are still pretty good, and from now on, we should see launches picking up.'
Having some high-profile launches would give the market a boost, said Mr Nicholas Mak, the director of research and consultancy at Knight Frank.
'Essentially, the lukewarm sentiment can be explained primarily by the lack of launches of major developments that might cause excitement.'
Further drop in new home sales and launches in April
Prices also show signs of weakening as buyers adopt a more cautious stance
By Fiona Chan
THE private home market continued to weaken last month, with launches of new homes falling to their lowest level in at least 10 months.
Sales volumes and median prices also dipped, according to monthly figures released by the Urban Redevelopment Authority yesterday.
Developers launched only 271 homes last month, fewer than half the 642 units launched in March.
The number of homes sold also fell, to 274 in the month, from 322 previously. These figures exclude executive condominiums.
'It is clear that homebuyers were in no hurry to make purchases and were taking more time to assess the market,' said Mr Li Hiaw Ho, the executive director of CB Richard Ellis (CBRE) Research.
He attributed this trend to the continuing instability of financial markets and increasing concerns over the higher cost of living.
Perhaps as a result of the slowdown, prices have begun to show signs of strain.
An analysis by property firm Knight Frank found median prices of new homes sold last month had slid 9 per cent to $943 per sq ft (psf), from $1,035 psf in March.
One reason for the lower prices could be that most of the homes launched and sold were in cheaper mass-market developments.
Eight out of 10 homes sold in the month cost $1,000 psf or less. Only seven homes, or about 2 per cent of the total sold, fetched more than $2,000 psf.
This is a major reversal from previous months. As recently as in December, more than 70 per cent of the homes sold for the month cost more than $2,000 psf.
The strength of the mass-market segment last month was the bright spot in an otherwise dismal set of figures yesterday.
The best-selling project was a suburban development: Stadia in Yio Chu Kang Road, which sold more than 90 per cent of its 56 units within the month.
'Latent demand remains strong, especially for the mass-market projects that are reasonably priced between $750 and $850 psf,' said Mr Chua Yang Liang, the head of South-east Asia research at Jones Lang LaSalle.
On the other hand, only three units were launched in the prime core central region. Demand for homes in this high-end area and in the mid-tier city-fringes remained fragmented and weak, said Mr Chua.
Property consultants said they expect buying activity to remain slow in the coming months as the current gloomy sentiment persists.
But some, such as CBRE's Mr Li, expect sales to start improving next month as developers begin stepping up launches.
Mr Ku Swee Yong, Savills Singapore's director of business development and marketing, said buyers are starting to return to the market.
'I dare say last month's sales numbers will be the lowest we will see this year,' he said.
'Showflat crowds are still pretty good, and from now on, we should see launches picking up.'
Having some high-profile launches would give the market a boost, said Mr Nicholas Mak, the director of research and consultancy at Knight Frank.
'Essentially, the lukewarm sentiment can be explained primarily by the lack of launches of major developments that might cause excitement.'
CDL chief Kwek Leng Beng awaiting right time to buy
May 16, 2008
CDL chief Kwek Leng Beng awaiting right time to buy
By Joyce Teo
PROPERTY tycoon Kwek Leng Beng has warned that most property investors follow the herd instinct and wait too long in a cautious market - then make a wrong move.
The executive chairman of City Developments (CDL) said he remains upbeat about prospects for the real estate scene in Singapore, despite recent weak sales volumes.
Mr Kwek, who was a panellist at the Financial Times Asia Property Summit held at his St Regis Hotel yesterday, said the property market is just consolidating.
The mood in the Singapore property market is cautious in the wake of the United States sub-prime crisis, with many buyers and sellers preferring to remain on the sidelines.
He said he was waiting for the opportunity to 'go in and buy at the right time, be a bottom fisher'.
But most people will do the opposite, he said. 'You notice (people) will keep on waiting... until it's too late,' he said.
'It's the herd instinct... the majority will be wrong.' A shrewd investor will act on his own, he said.
If the casino-led boom in Macau's luxury homes market is anything to go by, Singapore will do even better as it will have two casinos and other major events, he said.
'We are victims of our own success,' Mr Kwek.
'In the old days, we had only regional investors from Indonesia, Malaysia, Taiwan... But today, we have big investors like Morgan Stanley, hedge funds.'
Mr Christopher Fossick, Jones Lang LaSalle's managing director for South-east Asia, who was on the same panel, said there is now a higher proportion of investors than before, compared with occupiers.
Investors tend to be more sensitive to market sentiment, he said.
CDL, which has held back the launch of four residential projects because of poor sentiment, said in its recent earnings announcement that it plans to release them once sentiment improves and when pent-up demand can be realised.
'In the first place, we were sick,' said Mr Kwek of the property market before its recent boom. 'But today, we have shifted to another platform. Instead of relying on technology, we are relying on our status as a global city.'
He also told reporters yesterday that hotel rates will continue to rise this year because of short supply.
The office market will also do well, though rent increases have moderated. As for the much talked-about office oversupply situation come 2010 or 2011, Mr Kwek thinks supply will not pose a problem then because the current construction boom will check that.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
CDL chief Kwek Leng Beng awaiting right time to buy
By Joyce Teo
PROPERTY tycoon Kwek Leng Beng has warned that most property investors follow the herd instinct and wait too long in a cautious market - then make a wrong move.
The executive chairman of City Developments (CDL) said he remains upbeat about prospects for the real estate scene in Singapore, despite recent weak sales volumes.
Mr Kwek, who was a panellist at the Financial Times Asia Property Summit held at his St Regis Hotel yesterday, said the property market is just consolidating.
The mood in the Singapore property market is cautious in the wake of the United States sub-prime crisis, with many buyers and sellers preferring to remain on the sidelines.
He said he was waiting for the opportunity to 'go in and buy at the right time, be a bottom fisher'.
But most people will do the opposite, he said. 'You notice (people) will keep on waiting... until it's too late,' he said.
'It's the herd instinct... the majority will be wrong.' A shrewd investor will act on his own, he said.
If the casino-led boom in Macau's luxury homes market is anything to go by, Singapore will do even better as it will have two casinos and other major events, he said.
'We are victims of our own success,' Mr Kwek.
'In the old days, we had only regional investors from Indonesia, Malaysia, Taiwan... But today, we have big investors like Morgan Stanley, hedge funds.'
Mr Christopher Fossick, Jones Lang LaSalle's managing director for South-east Asia, who was on the same panel, said there is now a higher proportion of investors than before, compared with occupiers.
Investors tend to be more sensitive to market sentiment, he said.
CDL, which has held back the launch of four residential projects because of poor sentiment, said in its recent earnings announcement that it plans to release them once sentiment improves and when pent-up demand can be realised.
'In the first place, we were sick,' said Mr Kwek of the property market before its recent boom. 'But today, we have shifted to another platform. Instead of relying on technology, we are relying on our status as a global city.'
He also told reporters yesterday that hotel rates will continue to rise this year because of short supply.
The office market will also do well, though rent increases have moderated. As for the much talked-about office oversupply situation come 2010 or 2011, Mr Kwek thinks supply will not pose a problem then because the current construction boom will check that.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Design awards for HDB estates
May 16, 2008
Design awards for HDB estates
Sengkang, Ghim Moh estates score well for innovative design, user-friendly features
By Ong Bi Hui
HOUSING Board estates are not known for their innovative designs, but two cutting-edge ones are starting to change all that.
They have just become the first HDB estates to win design awards for both their good looks and user-friendly features.
The Coris, a precinct in Sengkang New Town, and the upgraded Ghim Moh Gardens estate, which is 32 years old, both won bronze awards at the Building and Construction Authority (BCA) Universal Design Awards.
'Universal Design' generally refers to design that allows users to get around easily, with easy-to-use facilities.
The BCA Awards were launched in September last year, and this year saw 34 entries, with most being refurbished buildings.
Both estates stood out due to their accessibility to residents, with seamless connectivity throughout.
The Coris at Sengkang, which has 14 residential blocks, had a comprehensive signage system so visitors can find their way around easily. There are also various recreational and communal facilities, including an area for the elderly to exercise, jogging tracks and pavilions.
Ghim Moh Gardens features wheelchair-friendly lifts that stop at every floor, safer clothes-drying racks and elderly-friendly toilets. Getting around is easy, with markets and bird- viewing spots all linked by sheltered walkways.
This year, three silver and six bronze awards were given in six categories of buildings: commercial, institutional, residential, open spaces, refurbished and open.
Other winners include Terminal 3 at Changi Airport and the National Museum of Singapore.
At last year's awards, Ikea Tampines clinched the top prize, the gold award, but a prize in this category was not handed out this year.
Professor Cheong Hee Kiat, chairman of the award assessment panel, attributes this to it having 'raised the bar' this year.
He said: 'Buildings need to be a holistic package. They must be comprehensive, integrative and have that special touch, while taking into account the owner's corporate philosophy.'
Winners will receive their awards from Minister for National Development Mah Bow Tan next Thursday. Those interested in applying for next year's awards can visit www.bca.gov.sg.
PRETTY AND PRACTICAL: Sculptures adorn the upgraded Ghim Moh gardens estate which is 32 years old. The estate has wheelchair-friendly lifts, safer racks to dry clothes, elderly-friendly toilets and sheltered walkways throughout. -- PHOTO: SURBANA INTERNATIONAL CONSULTANTS
ongbihui@sph.com.sg
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Design awards for HDB estates
Sengkang, Ghim Moh estates score well for innovative design, user-friendly features
By Ong Bi Hui
HOUSING Board estates are not known for their innovative designs, but two cutting-edge ones are starting to change all that.
They have just become the first HDB estates to win design awards for both their good looks and user-friendly features.
The Coris, a precinct in Sengkang New Town, and the upgraded Ghim Moh Gardens estate, which is 32 years old, both won bronze awards at the Building and Construction Authority (BCA) Universal Design Awards.
'Universal Design' generally refers to design that allows users to get around easily, with easy-to-use facilities.
The BCA Awards were launched in September last year, and this year saw 34 entries, with most being refurbished buildings.
Both estates stood out due to their accessibility to residents, with seamless connectivity throughout.
The Coris at Sengkang, which has 14 residential blocks, had a comprehensive signage system so visitors can find their way around easily. There are also various recreational and communal facilities, including an area for the elderly to exercise, jogging tracks and pavilions.
Ghim Moh Gardens features wheelchair-friendly lifts that stop at every floor, safer clothes-drying racks and elderly-friendly toilets. Getting around is easy, with markets and bird- viewing spots all linked by sheltered walkways.
This year, three silver and six bronze awards were given in six categories of buildings: commercial, institutional, residential, open spaces, refurbished and open.
Other winners include Terminal 3 at Changi Airport and the National Museum of Singapore.
At last year's awards, Ikea Tampines clinched the top prize, the gold award, but a prize in this category was not handed out this year.
Professor Cheong Hee Kiat, chairman of the award assessment panel, attributes this to it having 'raised the bar' this year.
He said: 'Buildings need to be a holistic package. They must be comprehensive, integrative and have that special touch, while taking into account the owner's corporate philosophy.'
Winners will receive their awards from Minister for National Development Mah Bow Tan next Thursday. Those interested in applying for next year's awards can visit www.bca.gov.sg.
PRETTY AND PRACTICAL: Sculptures adorn the upgraded Ghim Moh gardens estate which is 32 years old. The estate has wheelchair-friendly lifts, safer racks to dry clothes, elderly-friendly toilets and sheltered walkways throughout. -- PHOTO: SURBANA INTERNATIONAL CONSULTANTS
ongbihui@sph.com.sg
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
US sub-prime crisis hurting Asian property: GIC
May 16, 2008
US sub-prime crisis hurting Asian property: GIC
By Fiona Chan
THE sub-prime crisis in the United States is starting to weaken Asian property markets, said the real estate arm of the Government of Singapore Investment Corporation (GIC) yesterday.
GIC Real Estate president Seek Ngee Huat told a regional property conference that the impact of the crisis could hasten downtrends in the Asian property markets, according to a report by news agency Reuters.
'The contagion effects of the sub-prime crisis can potentially accelerate the downward spin of the property cycle,' he said in a keynote speech at the Financial Times Asia Property Summit.
'Some market weakening is being sensed in Asia, particularly in Japan and in Australia.'
In Australia, house prices are growing more slowly and demand for mortgages fell 6.1 per cent in March from February, according to the Reuters report.
It added that in Japan, the stock of unsold apartments is rising, while housing starts fell 15.6 per cent in March from a year ago.
Housing starts - the number of new private homes under construction - are used as an indicator of the state of an economy.
On the bright side, the sub-prime carnage presents opportunities for well-positioned players, Dr Seek said.
But he added that any interested party would face competition from other institutional investors.
'As always, weak markets favour those with the capacity to take strategic positions, and so the sub-prime meltdown presents threats as well as opportunities,' he was quoted by Reuters as saying.
Morgan Stanley has estimated that GIC manages more than US$330 billion (S$456.8 billion) of assets. This makes it the world's third-largest sovereign wealth fund, behind the Abu Dhabi Investment Authority and Norway's Government Pension Fund.
GIC Real Estate is also one of the top 10 property investors in the world, with more than 200 investments across more than 30 countries.
Its multibillion-dollar portfolio includes the Queen Victoria Building in Sydney and the Westin Paris in France, among other buildings.
In his speech, Dr Seek said that GIC began by investing in developed markets. It only started to focus on emerging markets in Asia in the mid-1990s.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
US sub-prime crisis hurting Asian property: GIC
By Fiona Chan
THE sub-prime crisis in the United States is starting to weaken Asian property markets, said the real estate arm of the Government of Singapore Investment Corporation (GIC) yesterday.
GIC Real Estate president Seek Ngee Huat told a regional property conference that the impact of the crisis could hasten downtrends in the Asian property markets, according to a report by news agency Reuters.
'The contagion effects of the sub-prime crisis can potentially accelerate the downward spin of the property cycle,' he said in a keynote speech at the Financial Times Asia Property Summit.
'Some market weakening is being sensed in Asia, particularly in Japan and in Australia.'
In Australia, house prices are growing more slowly and demand for mortgages fell 6.1 per cent in March from February, according to the Reuters report.
It added that in Japan, the stock of unsold apartments is rising, while housing starts fell 15.6 per cent in March from a year ago.
Housing starts - the number of new private homes under construction - are used as an indicator of the state of an economy.
On the bright side, the sub-prime carnage presents opportunities for well-positioned players, Dr Seek said.
But he added that any interested party would face competition from other institutional investors.
'As always, weak markets favour those with the capacity to take strategic positions, and so the sub-prime meltdown presents threats as well as opportunities,' he was quoted by Reuters as saying.
Morgan Stanley has estimated that GIC manages more than US$330 billion (S$456.8 billion) of assets. This makes it the world's third-largest sovereign wealth fund, behind the Abu Dhabi Investment Authority and Norway's Government Pension Fund.
GIC Real Estate is also one of the top 10 property investors in the world, with more than 200 investments across more than 30 countries.
Its multibillion-dollar portfolio includes the Queen Victoria Building in Sydney and the Westin Paris in France, among other buildings.
In his speech, Dr Seek said that GIC began by investing in developed markets. It only started to focus on emerging markets in Asia in the mid-1990s.
Copyright © 2007 Singapore Press Holdings. All rights reserved. Privacy Statement & Condition of Access
Subscribe to:
Posts (Atom)
