NEWS & VIEWS Wednesday, 16 July, 2014 RESIDENTIAL MARKET Prices of resale condos slip 1.4% in June: SRX Resale prices of private condos dipped further last month to a low since December 2012, despite an increase in resale volumes. This could be due to more buyers moving into the resale market as owners relent to lower prices to match the expectations of buyers, property consultants say. Transaction data from Singapore Real Estate Exchange (SRX) shows that prices fell 1.4 per cent from May, dragged by declines across all regions. But the number of resale transactions increased by 7.9 per cent month-on-month to 452 in June. This is, however, 23.8 per cent lower than the number of resale transactions inked in June last year. The Rest of Central Region (RCR) marked the biggest price decline of 3.2 per cent, followed by 1.7 per cent in Core Central Region (CCR) and 0.3 per cent in Outside Central Region (OCR). ERA Realty key executive officer Eugene Lim noted that the price declines in RCR and CCR, where homes fall in a higher price band, steered the prices down. Resale prices in the CCR are also affected by loan curbs, ample unsold developer stock, additional buyers stamp duty and weak leasing demand. But he reckoned that as prices stabilise, more buyers may be moving back to the resale market. In the rental market, condo owners were more willing to lower their asking rents to secure tenants. According to SRX, overall rental prices in June dipped 0.8 per cent from May, and fell 6.5 per cent from a peak in January last year. This is based on an estimated 3,151 units rented in June. This estimated number of rental transactions is a 2.2 per cent increase from the 3,084 rental contracts inked in May, and 18.6 per cent higher than the 2,657 rental contracts signed in June last year. Mr Lim noted that the completion of private condos will rise from 13,150 units last year to an estimated 17,138 units this year. This is expected to rise further to 21,738 units in 2015 and 26,252 units in 2016. More condo units entering the resale market and the tightening of foreign manpower will probably keep rents depressed going forward, he said. Source: Business Times – 15 July 2014 Private site acquired for public housing A private industrial property at No. 16 King Georges Avenue is part of a 1.23 ha plot that will be bought by the Government and developed for public housing. The site will be acquired under the Land Acquisition Act, said the Housing and Development Board and Singapore Land Authority (SLA) in a joint statement yesterday. The land at the junction of Syed Alwi Road and King Georges Avenue is zoned for residential use in the Master Plan, the agencies said. Apart from the private property, the area comprises mainly vacant state land. The SLA gazetted the land affected by the acquisition yesterday. Both agencies are assisting the landowner with queries and concerns, the statement said. More information on the housing development will be provided when the plans are ready, the agencies added. Source: The Straits Times – 15 July 2014 Condo buyers seen to be cautious in H2 With a drastic fall in developers sales of private condos last month, the market is increasingly tilted in favour of homebuyers in the second half of this year. URA data yesterday shows developer sales of private condos plunging 68 per cent to 482 in June from a month earlier. Though fewer launches (418 units) in the traditional lull season of school holidays and the World Cup are to be blamed, consultants do not expect sales to jump when developers ramp up condo launches. Developers were more focused on moving units at existing projects rather than launching new projects in the traditionally slow month. Favourable pricing perceptions enabled certain projects to still garner interest after the initial launch. City Developments Coco Palms in Pasir Ris, launched in May, sold 55 units at a median price of $1,014 per square foot (psf) in June. The Panorama in Ang Mo Kio managed to move 49 units at a median price of $1,287 psf. It had sold 100 units in its re-launch in May at a median $1,241 psf after developer Wheelock Properties cut prices by some 10 per cent. Another top seller in June was The Skywoods at Dairy Farm Heights, where 19 units were sold at a median $1,235 psf. The project - developed by TA Corporation, Hock Lian Seng Holdings, King Wan Corporation and Far East Distillers under Bukit Timah Green Development - managed to move only 82 units from its launch in September to May. The developers managed to revive interest in The Skywoods after offering some star-buys with 3 per cent discount from preview prices and raising the commission for agents, according to sources. Only two new projects were launched last month - Wing Tai-led The Crest in Prince Charles Crescent with 469 units and Roxy-Pacifics 222-unit Trilive freehold condo in Kovan. Both projects had a slow start, with 35 units at The Crest sold at a median $1,682 psf and 19 units at Trilive sold at a median 1,605 psf. Other projects launched in May such as Kallang Riverside and Waterfront @ Faber saw buying interest cooling off, with only six units and 16 units sold respectively in June. More than half of private condos sold in June were in the suburban areas (269 units), while city fringe areas accounted for 35 per cent (167 units) and core central region made up 10 per cent (46 units). URAs data also showed that 49 executive condos (ECs) were sold by developers, down from 59 in May. In the first half, 4,523 private condos (excluding ECs) were sold - 11 per cent fewer than in H2 of 2013, based on the latest data. This is a 56 per cent dive from about 10,182 units sold in the year ago period, which essentially means that sales by developers have more than halved since the TDSR kicked in in June last year. Source: Business Times – 16 July 2014 COMMERCIAL MARKET Non-residential deals to remain active in H2 Non-residential deals will continue to drive investment activity in Singapore for the rest of this year, given faltering sales in the tepid private residential market. The report found that overall real estate investments fell around 11 per cent from the previous quarter to $4.4 billion in Q2. And although non-residential investments (particularly offices) drove the volume, they too fell 6 per cent to $2.9 billion on muted transactions in the hospitality and mixed-use sectors. At least six big-ticket non-residential property deals were concluded in Q2. In the commercial sector, three office properties - Prudential Tower, Equity Plaza and Cecil House - all along Cecil Street in the central business district, were transacted. A consortium of Far East Organization, Far East Orchard and Sekisui House also beat seven others in a government land sales tender to clinch a 99-year-leasehold commercial site on Woodlands Avenue 5/Woodlands Square for $634 million. In retail, Frasers Centrepoint Trust acquired Changi City Point at Changi Business Park for $305 million; in Industrial, Ascendas Reit bought Hyflux Innovation Centre at 80 Bendemeer Road for $191 million. The transactions in Q2 brought the total investment volume in the first half of 2014 to $9.4 billion, 17 per cent lower than the same period last year. It also looks on track to achieve the earlier forecast of $20-25 billion for the full year. Property companies and real estate investment trusts (Reits) were the main drivers of activity in Q2. Property companies were the largest buyers, accounting for $3.1 billion or 71 per cent of investment activity. Reits were also very active, but their divestments of $512 million exceeded their acquisitions of $496 million, making them net sellers in Q2. This is expected to reverse in Q3, though. Acquisitions are likely to be boosted by the listing of Frasers Hospitality Trust. The trusts initial portfolio will comprise six hotels and six serviced residences, including two - InterContinental Singapore and Fraser Suites Singapore - located in Singapore. Both will be injected for a combined value of $824.1 million. Source: Business Times – 15 July 2014
Posted on: Wed, 16 Jul 2014 13:31:10 +0000
Trending Topics
Recently Viewed Topics
© 2015