The Housing and Development Board (HDB) is committed to providing sufficient and affordable flats to first-time Singaporean homebuyers, and it will make no distinction between indigenous and new citizens.

Senior of Minister of State for National Development, Grace Fu, said this in Parliament on Monday in reply to a question on how many new citizens rented homes, compared with those who bought properties.

Ms Fu said the government does not track the type of properties rented or owned by new citizens.

“As a policy, we do not distinguish between indigenous and new citizens. Our commitment in housing is to provide sufficient and affordable flats for first-time Singaporean homebuyers, whether new citizens or otherwise. I wish to reassure the House that HDB continues to uphold this commitment,” she said.

Source: Channel News Asia, 22 Feb 2010

Please take good care of your home and don’t sell it prematurely to make a quick buck.

It is an important investment for the future. It can help see Singaporeans through their old age. And it can be passed on to one’s children or grandchildren.

That’s the message from Prime Minister Lee Hsien Loong to the 1,300 residents attending the gala annual Teck Ghee Chinese New Year dinner in Ang Mo Kio yesterday.

‘I have seen so many residents come to see me at my meet-the-people sessions, who have sold their houses, who have used the proceeds to pay debts or to do something else, and now their money has run out and they are in trouble and they want help.’

He said that the government has been closely watching the property market and has announced recent moves to prevent a speculative bubble from forming so that more drastic measures will not be needed later.

‘The prices have risen very sharply over the last six months,’ Mr Lee noted. ‘It has not yet reached a dangerous level. But the trend has been so fast and the mood has been so exuberant that we were worried that people will get carried away and they will go beyond what is wise and we will have a bubble.’

The government cannot control property prices to the tee. ‘But what we can do is to make sure that for all Singaporeans, homes remain affordable,’ he said.

The Prime Minister is also worried that not enough Singaporeans are starting families and that they are not reproducing enough. He noted that Singapore’s Total Fertility Rate fell to a record low of 1.23 last year, and the rate among the Chinese is even lower at 1.09.

He urged Singaporeans to have babies this year, notwithstanding the Chinese superstition that babies born in the Year of the Tiger will take on the fearsome attributes of the Chinese Zodiac animal. ‘Tigers are good animals, and Tiger babies are good babies,’ he quipped.

‘So have a Tiger baby and have a new member to your family and a new member to the Singapore family.’

Source: Business Times, 22 Feb 2010

The government will take more measures to curb speculative activity in the property market if it has to, Minister for National Development Mah Bow Tan said yesterday.

Measures targeted at the HDB (Housing & Development Board) market could also be on the way. These could be announced during the Budget Debate and Committee of Supply sessions following today’s Budget announcement, Mr Mah added.

‘Going forward, we will monitor the market closely and if there is a need to, we will take further measures,’ Mr Mah said. ‘I think that there are a few other measures that can be taken.’

Mr Mah, who was speaking to reporters at a community event last night, added that it is better not to speculate on what those measures might be and instead ’see what happens’ first.

The government on Friday announced two new property policies to curb speculation and encourage financial prudence.

A seller’s stamp duty will be levied on those who buy a residential property and sell it within a year. Currently, stamp duty is levied only for the purchase of a property and not its sale.

Also, the loan-to-value limit on housing loans will be lowered from 90 per cent to 80 per cent.

The two measures, which come on top of previous policies announced in September last year to cool the market, are not expected to hit prices and the volume of private property sales, market watchers said.

Mr Mah said that the government is taking very measured moves – which are designed to have a minimal impact on genuine homebuyers – as it tries to pre-empt a property bubble from forming.

Measures are being implemented in steps this time around, unlike in 1996 when many measures were introduced at one go.

‘We have to weigh very carefully what are the measures we want to take, such that we don’t cause the market to collapse, but at the same time, we let a little bit of air out of the bubble,’ Mr Mah said.

And as for the HDB market, ‘we are looking at something’, he added.

Mr Mah said in late January that HDB is checking to see if buyers are using government-subsidised flats to speculate in the property market – even as resale flat prices hit a new high in the fourth quarter of 2009.

Source: Business Times, 22 Feb 2010

PRIME Minister Lee Hsien Loong yesterday urged Singaporeans to treasure their homes and not use them as an easy means to make a quick buck or settle a debt.

He disclosed that MPs have been approached by many residents who have sold their homes for cash to pay off loans or make purchases.

‘They have a problem finding another home or getting a loan to buy another home…it is not easy to solve the problem,’ he said, in a speech underlining the importance of treating a residential property as a long-term investment.

‘Property is for people to buy to live in, not for speculating,’ he said.

His remarks, in Mandarin and English, at a Chinese New Year dinner last night came two days after the Government made a surprise announcement to cool property speculation.

Mr Lee stressed that the Government cannot control property prices.

‘We can try to influence it, but whether it goes up or goes down depends on sentiment, depends on what happens in the region and the world…

‘But we can apply measures to try to guide it in a broad way, so that if it is getting carried away, we can pull it back a bit,’ he added.

The measures announced last Friday include the introduction of stamp duty on those who sell their residential property within a year of buying it. The duty is around 3 per cent of the price.

Also, buyers can borrow only up to 80 per cent, not 90 per cent, of their property’s value from a financial institution.

Mr Lee said these measures were a pre-emptive move. Prices have risen sharply in the last six months, he noted.

‘While it has not yet reached a dangerous level… the trend has been so fast, and the mood so exuberant, that we are worried it will get carried away beyond what is wise,’ he told about 1,300 Ang Mo Kio GRC residents attending the dinner at his Teck Ghee constituency.

‘It is better to pre-empt a bubble than wait for it to get serious and have to take more drastic measures,’ he said, assuring Singaporeans that his government’s priority is to ensure homes remain affordable.

At the other extreme, falling home prices is undesirable for the many Singaporeans who own their homes, he added.

A home, an appreciating asset in Singapore, is a nest-egg, said Mr Lee.

‘Please take good care of it. It’s for you to live in, it’s for you as an investment, it’s for you for your old age.

‘Don’t think of selling prematurely to make a quick buck,’ he advised.

Alternatively, home-owners can pass their flats on to their children, he said and added: ‘This means you need to have children to pass your home to.’

Mr Lee then reiterated his worry that not enough Singaporeans are starting families. Total fertility rate last year hit a new low of 1.23. For the Chinese community here, it was even lower at 1.09.

But falling birth rate is an issue faced by East Asian countries, he noted, and it is partly a result of changing values.

In China, young people, to avoid nagging from their parents, have resorted to ‘renting’ a boyfriend or girlfriend to take home during this new year period, Mr Lee observed.

‘It’s amusing, but it’s also sad,’ he said. ‘I’m relieved there’s no such reports in Singapore. I hope it doesn’t happen.’ Still, a little social pressure is useful but more importantly, parents and relatives need to encourage them and show them support.

Unmarried residents interviewed said they first needed to save enough and have a stable career before settling down and starting a family.

Said Mr Jason Quak, 28, an operations manager: ‘Now you need money for everything, especially for a wedding.’

He and his 25-year-old girlfriend want to buy a flat in Ang Mo Kio, near his parents, but he is not confident he can find one within his budget of around $300,000.

Teacher D. George, 32, welcomed the latest anti-speculation measures but argued that these will not have a major impact on rising HDB prices.

Source: Straits Times, 22 Feb 2010

NEWS of potential measures affecting the public housing market could come as soon as next month, hot on the heels of curbs announced last Friday aimed at cooling the private property market, Minister for National Development Mah Bow Tan said yesterday.

He was speaking to reporters yesterday evening at a Chinese New Year event at Tampines East Community Club.

When asked about possible measures for the Housing Board market, Mr Mah said: ‘We are looking at something. I’ve asked HDB to look at some of the activity that is going on in the market.’

He added that he would be making ’some announcements’ during the Committee of Supply debates in Parliament on his ministry’s Budget next month.

Mr Mah had said late last month that HDB was embarking on a review of its rules to stamp out possible speculation, and that the findings would be out in a few months’ time.

The review is being conducted as HDB prices have been rising, with some buyers said to be renting HDB flats illegally or selling them after a one-year period to make a fast profit.

Yesterday, Mr Mah noted that there was a ‘high risk’ of a property bubble forming in the private homes market.

Last September, the Government announced several measures which led to the sales volume slipping.

But there have since been renewed signs that the market is heating up.

Sales volume has risen sharply, with developers selling 1,476 units last month – three times higher than in December.

And prices rebounded in the second half of last year.

Mr Mah said: ‘If you look at the environment, interest rates are low, there’s a lot of exuberance in the market as a result of positive sentiments.

‘If you see a lot of speculation, especially at a time when what we are seeing is a confluence of factors (such as) low interest rates, positive sentiment, volumes actually picking up – those are the danger signals. We have to make a decision.

‘The question is, do we act now, take small steps, or wait until the bubble has formed, by which time we may have to take more drastic steps. So we decided to act now. It depends on how the market reacts. If there is a need to, we will take further measures.’

He said there were a few other possible measures the Government could take but declined to elaborate.

‘It’s a choice between not doing anything and letting the exuberance take over and then having to act when everything is too late.’

Taking smaller steps means that the number of people affected, especially genuine buyers, will be ‘very little’, he added.

Mr Mah said that given the current market situation, the introduction of a seller’s stamp duty will make speculators ‘think twice’ about flipping properties.

‘We are not against prices rising. If the economy is doing well and there is genuine demand, prices rise. It’s part of the market workings.

‘What we want to see is a very stable, sustainable market, that prices don’t run up faster than what the economy can accommodate.’

Source: Straits Times, 22 Feb 2010

PRIME property prices may still be a far cry from the record levels reached during the 2007 property boom, but one Orchard Road project recently achieved a new record price.

The Straits Times understands that a 2,885 sq ft apartment at Ardmore Park was sold last week for $10.64 million, or $3,688 per sq ft (psf) – a record for the project.

The previous record for the 330-unit freehold project was $10.1 million, or $3,501 psf for a unit, achieved in October 2007, according to caveats lodged.

The home with the record-breaking price is on a high floor in a premium tower with an unblocked panoramic view, said property agent Daphne Tay of Sotheby’s International Realty, who part-brokered the deal.

A foreign buyer from North Asia forked out the record sum. The sellers were an Indonesian couple who were the original owners, said Ms Tay, who has been in the industry for over 15 years. Both buyer and seller declined to be interviewed.

Property analysts said that the record deal was not unexpected, given that the luxury property segment is hotting up.

Mr Joseph Tan, executive director of residential services at CB Richard Ellis, said that this year will be a year dominated by high-end properties.

‘Mass market homes, which drove the property boom last year, have reached their previous peak in terms of price, whereas the luxury market is still 20 per cent below its peak,’ he said. He also noted that foreign buyers, who left in droves in the wake of the 2008 financial crisis, have been returning to the Singapore property market.

Based on caveats lodged, the number of foreign buyers rose from 1,498 in 2008 to 2,840 last year, he said.

Compared to rival cities such as Hong Kong, Singapore prime properties are still cheaper and represent good investment value, Mr Tan added.

According to a recent DTZ research report, foreigners accounted for 12 per cent of total purchases of private homes in the fourth quarter last year, up from 10 per cent in the previous quarter.

In the second half of last year, there was an increase in buyers from Britain, Korea and Australia, said the report.

High-end property prices have been inching up in tandem with the global economic recovery.

Late last year, six units at SC Global’s luxury development, Seven Palms in Sentosa Cove, were sold at record prices of $11 million each, or $3,100 to $3,400 psf.

However, luxury property prices are still nowhere near the dizzying heights achieved in 2007 when a 53rd storey 5,048 sq ft private apartment in The Orchard Residences was sold for a record $5,600 psf, or $28.27 million.

That was topped, in absolute terms, by a freehold apartment on the 19th storey of The Marq on Paterson Hill which sold for a whopping $31 million, but at a lower psf price of $5,100.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said that even though activity in high-end properties will pick up this year, prices this year are not likely to return to their 2007 peak.

‘This year is going to be a bit turbulent for the property market, especially after the recent government measures to cool the property market. Buyers should generally be quite cautious,’ he said.

The Government announced last Friday that it will introduce a sellers’ stamp duty for those who resell a property within a year. It also reduced the maximum home loan amount a bank can lend a buyer from 90 per cent to 80 per cent of the property value.

The new measures aim to pre-empt a property bubble from forming and to ensure a stable and sustainable property market.

BELOW PEAK
‘Mass market homes, which drove the property boom last year, have reached their previous peak in terms of price, whereas the luxury market is still 20 per cent below its peak.’ – Mr Joseph Tan, executive director of residential services at CB Richard Ellis

Source: Straits Times, 22 Feb 2010

I REFER to the report, ‘Uproar over new rental flats going up’ (Feb 9).

People who raise this issue should be reminded that they too live in public housing.

Do not pigeonhole people in the lower-income groups as loud and aggressive and complain that living near these residents will lower the value of your property.

Even owners of multimillion- dollar property have no say in developments coming up in their neighbourhood.

Christine Ng (Madam)

Source: Straits Times, 22 Feb 2010

A new Land Intensification Allowance (LIA) will replace the current Industrial Building Allowance (IBA) with qualifying firms being granted a first-time allowance of 25 per cent, then five per cent annually for qualifying expenditures on the construction of buildings.

Structures from the pharmaceutical, petrochemical, petroleum, chemical, semi-conductor, aerospace, marine & offshore, as well as solar cell manufacturing and other speciality industries are currently the nine sectors that qualify for the LIA.

These buildings must also be built on land zoned as Business 1 or Business 2 under the URA’s Master Plan.

Buildings must also meet the Gross Plot Ratio benchmark relevant to their industry sector, and will be set at the 75th percentile of GPRs for the sector.

The new allowance will be in place for five years, starting from July this year (2010), and will be administered by the Economic Development Board.

The measure to improve land use were announced in Parliament on Monday during the Finance Minister’s Budget speech.

Finance Minister Tharman Shanmugaratnam, said: “The new Land Intensification Allowance or LIA will apply to nine sectors identified to have large land take. It will give business in these sectors tax allowances on their building costs if they meet or exceed the Gross Plot Ratio bench marks set for each sector. To encourage land intensification, these benchmarks will be set around the 75th percentile of actual GPRs for each of these sectors. Businesses that meet this bench mark will receive more generous allowance than are currently offered under the IBA.”

Source: Channel News Asia, 22 Feb 2010

Recently, apartments at the 189-unit The Trumps have increasingly crossed the $800 psf level, even surpassing the 2007 peak of $896 psf. Last August, a high of $975 psf was achieved when a 1,270 sq ft unit on the 16th floor sold for $1.24 million.

Located a street away from the Kembangan MRT station, the five-year-old condominium is attractive to families with young children as it is a short drive to good schools like Victoria School and St Stephen’s Primary School as well as offices at Chai Chee Technopark. The condo is also within walking distance of the community centre and a short drive to eateries at Siglap and the East Coast Beach. Homeowners on the higher floors looking out from their full-length glass windows also enjoy a relatively unobstructed view as the neighbouring areas comprise mainly low-rise houses in the Changi, Telok Kurau and Frankel area.

The Trumps could be on the radar of homebuyers lately due to the launch of Kembangan Suites early last year. The two adjacent developments are separated by the Siglap park connector and a canal. Kembangan Suites is a five-storey development consisting of eight commercial units on the first floor and 60 residential units. The upcoming condo has been sold at an average of $910 psf since its launch last April, according to caveats lodged. The three latest transactions were priced between $1,065 and $1,102 psf.

Sales at The Trumps had been slow in 1H2009, hovering in the price range of $509 to $786 psf before picking up in 2H2009. From Jan 22 to 26, there were three transactions, priced between $885 and $952 psf, according to caveats lodged with URA Realis.

A 1,356 sq ft unit on the 11th floor went for $1.2 million, or $885 psf. That represents an attractive 60% gain for the seller, who purchased the unit for $750,000 in 2006. Another unit of the same size on the 13th floor went for $1.18 million, or $870 psf. This translates into a 36% gain for the original owner, who had purchased the unit for $870,000 in April 2009. Prior to that, the unit changed hands for $759,360, or $560 psf, in 2006.

Condos in the vicinity are also enjoying an uptrend in prices. For instance, units at Astoria Park, which is located right next to the MRT station, breached the $800 psf level in December. A high of $829 psf was achieved last month, when a 1,001 sq ft unit on the eighth floor was sold for $830,000.

Source: The Edge, 22 Feb 2010