SALES of new private homes slowed further last month as World Cup fever seemed to take its toll on buyer interest.

Homehunters bought 847 units in June, compared with 1,083 units in May and the near-record 2,208 units in April, according to Urban Redevelopment Authority (URA) data released yesterday.

The June figure brings new home sales to 8,518 units for the first half of the year – averaging 1,420 units per month and ahead of last year’s average monthly sales volume of 1,224 units, noted CBRE Research.

The URA figures show that launches were also down last month, with 1,010 units released, against 1,135 in May.

Property experts had factored in a quiet June, given that the four-week-long South Africa World Cup, school holidays and the euro zone crisis were likely to divert the attention of potential buyers.

About half of the sales in June were for homes in suburban areas, according to URA, while prime areas proved to be the quietest, accounting for 17 per cent of sales.

Colliers International sees the geographical breakdown of new sales volumes showing intensified price resistance in June.

It points out that mid-tier units in city-fringe areas – or what the URA calls Rest of Central Region – dipped by a sharp 74 per cent to just 275 units from April’s peak level of 1,044 units.

The firm’s director of research and advisory, Ms Tay Huey Ying, said that this was not surprising, considering URA preliminary data had showed prices in that region gaining the most in the first half, compared to prices in the city centre or suburban areas. And overall, the prices have crossed the previous peaks.

The Minton in Hougang proved to be June’s top seller, moving another 173 units at a median price of $871 per sq ft. CBRE Research said that this was higher than the median price of $849 psf reported for the first 204 units sold in May.

A new launch, Waterfront Gold, had a weaker showing with 157 units launched and 77 units sold at a median price of $996 psf.

Jones Lang LaSalle said the total quantum demanded at the project – more than $1 million for a three-bedder – was possibly larger than what the market was willing to absorb.

At the 84-unit La Brisa in Geylang, where most of the units range from 409 sq ft to 689 sq ft, buyers snapped up 82 units at a median price of $960 psf.

Looking ahead, experts expect to see stronger sales in July, noting that already two new launches – 368 Thomson and Terrene in Bukit Timah – have done well.

Yesterday, NOL Group reported selling more than 100 units at Terrene since a private preview started on July 8.

Buyers could come out to buy before the inauspicious Hungry Ghost Festival in August, they said.

Still, CBRE Research predicts buying interest will remain selective, and depend on location, product attributes and price points.

Jones Lang LaSalle said a more moderate buying mood backed by conservative global economic conditions, and hence a continual slowdown in price growth, can be expected.

Source: Straits Times, 16 Jul 2010

FAR East Organization has signed a deal to buy 31 Parbury Avenue off Upper East Coast Road for $55 million – a price that works out to $898 per sq ft of land area.

A two-storey bungalow stands on the sprawling 61,240 sq ft freehold site, which can be redeveloped into eight luxury bungalows or a strata landed-housing scheme comprising either 14 bungalows or 28 semi-detached houses or 37 terrace houses, according to CB Richard Ellis, which brokered the sale.

Depending on how intensively Far East redevelops the site – beyond a baseline plot ratio of 0.7 – a development charge may be payable.

The plot is zoned for three-storey mixed landed use under Master Plan 2008.

There are also a few condos in the area, such as Parbury Hill Condominium and Riviera Residences, although these are on residential sites with a 1.4 plot ratio – on which non-landed residential developments are allowed – under Master Plan 2008.

CBRE marketed 31 Parbury Avenue through a tender that closed in late May and is said to have attracted a handful of bids.

The property is being sold by the family of the late Goh Seong Pek, one of the founders of Tat Lee Bank.

Sales of residential sites have been picking up as developers seek to restock landbanks following strong housing sales last year. Besides the Government Land Sales Programme, collective sales and other private-sector sources have been providing residential land for developers.

BS Capital recently bought the Colourscan Building in Kim Keat Road in the Balestier area with a view to redeveloping the 32,544 sq ft freehold site into a 20-storey apartment project. The Urban Redevelopment Authority has approved a rezoning of the site from Business 1 to residential use with 2.8 plot ratio – the ratio of maximum potential gross floor area to land area. BS Capital’s purchase price of just over $36 million reflects a unit land price of $670 per sq ft of potential gross floor area, including an estimated Development Charge (DC) of almost $25 million.

In District 9, Cavenagh Mansions, which comprises 21 apartments, has been sold by Teck Jin – which developed the project about 20 years ago – to Selangor Dredging for $42.38 million or about $1025 per sq ft of potential gross floor area including an estimated $267,000 DC. The Malaysian company plans to redevelop the freehold site.

Source: Business Times, 16 Jul 2010

Volumes fell during school hols, World Cup; July spurt expected before Hungry Ghost Month starts

(SINGAPORE) Students were not the only ones taking a break during the mid-year school holidays. Home seekers also slowed their pace, buying just 847 private homes from developers in June.

This is the smallest number of new sales in a month since the start of the year. It is 22 per cent lower than the 1,083 units sold in May, and 62 per cent below April’s 2,208 units.

But market watchers are hardly fretting as they expect purchases to pick up slightly in July before the Hungry Ghost Festival is celebrated.

Also, overall sales for the first half of the year have been strong. Developers offloaded 8,584 units from January to June – an average of 1,431 monthly. They did better compared with the same period last year, when they sold 7,374 units in total or an average of 1,229 monthly.

‘The momentum of new home sales slowed down in June as expected,’ said CBRE Research executive director Li Hiaw Ho.

Purchases had started falling in May as the euro debt crisis and high prices caused interested buyers to think twice.

According to flash estimates from the Urban Redevelopment Authority (URA) two weeks ago, the private residential property prices index hit a new high in Q2, past the pre-Asian financial crisis peak.

Then there were other distractions – the football World Cup and the school holidays – which could have persuaded developers to hold back launches. They rolled out 1,010 homes in June, down 11 per cent from 1,135 in May.

Buying activity was concentrated in the suburbs, reflecting market caution. Home hunters bought 429 homes in the outside central region, accounting for 51 per cent of total sales. These included 77 units from Waterfront Gold at Bedok, which made its debut in June.

In the rest of central region, developers sold 275 units or 32 per cent of the total. Activity was quietest in the core central region with 143 units or 17 per cent sold.

New launches included Far East Organization’s Skyline @ Orchard Boulevard, where two units changed hands for a median price of $3,839 per square foot (psf).

Property consultants believe developers may sell slightly more homes this month, with the World Cup and school holidays over.

Also, the Hungry Ghost Festival arrives in the second week of August. There might be ’superstitious buyers looking to pick up homes in July ahead of the inauspicious home-buying period’, said Colliers International research and advisory director Tay Huey Ying.

DTZ executive director (consulting) Ong Choon Fah added that strong economic growth in Q2 could boost market sentiment. On Wednesday, the government revised its GDP growth forecast for the year to a range of 13-15 per cent, up from 7-9 per cent.

CBRE’s Mr Li noted that sales in the third quarter have ’started well’.

At UOL Group’s Terrene in Bukit Timah, more than 100 homes out of 130 soft-launched since July 8 have been sold. The average price is $1,250 psf and demand came mainly from Singaporeans, especially those with private home addresses. UOL will officially release 42 units for sale today.

While the market could get better in July, few consultants expect buying activity in the coming months to revisit highs reached earlier in the year.

‘Buying interest will remain selective, depending on the location and product attributes as well as price points of new launches,’ CBRE’s Mr Li said.

Price resistance could keep some buyers on the sidelines. ‘Bargain hunting is likely to be the main focus of buyers,’ said Chua Yang Liang, South-east Asia and Singapore research head at Jones Lang LaSalle.

To some extent, home sales are driven by the number of property launches, said DTZ’s Mrs Ong. She expects launches in the mass market to continue because developers who recently won tenders for state land may want to roll out their projects before more government sites and more competition come onstream.

But developers of prime freehold projects could hold back launches because there have been fewer collective sales of such sites. They may consider waiting ‘for a little while more when they have a bit more pricing power’, Mrs Ong said.

Source: Business Times, 16 Jul 2010

Property giant City Developments (CDL) has officially launched 368 Thomson today. The freehold residential development is located in the prime District 11 residential enclave and occupies the sites of the former Concorde Residences, Balestier Court and Bright Building.

It is a quick stroll to Novena MRT station and a stone’s throw away from the MacRitchie Reservoir. The development has a 36-storey tower with 157 apartment units. It also features Therma jet pools, children’s aqua treat areas, a gymnasium, a social lounge and a club house.

CDL said more than 85 per cent of the units have already been snapped up. It added that the price per square foot had increased marginally by 2 to 3 per cent since the previews last week. During the previews, the units were priced at an average of $1,350 per sq ft translating to a price tag which ranges from $918,000 for the one+study apartments to $4.4 million for the five-bedroom penthouses.

CDL said that the majority of buyers are Singaporeans with Permanent Residents and foreigners making up about 25 per cent of the buyers. CDL’s group general manager, Mr Chia Ngiang Hong, said: “With its prime District 11 location, freehold status and attractive pricing, 368 Thomson represents an excellent investment opportunity and also good rental potential.”

Source: Today, 16 Jul 2010

World Cup, school holidays, lack of supply among reasons cited for drop

Private home sales continued to slow last month, falling to below the 1,000-unit mark for the first time this year.

Data from the Urban Redevelopment Authority (URA) showed that only 847 new units were sold last month – the lowest number of private home sales so far this year.

The figure is 22-per-cent lower than the 1,083 homes sold in May.

Yet, analysts seemed unperturbed by the softening trend, with some citing the World Cup fever and the month-long school holidays as among the reasons that contributed to the lower sales last month.

“Demand is starting to stabilise, reaching a more sustainable level,” said Mr Nicholas Mak, a real estate lecturer at Ngee Ann Polytechnic.

Still, some analysts believe that the latest figures may not suggest that demand for private homes have cooled down. Instead, they attributed the decline in sales to the lack of supply as reflected by the drop in the number of new units launched.

Last month saw a total of 1,010 units launched compared to 1,134 units launched in May and a hefty 2,084 units launched in April.

This may have resulted in buyers holding back their purchases as they wait for more options to become available through future launches, analysts said.

“I think the developers couldn’t launch enough of the mass-market segment as they have exhausted most of their earlier sites and cannot get new sites secured quickly enough for it to be launched for sale,” said Mr Colin Tan, head of research and consultancy at Chesterton Suntec International.

ERA Asia Pacific associate director Eugene Lim reckoned that the decline in the number of property launches was because developers had held back due to jitters arising from the euro zone crisis.

Meanwhile, about 51 per cent of the total units sold in June were located in the suburban areas with 429 units sold there, among which are The Minton and Waterfront Gold.

Homes located in the city and prime districts also did well, totalling 143 transactions for the month. However, home sales in the city fringes declined with only 275 units sold out of the 445 units launched there.

Ms Tay Huey Ying, director for Research and Advisory at Colliers International, said this may be because price points in the area had risen by about 18.3 per cent in the first half, based on URA flash estimates.

That is higher compared to the core central region which gained 9.7 per cent and outside central region which increased by 10.3 per cent.

While there was a drop in the sales of luxury homes, the price points for last month were higher than in May, said executive director of CBRE Research Li Hiaw Ho.

The number of units sold in the first half of the year totals 8,158, said CBRE.

Analysts said monthly sales in the coming months could average between 900 and 1,000 units and total home sales for the year could be in the range of 12,500 to 14,000 units.

There could still be a bright spot this month as market watchers expect better home sales as developers gear up for more launches ahead of the Hungry Ghost festival in August.

The Government’s upward revision of its gross domestic product growth forecast to between 13 and 15 per cent for the year may also help improve sentiment among home buyers, they said.

Source: Today, 16 Jul 2010

Property developer UOL Group has sold more than 100 units of its latest condominium project, Terrene at Bukit Timah.

This is almost 80 per cent of the 130 units released at a private preview which started on July 8.

UOL will be releasing the remaining 42 units for the official launch on Friday.

The 999-year leasehold condominium is a 50-50 joint venture between UOL and La Salle Asia Investment Management.

The apartments are priced at an average of S$1,250 per square foot for a typical unit.

They range from S$719,000 for a one-bedroom unit to S$2.79 million for a five-bedroom penthouse.

UOL said 23 of the 30 penthouse units have been sold.

Demand came mainly from Singaporean buyers, with majority from private homes in the nearby vicinity.

The five-storey development of 172 units, stretches across more than 130,000 square feet near the Bukit Timah Nature Reserve.

The development is expected to be ready by April 2014.

Source: Channel News Asia, 15 Jul 2010

Demand for new private residential properties continues to moderate.

The number of new homes sold fell in June to 847 units, according to figures from the Urban Redevelopment Authority.

That’s down from 1083 transactions done in May 2010.

The top sellers in June include projects like The Minton, La Brisa and Waterfront Gold.

URA says 143 new homes in the city and prime districts were sold during the month.

While the city fringe saw 275 units changing hands.

Homes in the suburban areas were most popular with 429 units sold.

All in, developers placed 1,010 units of new homes for sale in June.

Source: Channel News Asia, 15 Jul 2010

(SINGAPORE) UOL Group and City Developments Ltd (CDL) continued to sell units over the weekend at their new condos released last week.

UOL and LaSalle Investment Management sold a further 46 units over the weekend (as of 7 pm yesterday) at The Terrene at Bukit Timah, in addition to the 50 that they had sold as of 10 pm last Friday.

Thus far, 130 of the condo’s total 172 units have been put on the market. While the initial 85 units released by Friday were priced at about $1,250 per square foot on average, the further 45 apartments offered on Saturday and Sunday were at marginally higher prices. The five-storey, 999-year leasehold condo is in the Toh Tuck/Jalan Jurong Kechil vicinity.

‘We’re keeping the balance 42 units for our official launch later this week, which will be tied with the start of our ad campaign. What we’re most pleased about is that our penthouses and big units are still selling well. More than half of the 30 penthouses in the project have been taken up,’ UOL’s chief operating officer Liam Wee Sin told BT yesterday evening.

‘We’ve combined a bit of luxury with a rustic feel,’ he added. Prices of penthouses in the condo range from $1.7 million to $2.9 million.

Singaporeans form the majority of buyers, buying mainly for owner occupation, according to Peter Ow, managing director (residential services) at Knight Frank, one of the project’s two marketing agents.

‘Demand is still there; it’s only a matter of pricing. People who are walking out of the showflat without making a purchase are doing so because the price is beyond their budget,’ he added.

CDL sold another 32 units at its 368 Thomson up to 6 pm yesterday, taking total sales to 128 units. Last Friday, the group said, it had sold 96 of the 120 units released initially in the 157-unit freehold condo, which will be 36 storeys high.

Yesterday, a CDL spokeswoman said that the group released the remaining 37 units progressively over the weekend at a marginal price increase of 2-3 per cent from the initial average selling price of $1,350 per square foot.

‘The majority of the 32 units we sold over the weekend were one-plus-study units. We also sold three and four bedders,’ she added.

Singaporeans made up 75 per cent of the 128 units sold at the District 11 condo.

The next project CDL plans to release is likely to be a 642-unit, joint venture condo in Pasir Ris located next to the fully-sold Livia. ‘It is planned for release in phases in Q3 2010,’ she added.

Source: Business Times, 12 Jul 2010

Mainboard-listed BBR Holdings plans to acquire a plot of freehold land at Simon Lane, near Serangoon Gardens, for S$86 million.

BBR said it aims to develop a low-rise condominium project on the over 9,000 square metre site which currently houses Goodrich Park Condominium.

Under the URA 2008 Master Plan, the site is zoned for residential development with an allowable height of up to 5 storeys and a Gross Plot Ratio of 1.4.

Based on this plot ratio, BBR said the cost of the land works out to about S$629 per square foot per plot ratio.

By including an additional 10 per cent of balcony gross floor area, the cost will be about S$572 per square foot per plot ratio.

BBR said development charges are not payable for the redevelopment of this site.

The group intends to develop a 5-storey condominium comprising some 120 units of around 1,200 square feet each, due to be completed by the end of next year.

BBR’s order book stood at S$520 million as at May 11 this year.

New projects won since then have boosted its gross order book to approximately S$605 million, mainly from civil engineering and building projects in Singapore and Malaysia.

Source: Channel News Asia, 12 Jul 2010

Sales are still going strong for so-called Mickey Mouse apartments or those that measure 500 square feet or less.

According to Credo Real Estate, transactions of Mickey Mouse units made up 9.5 per cent of total transactions in the first half of this year.

This is a three percentage point increase from the same period last year. But analysts are divided on whether demand for these units can be sustained.

Shoebox living in apartments of 500 square feet or under has become somewhat of a talking point in property circles.

Experts said the popularity of these units is due to their lower price quantum, making them affordable to young professional and expats.

They also tend to be located in the prime districts, luring buyers with their attractive location.

According to Credo Real Estate, pricing of Mickey Mouse units in the CBD area could range between S$1,800 to S$2,000 per square foot while those outside the CBD area could range between $1,200 to $1,400 psf.

This is about a 20 per cent increase compared to last year.

Liang Thow Ming, executive director Residential Services, Credo Real Estate, said: “I would think that this trend will continue to increase. I would not be surprised if we see Mickey Mouse units making up 10% of total sales in the second half of this year, and probably going up to 11 or 12% next year.”

But other market watchers said these apartments cater mainly to investors who want to cash in on rising property prices.

Last year, sub sales in the broad residential market was 12 per cent and have come down to 10 per cent in the first half of this year.

Speculative sales of Mickey Mouse units have increased from 13 per cent last year to 17 per cent in the first six months of this year alone.

Nicholas Mak, lecturer, School of Engineering, Ngee Ann Polytechnic, said: “Starting from May, Singapore private home sales market is starting to slow down. So they are concerned that there could be a correction on the horizon. As a result, they are selling off their investments. Some of these investors of small apartments are actually speculators. They are not intending to hold their investment for long term rental gains but rather just for speculative short term capital gains.”

As for rental gains, the views are also divided.

Some said the rentals are hard to predict as most of these units are still under construction.

But others said that rents for Mickey Mouse units in the prime districts could fetch up to S$7 per square foot.

This represents a 4.2 per cent return on rents, when compared to a 3.5 per cent per cent return on rent for a 1,200 square foot three-bedroom apartment.

Source: Channel News Asia, 12 Jul 2010