With 1,423 private homes sold in H1, it is far ahead of all other developers

Some developers have raised prices as a result

DEVELOPERS continued to report encouraging private home sales last week, and some have upped prices on firmer demand.

BelleRive on Keng Chin Road and Martin Place Residences on Kim Yam Road are among the projects where prices have been raised. BelleRive’s average price is now 13 per cent higher than when it was previewed in mid-April.

Frasers Centrepoint sold 60 more units last week at Martin Place Residences; new units were released over the weekend at prices that were about 5-7 per cent higher.

Chia Boon Kuah, Far East Organization chief operating officer, property sales, told BT that ‘in recent weeks, we’re seeing growing broad-based demand for our products across our portfolio in every price bracket, from upgrader market to the upper-middle segments to high-end luxury projects’.

Last week, the property giant sold more than 40 units, up from the 30 a week earlier. Far East’s home sales for the May 18-24 week include two units at Vida on Peck Hay Road which fetched an average price of $2,030 psf; the buyers did not take up the rental guarantee offered by Far East for the recently completed condo. The developer also sold nine units at Floridian in Bukit Timah at an average price of $1,220 psf.

In the upgrader housing segment, it sold seven units at Mi Casa in Choa Chu Kang, nine units each at Lakeshore near Jurong Lake and Waterfront Waves near Bedok Reservoir. Waterfront Waves is a joint development with Frasers Centrepoint.

Frasers Centrepoint also sold four units each at its Caspian condo in the Jurong Lake location and Woodsville 28 last week.

At Martin Place Residences, the developer released fresh units below the 14th floor sky terrace in the second and final block in the 33-storey condo.

Prices of the freshly released units start from $1,350 psf, higher than the $1,260 psf starting price in the earlier block during the preceding weekend’s marketing campaign.

However, the latest pricing is still below the $1,700 psf starting price for the 33-storey freehold project when it was previewed last year. Inclusive of the units sold last week, 168 units in the 302-unit condo are now sold.

Frasers Centrepoint is offering an interest absorption scheme (IAS) for all its four projects on the market – in exchange for a 3 per cent price premium for Caspian and a 2 per cent premium for the rest.

Over in Bukit Timah, a Sing Holdings subsidiary is understood to have sold five units last weekend at BelleRive, taking total sales to 39 units in the 51-unit freehold project. BelleRive was initially priced at $1,350 psf average when it was previewed in mid-April; this was raised to $1,430 psf last week and upped further to $1,530 psf this week. This translates to a 13 per cent price hike in about six weeks.

The average pricing is for the apartments in the 15-storey project, and excludes the two penthouses. About 75 per cent of BelleRive buyers have taken up the IAS offered by the developer at no extra cost.

The units were picked up predominantly by Singaporeans. BelleRive’s draws include its proximity to Anglo-Chinese School (Primary) on Barker Road and Singapore Chinese Girls’ School along Dunearn Road.

In the Balestier area, Soilbuild is understood to have sold another 25 units at Mezzo over the weekend. The project is priced at about $850-900 psf on average; the cost is 2 per cent more for IAS.

Property giant City Developments also sold 14 units last week for The Arte at Thomson condo. The average price in the project is now $900-930 psf, compared with $880 psf when previews began in March. The 336-unit condo is 84 per cent sold.

Near Botanic Gardens, Straits Trading has upped the price of the remaining few units at Gallop Gables to $1,400 psf, from the $1,188 psf average achieved for units sold in the past six weeks. The price increase comes after the developer achieved the sale of its 40th unit in the completed freehold condo.

In the secondary market, some 50-plus units are said to have been sold last week at RiverGate condo near the Singapore River. These are out of 88 units listed in a sales campaign last week. The average price is about $1,400 to $1,500 psf.

The 88 units were from an original pool of 100 units purchased in 2005 by a fund managed by Ferrell Asset Management.

Source: Business Times, 26 May 2009

(SINGAPORE) Is the interest absorption scheme (IAS) helping to grease home sales?

CapitaLand releases units at The Wharf Residence, Frasers Centrepoint to launch Woodleigh project in July or Aug

DEVELOPERS are riding the wave of buying interest to launch more units.

CapitaLand yesterday released 100 two and three-bedroom units at The Wharf Residence, a 999-year leasehold condominium near Mohamed Sultan Road which comprises 173 apartments and 13 shophouses.
CapitaLand could make more units available today as the launch stretches into the weekend.
The release of more units at The Wharf Residence comes as activity in the higher end of the property market is starting to stir. According to URA’s April statistics, buyers snapped up 64 units out of 75 launched at Bukit Sembawang Estates’ Verdure at Holland Road. The median price of the transactions was $1,416 psf.

‘Sentiment is better now,’ said Knight Frank executive director (residential) Peter Ow. Some buyers feel that property prices have dropped enough, he added.

And even if prices have not bottomed, they believe that there is probably ‘no harm in going in now, rather than letting money sit in the bank’. Some buyers are also worried about missing out on a real estate recovery, he said.

Separately, Frasers Centrepoint mentioned at its results briefing last week that it will launch its Woodleigh project in July or August this year. Prices will be at a level that ‘the market will accept’, said its chief executive, Lim Ee Seng.

The company’s Caspian at Lakeside has seen strong take-up since its launch in February. Of the 712 units in the development, 611 had been sold as at May 7, Frasers Centrepoint said.Source: Business Times, 16 May 2009

The group sold 85 units – mostly two-bedders – at an average price of between $1,300 and $1,600 per square foot (psf).

Sizes of two-bedroom units start at 1,012 sq ft. Assuming a price of $1,300 psf, one would cost about $1.32 million.

Some of the 100 units released yesterday were the remainder from an earlier launch.

According to Urban Redevelopment Authority (URA) records, CapitaLand introduced 80 units to the market in July last year and sold 24 until September that year at median prices above $1,500 psf.

The Wharf Residence is expected to receive its temporary occupation permit in 2013. CapitaLand is offering buyers a package deal of stamp duty absorption and interest absorption. BT understands that those who do not take up this package may get to pay up to 8 per cent less.

But healthiest quarterly sales in more than a year may not signal sustained recovery

(SINGAPORE) A ray of hope dispelled some gloom in the private home market yesterday when new data showed developers selling 1,220 new units in March. This brings the number sold in Q1 2009 to 2,660 – the best quarterly performance since Q3 2007.

But could this be a false dawn? Citing weak economic fundamentals, several industry watchers believe that it is still too early to say if a nascent recovery has begun.

According to Urban Redevelopment Authority (URA) figures from developer submissions, private home sales held up in March and dipped just 8 per cent below the 1,332 units sold in February.
Both months’ showings were markedly better than in January, when buyers took up just 108 units.
In fact, the number of units sold in Q1 2009 has already reached around 60 per cent of that for the whole of 2008.

‘Most of the demand in the first three months of the year was from Singaporeans and permanent residents, a significant proportion of whom comprised HDB upgraders,’ said CBRE Research executive director Li Hiaw Ho.

Indeed, new launches in mass-market to mid-tier projects contributed to the bulk of sales in March. The most popular was Double Bay Residences in Simei – developers UOL Group and Kheng Leong sold 264 units at a median price of $659 psf.

Far East Organization also sold 101 units at its Mi Casa condominium in Choa Chu Kang at a median price of $617 psf, while 90 units at City Developments’ The Arte fetched a median price of $874 psf.

There is ‘strong demand for lower-range properties in the outer areas that are priced below $1,000 psf,’ observed PropNex CEO Mohamed Ismail.

The mass-market and mid-tier sectors also dominated recent launches. DTZ senior director of research Chua Chor Hoon noted that 95 per cent of all launches in Q1 09 were outside the prime districts 9, 10 and 11. Developers brought out 832 new units in March, down 22 per cent from the 1,072 in February.

In contrast, activity in the Core Central Region continued to lag behind in March. Reception to The Mercury at Shanghai Road was the strongest, with buyers taking up 62 units at a median price of $1,148 psf.

The retreat of foreigners from the luxury property market could be one reason for the weak performance, said Knight Frank’s director of research and consultancy Nicholas Mak. ‘Preliminary figures suggest that the percentage of foreign transactions stood at 16.8 per cent in Q1 2009, settling at levels observed in Q2 2003 when the Sars outbreak badly affected the market.’

On the whole, most observers BT spoke to believe that the property market still faces downside risks – the coming months may see prices stay flat or fall and the number of units sold may decrease.

‘Historically, economic recovery precedes property market recovery,’ said DTZ’s Ms Chua. ‘Right now, there is no economic fundamental to support a bottoming of the property market.’

Just on Tuesday, the government cut its 2009 economic growth forecast again to a range of minus 6 to minus 9 per cent.

Already, there are signs of developers lowering prices to push sales. For instance, 6 units in Kovan Residences went for $782-$865 psf in February, achieving a median price of $809 psf. By March, 56 units were sold at a median price of $705 psf, with overall prices ranging from $597-$823 psf.

In fact, price cuts and the relatively affordable costs of smaller units could have spurred demand in the last few months, said DMG & Partners Securities analyst Brandon Lee. CIMB analyst Donald Chua also expects more price adjustments to happen at projects that have not been fully taken up.

In terms of new units that can be sold in the next nine months, few market watchers were confident of seeing the 1,000-a-month mark being crossed often. Some estimate that the transaction volume this year may range from 6,000-8,000 units in total. This would still be an improvement on 2008, when 4,264 units were sold.

Still, it’s not smooth sailing. Even some popular projects are taking back units. URA data indicates that buyers returned 20 units at the Caspian and 10 units at the Alexis between February and March.

URA will release more concrete data on home sales on April 24. Among other factors, its real estate statistics for Q1 2009 will take into account options on units sold that subsequently lapsed later.

Source: Business Times, 16 April 2009

THE bumper private property sales recorded in February were no fluke.

For a second straight month, home hunters defied the weakening economy to buy more than 1,000 units last month.

Property consultants say buyers are attracted to what they regard as good buys in the moderately priced mass market.

Still, they warn that these strong buying levels are probably not sustainable.

Last month, property developers sold 1,220 new private homes, just shy of the 1,332 units sold in February.

It was the first time in over a year that the market has seen two consecutive months with more than 1,000 units sold. Sales for both months were a stunning contrast to the dismal 108 in January.

Another striking figure: First-quarter new private home sales hit 2,660 units, representing 62 per cent of all new homes sold during the whole of last year.

February sales – boosted mainly by two new launches Alexis and Caspian – were the highest since August 2007.

Figures compiled by the Urban Redevelopment Authority also showed 832 new housing units were launched last month, compared with 1,072 units in February and just 204 units in January.
Most units sold last month were in the mass market, along with a few city-fringe small-format apartments at condominiums such as Domus and The Mercury.

HDB upgraders were the hottest group of buyers. CBRE Research said that last month alone, they bought 550 to 600 units at mass market projects such as Caspian, Double Bay Residences, Kovan Residences, Livia, Mi Casa and The Quartz at median prices of $610 per sq ft (psf) to $740 psf.

A survey of first-quarter caveats lodged for this market segment indicated an average price of $695,000, said CBRE Research executive director Li Hiaw Ho. ‘This is probably a good time for HDB home owners to upgrade to private property as the price gap between private properties and HDB resale flats has narrowed.’

Said Colliers International director for research and advisory Tay Huey Ying: ‘Developers have lowered their price expectations for new launches and generally cut prices of unsold units. Buyers are biting as there is pent-up demand.’

The top three sellers in March were Double Bay Residences, Mi Casa and The Arte. About 85 per cent of units sold last month were priced below $1,000 psf, said PropNex chief executive Mohd Ismail.

The high-end showed some life with 70 units launched and some sales, including one Orchard Scotts unit at $2,220 psf.

But overall, only 100 prime units were launched in the first quarter, or just 4.7 per cent of all units launched, well down from the 39.4 per cent of all units launched in the fourth quarter last year.

Knight Frank director of research and consultancy Nicholas Mak said this was partly due to the retreat of foreigners from the luxury market.

Preliminary data suggests foreign deals stood at 16.8 per cent in the first quarter – a level last seen when Sars badly hit the market in 2003, he said.

Market analysts say it is a good start to the year, but they do not expect the strong buying to continue long-term.

‘In the short term, this rate of buying can continue provided developers lower or maintain their prices,’ Chesterton Suntec International’s research and consultancy head Colin Tan said of March sales.

But in the long term, it is not sustainable, he said. ‘The last time the market sold so many new units (14,811 units) was in 2007. That was when the deferred payment scheme was available. And it has since caused indigestion in the top end of the market.’

Unless the Singapore economy and employment market improve significantly this year, only 6,000 to 7,000 new private homes are expected to be sold, said Mr Mak.

He said healthy demand for mass market homes is likely to continue only as long as average HDB resale prices do not fall by more than 7 per cent year on year.

‘Many in the mass market segment are buying now and banking on their future earnings to service their loans as they are afraid of missing the boat,’ said Mr Mak.

Source: Straits Times, 16 April 2009

With over 80 new housing projects islandwide, buyers have more choices but completion delays will keep prices stable

Home buyers keen to upgrade from a Housing Board flat to a private condominium will have plenty of choice this year. That is going by data compiled by real estate services company CB Richard Ellis.

A total of 82 projects are currently ready to be put up for sale throughout this year, said CBRE, an international company with a research team in Singapore.

From the coastal areas of Pasir Panjang and Punggol to the residential zones of Simei and Sixth Avenue, there is a private apartment development waiting to be launched in almost every corner of the island.

Most are in the non-landed condominium category, aimed at Housing Board upgraders and young family starters.

CBRE’s list defined the projects on the list as those that are ‘launch-ready’. By this, it means projects that have all the necessary permits from the authorities so they can be marketed, although construction work may not have started.

Already, four have been launched – including the latest, Mi Casa condominium at Choa Chu Kang, whose units went on sale this weekend. A further two are expected to be launched within the next two months.

With private property prices falling when HDB resale flat prices are still holding fairly steady, it is music to the ears of those who want to upgrade but have not been able to amid high prices and not so many mass-market launches in recent years.

Writer Ng Hui Hui, 28, who is looking for a private apartment but finds prices a bit high now, feels the high number of launches will increase her chances of finding one at the right price.

‘I’m more hopeful because the number of launches offers a lot of choices. There’s more for me to consider,’ she said.

HDB upgraders have flexed their muscle at condo launches so far this year, buying many units at The Caspian beside Lakeside MRT station, Double Bay Residences in Simei and The Quartz in Buangkok, for example.

Mr Joseph Tan, CBRE’s executive director, residential, notes: ‘If there are a number of HDB upgraders who are ready to enter the market, the sales momentum can be sustained.’

Over at the 18-storey The Mercury in Shanghai Road launched three weeks ago, all 67 units – priced from over $700,000 for a 635 sq ft apartment – were snapped up.

Mr Victor Soh, director of the developer, Fortune Shanghai Road, said: ‘There was no delay in launching the project despite the bad market – we launched it when the project was ready. There were quite a number of people waiting for us to launch.

‘All our units have already been sold and we’re ready to start construction.’

While house-proud Singaporeans will enjoy poring over the launch-ready list, imagining their dream home, most projects may not actually go up for sale soon, as developers wait and see how the economy goes.

Only 10 out of the 82 could name a date or period, but even they said their dates are subject to change.

Still, judging by the small amount of dates given, the hold-out may not go beyond this year or the early part of the next, as the furthest indicated date a developer gave was the first half of next year.
Such delays also mean prices will not plummet too sharply, said a spokesman for listed developer City Developments.

He said: ‘This has helped to balance current demand and supply by mitigating the supply of new apartments entering the market.’

The tough economic times are weighing on some developers, with Ms Chua Chor Hoon, a senior research director for global real estate adviser DTZ, saying: ‘Some have been responding to the slow market by deferring projects that are due for completion to later years.’

A spokesman for residential project Verdure – a planned 75-unit, freehold development in Holland Road – said: ‘The market is so bad, we can’t launch it.’

Another, representing the exclusive 26-unit The Verv @ River Valley, said it was putting off its launch, explaining: ‘Blame it on the economy.’

Both spokesmen declined to be named.

The experience of upcoming mid-market, 24-unit Evergreen View at Geylang Lorong 36 echoes this.

Mr Thomas Sim, associate manager of real estate firm PropNex Realty, which is the selling agent, said: ‘We’ve only had the soft launch last month so far because the show unit is only slated for completion in May, and also partly because the market is poor now. As it is, the reaction from the soft launch wasn’t very good.’

A key part of marketing a condo is to build a show flat to entice prospective buyers. Another reason some projects are being delayed is that developers are reviewing their plans in order to reconfigure units to a smaller size, say industry players. The smaller sizes make the units more affordable.

Knowing about the list of 82 ‘launch-ready’ projects is good news for the likes of home-hunter John Yeo, 38.

The sales manager says: ‘This means I have time and don’t have to rush. I can take my time to choose. But of course, price and location must also be right.’

‘I’m more hopeful because the number of launches offers a lot of choices. There’s more for me to consider’ Writer Ng Hui Hui, a house hunter who finds prices too high now

‘This means I have time and don’t have to rush. I can take my time to choose. But of course, price and location must also be right’ Sales manager John Yeo, who is happy with the list of 82 launch-ready projects

Source: Straits Times, 11 April 2009

More are buying new private condo units as prices come down

Despite the recent slump in the property market, new private properties are still being snapped up in the market.

Last month’s sales of new private homes jumped to 1,323 units, harking back to the days of the property boom, said observers.

In January, only 108 units were sold.

The figure was largely propped up by two newly launched heartland condominiums – the 293-unit Alexis at Alexandra Road and the 517-unit Caspian in Jurong.

Prices started from $450,000 at Alexis and $340,000 at Caspian.

‘Developers probably realised after January’s dismal sales that they had to lower their prices, while buyers noticed these discounts and decided to buy,’ said PropNex’s corporate communications manager Adam Tan.

According to CBRE Research executive director Li Hiaw Ho, the majority of last month’s buyers were HDB upgraders who put buying on hold while home prices surged in 2006 and 2007.

He estimated that private home sales this month would come up to about 400 to 600 units, bringing the total number of units sold to 1,800 to 2,000 for the January to March quarter.

‘A few projects are still selling fairly well, but they are not as large-scale as the projects launched last month,’ said Mr Li, who predicted that sales figures are likely to hover around 500 to 700 units a month for the second quarter of the year.

Developments that are anticipated to do well this month include Waterfront Waves in Bedok, which was first launched last year but relaunched in the middle of March, and Mi Casa condominium in Choa Chu Kang, which analysts are expecting to be launched at the end of the month.

They have 457 and 405 units respectively.

The rate of new launches this month is likely to be similar to last month’s, said Dr Chua Yang Liang, the head of research and consultancy at Jones Lang LaSalle Singapore.

‘This is backed by housing developers’ confidence in the latent demand by genuine homebuyers, encouraging them to release more,’ he said.

However, the islandwide take-up rate this month could dip as the market has been rather temperamental, especially in light of the volatile global stock market performance, he said.

So when is the right time to buy?

‘Many people ask that question but they should really be asking themselves where they want to buy, what they are buying it for, and what are their risk profiles,’ said PropNex’s Mr Tan.

‘Don’t buy blindly just because the price is good. As some of these places have two or three years till their completion, one should also consider the property’s surroundings, such as existing or future infrastructure. Go into this investment with about five to 10 years in mind.’

Source: Straits Times, 29 Mar 2009

Property transaction volumes rebound in Feb, but analysts warn surge may not last

AFTER almost half a year of dismal sales, the private property market staged a rebound last month with 1,323 new units sold — about10 times :the 108 units sold in January.

But while the surge had the mass market segment to thank, the current enthusiasm may not be sustainable, say analysts.

Some 60 per cent of February’s sales — a month that saw the highest volume of transactions since August 2007 — came from high-profile, mid-tier projects such as Caspian and Alexis, according to Government statistics released yesterday. Third on the list was The Quartz, which sold 168 units (see box above).

Located near MRT stations and generally priced below $1,000 per square foot, the three projects appealed to HDB upgraders who had been holding back during the property bull run between 2006 and 2007, said CBRE Research executive director Li Hiaw Ho.

Overall, 70 per cent of all units sold last month were below $1,000 psf, noted PropNex chief executive Mohamed Ismail — a sign that most of the sales were to HDB upgraders.

Discounted prices also lured in buyers. Units at The Quartz, for instance, were relaunchedlast month at around $417 to $684 psf, lower than December’s transacted range for the project of $766 to $814 psf.

While February’s strong sales are a shot in the arm for the beleaguered market, analysts do not think they point to a broad recovery.

“As the real estate market is expected to continue to soften this year, such a burst of buying activity may occur from time to time,” said Mr Nicholas Mak, Knight Frank’s consultancy and research director. “They may not be sustainable in the medium term unless there is an overall improvement in the economy.”

Jones Lang LaSalle’s South-east Asia’s head of research Chua Yang Liang concurred, saying the strong showing last month was probably a “short term blip” in the larger scheme of things. He said: “The pricing of projects within the affordable total quantum range has coincided with preceding periods of stable and strong public housing prices … supporting the renewed buying interest.”

With the economy expected to slow further, “hardcore incentives” such as pricing discounts and rental guarantees may be required to maintain the same number of sales, he added.

This month, newly-launched mid-end projects are expected to keep private home sales at an encouraging level — as shown by recent sales of Double Bay Residences at Simei and Suites@Kembangan.

PropNex’s Mr Mohamed Ismail predicts March sales to be about 800 units, which would be lower than February but still a big improvement from the preceding months.

Overall, CBRE’s Mr Li sees the year as presenting “a window of opportunity where the gap between private home prices and HDB resale prices is narrow”.

Source: Today, 17 Mar 2009