OUE and master tenant Ideal told to restore units to original condition

(SINGAPORE) Overseas Union Enterprise (OUE) and its master tenant at the Grangeford condo have been instructed to restore the apartments to their original condition. Ideal Accommodation, the master tenant, had subdivided apartments into smaller units resembling a dormitory layout.

‘Urban Redevelopment Authority has investigated and taken enforcement action against the persons responsible for the unauthorised use of Grangeford Apartments.

‘Enforcement notices have been served on the persons responsible to discontinue the unauthorised use and restore the apartment units to their approved condition,’ a URA spokeswoman told BT.

OUE and Ideal could face penalties if they do not act within the time frame stipulated by URA.
BT understands the enforcement notice was served towards the end of last month.

The paper reported last month that a fully owned subsidiary of OUE had signed a two-year lease with effect from Jan 1, 2009 with Ideal for 170 apartments at the condo at Leonie Hill. Of these 170 apartments, Ideal split 140 apartments into a total of 600 units. Most had no access to rubbish chutes. Kitchen and living room areas were boarded up to create new units. Tenants of some units have to share toilets.

Ideal, set up by Chinese citizen Tang Yong, provides rental housing accommodation including student housing and serviced apartments.

Last month, URA had indicated that change of use of Grangeford’s apartments from residential use to boarding house/dormitory use was not allowed.

OUE bought Grangeford through a $625 million collective sale struck during the market peak in 2007. With the property slump, OUE decided against redeveloping the project for the time being and opted to lease out the existing 193 apartments instead. It managed to rent out 22 apartments before it signed a master lease with Ideal for the 170 apartments.

BT noted in its reports last month that owners of apartments in other developments have also carried out similar subdivisions, though on a much smaller scale.

With the swine flu alert, the issue has become more critical as the overcrowding could pose a health hazard and contact-tracing could be difficult on account of transient tenants, as a letter writer living in People’s Park Complex pointed out in The Straits Times Forum pages on Monday.

Source: Business Times, 6 May 2009

A NEW initiative called Landscaping for Urban Spaces and High-Rises (Lush) – launched last week by the Urban Redevelopment Authority – offers a gross floor area (GFA) incentive scheme for buildings in the Orchard and Downtown Core planning areas to promote roof-top greenery.

This additional GFA can be used only for Outdoor Refreshment Areas (ORAs) at roof-top level if owners provide roof-top landscaping. A Development Charge (DC) or land premium, where applicable, is payable for this additional GFA.

The DC system, now used in Singapore, is based on the principle of sharing of enhanced land value. Since July 18, 2007, DC rates have been pegged at 70 per cent of land value, up from 50 per cent previously.

The 30 per cent balance is free, which is supposed to give the owner an incentive to undertake development work.

Under the fixed-rate system, the DC rate is an average value within a geographical sector. Applying it to a multi-storey development on a specific site, it is also an average value for that development.

As building intensifies or plot ratio increases, the additional floor area inevitably goes to higher floors. DC rates, therefore, work in favour of office and residential developments, where higher floors command higher value, but vice-versa for shopping centre and industrial/warehouse developments.

By levying the DC rate on a roof-top retail floor area, the 30 per cent benefit to the owner for undertaking the development is diminished. For example, take a typical five-storey shopping centre development where the DC rate is $7,000 per sq m (psm) of GFA.

The implied average land value of $10,000 psm would be at third-storey level. As rental and capital values decrease progressively towards higher floors, the land value of the floor area on the fifth storey roof-top could well drop more than 30 per cent to below $7,000 psm. There is, therefore, no financial incentive for the building owner to participate in such an initiative.

That’s just the DC component of cost. There will be other elements to consider, such as the cost of landscaping the roof-top and building the ORA, as well as the installation of additional mechanical and electrical equipment if necessary.

Most important is the accessibility of roof-top space. To install a new pair of escalators just to service a 200 sq m of ORA would not be cost-effective.

If the DC rates for roof-top ORA remain pegged at 70 per cent, how effective this initiative will be in promoting roof-top greenery will depend on the movement of the DC rates in the next few DC reviews.

The current DC rates for commercial use for the Orchard and Downtown Core planning areas, ranging from $4,550 psm in the Rochor Road area to $11,200 psm in the Scotts Road area, are near an all-time high.

The DC rates have to drop to make the Lush initiative attractive to building owners. And the drop has to be significant – and occur before the three-year validity period of the new scheme is over.
The writer is the owner of Landmark Property Advisers, a boutique property agency specialising in investment sales and property advisory services

Source: Business Times, 5 May 2009

URA’s approval for its expansion leaves many wondering

REGARDLESS of what his plans really are for Raffles Hotel, Saudi billionaire Prince Alwaleed bin Talal seems to have made a smart move by getting the authorities’ approval to expand it.

The prince’s investment company said recently that its unit, Fairmont Raffles Hotels International (FRHI), had secured the go-ahead to add as many as 78 guest rooms at the hotel’s shopping arcade. Coming just days after a London-based newspaper speculated on the hotel’s sale, the news once again sparked interest and left many observers wondering about the national monument’s fate.

Surely FRHI has no plans to sell the hotel if it is still planning to expand it, some say. Well, it depends. The option to redevelop the shopping arcade might come in handy in more ways than one.

Supposing that Raffles Hotel is up for sale, the expansion option would make FRHI’s offer more attractive to prospective buyers. And if the speculated terms of the offer are true, there would be quite a lot of sweetening to do.

Asking price $670m
For one, FRHI may be asking for close to $670 million for the hotel, based on the London report. This is pretty hefty considering floundering market conditions today. A BT report last year noted that the hotel and shopping arcade was valued at about $200 million in 2005.

The London report did not mention if FRHI has asked to retain management of Raffles Hotel. A long-term management contract (reportedly lasting 40 years) was part of the deal when it tried to sell the property in May last year. Some interested buyers may also find this condition a hard one to swallow if it is still there.

If the deal involves a high asking price and a long-term management contract, FRHI would have to justify its terms by showing that high returns are achievable, possibly by having more hotel rooms. And it could add value to its offer by getting the paperwork ready for the next owner.

FRHI can expand the hotel on its own but so far, there are few signs of work happening soon. On a visit to the shopping arcade a few days after its possible redevelopment was announced, shops remained open and many sales assistants did not know of plans to move.

‘It is business as usual for the foreseeable future,’ a Raffles Hotels & Resorts’ spokeswoman told BT. ‘Any proposals for strategic investment in the hotel and arcade are considered preliminary in nature and it would be premature to discuss them at this time.’

Downturn repositioning maybe
The Urban Redevelopment Authority’s (URA) data last month did not show when the project might get its temporary occupation permit.

But supposing that the prince is not seeking a buyer for Raffles Hotel – as his investment company said after the London report surfaced – FRHI may truly be looking for more returns.

URA granted approval for the creation of 78 hotel rooms across a gross floor area of over 79,300 sq ft. Assuming that 70 per cent of the new rooms are filled at $590 per night, the hotel can already expect to bring in an additional $11-plus million a year.

However, this does not factor in rental losses if some of the shops in the arcade have to make way for rooms. BT understands that retail rents there range from the mid- to high-$20s psf, and they make up a relatively stable source of income in the unpredictable tourism industry.

Without details from the hotel, it would be hard to pinpoint changes to come. But some industry observers believe that the hotel will retain some popular outlets and restaurants for a more optimal mix of returns.

But why think about having more rooms now, when the global economy is sinking, tourism numbers are down and the swine flu is on the attack? As a property consultant pointed out, renovation works may not be ideal when business is booming. ‘In a downturn like this, it will be good to reposition.’

Source: Business Times, 4 May 2009

NParks launches 3-year co-funding scheme; URA starts landscaping for urban spaces plan

(SINGAPORE) Hot on the heels of a sustainable development blueprint released on Monday, the National Parks Board (NParks) yesterday announced a three-year $8 million scheme to co-fund rooftop landscaping in the city.

The Urban Redevelopment Authority (URA) also launched its landscaping for urban spaces and high-rises (Lush) programme to help meet the blueprint’s goal of creating another 50 hectares of ‘sky-rise’ greenery by 2030.

‘Despite Singapore being land scarce, greenery can be pervasive in our urban spaces,’ said URA chief executive Cheong Koon Hean. From September this year, NParks will give cash incentives to owners who install green roofs on existing buildings in the downtown and Orchard planning areas. The scheme will first target low- to mid-rise developments that are highly visible, and those surrounded by little street-level greenery.

NParks hopes to create nine hectares of green roofs over the next three years. The incentives will cover up to half of installation costs, capped at $75 per sq m. According to the agency, the typical cost of installing a green roof ranges from $150-$180 per sq m.

Gardens on the roof cost more than those on the ground for every square metre, said Singapore Institute of Landscape Architects’ president Henry Steed. ‘But once you have built it, the asset is there and the land usable, whereas a plain roof is not.’

In conjunction with NParks’ scheme, URA will offer owners who install green roofs bonus gross floor area (GFA) above the master plan permissible intensity. The additional space – limited to half of the roof area or 200 sq m, whichever is lower – can be used for outdoor refreshment areas.

Developers will have to pay a development charge (DC) or differential premium, but URA believes the bonus GFA offer is sufficiently attractive.

The current DC calculation formula creams off 70 per cent of the enhancement in land value, but ‘there’s still a 30 per cent gain for developers,’ said URA’s urban design deputy director Cheng Hsing Yao.

The GFA incentive scheme is part of URA’s Lush programme, which includes other existing and revised measures to enhance the urban landscape.

For instance, developers applying to exclude sky terraces from GFA computations now have to submit detailed plans on landscaping and communal facilities at the terraces.

Developers housing car parks within raised decks must also put up earth berms for plants on at least 60 per cent of each side of the deck wall, and should surround the area with see-through fences rather than solid walls.

In the strategic areas of the Downtown Core, including Marina Bay, Kallang Riverside and Jurong Gateway, new developments also have to put in place ‘sky-rise’ greenery or ground-level landscaping equivalent to the site area in size.

For very small plots where buildings have to be tall to maximise the plot ratio, ‘replacement is typically not too difficult,’ said Singapore Institute of Architects immediate past-president Tai Lee Siang.

Both Mr Steed and Mr Tai believe more can be done to promote urban greenery.

Mr Steed, for instance, envisions it will ultimately be possible for all roofs to have green features ranging from gardens, water catchment areas and even mini-farms.

Source: Business Times, 30 April 2009

EXPECT to see more ‘gardens in the sky’ in Singapore, especially in areas like Orchard Road, Raffles Place and along the Singapore River.

A new plan launched yesterday by the Urban Redevelopment Authority (URA) makes it a must for new developments coming up in several areas from December to have landscaping.

This can take the form of rooftop gardens, planter boxes and sky terraces on the upper levels.

Developers will also be encouraged to landscape their grounds.

The areas affected by this new ruling are the Downtown Core – which encompasses Raffles Place, Shenton Way, and Marina Centre – along the Kallang River, and Jurong Gateway, the upcoming commercial hub in the west.

Existing buildings will not be left out.

Those in Orchard Road and the business district will be allowed to open outdoor refreshment areas on their rooftops. To do this, they will be given additional gross floor area of half the roof area or up to 200 sq m.

This complements a programme launched on Monday by the Building Construction Authority (BCA) and URA. Under it, private buildings which are eco-friendly enough to achieve high standards under BCA’s Green Mark scheme get additional gross floor area.

The new URA initiative, launched yesterday, is called Landscaping for Urban Spaces and High-Rises (Lush), and is part of a national sustainability blueprint launched by an inter-ministerial committee on Monday.

The blueprint sets national targets for pollution standards, energy usage and green areas over the next 20 years, and aims to create a more environmentally friendly and energy-efficient nation.

In addition to the Lush programme, the National Parks Board also announced yesterday an $8 million fund that developers can tap to create rooftop gardens on existing buildings.

To be launched in September, the fund will offset up to $75 per sq metre for landscaping costs – about half the $150 to $180 per sq m usually charged by gardening companies.

Landlords in the Orchard Road and downtown areas can apply to the fund.

In announcing the plans yesterday, the URA said that encouraging private developers to include greenery in their buildings is becoming increasingly important as Singapore becomes more built up.

Developers that The Straits Times spoke to yesterday welcomed the moves, but had suggestions to make the scheme more attractive as URA had said that the the usual development charges (DC) would apply.

The DC rate is pegged at 70 per cent of a building’s enhanced land value.

Managing director of City Developments Kwek Leng Joo felt that while developers can make use of the additional area, they would have to grapple with the additional costs.

‘We would suggest that the DC rate be pegged at the previous rate of 50 per cent instead of the current 70 per cent, which most developers find too high.

‘This could make the incentive more attractive and effective to help the policy take off quickly,’ he said.

Source: Straits Times, 30 April 2009

URA has received 4 applications to convert space in CBD

THE property market may be subdued, but developers are not sitting still. A check with the Urban Redevelopment Authority shows some are still putting up proposals to convert office space or embark on residential and commercial projects.

URA told BT it has received four applications to convert office space in the central area to other uses since it lifted the ban on doing so in October last year. ‘These applications are now being evaluated and are pending final approval,’ said a URA spokesman.

In a bid to ease the office space supply crunch that built up during the boom years, URA called a halt to such conversions in May 2007. It later removed the ban as the supply of office space coming on stream started to increase, while the economy began to slow. URA did not identify the buildings involved in the applications, but some property owners have revealed plans to convert office space.

CapitaMall Trust, for instance, said last week that it was ‘in talks with the authorities to optimise the integration plan for The Atrium@Orchard and Plaza Singapura’ and that work could start by end-2010 subject to market conditions and official approvals.

URA has also granted approval for close to 10 commercial and private residential projects, according to its Q1 2009 real estate statistics released yesterday.

UIC Investments (Properties) received provisional permission in January to develop office and retail space with gross floor areas (GFAs) of 114,500 sq ft and 48,000 sq ft respectively at the UIC Building in Shenton Way. Some 593 residential units could also take shape at the site.

The South Beach consortium – comprising City Developments, a Dubai World unit and Elad Group – has been given the go-ahead to develop 560 hotel rooms across a GFA of 474,100 sq ft at its Beach Road project. The site may include office space with a GFA of more than 632,100 sq ft, and retail space with a GFA of 158,000 sq ft. The project is tipped to receive a temporary occupation permit in 2014.

BT understands there will also be a residential component in the South Beach project, although this did not appear in the URA statistics. The data only shows development approvals for uncompleted private residential projects if they have at least 200 non-landed property units.

YTL Corp, which bought the Westwood Apartments in Orchard Boulevard in 2007, has obtained provisional permission to develop shop space with a GFA of 1,500 sq ft and 39 hotel rooms across 78,200 sq ft at the site. BT understands the residential component similarly did not show up in the URA statistics, because there are less than 200 non-landed units.

In February, UOL Group subsidiary Hotel Plaza got URA’s nod to re-use the GFA in The Plaza’s podium block to create 273 hotel rooms.

Source: Business Times, 25 April 2009

Vacancies hit 10% in Q1; broader property market sees prices fall across sectors; rentals also slide, URA data shows

This segment took a hit for the second consecutive quarter, government data showed. The broader property market also saw prices and rentals slipping.

‘Many of the corporates we talk to are well advanced in implementing their restructuring programmes. From this, we deduce we may be going through the period of sharpest contraction in office demand now. Contraction may ease in the second-half,’ he said.

The weak demand in the office sector also rubbed off on business park space, which saw negative take-up of about 215,000 sq ft in Q1, against positive take-up of some 10,700 sq ft in Q4 2008. Vacancy rate for the sector increased from 6.2 per cent in Q4 2008 to 9.7 per cent in Q1 2009.

In the private residential segment, URA’s overall islandwide price index slipped 14.1 per cent in Q1 over the preceding quarter, slightly steeper than the flash estimate decline of 13.8 per cent. The Q1 drop was also the biggest quarterly drop to date. The index has now eased 21.2 per cent since peaking in Q2 last year.

Colliers International director Tay Huey Ying says: ‘Mass market homes could see more gradual price corrections averaging about 8 to 12 per cent over the next three quarters (from Q1 2009 levels) as more sellers in the secondary market as well as developers with unsold units from earlier launches can be expected to adjust the pricing of their properties to near-current levels.’

She predicts bigger average price declines of 10-15 per cent for the mid-tier and high-end/luxury segments over the same period.

URA’s private residential rental indices show that the sharpest contraction in Q1 was for non-landed homes in the Core Central Region, which shrank 10.3 per cent quarter on quarter. The overall private residential rental index slipped 8.5 per cent in Q1, bigger than the 5.3 per cent drop in Q4. ‘The decline in rents could be attributed to supply outstripping demand as more expats left the country and to more new projects being completed,’ CBRE executive director Li Hiaw Ho said.

Developers sold a total 2,596 private homes in Q1, about six times the 419 units in Q4 2008.

The latest Q1 number was 64 units lower than the 2,660-unit figure collated from monthly developer sales stats (for January to March 2009). The decline reflects lapsing of options on units sold earlier in the quarter, URA’s spokeswoman said.

Market watchers also observed a slight easing in residential supply.

Some 27,423 private homes are expected to be completed between Q2 2009 and 2011, lower than the 31,004 units projected for completion between 2009 and 2011 in URA’s Q4 2008 data.
The smaller pipeline supply partly reflects the completion of 2,230 units in Q1 2009.

Developers may also have postponed redevelopment of some of the sites they had bought through en bloc sales and delayed construction, said URA’s spokeswoman.

URA’s shop rental index eased 3.3 per cent quarter on quarter in Q1, after dipping 0.6 per cent in Q4. The all industrial rental index slid 5.6 per cent in Q1, also worse than the 3.7 per cent fall in Q4.

Summing up prospects for Singapore’s property markets, Knight Frank managing director Tan Tiong Cheng said: ‘For the private residential sector, there’s evidence of a pick-up in activity – not just in the primary market but also subsales and resales. For office and industrial, there are going to be more rental declines because of the economic slowdown. Retail will be difficult. New malls opening this year may drum up business, but it will be at the expense of existing malls, given that tourism numbers are weak.’

Source: Business Times, 25 April 2009

PRICES of private homes fell off a cliff in the first quarter, continuing a dramatic slide that has now wiped out the gains owners have made since 2007.

Values dived 14.1 per cent in the first three months this year – the biggest fall on record – and followed a 6.1 per cent slide in the last quarter of last year.

Figures from the Urban Redevelopment Authority (URA) yesterday also point to pain in the residential rent market and in the office sector.

But the plight of the private home sector caught most attention. The first-quarter fall was worse than an initial URA estimate of 13.8 per cent, indicating the slide accelerated towards the end of the quarter.

The souring of the market has been fast and furious. Prices had been rising for four years and were still going north until as late as September of last year but then the rot set in.

Price declines have been registered in three consecutive quarters with the fall in the first three months of this year the worst since the URA began keeping data in 1975. Private homes on the city fringes suffered the most, with prices down 17 per cent, compared with 16.2 per cent in the city centre and 7.3 per cent for suburban residences.

The hefty gains over the past two years have been erased, so owners who bought after the first quarter of 2007 could see their home’s valuation fall below the purchase price, said Colliers International’s director for research and advisory, Ms Tay Huey Ying.

Rents for private homes also kept falling and at a faster rate. They plunged 8.5 per cent in the first quarter compared with a 5.3 per cent decline in the last three months of 2008. Rents of non-landed prime homes fell the most, at 10.3 per cent.

HDB resale flats showed more resilience with prices inching lower by just 0.8 per cent in the first quarter – the first fall since the third quarter of 2006.

But there was a sliver of good news. Sales of new homes in the first quarter were a robust 2,596 units, driven by pent-up demand, price cuts and innovative product packaging, experts said.

The mass market sector was most active with upgraders picking up many units to help lessen the rate of price fall in suburban areas, said Knight Frank consultancy and research director Nicholas Mak. Developer sales in suburban areas reached 1,637 units in the first quarter, almost as many as were sold last year, he said.

But the prime market accounted for only a meagre 9.5 per cent of all developer sales. And sales in the resale and sub-sale markets remained weak.

‘Property really depends on the economy, and the economy around the world and in Singapore still looks pretty weak.’ National Development Minister Mah Bow Tan told Bloomberg in Vietnam yesterday.

Mr Mak expects private home prices and rents to contract sharply in the first half of the year but the rate of decline will decelerate.

Singapore’s office market also took a beating in the first quarter. Rents slid 10.7 per cent, the biggest fall since the first quarter of 1992, while prices fell 12 per cent. Take-up contracted for the second consecutive quarter and for the first time since late 2006, the islandwide vacancy rate hit 10 per cent.

Source: Straits Times, 25 April 2009

SINGAPORE – The official private home price index in Singapore fell 14.1 per cent in Q1 2009 over the preceding quarter, a steeper declined than the 6.1 per cent quarter-on-quarter drop registered in Q4 2008.

Real estate data released by Urban Redevelopment Authority (URA) today also show that prices of office, shop and industrial properties decreased by 12 per cent, 4.2 per cent and 10.1 per cent respectively in Q1 2009 over the preceding three months.

Rentals of private residential, office, shop and industrial properties posted quarter-on-quarter declines of 8.5 per cent, 10.7 per cent, 3.3 per cent and 5.6 per cent respectively in Q1 2009.

Source: Business Times, 24 April 2009

Q1 sees rise in resale and subsale deals as prices get more attractive

(SINGAPORE) The pick-up in private home sales by developers has spilled over to the secondary market. Falling prices are greasing the flow.

Caveats have been lodged for 1,063 private homes in the resale market in the first three months of this year, up 11.7 per cent from the preceding quarter. In the subsale market, 384 caveats were lodged in Q1 2009, reflecting a 44.4 per cent increase from the Q4 2008 figure, according to Savills’s analysis of caveats captured by the Urban Redevelopment Authority’s Realis system.

Resales and subsales refer to secondary market transactions. Subsales involve projects that have yet to obtain Certificate of Statutory Completion while resales relate to projects that have received CSC. CSC is typically obtained anywhere from three to 12 months after the project receives Temporary Occupation Permit (TOP).@ Marina Bay, The Cosmopolitan and Rivergate have received TOP in 2008/2009, while One Amber and The Centris will get TOP soon, Savills said.

Market watchers said that this could be because many specuvestors who bought on deferred payment schemes (DPS) may be inclined to offload their units as the TOP date approaches, when they have to pay up the bulk of the purchase price to developers.

However, CB Richard Ellis executive director Joseph Tan pointed out that regardless of whether buyers opted for DPS, private housing projects are typically a hive of activity around the time they receive TOP, drawing buyers who want to move in themselves or to rent out immediately.

He also attributed the increase in subsale and resale transactions in Q1 to ‘prices being at fairly reasonable levels now’, with the stock market rally improving sentiment.

Mr Tan said that whether the buzz in the secondary market continues will depend on the stockmarket. ‘So long as the Straits Times Index remains fairly stable, it will give comfort to investors that the property market is close to bottoming out, given the price correction in the past 12-15 months,’ he added.

According to DTZ’s figures, which are based on resale prices, the average freehold luxury condo and apartment price of $1,880 psf in Q1 this year marks about a one-third drop from the peak of $2,800 psf in late 2007/early 2008.

The most expensive subsale deal (in terms of psf price) in Q1 this year was a 29th floor unit at Orchard Residences that changed hands for $2,579 psf. In absolute dollar quantum, the most expensive subsale deal was an 11th floor apartment at The Tate Residences at Claymore Road, which sold for $5.93 million ($1,850 psf).

As for resale transactions, the top grossers were a 10th floor apartment at Richmond Park at Bideford Road which sold for $2,199 psf and a 25th floor unit at Four Seasons Park at Cuscaden Walk that fetched $6.5 million ($1,701 psf)

The average prices of resale and subsale transactions at the most popular projects in Q1 2009 were generally lower than in the preceding quarter as well as the same period last year.

City Square Residences, the most popular subsale project in the first three months of this year with 41 units, saw an average price of $804 psf, down 5 per cent from the $845 average subsale price in Q4 2008 and 15 per cent below the $947 psf average subsale price seen in Q1 2008.

Average prices for 11 of the 12 most popular subsale projects in Q1 this year fell between one and 14 per cent from the preceding quarter. The exception was Clementiwoods Condo, where eight subsale deals were done at an average of $664 psf in Q1, some 5 per cent higher than in the previous quarter but down 7 per cent from the same period a year ago.

Compared with Q1 last year, average prices for all 12 top-selling subsale projects in Q1 2009 fell between 4 per cent (Centris) and 36 per cent (The Cosmopolitan).

As for resale transactions, the 11 hottest developments saw quarter-on-quarter price declines ranging from 4 per cent (for The Lakeshore) to 19 per cent (Bayshore Park) in Q1. The Lakeshore was the most popular resale project in the first quarter, with 27 units changing hands, followed by Costa del Sol, with 11 units.

Savills Singapore head of research Priya Sengupta noted that the 11 most popular resale projects in Q1 were all in the mass and mid-tier sectors. ‘Amid the economic uncertainties, affordability remains a key consideration for home buyers/investors; 100 of the 113 deals in the 11 most popular resale projects in Q1 were at below $1 million,’ she said.

Resale activity for high-end projects was limited. ‘This could be attributed to the price disparity between sellers and buyers as the latter expect further downward price adjustment in the near future, as well as the stricter home loan criteria in terms of loan-to-value ratio, especially for investors,’ Ms Sengupta said.

Mass and mid-tier projects also saw more subsale transactions than high-end projects. Much of the subsales activity in Q1 surrounded projects that have either received TOP recently or are close to receiving it. For instance, City Square Residences, The Esta, The Sail

Source: Business Times, 24 April 2009