NorthPark Residences Singapore

A very popular condominium type for the past few years is integrated development projects where the residential condominium units sit on top of a shopping mall. This allows the home owners to access many shops, supermarkets, dinning and entertainment establishments easily while keeping relatively peaceful enviroment elevated high on the ground. For investors, units in these developments are also quite attractive because they are very popular and convenient for tenants.

One such condominium project is the upcoming NorthPark Residences in Yishun central. The 13 floor, 12 block property project will sit on the top of upcoming NorthPoint City, the second shopping mall in Singapore. And more over, it will be also right next to the existing NorthPoint Shopping center. The Yishun MRT Station and bus interchange will also be walking distance away.

The suburban location is great as the Yishun MRT Station on the Red Line (North South MRT Line) offers direct access to Singapore's Central Business District and the suburban location offers a peaceful place to live. 99 years leasehold condominium North Park Residences will receive its TOP (Temporary Occupation Permit) in 2018. The Yishun condo will have 12 blocks with 920 units ranging from Studio (430 sqft) to 5 bedroom (1,431 sqft). A 50 meter lap pool, gym, hot spa, water cabana and dinning lounge will be some of the facilities the development offers.

For those who own their own car, major expressways like CTE/SLE and the upcoming North-South Expressway are very accessible.

NorthPark Residences condominium project will sit on the top of upcoming
Yishun shopping mall, NorthPoint City.

Northpoint Residences Launch Soon. To learn more about this exiting Singapore condominium and integrated development project. you can visit North Park Residences & North Point City page  on mysingaporecondo.com.

About My Singapore Condo
My Singapore Condo is a web site focused on new condo launches in Singapore serving to those planning to invest in Singapore real estate and property as well as people who would like to sell their Singapore property. Visit the web site at www.mysingaporecondo.com.  

Singapore Property Review - Your one stop online Singapore property information source

If you are looking forward to buy a Singapore property, you need to ask many questions to yourself like which projects has the best value, which properties have potential to perform well even in an uncertain market, what is a good buy, etc. There are many hot property projects around whether it is residential, commercial or industrial. You need as reliable info as you can and if you are looking for such Singapore property information source, you can take a look at Singapore Property Review.

Singapore Property Review web site lists hot projects in residential, commercial and industrial properties in Singapore as well as the latest property news. You can also check the list of upcoming projects for purchasing brand new property. Residential property section is nicely segmented into different categories to help you navigate easily: Executive condos, Core Central Region (CCR) , Landed, Rest of Central Region (RCR) and Unit Type by Price. The site comes in 4 languages to help buyers of English, Chinese, Indonesian and Malay speakers. This is quite cool because most Singapore property related info in the internet is in English and this site makes such valuable info available to major Asian language speakers.

In the commercial property section, you can see the latest offers in retail shops, restaurants, offices, F&B, land and medical suites. Industrial property section list Singapore production and warehouses units.
The site provides detailed information about property projects. For each project, you can have detailed description of the property, floor plans, brochure, pictures, location maps and top reasons to buy property in that project. You can also register for show flat preview. If you subscribe to the site, new information will flow to your email.

Singapore Property Review offers detailed online Singapore property information as well as
previews of various popular properties.

In short, Singapore Property Review is a site to look at if you are looking for information about various Singapore properties. You can access Singapore Property Review site at www.propertyreview.sg.

Property Market 2014 Outlook by Property Guru

PropertyGuru, an online property portal in Singapore, has announce the launch of the PropertyGuru Property Market Outlook 2014 eBook. First in Singapore, the eBook is available for free and can be viewed exclusively at PropertyGuru.com.sg/propertyoutlook2014.

Mentioned Steve Melhuish, Co-Founder and Chief Executive Officer of PropertyGuru: “The PropertyGuru Market Outlook 2014 eBook is our definitive digital guide to empower property seekers to make better informed property decisions.”

“It is a culmination of our unique leadership position in property listings and information services, an expansive real estate agent network and enriched stakeholder partnerships with developers and consumers to provide insightful perspectives that draw on past trends to predict demand and price behaviour for 2014,” he said.

Leveraging on government data and industry expert opinions, the eBook aims to provide a complete and comprehensive market view for the reader. Topical themes include changing property sentiment and the effect of cooling measures on transaction volumes in 2013.

Moving forward into 2014, the eBook incorporates the Company’s forecast on what to expect in the property market. In a nutshell, PropertyGuru expects 2014 to be quieter as compared to 2013 - with the HDB resale and condo markets experiencing further declines in transaction volumes in the first half of 2014 before reaching a plateau. In correlation to this trend, prices are expected to slide by 8-11 percent (HDB resale) and 6-8 percent (private property).

Other compelling insights from the eBook by consumer segment include:

First-Time Home Buyers:. The new supply of 24,000 HDB units in 2014 will provide first time buyers with more choices, better bargaining position – and relief on price rises. This will be a welcome relief after the highly competitive environment of 2012 and 2013. Housing availability will be further improved with projected decline in BTO applications and Singaporean population numbers.

Upgraders: New restrictions on the capacity to borrow under the new cooling measures will reduce the ability of upgraders to gain the funds to move to condos. Most will be expected to adopt a wait-and-see approach as the market continues to soften.

Investors: High-net worth individuals will remain cautious investors owing to the TDSR and ABSD restrictions and restrictions on what properties can be rented and purchased. The cooling measures will definitely affect the investment market in 2014. This will in turn be reflected in lower prices – reducing the attraction of the investment segment in 2014.

Singapore Property News - December 2014

Spike in number of HDB flats sold below valuation - More HDB flats were sold below their valuation because of the tighter mortgage rules and latest property cooling measures targeting resale HDB market. 105 units in October 2013 were sold below their valuation which represented 7% of resale HDB volume in that month. January to June 2013 there were only 5 resale units sold below valuation each month totaling to 30 in half year.

Average COV on the other hand  fell to $12,000 from $35,000 in January 2013.

COV fell to $8,000 - Cash premiums for Housing Board flats fell for the third straight time last month to $8,000, according to Singapore Real Estate Exchange flash estimates on Thursday.   More HDB resale transactions had negative COVs, with 13.1 per cent of HDB resale deals closing below valuation in November, up from 8.5 per cent in October. Sengkang, Choa Chu Kang and Jurong West saw the most such transactions. Source : HDB COVs fall to $8,000 in Nov, lowest since July 2009; more flats sold below valuation

8,952 new flats HDB BTO launched

HDB has launched the largest number of Build-To-Order and Sale of Balance Flats to date: 8,952 HDB flats for sale in a mix of mature and non-mature towns/estates under the November joint Build-To-Order (HDB BTO) and Sale of Balance Flats (HDB SBF) exercise.

4978 BTO units and 3974 SBF units are on sale. This launch brings the total BTO flat supply in 2013 to 25,139 units, in line with HDB’s commitment to launch 25,000 BTO flats for sale this year. Together with the 7,074 balance flats offered under the May and Nov 2013 SBF exercises, as well as an additional 1,355 bonus 2-room flats in the Jul and Sep 2013 BTO exercises, HDB has offered a total of 33,568 flats for sale in 2013 to meet the housing demand of our people:

HDB is offering 4,978 BTO flats over six projects in five non-mature towns, namely Bukit Batok, Hougang, Jurong West, Sembawang and Woodlands. A wide range of flats, including Studio Apartments (SAs), 2-room to 5-room flats, as well as 3Gen flats, is offered to meet the diverse housing needs of first-timers, second-timers, multi-generation families, elderly and singles.

First-timers will continue to enjoy priority flat allocation with at least 85% (for 4-room and 5-room) and 70% (for 2-room and 3-room) of the BTO flat supply in non-mature towns/estates set aside for them. Eligible singles can submit their applications to buy a 2-room flat in Admiralty Grove or West Ridges @ Bukit Batok. Applicants with a multi-generation family comprising at least a married/courting couple and their parent(s) listed in the application will also be eligible to purchase a 3Gen flat in Boon Lay View.

8,952 new flats HDB BTO launched

The Multi-Generation Priority Scheme Under the MGPS, HDB will set aside up to 15% of the SAs, 2-room and 3-room flats in a BTO project (subject to a minimum of 20 units each) for parents applying under Multi-Generation Priority Scheme (MGPS). The same number of 2-room and bigger flats will be set aside in the same BTO project for their married children. (MGPS) for parents and married children to apply jointly for flats in the same BTO project will be available to those applying for flats at Admiralty Grove, Hougang Meadow, Boon Lay View and West Ridges @ Bukit Batok. In addition, 50% of the SA supply in Hougang Meadow will be reserved for eligible elderly applicants under the Studio Apartment Priority Scheme (SAPS).

Eligible first-timer households can enjoy up to $60,000 of housing grants, comprising the Additional CPF Housing Grant (up to $40,000) and Special CPF Housing Grant (up to $20,000). With these grants, 2-room, 3-room, 4-room and 5-room flats will be priced from as low as $15,000, $106,000, $201,000 and $297,000 respectively (Table 1). Further details can be found in Annex A1  (PDF 924KB).

Pipeline Supply of New Residential Units in Singapore

National Development Minister Khaw Boon Wan has posted the below chart in his Facebook. According to the post 204,461 units of residential property will be ready for occupation in 2014, 2015 and 2016. This is is 3.4% larger than the earlier projection of 197,559:

We are making good progress in our ramp-up of home building programme. The number of new public and private residential units ready for occupation in the next three years is increasing. Our earlier projection (197,559) has been outstripped. The new number now is 204,461. For this year, more than 21,000 residential units have already been built; another 9,220 units will be ready by year end.

Source : Khaw Boon Wan's Facebook Page

According to the graph 65,383 units of private residential properties, 10,435 units of Executive Condominiums and 97,551 units of HDB's will be completed in the next 3 years. Most of the flood is expected in 2016 where 73,628 units of properties will be completed.

It seems like a flood of property supply will come to the Singapore market. The Facebook post followed the news that HDB Resale Price Index (RPI) fell by 0.9 per cent in the third quarter of this year. This was a slightly bigger drop than the flash estimate of 0.7 per cent released earlier this month. The last time resale flat prices dipped was at the start of 2009, when the recession hit. Prices have been on the upward trend since and reached a peak in the second quarter of this year, when prices went up by 0.5 per cent.

Pipeline Supply of New Residential Units in Singapore

New Singapore Property Market Cooling Measures

New Singapore property cooling measures have hit the shores of flooded property market as Ministry of National Development (MND) has announced 2 cooling measures in a press release today. Basically:

• HDB housing loan tenures are reduced from 30 years to 25 years
• The Mortgage Servicing Ratio (MSR) limit is reduced from 35% to 30% of the borrower's gross monthly income
• New Singapore Permanent Residents (PR) will have to wait 3 years after they become PR to buy a resale HDB flat.

MND says these first 2 measures are in line with those introduced by the Monetary Authority of Singapore (MAS) to encourage financial prudence among borrowers, which is especially important given that the current low interest rate environment is unlikely to be sustained.

According to The Straits Times, there were 51,000 Housing Board flats fully owned by permanent residents as of end June 2013, representing 6 per cent of all HDB flats. In 2013, 130 flats were sold by PRs within three years of their purchase, while 320 were sold within four years of purchase, and 490 within five years.

Singapore PRs need to wait 3 years before buying resale HDB flats

Singapore's Ministry of National Development has published a press release today in its web site announcing that Singapore Permanent Residents (Singapore PRs) will need to wait 3 years before they can buy a resale HDB flat in Singapore. Before the announcement Singapore Permanent Resident (SPR) households, i.e. SPR households with no Singapore citizen owner, could buy resale HDB flats as soon as they acquire SPR status.

This new property cooling measure will apply to resale applications received on or after 27 Aug 2013, 5:30pm.

How will this impact the Singapore property market? Previously in a blog article in Housing Matters blog named Who Buy Resale Flats?,  Ministry of National Development has revealed that 20% of resale HDB flats were bought by Singapore PRs. In fact, almost half of the buyers in 4 room HDB category (45%) were Singapore PRs. Although many PRs who carry this status for more than 3 years are still eligible to buy HDB flats, many will not be able to do so. In fact on the ground, one of the main reasons many seem to go to Singapore PR looks like to be able to buy an HDB flat (but I am not sure this can statistically be proven).

Resale flat buyers - Source : Housing Matters Blog

According to some analyst, Singapore permanent residents (PRs) are expected to show greater demand for rental and private homes following the latest measures targeting the purchase of resale HDB flats. “For the next three years, this is going to be a lifeline for the private housing market as a lot of private homes will be completed.” says Nicholas Mak.

I really suspect this expectation will be realized since private homes are beyond reach of many PRs going for resale HDBs. If they go for private homes we will have another group of over extended borrowers to add to the pain when the property prices goes down.

By the sudden policy change, at least 150 property deals have hit the skids. The figure is an early estimate by property agents, who say that similar cases are streaming in, with PRs having been caught out by Tuesday night's surprise announcement, which took effect immediately:

"IT customer service officer Gong Wei, who got his PR status last year, says the new rule is a decision by the Government and he can accept the policy, but a grace period for those who are in the middle of a deal would be a fair concession to make."

To cool the runaway property market further MND has also revised the mortgage loan terms:

To ensure financial prudence in purchase of public housing and discourage over-consumption, we will reduce the maximum tenure for HDB housing loans from 30 years to 25 years. The Mortgage Servicing Ratio (MSR) limit will also be reduced from 35% to 30% of the borrower’s gross monthly income (see Annex C for details). These measures are in line with those introduced by the Monetary Authority of Singapore (MAS) to encourage financial prudence among borrowers, which is especially important given that the current low interest rate environment is unlikely to be sustained.  

In tandem, the MAS will reduce the maximum tenure of new housing loans and re-financing facilities granted by financial institutions for the purchase of HDB flats (including DBSS flats) from 35 years to 30 years. New loans with tenures exceeding 25 years and up to 30 years will be subject to tighter loan-to-value (LTV) limits. 

Singapore condo rents are down with huge oversupply

Thanks to a wave of newly completed condominiums, the era of ridiculously high rents for private properties in Singapore is coming to an end. According to The Straits Times, landlords faced with stiff competition for tenants, are now asking less for rentals:

At NV Residences in Pasir Ris, which obtained its temporary occupation permit (TOP) in January, landlords of three-bedroom units have lowered asking rents from $4,000 a month to less than $3,500 a month, said Mr Chris Koh, director of property consultancy Chris International.
Homemaker Angelin Loh, 46, who bought her 1,184 sq ft three-bedder there for $1.07 million in January last year, said she was unable to lease her unit for three months after collecting the keys in February.
She found a tenant only after slashing the monthly rent from $4,000 to $3,200. Ms Loh noted that the rent was just enough to cover her monthly mortgage instalments.
Source : The Straits Times, Wave of new condos drives down rents

The key reason for this is the oversupply of condos flowing into the market. Completed private units are not only increasing the supply but also decreasing the demand since some of the tenants are individuals waiting for their condominium units to be completed.

In 2013, 16,742 private residential properties will be completed in Singapore up from 10,329 units completed in 2013. 5 large suburban projects has received their TOP (Temporary Occupation Permit) in the past 6 months adding 2600 units to the supply.

Many Singapore residents and foreigners jumped to buy private homes in the high rent - low mortgage rate environment and a significant group of these buyers are investors hoping to rent their units to create a positive cash flow. In fact, even the owner occupiers add to supply of rental units since they are usually HDB owners who will rent out their HDB units once they move to their condo (or sell their HDBs to someone who will be removed from tenant demand).

The oversupply situation is much bigger if you look at overall new residential units: According to MND boss Mr Khaw Boon Wan, 197,559 new will be built by 2016! Almost 200,000:

How much is coming on stream?  Plenty!  Indeed, some 200,000 new housing units will be constructed – 80,000 private properties, 10,000 ECs and about 110,000 public housing. This is equivalent to the building of four new Ang Mo Kio towns by 2016!   And we are still building more.
Source : Enough Homes for All

Picture of Singapore home oversupply: Almost 200,000 private homes,
ECs and HDBs will be built by 2016.
Source : MND Blog

Even asking rents at older projects are being slashed:

Three-bedders at Dakota Residences at Old Airport Road, which received TOP in 2010, have been rented out for $4,700 to $5,000 a month, below landlords' expectations of $5,000 to $5,200, he said. Next door, at Waterbank@Da-kota, which was completed last month, rents for similar units have also been advertised for $4,700 to $5,000.
Source : The Straits Times, Wave of new condos drives down rents

But the rental demand is still high and increasing. Q2 2013 rental contracts were 16% higher than Q3 2013. According to experts, the increase can be due to demand for interim housing from home owners waiting for construction of their new homes to be completed and from those whose homes have been sold through collective sales. If this is the case, this demand will be reversed in the next few years as their units will be completed.

Singapore Home Loan Calculator with what-if feature launched

Current interest rates are artificially low thanks to giant money printing machines in major world economies. And although these ultra low rates stayed for a very long time to make some think that they will stay like this for ever, they wont. Worse, it may be very likely that ultra low interest rate period can bite us with a long term ultra high interest rates.

Anyway, when the interest rates will start to rise is a question but they will start to rise. And when they rises, things will be difficult. So it is more prudent to make your home loan calculations with some "what-if" in your mind.

Unfortunately, wxisting home loan calculators compare the interest rates for new home loans and refinancing with the current interest rates. Now FindaHomeLoan.sg develops the first of its kind Singapore “what-if” calculator, which takes into account the possibility of rising interest rates within the loan period.

Many are currently flocking to invest in the booming real estate markets in Singapore, especially with low interest rates. However, with so many financial institutions and home loan packages to choose from, it is also a challenge for buyers to apply for suitable home loans. It is from this predicament that the founders of home loan comparison website FindaHomeLoan.sg developed a groundbreaking comparison portal for comparing the best home loan rates from Singapore-based banks for properties in Singapore, Malaysia, Australia, United Kingdom and other countries.

“We recognized the gap in the market where property buyers might not be well-served in your interests. Not only is the portal free-to-use, our mortgage consultants will understand your needs and help you in deciding the choice of home loans, without advisory fees,” said Sean Lim, Founder of FindaHomeLoan.sg.

The portal boasts the most comprehensive home loan calculators available online, comparing rates for New Home Loans, Refinancing and a first ever “What-If” calculator.

The New Home Loan calculator allows users to choose properties by type and completion status, and then filters results by floating rates, fixed rates and interest offset rates. It then calculates monthly installments according to interest rates for each year, while most available calculators apply the first year rate to all subsequent years. This is designed to cater to the unique structure of home loans provided by banks in Singapore.

The calculator then groups the interest payable into 3 groups: year 1 to 3 and 1 to 5. This caters to short, medium and long-term investors. Extracting the most attractive features of each loan package, it then publishes a list of recommended loans based on lowest interest rates and popularity.

The Refinance calculator does all of the above in addition to calculating the potential savings accumulated on the monthly installments and interest payable.

The What-If home loan calculator is a first of its kind in Singapore, allowing users to do comparative calculations around fluctuating interest rates over the course of a housing loan. What happens when interest rates rise over the next two years? What if benchmark rates such as SIBOR or SOR inflate on the third year?

“These are the what-if scenarios buyers and investors often ponder upon. The What-If calculator helps you answer these questions independently and as a result, facilitate your decision on choosing the right home loan,” Sean added.

Tallest building in Singapore will be Tanjong Pagar Centre by GuocoLand

Tallest building in Singapore will be mixed use-development Tanjong Pagar Centre right above Tanjong Pagar MRT station. The plans for the building is unveiled today by Malaysian tycoon Quek Leng Chan's GuocoLand. This will be GuocoLand's first mixed-use development in Singapore.

290 metre Tanjong Pagar Centre will sit along Choon Guan Street, Peck Seah Street and the new Wallich Street in the heart of Tanjong Pagar, which has been earmarked for development as Singapore’s next business and lifestyle hub in the Central Business District. It will also be the gateway to the future waterfront city that will replace the existing Tanjong Pagar ports.

Tanjong Pagar Centre will include Guoco Tower, a 38-storey, Grade A office block and TP180, offering prestigious and limited collection homes above Guoco Tower. TP180 will be the tallest residences in Singapore, starting at 180 metres (equivalent to 50 residential storeys) and reaching up to 290 metres, offering unparalleled sea and city views. The integrated development will also contain six levels of premium retail and F&B space integrated with Tanjong Pagar MRT station, a luxury business hotel linked to the main tower.

“Tanjong Pagar Centre is GuocoLand’s first integrated mixed-use project in Singapore. Its fusion of premier office, retail, residential and hospitality spaces raises the bar for what is available in this part of the CBD. The richness of the historical district, park and landscape spaces will differentiate it from other commercial developments. We have set out to build a global icon that will position Tanjong Pagar as a premier quality business and lifestyle district in the CBD and be a benchmark for sustainable and liveable developments. As such, it will become one of the CBD’s and the region’s most sought-after addresses not only for work, but for live and play as well,” said Mrs Trina Loh, Group Managing Director, GuocoLand (Singapore) Pte Ltd.

Proposed Tanjong Pagar Centre is an integrated
development at Tanjong Pagar, a prime location
 within the Central Business District, and within 1.7
million square feet will  feature premier Grade A office
and retail space, an international hotel
and exclusive residential apartments

She added, “Tanjong Pagar Centre signals a transformed portfolio for GuocoLand in Singapore. It will expand our focus on commercial properties in Singapore, and reaffirms our position as a developer of large-scale integrated developments here and in the region.”

According to the press release by GuocoLand, Tanjong Pagar Centre is designed by architectural firm, Skidmore, Owings & Merrill (SOM) which is behind some of the world’s most iconic buildings such as Burj Khalifa in Dubai, Jin Mao Tower in Shanghai, and One World Trade Center in New York City. The design epitomises the concept of a vertical, liveable city that meets all the needs of urbanites in one location.

New private residential property sales down by 65 percent in February 2013

February private home sales took a 65% nosedive to 708 units.New private residential property sales in Singapore were sharply down from the 2,016 new homes in January 2015 to 708 units last month:

Singapore home sales plunged 65 percent last month after the government introduced its seventh round of cooling measures in January to cool home prices.

Home sales dropped to 708 units in February from a revised 2,016 units in January, according to data released by the Urban Redevelopment Authority today. Home sales reached 22,699 units in 2012, according to calculation by Bloomberg News based on the government data, which dates back to 1996. 

Singapore home prices reached a record in the fourth quarter amid low interest rates, raising concerns of a housing bubble and prompting the government to widen a four-year campaign to curb speculation prices in Asia’s second-most expensive housing market. Knight Frank Pte cut its estimates for new home sales for 2013 by 20 percent and expects annual sales to range between 12,000 and 14,000 units.
Source : Singapore February Home Sales Drop 65% After Government Measures

 Although the mainstream media attributed the decline to Chinese New Year holiday and February being a short month, the sharp decline came after new property market cooling measures of January 2013. The latest measures increased the stamp duty for home buyers by between 5 per cent and 7 per cent, with Singapore permanent residents paying taxes when they buy their first home. Singaporeans will also have the levy starting with their second purchase. Since a significant part of the home buying activity in Singapore is investment riding on low and saving punishing interest rates, the cooling measures may be starting to take effect:

“The government’s measures are starting to take effect,” said Vijay Natarajan, a Singapore-based analyst at UOB-Kay Hian Pte. “In addition, fewer units were offered because of the Chinese New Year. Over the coming months, I expect volumes to decline further.”
Source : Singapore February Home Sales Drop 65% After Government Measures

Knight Frank previously predicted that these new property policies could badly hurt investment demand.

Pipeline Supply of New Residential Units by Expected Year of Completion in Singapore

"Some 200,000 new housing units will be constructed – 80,000 private properties, 10,000 ECs and about 110,000 public housing. This is equivalent to the building of four new Ang Mo Kio towns by 2016!   And we are still building more", said  Minister for National Development Khaw Boon Wan in his blog post named "Enough Homes for All".

Indeed, according to a chart published in the blog post (below), total number of new residential units by 2016 will be 197,559! Most units are expected to be completed in 2016 with 42,318 HDB flats will be ready in that year.

In May 2011, new Minister for National Development Khaw Boon Wan changed almost a decade old practice of BTO (Built-to-Order) in public housing to Build-Ahead-of-Order. Since than around 25,000 public housing units are built each year.

In the same blog post Khaw Boon Wan also defended the latest and most comprehensive to date round of Singapore property cooling measures:

"Last week’s package of property cooling measures is necessary to soften the market.  The alternative of doing nothing, allowing the prices to run beyond economic fundamentals, will only invite a large and serious price correction in the future.  That will not do anyone any good.

The package was carefully formulated to protect first-timers. Investors buying additional properties may be disappointed but I hope they will in due course come to accept that the package will also be good for them.  In any case, many of the new measures are counter-cyclical in nature, to be lifted when the market regains its balance.

The market is temporarily not in balance because of under-building in the past, and high investment demand today.  But we have been ramping up supply and in 2, 3, and 4 years’ time, supply will have caught up with pent-up demand."

New Singapore Property Cooling Measures announced

Singapore Government has announced 7th round of property cooling measures with a joint press release issued by the Ministry of Finance, Ministry of National Development, Monetary Authority of Singapore and Ministry of Trade & Industry. These new property cooling measure will take effect on 12 January 2013:

Additional Measures To Ensure a Stable and Sustainable property market[1]

The Government announced today a comprehensive package of measures to cool the residential property market. It also introduced a Seller’s Stamp Duty on industrial properties for the first time, to discourage speculative activity in the industrial market.

Cooling Measures for the Residential Property Market


The Government has implemented several rounds  of  measures to cool demand and expand supply, so as to moderate the increase in housing prices. While these measures have dampened speculative buying, the  demand for residential property remains firm and prices have continued to rise.

The continued buoyancy of the property market reflects the very low interest rate environment and continued income growth in Singapore. These factors supported a record level of housing transactions last year, particularly from investment demand. Housing prices have also shown signs of re-accelerating in recent months, in both the private residential and HDB resale flat markets. Price increases, if not checked, will run further ahead of economic fundamentals and raise the risk of a major, destabilising correction later on.

The Government has  therefore decided to implement a further set of measures to cool the private and public housing markets.  These measures are calibrated to be tighter on property ownership for investment, as well as on  foreign buyers. To discourage over-borrowing, financing conditions for housing have also been tightened. In addition, structural measures have been implemented to strengthen the policy intent of public housing and executive condominiums.

Deputy Prime Minister and Minister for Finance Mr Tharman Shanmugaratnam said: “The reality we face is that interest rates are extraordinarily low, globally and in Singapore, and continue to add fuel to our property market. We have to take this further round of measures now, to check recent market trends and avoid a more serious correction in prices further down the road.”

Minister for National Development Mr Khaw Boon Wan said: “A large supply of public and private housing – up to 200,000 units in total – will be completed in the coming years. Coupled with the new measures, we will be better placed to ensure that housing remains affordable to Singaporeans.”

Measures Applicable to all Residential Property

The following measures will take effect on 12 January 2013:

a) Additional Buyer’s Stamp Duty (ABSD) rates will be: i) Raised between five and seven percentage points across the board. ii) Imposed on Permanent Residents (PRs) purchasing their  first residential property and on Singaporeans purchasing their  second residential property.

b) Loan-to-Value limits on housing loans granted by financial institutions will be tightened for individuals who already have at least one outstanding loan, as well as to non-individuals such as companies.

c) Besides tighter Loan-to-Value limits, the minimum cash down payment for individuals applying for a second or subsequent housing loan will also be raised from 10% to 25%.

The measures listed above will not impact most Singaporeans buying their first home. Some concessions will also be extended to selected groups of buyers, such as married couples with at least one Singaporean spouse who are purchasing their second property and will sell their first residential property.

These  new ABSDs and loan rules are significant, but  they are  temporary. They are being imposed to cool the market now, and will be reviewed in future depending on market conditions.

The details of the ABSD measure are set out in Annex I, and the housing loan measures, in Annex II.

Measures Specific to Public Housing


The Government  is  also  introducing measures to  further  moderate the demand for HDB flats, instil greater financial prudence among buyers, and require  owner occupation  by PR buyers. The following measures will take effect on 12 January 2013:

a) Tighter eligibility for loans to buy HDB flats: i) MAS will cap the Mortgage Servicing Ratio (MSR) for housing loans granted by  financial institutions at 30% of a borrower’s gross monthly income. ii) For loans granted by HDB, the cap on the MSR will be lowered from 40% to 35%.

b) PRs who own a HDB flat will be disallowed from subletting their whole flat.

c) PRs who own  a HDB flat  must sell their flat  within  six months  of purchasing a private residential property in Singapore.

Details of these measures are in Annex III.

An additional measure will take effect on 1 July 2013 to tighten the terms for granting HDB loans and the use of CPF funds for the purchase of HDB flats with remaining leases of less than 60 years  (details of this measure are in Annex IV).


Measures for Executive Condominium Developments
The Government will introduce measures specific to new EC developments to ensure that ECs continue to serve as an affordable housing option for middle income Singaporean families.

The following measures will take effect on 12 January 2013:
a) The maximum strata floor area of new EC units will  be capped at 160 square metres.

b) Sales of new dual-key EC units will be restricted to  multi-generational families only.

c) Developers of  future  EC  sale  sites from  the  Government Land Sales programme will only be allowed to launch units for sale 15 months from the date of award of the sites or after the physical completion of
foundation works, whichever is earlier.

d) Private enclosed spaces and private roof terraces will be treated as gross floor area (GFA). The GFA of such spaces  in non-landed residential developments, including ECs, will be counted as part of the ‘bonus’ GFA of a residential development and subject to payment of charges. This is in line with the treatment of balconies under URA’s current guidelines. Details of this measure are at www.ura.gov.sg/circulars/text/dc13-01.htm.

Cooling Measure for the Industrial Property Market: Seller’s Stamp Duty

Prices of industrial properties have doubled over the last three years, outpacing the increase in rentals.  In addition, there has been increasing  speculation  in industrial properties:  in 2011 and the first  eleven months of 2012,  about  15% and 18% respectively of all transactions of multiple-user factory space were resale transactions carried out within three years of purchase. This is significantly higher than the average of  about 10% from 2006 to 2010.

The Government is introducing Seller’s Stamp Duty (SSD) on industrial property to discourage short-term speculative activity which could distort  the underlying prices of industrial properties and raise costs for businesses.

The following SSD rates will be imposed on industrial properties and land bought and sold within three years of the date of purchase:

a) SSD at 15% if the property is sold  in the first year of purchase, i.e. the property is held for one year or less from the date of purchase.

b) SSD at 10% if the property is sold in the second year of purchase, i.e. the property is held for more than one year and up to two years from the date of purchase.

c) SSD at 5% if the property is sold in the  third year of purchase, i.e. the property is held for more than two years and up to three years from the date of purchase.

These SSDs will apply for industrial properties and land bought on or after 12 January 2013.

The Inland Revenue Authority of Singapore (IRAS) will be releasing an E-tax guide on the circumstances under which SSD is applicable and the procedures for paying SSD. The E-tax guide will be available at
www.iras.gov.sg.

[1] - Additional Measures To Ensure a Stable and Sustainable property market

Will property prices go up or down in 2013?

Most analysts predicted a price decline for 2012 and they seem to only differ in the magnitude of decline. But after rounds of property cooling measures, slowing economy and uncertainty in Europe, cheap credit and printed money fueled Singapore property bubble proves one common aspect of all asset bubbles: Asset bubbles do not end until the cheap and easy credit fueling them ends.

Here's what Mr. Propwise says in Singapore Property Weekly (issue 84) :

The question now hanging on most people’s minds is now: will property prices continue to rise in 2013? Certainly the re-acceleration of the PPI starting from the second quarter of 2012 was unexpected, but it should be noted that the 2.8% property price increase in 2012 is already a deceleration from the 5.9% in 2011 and 17.6% in 2012.


I believe that we will only see significant levels of price declines if there is an external crisis to cause a sense of panic, which we had in each of the previous three declines (e.g. Asian Crisis, Dotcom Bubble, Global Financial Crisis). This is because the abundant global liquidity situation and sustained low interest rates will continue to support Singapore property prices in the meantime.


The Straits Times Index (STI) has recovered to 3,167 points as of end December 2012, up 17.8% for the year and 3.6% versus the last quarter. If you believe that the stock market is a leading indicator for the property market, then we could see continued support for property prices in the coming quarters.

Singapore private property and HDB's resale prices up in Q4 2012. The overall private residential property index rose from 208.2 points in 3rd Quarter 2012 to 211.9 points in 4th Quarter 2012. This translates into an increase of 1.8%, compared to the 0.6% increase in the previous quarter. HDB Resale Price Index jumped to 202.9, a 2.5% increase over 3rd Quarter 2012. This is on the top of 2% quarter-on-quarter jump in Q3 2014. The increase to 202.9 in Q4 2012 also points to a 6.56% year-on-year increase compare to last year Q4, when index was at 190.4.

Singapore private property and HDB's resale prices up in Q4 2012

Urban Redevelopment Authority (URA) and Housing Development Board (HDB) have released flash estimates for Q3 2012 price indexes for Singapore private residential property and HDB resale flats.

Singapore residential property prices increase has accelerated to 1.8% q-o-q

According to URA flash estimates for 4th quarter 2012, which are released today, The overall private residential property index rose from 208.2 points in 3rd Quarter 2012 to 211.9 points in 4th Quarter 2012. This translates into an increase of 1.8%, compared to the 0.6% increase in the previous quarter. For the year 2012 as a whole, prices of private residential properties increased by about 2.8% (based on preliminary 4Q2012 flash estimate), lower than the 5.9% increase in 2011.

Prices of non-landed private residential properties increased by 0.8% in Core Central Region in 4th Quarter 2012, compared to an increase of 0.1% in the previous quarter. Prices in Rest of Central Region increased by 0.9%, compared to the 0.8% increase in the previous quarter. For Outside Central Region, prices increased by 3.4% in 4th Quarter 2012, compared to an increase of 1.0% in the previous quarter
Source : URA releases flash 4th quarter 2012 private residential property price index

URA’s flash estimates are compiled based on transaction prices given in caveats lodged during the first ten weeks of the quarter. The actual quarter statistics will be updated four weeks later.

HDB resale price index jumped 2.5% in the last quarter

Well you can call it a jump indeed: According to HDB’s flash estimate of the 4th Quarter 2012, HDB Resale Price Index jumped to 202.9, a 2.5% increase over 3rd Quarter 2012. This is on the top of 2% quarter-on-quarter jump in Q3 2014. The increase to 202.9 in Q4 2012 also points to a 6.56% year-on-year increase compare to last year Q4, when index was at 190.4. (Flash Estimate of 4th Quarter 2012 Resale Price Index)

See also Will property prices go up or down in 2013?

When Singapore property prices will fall?

Singapore private residential property prices in Singapore have risen 56 percent since 2009 and most analysts expect this upward trend to continue into 2013 even a flood of completed units are entering the market and economic outlook is gloomy.

Although Singapore's private home sales sharply declined in October and November 2012 (44 percent month-on-month fall in November), these were declines from very high sales figures. So total sales in 2012 are sharply up compared to the all year sales in 2012.

So when will Singapore property prices fall? The answer is actually simple, when the main fuel in the fire dries up: cheap, printed money! So Singapore property prices will decline when the interest rates goes up (even to the normal levels) or maybe the economic condition deterioration accelerates. On the other hand, a large inflow of completed supply will probably not result in fall in prices alone but will at best keep the prices flat.
A large supply of newly completed residential property combined with slower influx of immigration will depress rental yields. In fact, plagued with a high number of new properties entering into market and less number of tenants to taking them up, average unit monthly rent dropped by 1.0%, from $3.88 psf in Q3 to $3.84 in the first two months of Q4 2012.

But low interest rates will still give property investors holding power even if this means more properties will stay vacant. In fact, vacancy rate is increasing. It has climbed to 5.9% in Q2 2012 and from there climbed up to 6.1% in Q32012. The rate will probably increase more as more and more units are entering market to compete for demand which is almost completely fed by immigrant foreigners.

Singapore private residential properties Vacancy Rate against the Property Price Index (PPI)
Source : Vacancy Rate and PPI

And this is where the danger is: It is highly probable that property investors will hold onto their investments as the yield detoriates and they will probably do this even the cash-flow from property turns negative (rents fall below monthly mortgage payments). And at this situation, when interest rates increase even to normal historic levels or economy significantly goes down and retrenched foreigners leave Singapore, investors will fall into a large negative cash flow situation. Since 37% of private residential property in Singapore were sold to foreign and local investors in the first 9 months of 2012 alone, many investors who keep more than 1 property will feel the heat. And with an already slowly bleeding cashflow, they may suddenly rush to exit door altogether.

Disclaimer

This blog article is to provide general information only and should not be treated as an invitation to buy or sell any property or as sales material.  Users of this report should consider this report as a one of the many factors in making their investment decision. Users should make reference to other sources of information and specific investment advice to obtain a more objective view of the property market. Asia Singapore shall not be responsible for losses suffered.

Singapore private residential property prices were falling for five quarters

As people continue to ask will Singapore property prices rise or fall in 2013, something which looks certain was questioned last week: Singapore property prices rose in 2012! According to a report published last week, this is not true and the prices fell indeed! Last Wednesday, The Global Property Guide published a report which claimed that private home prices in Singapore, once adjusted for inflation, have fallen for five consecutive quarters. The Global Property Guide used property price data from the Urban Redevelopment Authority (URA) of Singapore and data for consumer price index (CPI) from Statistics Singapore. The company looks at inflation adjusted private property price index instead of nominal price index which is used to assess the direction of property prices in  most reports and news.

Below table is from Property Guru (Home prices fall for five quarters claim is true). Although all quarters registered a nominal increase year-on-year (5th column), the Singapore private residential property prices fell y-o-y in the past 3 quarters, sharpest registered as -3.1% in Q2 2012. And quarter-on-quarter, private property prices have fallen in the last 5 quarters.

Singapore private property index (nominal & inflation adjusted)
Source - Property Guru

In Singapore, house prices continued to fall as government market-cooling measures took effect. During the year to Q3 2012, house prices dropped 2.88 percent after falling 3.14 percent in Q2 and 1.36 percent in Q1 2012. House prices fell 0.34 percent during the latest quarter, Singapore 's fifth consecutive quarter-on-quarter house price decline.

Source : Asian property markets show signs of weakness

Resale non-landed private residential property prices increased 5.4% in a single quarter

It seems like sky is the limit for the credit fuelled Singapore property bubble. According to SRX Residential Property Flash Report, resale non-landed private residential property prices increased 5.4% in a single quarter in the first two months of Q4 2012, compared to the previous quarter. The prices have climbed 4.5% in Outside Central Region (OCR).

All regions have outperformed the previous quarter. Outside Central Region (OCR) led the gain with a 4.5% increase over Q3, followed by Rest of Central Region (RCR), which saw a 3.3% increase. 

The Core Central Region (CCR) gained 2.8%. This quarter, CCR transactions, which have higher PSF than that of other regions, represent a bigger proportion of total transactions than seen in previous quarters. 

Transaction volume continues to increase. Comparing the first 2 months of Q3 and Q4, transaction volume rose by 6% in Q4 to hit 2,483 resale transactions in the Oct-Nov period.

Source :  Prices of resale homes rocket to historic high $1,222 psf

Rental market was a completely opposite story. Plagued with a high number of new properties entering into market and less number of tenants to take them up, Average unit monthly rent dropped by 1.0%, from $3.88 psf in Q3 to $3.84 in the first two months of Q4.

Gross rental yield fell to a 6-year historic low of 3.77% in Q2 2012 due to fast price increase and drop in rents.

On the public resale flat side, HDB median resale price hit a new record of $455,000. Overall cash-over-valuation (COV) went up to $34,000 in the first two months into 4Q 2012:

This is $2,000 shy of the 5-year historical high of $36,000 COV attained in 2011Q3 since tracking began in 2007. On a month-to-month basis, overall COV increased from $33,000 in Oct to $35,000 in Nov. 

The highest COV with at least 10 contracts signed among all property types in all towns is for HDB 4-room flats in Queenstown. Median COV in the first 2 months of Q4 is $76,250. The higher COV helped to push overall HDB median resale price to a new historical high of $455,000. This represents a 1.1% increase from 3Q's $450,000. 

Overall HDB median rents remained unchanged at $2,400.
Source : HDB median resale price hits $455,000 

HDB has launched 6,463 BTO flats for sale on November 21st 2012

Housing Development board (HDB), the statutory board of the Ministry of National Development responsible for public housing in Singapore, has launched 6,463 units of Studio Apartments, 3-, 4- and 5-room flats in various locations today. The flats are in seven new Build-To-Order projects – Keat Hong Mirage in Choa Chu Kang, Compassvale Mast and Rivervale Delta in Sengkang, Fengshan GreenVille in Bedok, Ghim Moh Edge in Queenstown, Joo Seng Green and Toa Payoh Crest in Toa Payoh.

With these flats, total number of new BTO (public housing units) released will be 27,084, which is the largest BTO supply in a year since the system was introduced in 2002. Add the 7,153 Sale of Balance flats released in March 2012 and September 2012, HDB has launched a total of 34,237 public housing flats this year.

In January 2013, HDB will offer about 3,320 BTO flats in Ang Mo Kio, Choa Chu Kang, Hougang, Kallang Whampoa, Tampines and Yishun. HDB is planning for at least 20,000 BTO flats in 2013.

BTO stands for Build-To-Order and the system originally released projects after a predefined number of preorders were collected (this build to order). But since last year, in response to a severe public housing supply crunch, HDB has changed strategy to release BTO flats without waiting for the orders or ahead of the orders.

Artist's impression of Fengshan GreenVille in Bedok,
one of the BTO projects, launched in November 2012

According to HDB's press release, first-timers will continue to have priority flat allocation with at least 95% and 85% of the BTO flat supply (excluding Studio Apartments) set aside for them in mature towns and non-mature towns respectively. The Multi-Generation Priority Scheme (MGPS) will be available to those applying for flats at Fengshan GreenVille, Ghim Moh Edge and Toa Payoh Crest. Elderly flat owners in Bedok, Queenstown and Toa Payoh will also enjoy doubled balloting chances under the Ageing-In-Place Priority Scheme (APPS) when they apply for a Studio Apartment in Fengshan GreenVille, Ghim Moh Edge and Toa Payoh Crest.

In The Multi-Generation Priority Scheme (MGPS), married individuals can submit a joint application with their parents to purchase a studio apartment or two-room flat with another flat of at least two rooms in the same project. In The Ageing-in-Place Priority Scheme (APPS), elderly flat owners get doubled balloting chances.

Applications for new flats launched can be submitted online from today, 21 Nov 2012 (Wednesday) to 27 Nov 2012 (Tuesday).