Singapore Property Weekly Issue 218

8/20/2019 Singapore Property Weekly Issue 218

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Issue 218Copyright © 2011-2014 www.Propwise.sg. All Rights Reserved.

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CONTENTS

p2 5 Reasons Why It’s Still a Terrible Time to

Buy Singapore Property

p7 Singapore Property News This Week

p11 Resale Property Transactions

(July 8 – July 14 )

Welcome to the 218th edition of the

Singapore Property Weekly .

Hope you like it!

Mr. Propwise

FROM THE

EDITOR

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SINGAPORE PROPERTY WEEKLY Issue 218

Page | 2Back to Contents

By Gerald Tay (guest contributor)

Tempted to buy a property due to the falling

prices? Think again. In this article I will go

through five reasons why I think it’s still a

terrible time to buy Singapore property.

1. Property prices are still high for mass

market homes

Since Q1 2009, prices in the Core Central

Region (CCR) have risen 30 percent,

42 percent in the Rest of Central Region

(RCR), and 60 percent in the Outside Central

Region (OCR).

5 Reasons Why It’s Still a Terrible Time to BuySingapore Property


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Since the peak in Q3 2013, prices of mass

market homes have fallen a measly 5.5

percent. Properties in the OCR are still

overpriced. Mass-market home prices haven’t

dropped as much as those for luxury housing.Rental incomes are falling and vacancy rates

are rising. A huge oversupply is looming on

the horizon.

The bottom is still far from sight even though

vested players claim it will happen in the next

three to six months. While new home sales

have dropped significantly, prices have

stayed relatively high due to developers’

holding power.

There is still room for a further decline o

property prices in the OCR. Investmentopportunities will arise over the next couple o

years when prices decline further.

My last purchase of a Singapore residential

property was in mid-2012 before the policies

came in. I won’t be re-entering the Singapore

residential market until I see a further decline

in prices. Prices need to drop by about 20 to

30 percent to make residential investments

attractive again, not a measly 5.5 percent!

2. Interest rates are low but rising

Property prices rose as interest rates fell, and

property prices will fall if interest rates

rise with a weakened economy.

The way to win the game is to have cash on

hand to buy at a low price when others

cannot borrow very much because of high

interest rates and the constraint of the debt

servicing ratio. Then you get a low price, and

you get capital appreciation caused by future

interest rate declines. To buy an expensive

property or believe in the fallacy of

“affordable” property at a time of low (and

rising) interest rates and high prices is a

mistake.


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It is far better to pay a low price with high

interest rates than a high price with low

interest rates, even if the mortgage payment

is the same either way.

3. Government property curbs are here to

stay

Many are betting on a removal of the cooling

measures. I don’t see the government

removing property curbs for the next two

years. With interest rates on the way up,there will be pressure. The policy is working,

there is no reason whatsoever for the

government to relax it.

When stringent property curbs are here to

stay, this only means property prices are still

high.

4. Buyers are still biting the marketers’

bait

The problem with buyers who act like

lemmings is that they become obvious targets

for clever marketers. In today’s property

market, how does a seller of real estate use

human weaknesses to sell and profit?

Here’s a case study from the latest property

launch near Seletar:

The Solution – Sell, market and lure

“desperate” buyers with under $1,000 per-

square-foot on average condominium units to

beat the TDSR (Total Debt Servicing Ratio).

The Outcome – 1,110 lemmings rushed to

snap up smaller units with empty cheques

and balloting. 78% of project was sold within

a weekend.

The Profits – 1,400 small unit apartments arecramped into every space possible.

This new successful sales model will soon be

copied by other developers. As long as foolish

buyers keep biting,


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sellers will continue to sell to them. Watching

others get rich during boom times while you

don’t is terrible enough. Lemmings want it

now and that’s why they are prime targets

today.

5. We may have an even greater financial

crisis coming

Look for falling oil prices and another scare in

China to spook the speculators, followed by a

series of growing defaults like in 2008, butorse. They’re also kidding themselves if

they think they can stop everybody from

selling their stocks (look at China).

And expect the global crash that follows to be

even more brutal thanks to all the financial

manipulation in the system. But even beyond

a global stock bubble, housing bubble,

fracking bubble, and pension problems, there

are signs of economic destruction across the

world.

The air has been let out of China’s stock

market. Commodity prices are down acrossthe board to the detriment of the world’s

emerging markets. Long-term interest rates

are rising despite global efforts to suppress

them with continued stimulus. Europe is

enlarging the black hole of Greece by

funnelling even more money into it. The eurozone as a whole has an unemployment rate

over 10%.Japan is caught in a downward

demographic spiral.

Chaos is erupting. And despite efforts to stop

the global economic system from melting

down, free market forces are finally starting toshow governments and central banks who’s

in charge. That’s the simple, bitter truth of it.


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Inaction for now is the best action for savvy

buyers and investors. Many are tuned in to

the devastating market forces ahead. Those

who are listening will be the best prepared.

Those who have been patiently waiting on theside-lines and preparing themselves to take

advantage of the coming crisis will be best

rewarded.

For the buyers of today, I wish them luck.

By guest contributor Gerald Tay, who is thefounder and coach at CREI Academy Group

Pte Ltd , an organization dedicated to

empowering retail property investors with

smarter investing philosophy and strategies.

He is a full-time investor with over 13 years of

solid experience in building his wealth

through Property Investment and is financially

wealthy today.

SINGAPORE PROPERTY WEEKLY I 218

http://www.crei-academy.com/http://www.crei-academy.com/http://www.moneymatters.sg/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/


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Singapore Property This Week


ResidentialSentosa bun gal ow aski ng for $2,325 psf

A sea-facing bungalow at Sentosa is asking

for $2,325 psf. An expression of interest

exercise has been launched. The property

hich consists of 10,754 sq ft of land has a

99-year leasehold tenure that starts from

2005. The building has two storeys and a

basement. Steve Tay from Newsman Realty

believes that the unique location of the

bungalow and its large size will be key selling

points.(Source: Business Times)

HDB resale prices fal l by 0.4% in Q2

According to data from HDB, resale prices

have fallen by 0.4% in Q2 this year from the

previous quarter. Market experts believe that

prices will soon stabilise as the price fall in Q2

this year was the most moderate in the past

eight quarters of decline. As resale

transaction increases 27.8% quarter-on-

quarter to 5,286 units, market experts believe

that the low prices are attracting buyers.

Mohammed Ismail from PropNex believes

that prices will continue to fall despite

showing signs of stabilising. Nicholas Mak

from SLP International added that the resale

price index may fall by up to 3.5% for thewhole year. He believes that HDB resale

prices may start increasing if the government

cuts the supply of BTO flats.

(Source: Business Times)

SINGAPORE PROPERTY WEEKLY I 218


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H ig h v ac an c y r at e d u e t o o v er s u p p ly o

p r i v a te h o m e s

Vacancy rates have increased due to an

oversupply of private homes. Based on data

from the URA, the volume of private home

transactions in the primary and secondary

markets have also increased in Q2 from Q1.

Ong Teck Hui from JLL believes that given the

current rate of price declines, it may take

another one to two years before a 10 to 15percent fall in prices is observed. The

vacancy rate for completed private homes

has increased to 7.9% in Q2 from 7.2% in

Q1. Wong Xian Yang from OrangeTee said

that the increase in vacancy rate was most

extensive in the north-east region of Singapore, where the vacancy rate had

increased by 6% in Q2 from the previous

quarter.


Commercial

Q 2 c e n t r a l r e g i o n o f f i c e r e n t a l i n d e x f a l l s

by 2.6%

In Q2 this year, URA’s central region officerental index fell by 2.6% from the previous

quarter. This marks the first drop after eight

consecutive quarterly increases. Not only so,

this was the steepest fall in the index since

Q4 2009. According to Christine Li from

Cushman & Wakefield, the declining economymay have resulted in the fall in rental index in

the central region. Li added that about four

million sq ft of prime office spaces will be

completed in 2016, thus pushing rental prices

down. Nonetheless, the net increase in office

demand doubled to 38,000 sqm in Q2 thisyear from 19,000 sqm in the previous quarter.


SINGAPORE PROPERTY WEEKLY Iss e 218


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Q 2 i n d u s t r i a l p r i c e s a n d r e n t a l s e a c h f a l l

by 0.7% from Q1

Data from JTC showed that industrial prices

and rentals have both fallen by 0.7% in Q2

from Q1 this year. This translates to a 0.9%

fall in industrial prices year-on-year, and a

2.7% fall in rents year-on-year, in Q2 this

year. The fall in prices and rentals had been

attributed to an increase in industrial land

supply and a weakening economy. DesmondSim from CBRE added that the labour crunch

had also impacted the market for industrial

spaces. Occupancy rates are expected to be

pushed according to JTC as more industrial

spaces will be provided in 2015 and 2016.

Particularly in 2016, 2.8 million sqm of industrial land is expected to be completed.


158 Cecil Street sold for $2,100 psf

According to the Business Times, the 14-

storey building on 158 Cecil Street has been

sold for $2,100 psf or $240 million. The

building has a lettable area of 115,000 sq ft

and has a balance lease term of about 65

years. The building had undergone a major

revamp several years ago. Bank of India and

Zurich insurance are expected to retain its

existing premises in the building.(Source: Business Times)

Retai l rents expected to fal l i n H2

In the second half of the year, retail rents are

expected to fall as vacancy rates shoots up,

said Knight Frank. Not only so, an increase insupply of retail space in major malls over the

next four years is expected.



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To generate revenue while mall owners try to

search for long term tenants, mall owners will

be issuing short-term leases. Knight Frank

predicts that the average rent in Singaporewill fall by 3 to 5% due to the expected

increase in supply of new retail space this

year. About 3.7 million sq ft of net lettable

retail space is expected to be completed from

2015 to 2019.



http://propertymarketinsights.com/


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Non-Landed Residential Resale Property Transactions for the Week of Jul 8 – Jul 14

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

1 THE SAIL @ MARINA BAY 678 1,315,320 1,940 99

1 THE SAIL @ MARINA BAY 667 1,270,000 1,903 99

3 RIVER PLACE 786 985,000 1,254 99

4 CARIBBEAN AT KEPPEL BAY 1,335 1,950,000 1,461 99

4 TURQUOISE 2,185 2,900,000 1,327 99

5 LANDRIDGE CONDOMINIUM 1,905 2,350,000 1,233 FH

5 BAYVILLE CONDOMINIUM 893 965,000 1,080 FH

5 VISTA PARK 969 888,000 917 99

5 PARK WEST 1,894 1,330,000 702 99

5 PARK WEST 1,894 1,320,000 697 998 KERRISDALE 1,281 1,580,000 1,233 99

8 STURDEE VIEW 1,475 1,390,200 943 FH

9 SCOTTS SQUARE 635 2,175,358 3,425 FH

9 CAIRNHILL RESIDENCES 1,163 2,550,000 2,194 FH

9 THE COSMOPOLITAN 1,399 3,000,000 2,144 FH

9 VIDA 527 1,090,000 2,067 FH

9 SKYLINE 360 @ SAINT THOMAS WALK 2,131 4,091,520 1,920 FH

9 MACKENZIE 88 420 745,000 1,775 FH

9 PARC CENTENNIAL 1,163 1,630,000 1,402 FH10 ARDMORE PARK 2,885 9,300,000 3,224 FH

10 ARDMORE PARK 2,885 8,300,000 2,877 FH

10 SPRING GROVE 1,012 1,500,000 1,482 99

10 PALM SPRING 1,055 1,500,000 1,422 FH

Postal


Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

10 SIXTH AVENUE VILLE 1,550 2,088,000 1,347 FH

10 THE BALMORAL 3,132 4,100,000 1,309 FH

11 EVELYN MANSIONS 797 1,200,000 1,507 FH

11 ROSEVALE 1,313 1,900,000 1,447 FH

11 THE SPINNAKER 1,378 1,750,000 1,270 FH

11 MIRO 1,345 1,500,000 1,115 FH

12 8 RAJA 2,024 2,650,130 1,310 FH

12 TREVISTA 1,281 1,550,000 1,210 99

14 VACANZA @ EAST 840 1,050,000 1,251 FH

15 THE SEA VIEW 1,647 2,620,000 1,591 FH15 ONE AMBER 1,324 1,920,000 1,450 FH

15 THE MAKENA 1,582 2,120,000 1,340 FH

15 CASA MEYFORT 1,765 2,250,000 1,275 FH

15 COTE D'AZUR 1,324 1,638,000 1,237 99

15 CRYSTAL RHU 1,270 1,560,000 1,228 FH

15 HAIG COURT 1,076 1,200,000 1,115 FH

15 OCEAN PARK 2,110 2,320,000 1,100 FH

15 DUNMAN VIEW 1,249 1,265,000 1,013 99

15 PINEHURST CONDOMINIUM 1,593 1,310,000 822 FH16 WATERFRONT KEY 1,356 1,570,000 1,158 99

16 RIVIERA RESIDENCES 1,216 1,399,999 1,151 FH

16 BREEZE BY THE EAST 1,776 2,000,000 1,126 FH

16 COSTA DEL SOL 1,345 1,510,000 1,122 99



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NOTE: This data only covers non-landed residential resale propertytransactions with caveats lodged with the Singapore Land Authority.Typically, caveats are lodged at least 2-3 weeks after a purchasersigns an OTP, hence the lagged nature of the data.

Postal


Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

16 COUNTRY PARK CONDOMINIUM 1,356 1,445,000 1,065 FH

16 THE BAYSHORE 1,184 1,050,000 887 99

19 AMARANDA GARDENS 1,163 1,530,000 1,316 FH

19 PRIMO RESIDENCES 495 630,000 1,272 FH

19 PIN MANSIONS 1,238 1,200,000 969 FH

19 RIO VISTA 1,798 1,388,880 773 99

19 RIO VISTA 1,238 950,000 767 99

20 RAFFLESIA CONDOMINIUM 1,195 1,268,000 1,061 99

20 GRANDEUR 8 1,421 1,450,000 1,021 99

20 BRADDELL VIEW 1,561 1,200,000 769 99

21 1 KING ALBERT PARK 1,173 1,350,000 1,151 FH

22 THE LAKEFRONT RESIDENCES 506 780,000 1,542 99

23 HAZEL PARK CONDOMINIUM 1,518 1,408,000 928 99923 TREE HOUSE 2,917 2,570,000 881 99

23 PARKVIEW APARTMENTS 1,119 835,000 746 99

25 PARC ROSEWOOD 603 725,000 1,203 99

25 PARC ROSEWOOD 603 720,000 1,194 99

26 CASTLE GREEN 1,152 1,020,000 886 99

27 THE SENSORIA 1,270 1,060,000 835 FH

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