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PRIVATE property owners may soon have to pay to repair leaky sewers on their premises, Minister for the Environment and Water Resources Yaacob Ibrahim said yesterday.

‘About half of the sewers in Singapore are private sewers that perform the function of channeling used water from individual premises into the public sewers,’ Dr Yaacob said.

‘Used water that leaks out will find its way into the water bodies . . . creating aesthetic and possible health problems.’

The Public Utilities Board (PUB) will conduct free checks on the condition of private sewers, he said. ‘Should repairs be needed, PUB will help to defray part of the costs.’ PUB’s director of policy and planning Tan Yok Gin said the cost will vary widely, depending on the scale of repairs involved and the amount of subsidy from PUB.

‘For landed premises we expect them to cost maybe about $2,000 and for high-rise buildings, it may cost around $20,000,’ he said. ‘But anyway, these are just estimates because until we actually get the work carried out we don’t really know how much it will cost.’

PUB said that for an average high-rise building with 100 units, the estimated per-unit cost should repairs be required would be $200. The amount of subsidy will depend on the length of the affected sewers, Mr Tan said.

He said that under the Sewerage and Drainage Act, owners are responsible for maintaining sewers on their property. Work will begin in the Rochor canal area because the sewers there are some of the oldest in Singapore, he added.

Source : Business Times - 29 Aug 2006

Eight such homes resold for 20% gain in past 12 months

Some rich people are getting richer by selling their new Good Class Bungalows (GCBs) for a quick profit.

An analysis of caveats by Savills Singapore revealed that eight such properties were bought and resold at an average profit of about 20 per cent in the past 12 months.

And considering that GCBs now easily cost upwards of $10 million, the investment returns are attractive.

A caveat is a legal document lodged with the Singapore Land Authority by a purchaser to protect his/her interests after an option to purchase is exercised or a Sales & Purchase Agreement is signed.

According to the caveats lodged, one GCB in Peirce Road was bought eight months ago for $4.3 million and resold three months later for $9 million.

Another in Queen Astrid Park was bought for $12.5 million and resold a month later for $16 million.

Steven Ming, director of Savills’ GCB arm Prestige Homes, said the number of ‘quick sales’ has increased since the property market started to pick up but added: ‘A point to note is that it does not make up a lot of transactions.’

GCBs are located in designated areas, mostly in District 10, and have to be on a plot of at least 15,000 sq ft. There are about 2,500 such homes here.

Savills’ analysis did not include detached houses on plots of less than 15,000 sq ft. As such, it does not include the many new houses coming up at Sentosa Cove or ordinary detached houses that may sit on land as small as 4,300 sq ft up to 15,000 sq ft.

Mr Ming estimated that about 10 per cent of recently transacted GCBs have been bought and resold within a year, with an increasing number bought by permanent residents. So far this year, there have been 68 transactions.

The ‘quick sales’ - Mr Ming believes ’speculation’ is too strong a word - can mostly be attributed to opportunistic selling.

‘Some buyers went into the market one or two years ago without anticipating that prices would increase,’ he said.

But with his 12-month projection of a further 10-15 per cent increase in prices for GCBs - similar to that for high-end condominiums - more may see GCBs as a lucrative investment.

Giving an insight into GCB buyers, Douglas Wong, associate director of Knight Frank’s GCB arm Regal Homes, said the pool of buyers is very small.

‘There are probably between 800-1,000 such buyers and many of them own more than one GCB. Some own three to four,’ he said.

Mr Wong also believes that ’speculator’ is not the right term for these investors. ‘They are not really speculators because it’s not easy to speculate in this segment,’ he said, referring to the big price tags.

Mr Wong, who has been in this market for close to 10 years, believes that these buyers are long-term investors.

Still, he too has seen some ‘quick sales’ recently, saying that one GCB in the Nassim area was recently sold for $15 million by a buyer who paid $9.8 million for it a year ago.

Perhaps the surest sign that the GCB market is hot must be that the first collective sale could take place soon.

Credo Real Estate is marketing a 26,254 sq ft GCB site in Bin Tong Park, and Credo managing director Karamjit Singh said the owners of the neighbouring GCB are keen to cash out too, so much so that they are prepared to either sell part of their own land or even the whole plot as a ‘collective sale’.

The two GCBs combined could yield enough land for a total of three GCBs, so even if the present owners choose to stay, they could sell one house for $11-13 million.

Mr Singh estimated that the potential return on such a development could be 20-30 per cent, ‘which is not bad’, he said.

Source : Business Times - 28 Aug 2006

It’s first bank here to extend such loans to older homeowners; other banks not keen to join race

Catering to the needs of Singapore’s ageing population, OCBC Bank has become the first bank here to offer reverse mortgage loans, joining pioneer, NTUC Income, which has been offering such loans for several years. A reverse mortgage is a special type of loan homeowners can take against their home, which enables them to convert their home-equity into cash.

Other banks here have no immediate plans to offer reverse mortgages - and some bankers think there is not much demand for the product.

Tan Chia Seng, Citibank Singapore’s business director for secured assets group, said: ‘As our existing suite of mortgage offerings meets the needs of our customers, we have no immediate plans to introduce reverse mortgage packages.

‘The feedback from our regular conversations with customers, either directly or via market research, indicates that customers who may have a need to unlock the cash value of their properties usually prefer to do so by downsizing to smaller properties.’

Koh Kar Siong, managing director of secured loans at DBS Bank, said: ‘We have been monitoring the development and business opportunity closely. There are currently more popular alternatives available to the older homeowners who require cash.’

Mr Koh said older homeowners can, among other things, consider taking out mortgage term loans, downgrading their property, sub-letting or renting.

Kevin Lam, head of the loans division at United Overseas Bank, said: ‘We will monitor the demand for reverse mortgages.’

NTUC Income, which introduced a reverse mortgage scheme for private properties in January 1997, has about 350 reverse mortgage policy-holders for private properties. In March, following the government’s announcement to allow HDB flat owners to obtain reverse mortgages, NTUC Income started to offer such mortgages for HDB flats. And so far it has approved 10 such mortgages for HDB flat owners.

Melissa Yam, senior manager at NTUC Income, said: ‘Reverse mortgages allow our customers to continue to stay in their homes, enjoy capital appreciation on their property and help them cover day-to-day expenses.’

OCBC’s scheme is for private properties, and there are term-based and annuity-linked options.

For the term-based option, customers receive a monthly payout for up to 25 years or when they reach 90 years of age, whichever is earlier. The bank has the right to sell the property at the earlier of the end of the term of the loan or when a customer reaches 90.

Those concerned about outliving the payouts can choose the annuity-linked option, under which monthly payouts continue until death.

The term-based and annuity-linked options are priced at annual interest rates of 5 per cent and 4.88 per cent respectively. These rates are not guaranteed and can change over time, depending on how interest rates here move.

Taking the maximum financing quantum of 70 per cent on a property valued at $500,000 and free of encumbrances, the monthly payout is $823 for a 20-year loan. Using the same example, the monthly payout is $670 during the first 10 years and $557 subsequently under the annuity option.

‘We recognise that with longer life expectancy, many senior citizens are concerned about the rising cost of living and reduced income streams during retirement,’ said Gregory Chan, head of consumer secured lending at OCBC, who sees reverse mortgage loans providing an additional option for senior citizens.

‘We don’t see a big influx into reverse mortgages,’ he said. However, he believes the time is right to launch the reverse mortgage product because there is now greater awareness of retirement planning. Mr Chan thinks reverse mortgage loans can be useful for Singaporeans who are asset rich but cash poor. To be eligible for a reverse mortgage loan from OCBC, applicants must be Singapore citizens or permanent residents, aged 65 years and above and must own or co-own a private property with a remaining lease of at least 45 years at the end of the loan tenure.

Customers who might want to change their mind about reverse-mortgaging their property can unwind the arrangement by repaying the bank in full the money received from the reverse mortgage. A penalty fee of $500 is payable should this happen in the first five years of the reverse mortgage.

Source : Business Times - 28 Aug 2006

Retired nurse claims there is a conflict of interest

PUSHING two trolleys full of court documents, 80-year-old Chow Ai Hwa arrived at the Strata Titles Board yesterday morning to contest the collective sale of her Napier Road estate, Eng Lok Mansion.

Dressed in a blue floral blouse and blue skirt, Madam Chow asked two of the five members of the tribunal hearing her case to disqualify themselves because of a conflict of interest.

She did not want Mr Tay Kah Poh on the panel as he had been a director at Knight Frank - Eng Lok’s managing agent - for 12 years before he left the property consultancy firm a year ago.

Nor did she want the board’s deputy president, Mr Alfonso Ang, to preside over her case as he had been with law firm Shook Lin & Bok in 1996. Madam Chow said the firm had acted for her estate years ago when it failed in its other attempt at a collective sale.

But both men declined to disqualify themselves.

Mr Tay said his former employers Knight Frank did not have anything to do with Eng Lok’s collective sale. It was CB Richard Ellis which had brokered the deal.

Mr Ang left Shook Lin & Bok ‘many, many years ago’ and his old firm was not involved in any way in the current sale.

But Madam Chow shook her head, saying: ‘I don’t believe your explanations. There’s still feelings, relationships between all of you.’

The hearing had to be delayed for an hour yesterday as Madam Chow decided at the last minute that she needed a Chinese translator.

The retired nurse is trying to block the sale of her estate, located beside Gleneagles Hospital, which was sold in March to Napier Properties for a then record price of $138 million.

Apart from claiming the estate could have been sold for double that amount, Madam Chow is also objecting as she feels her late husband’s spirit still visits her and if she moves away, he would not know where to find her.

Madam Chow was the first owner of her unit, paying $40,000 for it 37 years ago. She also acts for her son, who owns another unit but works overseas now.

The two are the only hold-outs in the 64-unit estate. All the other residents have agreed to the deal, which would net them $2.156 million each.

About 10 of them turned up for the hearing yesterday, hoping to see the last stumbling block to the lucrative deal fall.

But they will have to wait another two weeks for the next hearing as yesterday’s session could not finish by 1pm.

Madam Chow kept talking and interrupting the tribunal, leading Mr Ang to say: ‘Madam, let me finish talking or we’ll never finish.’

At one stage, he had to tell her to sit down five times before an agitated Madam Chow stopped talking and took her seat.

Lawyer David De Souza, who acts for Eng Lok, said the estate had followed all the correct procedures for the collective deal.

As for Madam Chow’s request that she be given an apartment at the new development, Mr De Souza said the sales agreement stated that former residents of Eng Lok had first priority to buy a unit at the new estate.

Source : Sunday Times - 27 Aug 2006

These are typically leasehold homes in large projects located in areas like Loyang and Jurong

IF YOU ARE scouting around for a two- to three-bedroom apartment and think you can afford only a Housing Board (HDB) flat, it is time to think twice.

Property agents say there are many old private apartments selling for about the same price as a large HDB flat.

But these are typically older, 99-year leasehold properties located in far-flung corners of Singapore such as Bukit Panjang, Loyang and Jurong. They also tend to be in fairly large developments.

For example, in June, a 1,485 sq ft unit in Loyang Valley condominium in Loyang Avenue was sold for the fairly modest price of $320,000. That translates to about $215 per sq ft (psf) for a three-bedroom unit in a project which has a lease of about 75 years left.

‘It’s a very reasonable price,’ said PropNex Realty’s senior division director, Mr Eric Cheng. ‘A lot of people are focusing on freehold properties and neglecting the 99-year leasehold ones. But when the market picks up, prices of leasehold properties will also rise.’

Average prices of a three-bedroom unit at the 362-unit Loyang Valley are about $380,000 to $420,000, which translates to less than $300 on a psf basis, he said.

This compares with about $390,000 on average for a 1,572 sq ft to 1,625 sq ft executive HDB flat in Pasir Ris.

In fact, an executive HDB flat in Pasir Ris was sold for $440,000 in June. ‘The monthly maintenance fees for large, older projects are usually around $200 to $250 on average. It is not very much more than the combined service and conservancy charges and parking fees for an executive flat,’ said Mr Cheng.

Over in the Bukit Panjang area, the 636-unit Maysprings condominum in Petir Road also has units going for less than $400,000. In June, a 1,291 sq ft unit there was sold for $380,000 or about $294 psf.

It is easier to find cheaper apartments in bigger projects simply because there is more competition among the sellers.

Bargains can be found in quality projects, which are sometimes small ones. But these properties are likely to be old, in a not very convenient location or in a less desirable residential neighbourhood such as Geylang, agents said.

Bayshore Park, for one, may have some bargain apartments, said Mr Colin Tan of property consultancy Chesterton International. While it is a fairly old property with about 75 years left on its lease, it has spacious grounds and sea views from units on the higher floors, he said.

Other fairly large projects that may turn up some bargains include the 950-unit Parc Oasis at the junction of Boon Lay Way and Jurong Town Hall Road and the 645-unit Regent Heights in Bukit Batok.

Ageing 99-year leasehold apartments remain attractive to those who are keen to soak up the lifestyle of a private home but have a limited budget, agents said.

‘If you get a private apartment instead of an HDB flat, you may have to compromise on amenities such as food outlets and accessibility but you gain on privacy and facilities such as swimming pools,’ said Mr Cheng. ‘If you don’t mind the compromises, there are a lot of good buys out there. You just have to look around.’

Source : Sunday Times - 27 Aug 2006