SGHOUSING.COM 新加坡房地产网

I WONDER how many Singaporeans are aware they cannot use their CPF savings to pay their housing loan fully.

I did not realise this until I received a letter from the authorities earlier this month which said we could not withdraw more CPF funds to pay for our flat.

Thus, the balance had to be serviced in cash even though we still make monthly CPF contributions.

The reason given by the CPF Board is as follows (quoted from a letter sent to us after repeated appeals to the CPF Board via our MP):

‘The primary objective of CPF is to help members save for old age. We must balance the home ownership objective with the retirement objective. This is done by capping the withdrawal of CPF for a property up to the Valuation Limit (VL), that is the purchase price of the property . Once members have withdrawn their CPF up to the VL, they can only withdraw further CPF if they can set aside Minimum Sum cash component in their CPF Special and Ordinary accounts, this amounts to $120,000.’

Can an exception be made for young couples like us who have many other commitments - young children, aged retired parents - and as a result are not cash-rich at present.

What is more, we have many more years to save towards retirement.

Can we therefore be allowed to service our housing loan fully via CPF, given that this is our first flat?

Lim Keng Chiew

Source : Straits Times - 28 Jan 2008

Subsale activity slowed in Q4; rising rents defined 2007.

The level of speculative activity in the private property market, as measured by the extent of subsales, slowed considerably in Q4 last year, especially in the Core Central Region (CCR), according to the latest official data.

Islandwide, subsales as a percentage of total private housing sales fell from 14.4 per cent in Q3 last year to 10.7 per cent in Q4, while in the CCR, the hotbed of speculation, the subsale percentage fell from 24.8 per cent to 18.6 per cent over the same period. Property consultants attributed the drop to uncertainty about the financial markets as well as the withdrawal of the deferred payment scheme in October 2007.

Reflecting the current housing shortage, the stock of completed private homes increased by just 1,448 units last year - the smallest rise in at least 12 years. The stock had increased by 4,008 units in 2006, 7,453 units in 2005, and 10,969 units in 2004.

Rents of condos and apartments rose significantly last year - by 42.3 per cent in CCR (comprising the prime districts 9, 10, 11, Downtown Core and Sentosa), an even higher 47 per cent in the Rest of Central Region (RCR), and 41.9 per cent in Outside Central Region (OCR).

‘Looking back at 2003/2004, developers were cautious and there were not many housing starts. So three or four years down the road, we’re seeing a fall in terms of new home completions,’ DTZ executive director Ong Choon Fah explains. ‘Of course there have also been a lot of en-bloc sales in the past two years and some of these properties have been demolished,’ she adds.

‘The situation is even more severe in the prime areas, and we’ve been seeing a lot of expats fanning out from the prime districts to RCR, to rent private homes, which probably explains why the increase in non-landed rents was steeper in RCR compared to the CCR,’ Mrs Ong explains.

With many private residential projects likely to be completed only in late 2008 and 2009, property consultants including Knight Frank managing director Tan Tiong Cheng expect rentals for non-landed properties to increase further this year. The rise could be less steep - perhaps 20 per cent, or around half the rate of increase for last year.

Yesterday’s data on the private property market by Urban Redevelopment Authority showed that the overall price index for private homes rose 6.8 per cent in Q4 over the preceding quarter, slower than the 8.3 per cent hike in Q3. For the full year, the index was up 31.2 per cent, three times the 10.2 per cent rise in 2006.

In terms of regions, the price index for non-landed private homes in CCR rose 7.5 per cent in Q4, more measured than the 8.3 per cent gain in Q3. Price indices for RCR and OCR advanced 7.7 per cent and 7 per cent respectively in Q4, slightly more modestly than in Q3.

For the whole of last year, the non-landed home price index for CCR rose 32.7 per cent, while RCR and OCR indices were up 30.4 per cent and 26.4 per cent respectively.

Developers sold a record 14,811 private homes last year, surpassing the previous high in 2006 by 32.9 per cent. They launched a total of 14,016 units in 2007, 26.6 per cent above the 2006 figure and also a new high.

Knight Frank director (research and consultancy) Nicholas Mak predicts that URA’s overall private residential property price index will rise at a more sluggish pace - around 10-15 per cent - this year, as buyers become more prudent.

Colliers International director (research and consultancy) Tay Huey Ying reckons that subsales as a percentage of total private homes sales islandwide will continue trending down in the coming months, to average about 8 per cent for the whole year, as the market moves to a ‘healthier and more sustainable set of fundamentals’.

Less speculation could also slow the hike in home prices, she says. ‘As a result, developers are less likely to bid aggressively for development sites and this will affect the success rates of collective sales,’ she adds.

Some seasoned market players are predicting that home prices in CCR could take a hit of up to 10 per cent this year; those in RCR will be flat, perhaps rising slightly; while OCR will post the biggest gains of about 10-15 per cent.

‘There’s significant supply of projects for launch in CCR, and that will weigh down on prices. Foreign buying will thin because of the financial market turmoil which is hitting high-net-worth bankers and others,’ a veteran industry observer suggests.

BT learnt yesterday that the release of the high-profile Marina Bay Suites, which was initially slated for the end of this month, has been delayed till after the Chinese New Year festivities - by which time the Budget should also be announced and hopefully lift sentiment.

Source : Business Times - 26 Jan 2008

WING Tai Holdings yesterday reported a 19 per cent year-on-year drop in net profit to $43.6 million for its second quarter ended Dec 31, 2007, while revenue plunged 59 per cent.

Q2 sales for the property group came to $110.7 million, while earnings per share were 5.81 cents - down from 7.47 cents.

The Q2 earnings brought first-half net profit attributable to shareholders to $105.35 million, a rise of 25 per cent, even though revenue fell 52 per cent to $210.9 million. The results included a $27.5 million gain from the disposal of available-for-sale financial assets.

The company attributed the lower half-year sales to smaller contribution from the development properties division.

Revenue on development properties for the current period was mainly from the units sold in The Riverine by The Park, The Meritz and The Lakeside.

The profits recognised from these three projects contributed to its operating profit of $70.1 million - down 37 per cent from $110.5 million a year ago.

However, the company was helped by a more than three-fold jump in the share of profit of associated and joint venture companies, which lifted half-year net income.

The share of profit from associates and joint ventures rose from $23.2 million in the previous corresponding period to $75.9 million, due to the higher contributions from VisionCrest and Casa Merah projects in Singapore.

Wing Tai said that in view of volatility in the current market, it will continue to monitor the property market closely.

New residential projects for sale in the current year will be released at an opportune time.

Yesterday, Credit Suisse issued an ‘underperform’ on the stock, with a price target of $2.48.

The shares ended trading yesterday at $2.30 - up 6 cents from previously.

Source : Business Times - 26 Jan 2008

THE Ascott Group, Asia’s biggest operator of serviced apartments, yesterday said that its fourth-quarter profit more than tripled on the back of divestment gains.

Net profit for the three months ended Dec 31, 2007 rose to $45.4 million from $13.6 million a year earlier. Q4 earnings per share rose to 2.8 cents, from 0.9 of a cent a year earlier.

The company is recommending a total cash dividend of six cents a share, including a bonus dividend of 4.8 cents.

Ascott’s performance was boosted by the divestment of the Somerset Bayswater property in London, which gave it a net gain of $17.8 million. The company also saw some gains from the sale of a golf course in Guangzhou.

Q4 revenue rose 14 per cent to $116.5 million, from $102.1 million a year earlier, as Ascott benefited from increases in revenue per available unit and better fee-based income.

Related links: Click here for Ascott’s news release Financial results Presentation slides

During the quarter, Ascott’s property portfolio also crossed the 20,000-unit mark for the first time. The company added 3,528 units to its stable, taking the total number of serviced residence units under its management to 20,449. Ascott plans to have to have 25,000 apartments in Asia, Europe and the Gulf region by 2010.

For the whole of 2007, Ascott’s net profit rose 8 per cent to $177.3 million, from $163.6 million in 2006. Revenue for the full year rose 7 per cent to $435.3 million, from $405.9 million previously.

Ascott will continue to grow its portfolio, said chief executive Jennie Chua yesterday. ‘I think crossing the 20,000-mark makes us the largest owner-operator of serviced residences in the world. We will continue to grow, in the right cities and the right locations.’

Ms Chua aims to expand Ascott’s presence in South-east Asia, China, India and Europe. For South-east Asia, Vietnam and the Philippines are particularly attractive, she said.

In a separate statement, Ascott said that it would invest A$136.2 million (S$170.4 million) to develop a 398-unit property in Melbourne’s central business district. The investment amount includes land and building costs. The property will be Ascott’s first Citadines-branded serviced residence in Australia, the company said.

Ascott’s parent company, CapitaLand, made a general offer for Ascott on Jan 7 in a deal that values the serviced residence company at $2.8 billion.

CapitaLand, South-east Asia’s largest property firm by market value, owns 66.5 per cent of Ascott and intends to pay up to $989.5 million - or $1.73 a share - for the remaining shares in Ascott to take the company private. Ascott’s shares closed one cent lower at $1.72 yesterday.

Source : Business Times - 26 Jan 2008

Median cash over valuation amount up a third; trend filters to outlying areas.

BUYERS of resale Housing Board (HDB) flats paid a median amount of $22,000 in cash over the property ’s valuation for their new homes from October to last month, a whopping 30 per cent rise from the previous quarter.

The good news for HDB flat owners in outlying areas is that this trend is filtering outwards towards them from the most popular districts downtown.

HDB data released yesterday showed that 86 per cent of all resale transactions in the fourth quarter of last year required cash payments over valuation, up from 80 per cent in the previous quarter.

However, greater resistance from buyers to the surging prices of resale flats last year resulted in a 13 per cent drop in the number of flats sold, to 6,700. For the whole of last year, 29,436 flats changed hands.

In fact, despite the overall rise, the median cash over valuation (COV) of some units in traditionally more popular estates such as Queenstown actually dropped. The median COV for a five-room flat in that area, which hit $110,000 in the July to September period, actually shrank to $79,000 in the period after that - albeit off a high base.

This, said the assistant vice-president of ERA Singapore, Mr Eugene Lim, showed the extent of the current market resistance towards high COVs.

‘Very often, the deal cannot be closed or takes much longer to close because of unrealistic sellers demanding high COV transactions,’ he said.

The chief executive of PropNex, Mr Mohamed Ismail, said another reason for this phenomenon is that the number of flat buyers with thick wads of cash in hand - mostly due to the collective sales of their private homes - is shrinking.

Most people buying HDB flats rely heavily on home loans to finance their purchase.

Resale prices of HDB flats rose 5.7 per cent during the quarter to bring the year’s growth to 17.5 per cent.

Last year’s growth is the biggest in a decade but property agents are not expecting a repeat for now as the HDB is offering at least 4,500 new flats for the first half of this year to calm buyers worried that housing is growing out of their reach.

These flats, which are highly subsidised, have an advantage over resale flats because they do not require buyers to fork out cash over valuation.

While ERA’s Mr Lim expects the price of resale flats to grow by 5 to 8 per cent this year, Mr Ismail reckons it would move by about 10 per cent.

Mr Ismail pointed out: ‘The economy is still doing well. And the labour market is tight.’

Source : Straits Times - 26 Jan 2008