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PRICE increases for high-end homes in the central areas may be easing, but not so for homes on the city fringe and suburban apartments - where prices are still rising strongly.

Urban Redeveloment Authority figures showed growth in the prices of uncompleted apartments in the central areas slid from 7.8 per cent to 7.6 per cent from October to December. Price increases for city fringe units, on the other hand, rose from 7.6 per cent to 8.3 per cent.

Growth in the prices of uncompleted apartments in suburban areas also crept up to 9.2 per cent from 9.1 per cent.

Dr Chua Yang Liang, head of research, South-east Asia, at Jones Lang LaSalle, said home prices in the suburbs would keep growing by 24 per cent to 26 per cent this year. This would be supported by home owners looking for new homes after being disloged by collective sales.

Last year, 14,811 new homes were sold.

Mr Li Hiaw Ho, executive director of research at CB Richard Ellis, meanwhile, expects price rises and sales volume to moderate this year.

‘Luxury prices are likely to stabilise at current levels, while mid-tier and mass market prices may have the potential to rise by 10 per cent to 15 per cent,’ he said.

Source : Straits Times - 26 Jan 2008

EXPATRIATES and other tenants in private apartments can finally start to breathe easier. Data from the Urban Redevelopment Authority released yesterday showed a subsiding of the sharp rise in rentals for condos in key areas.

Rentals for non-landed property in the coveted core central region, which covers Tanglin and Bukit Timah, for instance, grew just 5.3 per cent, less than half the rate of 12.2 per cent achieved in the third quarter.

The drop in rental growth was not as dramatic for the rest of the central region, though, which slid from 11.9 per cent to 8.8 per cent, and outside the central region - from 11.8 per cent to 8.5 per cent. Overall rents of private homes grew 6.8 per cent from October to December, slowing from an 11.4 per cent rise in the previous period. For the whole of last year, private home rentals surged 41.2 per cent.

Mr Nicholas Mak, the head of research and consultancy at Knight Frank, expects private homes rentals to rise in a more ‘tamed manner’ of 10 per cent to 15 per cent this year.

Still, Ms Tay Huey Ying, director for research and consultancy at Colliers International, reckons rentals of luxury homes will rise by 25 per cent to 30 per cent this year.

Meanwhile, rentals for the HDB market continued to grow strongly.

The median rent for a four-room flat rose from $1,400 to $1,500 in the fourth quarter, while that for a five-room unit also grew $100 to hit $1,700.

From October to December, 3,300 flat owners were given approval to rent out their flats. The total number of flats being rented out rose 7 per cent to 17,400 in that period.

The chief executive of property agency PropNex, Mr Mohamed Ismail, expects rentals to rise by 15 per cent to 20 per cent for the whole of this year, as expats pushed out by high rentals for condo units look for cheaper options.

Source : Straits Times - 26 Jan 2008

RESPITE may be in sight for those who have been griping about the surging cost of doing business in Singapore.

Latest figures show that the increases in the cost of shops and offices eased in the fourth quarter of last year, in line with a general slowdown in the property market.

Prices and rentals for these commercial properties soared for most of last year, especially for office space, which reached an all-time high amid an acute short supply.

This prompted complaints from businesses and sparked off worries about Singapore’s competitiveness.

But official data released by the Urban Redevelopment Authority yesterday may finally calm these jitters.

Rentals for offices rose by 10.9 per cent between October and last month, down from 14.8 per cent in the previous three months - which was a decade-high jump, said Mr Li Hiaw Ho, the executive director of CBRE Research.

The slowing could be ‘the initial sign that the numerous efforts by the Government to cool the sector are taking effect’, said Ms Tay Huey Ying, the director of research and consultancy at Colliers International.

These moves include releasing more land for offices as well as immediate steps such as short-term leases in existing buildings and temporary office plots.

Colliers’ own data shows that office tenants are becoming increasingly resistant to further rent rises. Rents for office space in several areas, including Grade A buildings in Raffles Place, have seen declining growth rates for the past two to three quarters, said Ms Tay.

She said this is because firms are more willing to explore alternative business space locations, including business parks and high-tech industrial space.

For the whole year, rentals for office space jumped by 56.1 per cent. The rental index is now at an all-time record of 175.1 points, said Mr Li.

Ms Tay expects growth to moderate next year as tenants hold out for the expected large new supply in 2010. She is forecasting a rise of up to 20 per cent for Grade A office space.

As for shops, the rise in rentals has all but peaked. Overall rentals rose by 0.6 per cent in the fourth quarter, compared with 8.1 per cent in the previous quarter.

In Orchard Road, rental growth was almost flat at 0.3 per cent in the quarter. Shops on the fringes saw slightly higher growth, but suburban retail space did the best with a 1.3 per cent rise.

For the whole year, shop rents rose by 18.2 per cent.

But landlords wanting to raise rents this year are likely to face strong resistance from retailers, said Mr Nicholas Mak, the director of research and consultancy at Knight Frank.

‘With the projected large supply coming on stream next year, retailers would have more space choices and would resist large increments in retail rents.’

He expects rents to increase by 5 to 10 per cent for this year.

Source : Straits Times - 26 Jan 2008

Try for flats in newer towns for a higher chance of success

Letter from Ignatius Lourdesamy
Acting Deputy Director (Marketing and Projects) for Director (Estate Administration and Property)
Housing and Development Board (HDB)

I REFER to the letter from Lim Jie Yi, “A young S’porean’s housing dilemma” (Jan 5). Ms Lim applied for a 4-room flat under HDB’s Build-to-Order (BTO) exercise for Telok Blangah Towers in October last year.

Her application qualified for first-timer priority as well as the Married Child Priority Scheme (MCPS), which meant that it enjoyed four times as many chances under the ballot as regular applicants without priority.

However, there were altogether close to 1,000 other first-timers who also qualified for MCPS, and who were vying for the 210 units of 4-room flats offered under this exercise. In total, HDB received more than 6,000 applications for these 4-room flats.

Given the overwhelming number of applicants for this BTO exercise, there would be many disappointed first-timers and MCPS applicants in spite of the additional priority accorded them.

While HDB understands the desire of flat buyers to purchase a new flat in mature HDB towns, it is not possible to satisfy this overwhelming demand as there is limited land available in these locations for building new flats.

For those who wish to buy a HDB flat in a popular HDB town, we would like to advise them to consider the option of buying a resale flat.

Eligible first-timers can enjoy a CPF Housing Grant of $30,000 when they purchase a resale flat, or a higher grant of $40,000 if they are buying a unit with their parents or near their parents’ home.

Alternatively, they may want to consider applying for a new HDB flat in one of the newer towns such as Punggol and Sengkang, where the chances of being successfully shortlisted are higher.

Source : Weekend Today - 26 Jan 2008

Property developer Wing Tai has reported a 25 percent rise in half-time earnings to S$105 million.

This is due mainly to higher contributions from the sale of its condominium projects.

Revenue fell 52 percent to S$211 million.

In the second quarter, earnings fell 19 percent to S$44 million, following a 59 percent fall in the topline figure to S$111 million.

Wing Tai did not give a guidance on its outlook, but said it would monitor the market closely in light of the volatility.

Source : ChannelNewsAsia - 25 Jan 2008