Singapore Property News This Week #180

Residential

Tharman: Home prices not corrected enough yet

While HDB resale prices and private property prices have been adjusting in the last four to five quarters, Deputy Prime Minister and Finance Minister TharmanShanmugaratnam said that the price correction mechanism is still working to reverse the effects of the sharp increase in property prices in the past years. He said that if property prices are left unchecked, they would have increased in excess of household incomes. Nonetheless, Minister Tharman said that the risk profiles of borrowers have improved as the share of borrowers taking up multiple housing loans have fallen to 13 percent of new housing loans in Q2 this year, as compared to the 30 percent in 2011. The average tenure of new private housing loans has also declined to about 25 years, instead of 30 years in 2012. According to the Urban Redevelopment Authority, private property prices have decreased by 0.7 percent in Q3 this year, compared to the previous quarter. This was the fourth quarter that prices have fallen.

(Source: Business Times)

URA approves 2 mega private residential projects

URA has approved two mega private residential projects in Q3 this year. These mega private residential projects are expected to house at least 1,000 units each. GuocoLand will be developing a 99-year leasehold site at Sims Drive into a 1,024 unit condominium called Sims Urban Oasis. The site at Sims Drive was purchased by the developer in April this year for $530.89 million or $688 per square foot per plot ratio (psfppr). The site is almost 2.4 hectares large. The other mega private residential site that has been approved is located at Upper Serangoon View. Located on two adjacent river-fronting sites, Kingsford Waterbay will be developed into a 1,165 unit condominium. The land parcel was purchased at $460.4 million by Kingsford Property Development or $522 psfppr in November 2013.

(Source: Business Times)

Lake Life opens for public viewing

Lake Life, an executive condominium that is located at Jurong Lake District, has been opened for public viewing. Units are priced at an average of $857 per square foot. The 546 units executive condominium has been opened earlier for public viewing as its developer had expected large crowds. A two bedroom unit is priced at $685,000; a three-bedroom unit is priced at $898,000 while a three-bedroom premium unit will cost around $984,000. Four bedroom units are expected to be priced around $1.07 million; and a four-bedroom premium unit will cost slightly more at $1.088 million. Five-bedroom units will be priced at an average of about $1.388 million. Evia Real Estate, which is leading the consortium of developers for Lake Life, said that prices for the executive condominium have been priced high due to the high land price. Developers expect to break even with costs at $800 psf.

(Source: Business Times)

PPHS HBD flats increased by 800 units

In addition to the current supply of 1,150 HDB flats under the Parenthood Provisional Housing Scheme (PPHS), the government will increase flats under the PPHS by another 800 units, said Minister for National Development Khaw Boon Wan. This will be done to ease rental expenses for couples who can co-rent the units. The PPHS was introduced in 2013 to provide first-timer married couples with children below 16 years old an affordable temporary housing while they wait for their HDB flats to be completed. Since its introduction, the scheme has been extended to include married couples, with or without children, who are waiting for the completion of their Build-to-order flats or their Sale of Balance flats.

(Source: Business Times)

Commercial

PayaLebar Central site released for tender

URA has launched a site at PayaLebar Central for mixed development. The site has a gross floor area of 164,794 square meters. About 55 percent of the maximum gross floor area will be allocated for office use while the remaining space will be developed into retail, entertainment, F&B and residential use. URA intends to limit the number of strata lots at the site to just five. Thus, the average strata office size is expected to be around 200,000 square feet. Since the strata units are larger, market experts believe that developers will have better control over the mix of tenants and may be better able to attract major tenants like banks. Nonetheless, Ong ChoonFah from DTZ said that with bigger strata units, only deep-pocketed investors will be able to finance such projects. Thus, Chris Archibold from JLL said that he expects the site to be priced around $700 to $850 psfppr. However, Donald Han from Chestertons expects more bids for the site. He believes that there will be at least six bids for the project, of which at least three bids would be more than $1,000 psfppr. The tender for the PayaLebar Central site will cease on March 31 2015.

(Source: Business Times)

JTC launches 3 sites

Three sites have been launched for tender by JTC. Of the three sites, two have been released on the confirmed list while one will be launched on the reserved list. The two sites on the confirmed list include sites at Tuas South Street 9 and TanjongPenjuru; while the reserve list site is located at Tuas South Street 7. The site at Tuas South Street 9 is 0.8 hectares large and has been zoned for business-2 development. It has a tenure lease of 20 years and 7 months. On the other hand, the TanjongPenjuru site has a maximum gross plot ratio of 2.5 and has a tenure lease of 20 years. The Tuas South Street 7 site is only 0.5 hectares large but has a 20 year 4 month tenure. The tender for the sites are expected to close on December 23.

(Source: Business Times)