Singapore Property News This Week #210

Residential

First smart HDB launches in Punggol

In this month’s build-to-order exercise, the first smart HDB home has been launched. Located at Punggol, Northshore Residences I and II consist of 12 blocks. Of the 1,402 units available, 546 are two-bedders, 112 units are three-bedders, 519 units are four-bedders and 225 units are five-bedders. The project is slated to be completed in 2020. After a $60,000 grant, the two-bedders are priced from $28,000, the three-bedders are priced from $132,000; the four-bedders cost $249,000; and the five-bedders are priced from $354,000. Market experts expect that there will be high application rates as the four- and five-room flats are cheaper compared to resale flats that are of similar sizes in the vicinity. The HDB project will serve as a test-bed for smart technology such as a smart car park management system and a waste conveyance system.

(Source: Business Times)

9,431 HDB flats launched for sale

9,431 flats were launched for sale in this month’s build-to-order (BTO) and sale of balance flat (SBF) exercise. Online applications for this month’s BTO and SBF will cease on June 2. Market experts believe that Clementi Crest will draw high interest due to its prime location, and close proximity to retail amenities and the MRT Station. Also, market experts believe that Northshore Residences I & II will be a hot favourite among buyers as it is reasonably priced and will feature the use of smart technology. Eugene Lim from ERA Realty believes that the BTO prices for Clementi Crest may be perceived as high. This is because four-room flats at Clementi Crest have been priced from $478,000, and five-room flats have been priced from $576,000. According to Lim, 99-year leasehold condo units in the West Coast are priced below $1 million for two-bedroom units and $1 million for three-bedroom units, as such, buyers may perceive the BTO prices for Clementi Crest as high. Also, the record number of units released this month is expected to affect resale demand in May and June, said Lim.

(Source: Business Times)

Prices of completed non-landed private homes fell by 0.1% in April

According to flash estimates by NUS, prices of completed non-landed private homes have fallen by 0.1% in April from the previous month. The sub-index for central region has also fallen by 0.1% in April from March. However, the sub-index for the non-central region remained the same. Ong Kah Seng believes buyers are cautious about being completed properties in April as more new projects are expected to be completed in the coming months. However, since the fall in prices has been subtle, market experts believe that buyers are still interested in the resale market, despite competition from developer projects. Ong added that the profile of buyers for resale properties differ from buyers for developer sales. Typically, buyers for resale properties require a unit immediately while buyers for developer sales can afford to wait, said Ong. As such, the market for developer sales may not be a direct competitor of the resale market.

(Source: Business Times)

OrangeTee: proximity to MRT station may not impact rental yields

According to a study by OrangeTee, projects that are located near to MRT stations may not result in higher rental yields. Of the 34 projects in the study, 20 which were identified to have high rental yields were not within 400 meters of the MRT station. Particularly, 56% of the projects that were identified to have high rental yield were located outside the central region. Of the projects that were identified to have high rental yield, 12 percent of them were located in the core central region while 32 per cent were located in the rest of central region. According to the study, rental yields in the outside central region may be higher due to lower prices. The study also showed that leasehold properties were the most attractive in the rental market as a 99-year leasehold property usually has lower relative psf upon purchase compared to a freehold property.

(Source: Business Times)

Overall rents expected to fall by 5% to 7% in 2015

According to CBRE, the overall rent is expected to fall by 5% to 7% this year. Not only so, the total leasing volume is also expected to fall by 5% to 10% for the rest of the year. This is due to a surge in the number of new homes completed in 2015. According to the Business Times, 10.4% more homes will be completed this year, up from the 19,921 homes completed in 2014. CBRE added that in the central region, the leasing climate will be competitive. In Q1 this year, there was a 3.1% quarter-on-quarter increase in lease commencements to 15,229 units. This is 13.5% higher than the lease volume in Q1 last year. The average rent for luxury homes remained at $4.95 psf per month in Q1 this year according to CBRE. However, the average rent for homes in the rest of the prime districts has fallen by 1.1% quarter-on-quarter to $4.55 psf per month in Q1 this year. Also, the average rents for the rest of the island fell by 1.6% quarter-on-quarter to $3.15 psf per month in the same period of time.

(Source: Business Times)

Freehold site at Ridout Rd expected to be sold for more than $90m

A 73,277 sq ft freehold site at Ridout Road is expected to be sold for more than $90 million, or $1,288 psf. According to the Business Times, this would be the biggest transaction in a Good Class Bungalow Area, as the price is higher than the previous record of $87.5 million that was set in 2001. Currently, the freehold site consists of a two-storey bungalow that has a two single-storey outhouse and an open field. However, the site may be redeveloped into as many as four smaller plots of land that are at least 1,400 sqm. Only Singaporeans are allowed to purchase landed homes in Good Class Bungalow Areas following a change in policy in 2012.

(Source: Business Times)