Singapore Property News This Week #220

Residential

July HDB resale price down by 0.5%

According to SRX Property’s flash estimates, HDB resale prices fell by 0.5% month-on-month from June to July. Market experts believe that the resale flat market is stabilising. Overall, there is a 0.4% fall in resale prices in Q2 according to HDB. The discrepancies between SRX and HDB’s calculations suggest that there may be uncertainty in the market, said Ong Kah Seng from R’ST Research. Nonetheless, Eugene Lim from ERA Realty believes that the drop in prices is not severe and is likely to be due to month-to-month fluctuations. Based on SRX’s sub-indices, HDB resale prices in non-mature estates fell 0.9% compared to 0.1% in mature estates last month. The volume of HDB resale flats also fell from 1,709 units in June to 1,552 units in July—a 9.2% fall in transaction volume.

(Source: Business Times)

23 units at Draycott Eight expected to be sold for more than $150m in total

In a bulk sale, 23 units at Draycott Eight are expected to be sold for more than $150 million or $2,200 psf based on the total strata area of 68,419 sq ft. The site has a balance lease term of 81 years. The sale of Draycott Eight is expected to be effected through the sale of shares. The development comprises of 136 units across three blocks of 24 storeys each. According to the Business Times, the seller will be making a loss as the site was bought at $2,600 psf about eight years ago. Based on Knight Frank’s latest Prime Global Cities Index, which tracks luxury residential property prices, Singapore had the largest year-on-year fall in luxury home prices among the 35 cities covered in the index. Overall, luxury residential property prices fell by 15.2% year-on-year, in June this year. In H1 this year, Singapore saw a 7.9% fall in luxury home prices. Alice Tan from Knight Frank said that the fall inprices is due to the persistently weak sentiment in the luxury residential market.

(Source: Business Times)

Home ownership in Singapore changes in the last 50 years

In the last 50 years, the government has always strived for 100% home ownership in Singapore, said the Business Times. However, market experts believe that more measures need to be looked into as Singaporeans are starting to own more than one house. Tan Tiong Cheng from Knight Frank said that some buyers may speculate and may punt on property as there is limited land in Singapore. Opportunities for speculation arise as there are limited housing options in Singapore and price changes are faster than in other countries, said market experts. Tan added that foreign investments also lead to speculation, which may result in an upwards pressure on HDB resale prices. Market experts believe that the implementation of cooling measures such as the additional buyer’s stamp duty has managed to keep prices in check.

(Source: Business Times)

Commercial

Hongkong St shophouse sold for $14.45 million

A shophouse at Hongkong Street has changed hands at $14.45 million, or $1,780 psf based on a gross floor area of 8,100 sq ft. The shophouse has a 99-year lease that was topped up in 2007. The site has been zoned for commercial use under URA’s Master Plan 2014. The site is expected to be refurbished and to be used for F&B operations. According to Knight Frank, shophouse transactions have been affected by buyer-seller price gap. Mary Sai from Knight Frank said that sellers are unwilling to lower prices due to the rarity value of shophouses. Yet, buyers are unable to match that high price due to the implementation of cooling measures such as the total debt servicing ratio framework which restricts buyers’ abilities to afford pricey purchases.

(Source: Business Times)