Higher, 95% of flats reserved for first-timers

Nov 17, 2009

Higher, 95% of flats reserved for first-timers

HDB increases their chances of getting a home

By Jessica Cheam

THE Housing Board (HDB) has moved to address mounting concern about inadequate flat supply by upping the first-timer's success rate for getting a flat and by launching more than 1,000 homes for sale in Punggol.

With immediate effect, the Board has increased the number of flats reserved for first-timers at its sales launches from the current level of 90per cent to 95 per cent.

This applies to both its build-to-order (BTO) scheme - which provides the bulk of HDB flats and where units are built when a certain demand is reached - and the sale of balance flat (SBF) exercise, which typically offers ready flats across the island.

Flats offered in the latter exercise are highly popular given that buyers do not have to wait for homes to be built and are given access to a wide variety of locations.

HDB said yesterday its move was designed to 'give greater priority to first-timers, who generally have more urgent housing needs than second-timers'.

'HDB will monitor the demand situation closely and make adjustments where necessary,' it added.

The Board first introduced this scheme for first-timers in August 2007 to prevent them from being crowded out of the then-booming market.

Prior to that, there was no quota and first-timers were balloted along with everyone else.

The scheme also gave a leg-up to applicants who had tried and failed in four or more ballots by favouring them in BTO project ballots. (see below)

Yesterday's move by the HDB is a response to those first-time home buyers who fear missing out on the chance to buy a property because of historically high resale flat prices - they rose 3.8per cent in the first nine months of the year - and a perceived supply shortage.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak, an industry observer, believes the HDB is likely responding to feedback that young couples cannot afford resale flat prices.

'In this case, they are reserving so many flats for first-timers so they can ensure affordability,' said Mr Mak, who added that the HDB's decision might help shift some demand away from the resale market to demand for new flats directly from HDB.

PropNex chief executive Mohamed Ismail does not see the HDB's five-point increase having a major impact on the market, but said it clearly demonstrated that first-timers and not upgraders were being given priority for new flats.

'It is a clear signal that the current concern is to provide a roof for all young couples,' he said.

The HDB yesterday unveiled 1,078 new standard flats for sale at Punggol Sails and Punggol Ripples. The units range from studio apartments to five-room flats and prices range from $65,000 to $377,000.

Punggol Sails offers 279 three-room, 218 four-room and 109 five-room flats, while Punggol Ripples has 130 studio apartments, 157 three-roomers and 185 four-roomers for sale.

Both projects are located along Punggol field, are served by the Punggol MRT and LRT stations, and are near the future Punggol Town Centre.

PropNex's Mr Ismail noted that the typical selling price of the new flats was 10 to 20per cent cheaper than those of comparative resale units in the area.

With the vision for Punggol as Singapore's waterfront town starting to become a reality, flats in the area will become increasingly popular, said Mr Ismail, who expects the projects to be five times over-subscribed.

Home buyers need to submit their applications before the closing date of Nov30.

Including yesterday's sale, HDB has offered 10,800 flats for sale this year. It said that 2,700 more flats will be offered next month in Bukit Panjang, Sembawang and Dawson.

jcheam@sph.com.sg


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A leg-up for young couples

YOUNG couples now have a greater chance of securing a flat, with the Housing Board setting aside 95per cent of all its sales exercise - BTO and sales of balance flats - for first-timers.

The HDB's priority scheme was first introduced in August 2007 and, prior to that, no quota existed so first-timers were balloted along with everyone else.

The revised scheme additionally gives a leg-up to applicants who have tried and failed in four or more ballots.

On their fifth attempt they will be accorded one extra chance, with their name being entered for the ballot one more time.

For their sixth try, they get entered two more times, and so on. However, this only applies to BTO projects in non-mature areas.

Couples already receive a helping hand under the Married Child Priority Scheme, which gives them double the chance during the balloting.




The vision for Punggol as Singapore's waterfront town is becoming a reality and flats will become increasingly popular, it is said. -- ARTIST'S IMPRESSION: HDB

Sales of new private homes down again

Nov 17, 2009

Sales of new private homes down again

Number of units launched, sold in Oct lowest since Jan; Govt's cooling measures taking effect

By Joyce Teo

SALES of new private homes plunged last month to just 811 units - well down on September's numbers and a clear sign that the Government's cooling measures have taken hold.

The decline also marks the third straight monthly contraction since August.

October's sales were down from the 1,143 units sold in September and 1,805 in August, although they were still about six times the sales done in the same month last year, according to the Urban Redevelopment Authority yesterday.

'Although the number of units launched and sold in October was the lowest since January, it should not be treated with alarm as it reflects that the property market is subsiding into a more sustainable level of activity,' said DTZ's head of Southeast Asia research Chua Chor Hoon.

October's sales came close to the average monthly take-up of 845 units since June 2007, she said.

Property experts were already expecting the slump as sales at launches started to slow down not long after the Government introduced measures to calm the market in mid-September.

Price resistance has also set in, particularly for mass market homes, they say.

Developers launched only 566 units last month, a far cry from the 1,413 launched in September.

About 60 per cent of the launches were prime projects, which accounted for slightly more than one-third of the sales. There were no new major mass market launches.

PropNex chief executive Mohamed Ismail believes the pent-up demand that accumulated during the financial crisis has largely been met. He noted that 66 per cent of the units sold last month were mid-range homes that went for between $1,000 psf and $1,999 psf - a result of developers selling smaller units at higher prices per square foot.

One of last month's best sellers was Far East Organization's 278-unit Cyan in Bukit Timah Road. It launched 90 units and sold 81 at a median price of $1,821 per sq ft.

Last month's figure brings sales so far this year to 13,639 units, just 8 per cent short of the record 14,811 units sold in 2007. Total sales of new homes will likely surpass the 2007 total, experts say.

Jones Lang LaSalle said the Government's measures to curb speculative behaviour seem to have taken effect, going by sub-sales, which fell to 7.9 per cent of total sales last month from the 12 per cent recorded in September.

Still, the low level of new launches last month suggests that developers were more affected by the measures than buyers, say experts.

'While one would expect developers to capitalise on the buying trend, they were surprisingly more cautious and anticipated a bigger demand pull-back,' said Jones Lang LaSalle's head of research for South-east Asia, Dr Chua Yang Liang.

It suggests the market could be 'closing in on its peak as developers are no longer as confident of the sustainability of the current market movement', he said.

New home sales are expected to slow this month and next to between 600 and 700 units. Dr Chua expects sales of non- landed homes to contract by a further 10 per cent to 20 per cent.

But if the rise in house prices continues to surge ahead of economic fundamentals, tougher anti-speculative measures could be introduced. These could include a capital gains tax, perhaps for those who flip within a two-year period of the first purchase, added Dr Chua. Ngee Ann Polytechnic lecturer Nicholas Mak believes the next wave of buying may come when the two integrated resorts open next year.

Home prices, said CBRE Research executive director Li Hiaw Ho, are likely to 'hold firm at current levels', though the imminent launch of Marina Bay Suites will give a good indication of how the prime and high-end segment will perform.

joyceteo@sph.com.sg




An artist's impression of Lincoln Suites in Khiang Guan Avenue in the Newton area.

Property agent jailed for acting as fall guy

Nov 17, 2009

Property agent jailed for acting as fall guy

A PROPERTY agent who took the rap for an unlicensed driver's offence of running a red light was jailed for three months yesterday.

Leung Man Kwan, 34, accepted $1,000 to take the fall for Ms Evangeline Tay Su Ann, 21, who took a Bulgarian business manager's car out for a spin without his consent while he was abroad in January last year.

Leung is appealing against her sentence.

Ms Tay, who had been staying in the house belonging to the owner of the car, skipped the lights in Lornie Road. She knew she had been caught as she saw the camera flash go off.

Worried because she was driving without a licence and without the permission of the car's owner, she turned to friends for help.

One of them, former police officer Kelvin Choo Yew Beng, 38, secured Leung's complicity for $1,000.

When the car's owner received a summons asking for the driver's particulars, he asked Ms Tay about the offence. She gave him Leung's particulars.

Deputy Public Prosecutor Andrew Tan said one reason Leung agreed to take the fall was her own driving record: At the time, she had pending drink driving-related charges, so the extra demerit point for running a red light would have been of little consequence to her.

In November last year, she was jailed for two months, fined $4,800 and banned from driving for 18 months for hurting a public servant, drink driving, failing to give a breath specimen and disorderly behaviour.

Neither Ms Tay nor Mr Choo have been charged over their roles in the bribery.

It is not known whether Ms Tay has been charged over her traffic offences.

Leung could have been jailed for up to seven years and fined for subverting the course of justice.

More HDB flats in Punggol with two new BTO projects

Business Times - 17 Nov 2009


More HDB flats in Punggol with two new BTO projects

Punggol Sails and Punggol Ripples will have a total of 1,078 new flats

By UMA SHANKARI

THE Housing & Development Board (HDB) yesterday launched new build-to- order (BTO) projects at Punggol with a total of 1,078 flats.

And four more BTO projects - with 2,700 flats in all - can be expected next month in Bukit Panjang, Sembawang and Dawson.

Including the two latest Punggol projects - Punggol Sails and Punggol Ripples - HDB has offered about 10,800 flats under BTO and other exercises so far this year. Last month HDB announced plans to ramp up the supply of new flats to meet increased demand for public housing.

HDB also said that with effect from this BTO exercise, 95 per cent of the supply of two, three, four and five-room flats will be set aside for first-timers.

'This will give greater priority to first-timers, who generally have more urgent housing needs than second-timers,' it said.

Punggol Sails and Punggol Ripples will have 130 studio apartments and 436 three-room, 403 four-room and 109 five-room flats.

Studio apartments will be priced from $65,000 to $92,000; three-room flats will sell for $158,000 to $185,000; four-room flats for $249,000 to $305,000; and five-room flats for $332,000 to $377,000.

PropNex chief executive Mohamed Ismail expects strong interest in the new projects.

'Plans are already underway to construct the 4.9km Punggol Promenade linking the estate's two activity clusters,' he said. 'As part of the Punggol 21 Master Plan, this will enliven the area and increase the value of homes there.'

He expects the two BTO projects to be at least five times subscribed on the back of the increasing HDB resale price index.

BTO projects are typically cheaper than resale flats. The typical selling prices of new units are 10-20 per cent cheaper than those of comparable resale units in the area, Mr Ismail said.

HDB expects first-time flat buyers will need to use 23-27 per cent of their monthly household income to meet their monthly loan commitments for these two projects.

The agency says this is well below the 30 per cent international benchmark for affordable housing.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

CPF interest rate stays at 2.5% in Q1 next year

Business Times - 17 Nov 2009


CPF interest rate stays at 2.5% in Q1 next year

CENTRAL Provident Fund members will continue to receive 2.5 per cent a year interest on savings in their Ordinary Account for the first three months of next year.

The CPF board said yesterday the interest rate as derived from those of the major local banks from August to October this year worked out to 0.42 per cent a year. But interest of 2.5 per cent will be paid, as this is the minimum rate provided for under the CPF Act.

With the Housing & Development Board, the CPF Board also said the concessionary interest rate for HDB mortgage loans will remain at 2.6 per cent a year from January to March next year.

For the Medisave, Special and Retirement accounts, the interest rate will be announced in December, after the 12-month average yield of the 10-year Singapore Government Security has been computed.

The CPF interest rate for the Special, Medisave and Retirement Accounts is pegged at one per cent above the yield rate. The current rate of 4 per cent for the October-December period will be kept as the floor until Dec 31 next year, to 'help members adjust to this floating rate'. In addition, an extra one per cent interest will be paid on the first $60,000 of a member's combined balances, with up to $20,000 from the Ordinary Account.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

HSR to list on SGX via reverse takeover

Business Times - 17 Nov 2009


HSR to list on SGX via reverse takeover

The property firm's owners will sell their entire stakeholding to Catalist-listed Wepco for $40m

By UMA SHANKARI

PROPERTY agency HSR International Realtors said yesterday it plans to list on Singapore Exchange (SGX) through a reverse takeover (RTO).

Husband-and-wife team Patrick Liew and Kellie Lim, who own 100 per cent of HSR, will sell their entire stakeholding to Catalist-listed Wepco Ltd for $40 million.

Wepco now provides electroplating services to the electronics, automotive, aerospace and medical industries. But once the RTO is completed, it will focus on real estate.

The company is likely to be renamed and re-branded. It will also apply for a transfer from the Catalist board to the mainboard.

Established in 1981, HSR is one of the largest homegrown real estate agencies in Singapore, with more than 7,000 agents listed.

Last year, it had a 32 per cent share of the HDB resale market and 40 per cent of the private residential market, said chief executive Mr Liew, who will head the enlarged Wepco.

HSR reported a drop in 2008 net profit to $1.4 million, from $4.9 million in 2007.

The weaker property market caused revenue to fall to $55.2 million from $80.6 million.

Mr Liew intends to use HSR's listed status to grow the company.

'We see tremendous opportunities for growth in Singapore as well as regionally and globally,' he said.

In particular, HSR is looking to partner other real estate firms in South-east Asia to break into more markets.

It has marketed property in Australia, New Zealand, Malaysia, Canada and the United States, but currently operates mainly in Singapore.

Being a listed company will boost HSR's brand equity and give it more ways to tap the capital markets for growth, Mr Liew said.

Wepco will pay the $40 million to Mr Liew and Ms Lim by issuing 80 million new shares at 50 cents each.

The issue price represents a premium of about 117 per cent over Wepco's closing price of 23 cents last Friday.

Upon completion of the acquisition, Mr Liew and Ms Lim will own 83 per cent of Wepco's enlarged share capital.

Wepco said that in the past few years many of key customers have shifted their operations overseas, resulting in a substantial loss of revenue.

This, plus increased raw material prices and other operating costs, has had a substantial negative impact on profitability, Wepco said. 'While the company continues to strive for high growth in its current business, the directors are of the opinion that in view of the challenging business climate in which the group operates, there is a need to look for other business opportunities to increase shareholders' value,' it said.

Wepco's stock gained 10 cents to close at 33 cents yesterday.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.

Oct home sales dip, but prime area defies mood of caution‏

Business Times - 17 Nov 2009


Oct home sales dip, but prime area defies mood of caution

By KALPANA RASHIWALA

(SINGAPORE) The number of private homes that developers launched and sold in October slowed to their lowest levels since housing sales began their revival in February, according to latest official figures. While the outcome was expected, the big question is how long it will take for home sales to rev up again.

Buyers, especially in the price-sensitive mass-market segment, had begun to be fatigued by price increases in the third quarter - even before the government acted on Sept 14 to cool the market. Developers are also running out of mass-market projects which are launch-ready.

'Everybody's more cautious now,' said Knight Frank chairman Tan Tiong Cheng, summing up the current mood among buyers and developers.

DTZ executive director (consulting) Ong Choon Fah said: 'Buying is likely to continue to be slow for the rest of the year. There's not much to launch; and people are away. Activity will probably return after Chinese New Year.'

While developers of a few projects are expected to proceed with launches soon - including Marina Bay Suites and City Developments's new condo on Thomson Road - others have decided to postpone their launches until Q1 next year or even later, when they hope there will be clearer signs confirming the recovery in the Singapore economy that will see buyers emerging from the sidelines again.

Data released by Urban Redevelopment Authority yesterday showed that developers sold 811 private homes in October, down 29 per cent from September's sales of 1,143 homes. This is the third consecutive monthly decline after home sales peaked at 2,772 units in July.

In the first 10 months of this year, developers have sold 13,639 units. Views in the market are mixed whether developers will manage to sell another 1,172 units in the final two months of 2009 to match the record of 14,811 units in 2007.

The 566 units developers launched in October was 60 per cent lower than in the previous month.

The Core Central Region (CCR) - where higher-priced homes are located - fared relatively better in October than the Rest of Central Region (RCR) and Outside Central Region (OCR).

CCR saw a doubling in sales from 152 units in September to 311 units in October; the number of private homes launched in the region also increased 67 per cent over the same period.

In contrast, the number of units launched as well as sold by developers fell in the other two regions. For instance, the number of homes sold in OCR fell 55.2 per cent month on month to 251 units in October. And the number of homes launched in RCR declined to just 40 units in October from 631 in September.

Last month, a total of 250 units were sold in the $1,500 psf to $2,000 psf range, accounting for 31 per cent of total sales in October and representing a big jump from the 92 units sold in this price range in September, Colliers International research director Tay Huey Ying noted. 'This shows that as of October, filtering-up of demand from the mass-market to the high-end has not been derailed by the September cooling measures,' she added.

CB Richard Ellis executive director Li Hiaw Ho noted that interest in luxury projects continued in October despite the slowdown felt in the rest of the market. ' A unit at Boulevard Vue sold at $4,150 psf; a unit of Seven Palms fetched $3,429 psf in October after six units were sold in September at $3,091 to $3,353 psf. Over at Nassim Park Residences, five units were sold last month at a median price of $3,089 psf following the sales of nine units in Q3 at $2,800 to $3,450 psf,' he added.

Jones Lang LaSalle's head of SE Asia research Chua Yang Liang said the impact of the September announcement was felt most in OCR and RCR as these markets were driven mostly by HDB upgraders who are more sentiment driven.

October's top-selling project was Far East Organization's Cyan at Bukit Timah (81 units transacted at a median price of $1,821). Other chart toppers in CCR last month included Trilight (58 units) and Lincoln Suites (53 units) - both in the Newton area.

In RCR, the top sellers included Suites @ Guillemard (66 units) and City Loft (40 units). Both projects featured shoebox units. In OCR, sales were contributed mainly by Hundred Trees in West Coast (52 units) and Mi Casa in Choa Chu Kang (43 units), noted Savills Singapore.

Copyright © 2007 Singapore Press Holdings Ltd. All rights reserved.