ST : Expect to pay more for exec condos

Mar 14, 2010

property

Expect to pay more for exec condos

Market watchers cite strong bids for new sites and pent-up demand

By Joyce Teo

Executive condominium (EC) prices look set to rise further with the close of two EC tenders at higher-than-expected bids in the past two weeks.

The Sengkang EC site attracted a top bid of $315 per sq ft (psf) of gross floor area, while the Yishun EC site drew a top bid of $281 psf of gross floor area.

Analysts estimated that the winning bidders will have to sell the units at Sengkang for $650 to $700 psf and those in Yishun for $600 to $650 psf.

CBRE Research said the median price of new 99-year leasehold private condo units in similar locations as ECs was just $663 psf as of last month.

However, the latest 99-year condo The Estuary in Yishun sold at some $750 to $800 psf, with more than 500 units snapped up since early this month. It is therefore reasonable to expect that new EC projects may be launched at more than $600 psf, it said.

In the resale market, EC unit prices have risen in line with the market, closing the gap between resale prices of EC and private condo units.

As of last month, resale EC unit prices have reached $557 psf, up 75 per cent from the market bottom in the third quarter of 2006.

The price gap between resale private condo units and resale EC units has narrowed to 11 per cent, from 14 per cent late last year, according to CBRE Research.

This could have a bearing on the gap between new EC units and new private condo units - the gap could become smaller than the historical one of 25 per cent to 35 per cent, said its executive director Li Hiaw Ho.

Said PropNex chief executive Mohamed Ismail: 'There will still be a gap of around 25 per cent. It is still there, but it may be slightly smaller because land cost has become more competitive.'

This price gap reflects the constraints attached to ECs such as qualifying conditions and the restriction on resale only after the minimum occupation period of five years, experts said.

ECs come with condo facilities but have initial sale restrictions similar to those for public housing. They convert to a private property only after a decade.

They were introduced in 1995 to bridge the gap between public housing and private apartments, aimed at Singaporeans who could afford more than an HDB flat but might find private property out of their reach.

Buyers of new EC units have to meet a gross monthly household income ceiling criterion of $10,000 a month, slightly above the $8,000 income ceiling for a new HDB flat.

Despite the expected higher EC prices, there is likely to be pent-up demand for the new ECs, Mr Ismail and Ngee Ann Polytechnic lecturer Nicholas Mak predicted.

Firstly, there have not been any EC launches since 2005, when La Casa in Woodlands was marketed, said Mr Mak.

Also, prices of 99-year leasehold condo units as well as HDB resale flats have gone up, he pointed out.

'Those who earn more than $8,000 do not qualify for build-to-order or design, build and sell scheme HDB flats. They would have a greater motivation to apply for ECs,' said Mr Ismail.

Besides, the higher psf price may not translate to a huge lump sum. 'Given the two recent EC bids, the developers are likely to offer more smaller units, such that they can sell them at the right prices,' he said.

'Developers these days are offering more smaller units. Buyers will have a better lifestyle but they will have to compromise on space.'

joyceteo@sph.com.sg



Visitors at the launch of The Estuary, a 99-year leasehold condo in Yishun, which has a price range of $750 to $800 psf. Property watchers expect new ECs to be priced above $600 psf. -- ST FILE PHOTO

ST : New PR limits may hit Indian flat sellers

Mar 14, 2010

New PR limits may hit Indian flat sellers

Pool of buyers could shrink despite higher quotas for Indians, say property agents

By Irene Tham

Mr Mohamed Mustafa Shahulhamid has been looking for a resale flat in Little India for his son in the last six months.

So far, his hunt has been fruitless.

'Many Indian families want to live in Little India. No Indian families are moving out and we cannot buy from the Chinese,' said the 51-year-old frozen food trader.

Under the Ethnic Integration Policy, the Government has set ratios for ethnic groups in HDB blocks and precincts. This is to prevent enclaves from forming.

In Little India, the quotas for Indians/Others are usually filled.

But Mr Mohamed Mustafa may now get a break as a result of quota changes. On March 5, the quotas for Indians/Others were raised to 12 per cent and 15 per cent for precinct and block respectively, up from 10 per cent and 13 per cent.

The corresponding quotas remain unchanged for the Chinese (84 per cent and 87 per cent) and Malays (22 per cent and 25 per cent).

Is this change a boon for Indian buyers and sellers?

It is unclear at this point, said estate agents, because another quota has also come into play.

On March 5, the HDB also announced quotas for permanent residents (PRs), set at 5 per cent and 8 per cent for precinct and block respectively.

Previously, an Indian seller could also rely on PRs to make up for any shortfall in potential Indian buyers, if the Chinese and Malay quotas had been reached in a block or precinct.

But with the PR quotas, the pool of buyers could become smaller, said Mr R. Subra, managing director of SKV International Property Consultants.

'The new limits for PRs may nullify any upside from the ethnic quota change,' he noted.

Already, Indians are selling their homes at a few thousand dollars - or up to 10 per cent - below the average transacted prices of a similar flat type in the same neighbourhood, said Dennis Wee Group agent Jason Sim.

This is true of areas like Sembawang and Woodlands, where the Chinese quotas are maxed out, he said.

Take the case of retiree K. Omar, who had Chinese buyers offering up to $25,000 cash over valuation for his four-room flat in Bukit Ho Swee. But they could not close the deal because the Chinese quota in his block had already been met.

Mr Omar, 65, took a year before he sold the flat at the valuation price of $430,000 last November. The buyers were a Vietnamese couple.

But the revised Indian/Others quotas offer potentially good news for Indians eyeing areas such as Race Course Road.

One reason such places are popular is that they are near temples.

In these districts, Indians have often found it hard to buy a resale flat because the quotas were already filled, and not many Indians or Eurasians wanted to sell their homes in the first place.

Industry experts said the effects of the new changes will be seen only in a couple of months.

For now, the search for a flat continues for Mr Mohamed Mustafa.

'The raised quota may not help,' he said, adding that he may consider areas like Toa Payoh, Thomson and Paya Lebar.

itham@sph.com.sg


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Good news for buyers

The revised Indian/Others quotas offer potentially good news for Indians eyeing areas such as Race Course Road. One reason such places are popular is that they are near temples. In these districts, Indians have often found it hard to buy a resale flat because the quotas were already filled, and not many Indians or Eurasians wanted to sell their homes in the first place.



Tekka Centre, which consists of a wet market, food centre and shops, is one of Little India's popular landmarks. Many Indian families want to live in Little India, but have found it hard to buy a flat there because of ethnic quota restrictions. -- MY PAPER FILE PHOTO

ST : Relocation of govt agencies: Good move or not?

Mar 14, 2010

Relocation of govt agencies: Good move or not?

By Goh Chin Lian

More government offices are moving out of their city centre locations, becoming more dispersed as a result.

But this move, by agencies that do not need to remain in the Central Business District, frees up prime office space for the private sector.

The Infocomm Development Authority of Singapore, whose offices are in Suntec City and Hill Street, will move to Pasir Panjang next year. Going to Bendemeer in 2012 is the Manpower Ministry's Foreign Manpower Management Division, now in Kim Seng Road.

And more will be moving away from the city centre over the next five years, the Government announced last week.

While the Workforce Development Agency (WDA) will move to Paya Lebar, two ministries - National Development (MND) and Environment and Water Resources (MEWR) - and four of their statutory boards will move to Jurong.

Three statutory boards have already moved out since the Finance Ministry directed two years ago that government agencies be more cost-efficient, including finding cheaper offices to rent.

The trio are: the Media Development Authority which headed west to Fusionopolis in Buona Vista, the Singapore Land Authority which went north to Newton, and the Energy Market Authority which relocated to Alexandra Road.

MP Lee Bee Wah, deputy chairman of the Government Parliamentary Committee for National Development and the Environment, supports the move out of the city centre. But she said offices that deal with the public should be sited as close as possible to MRT and bus services.

The Manpower Ministry, by choosing to move its Foreign Manpower Management Division to a new $73 million office in Bendemeer, emphasises consolidation.

The ministry's headquarters in Havelock Road, and its offices in Kim Seng and Tanjong Pagar, will then have consolidated counter services at the Bendemeer site.

The result: a one-stop customer service centre for issues related to foreign manpower, workplace relations and standards, as well as occupational safety and health.

Also, Potong Pasir MRT station is near Bendemeer.

Another concern raised is the loss of 'synergy' that comes from people needing to travel far for meetings. But urban planning analyst Wong Tai Chee felt this can be addressed by teleconferencing. Also, much paperwork is now done online, reducing the need for face-to-face interaction.

Some countries have the space to centralise government services outside the city centre. Malaysia has done this with a federal administrative centre in Putrajaya.

But land-scarce Singapore does not have this option, said Associate Professor Wong, who is from the National Institute of Education.

In any case, the very act of moving government offices to areas earmarked for development has spin-off benefits, said property consultancies Colliers International and Savills Singapore. It will give the mass needed for services, from food to banking, to be provided there, and attract developers and the private sector, they said.

Agreeing, Prof Wong added that this will also speed up the decentralisation of office jobs, which he felt has lagged behind the decentralisation of city centre inhabitants in the last 50 years as new towns and regional malls were built.

In Jurong, the MND and MEWR are studying the options of building a new government complex or renting office space from the private sector, a Finance Ministry spokesman told The Sunday Times.

She said both sides will together require an estimated gross floor

area of 60,000sqm, which property consultants estimate to be 1.3 times the size of an office tower in Suntec City.

The city sites now occupied by the MND and MEWR could either be redeveloped as part of the Government Land Sales scheme, or the buildings there could be leased for office use, the spokesman added.

She said this was also the case for the former Raffles Institution site in Grange Road, now used by the Education Ministry for teacher development.

Ms Chua Chor Hoon, head of South-east Asia research at property consultancy DTZ Debenham Tie Leung (SEA), thinks there is no hurry to develop such prime spots as the market is not lacking in them.

'It's good to save some land for the future,' she said.

Now that the WDA is moving out of One Marina Boulevard, near Raffles Place, observers have asked if the National Trades Union Congress - which occupies eight floors in the prime property owned by the Singapore Labour Foundation - will do likewise.

NTUC director Shona Tan said it had no immediate plans to do so.

She said the Government had developed the NTUC office space as a gift to the labour movement to recognise its contributions to Singapore's economic and social development.

chinlian@sph.com.sg


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Where they are

Moving soon

· Infocomm Development Authority (next year), from Suntec City to Mapletree Business City, Pasir Panjang Road, spread over six floors in an 18-storey office tower

· Manpower Ministry's Foreign Manpower Management Division (by 2012), from Kim Seng Road to Bendemeer Road

· Singapore Workforce Development Agency (by 2013), from One Marina Boulevard to Paya Lebar Central

· Ministry of the Environment and Water Resources, Public Utilities Board and National Environment Agency (by 2015), from Scotts Road to Jurong Gateway

· Ministry of National Development, Agri-Food and Veterinary Authority and Building and Construction Authority (by 2015), from Maxwell Road to Jurong Gateway

Moved

· Media Development Authority (2008), from four places - Mica Building in Hill Street, The Adelphi in Coleman Street, URA Centre in Maxwell Road and Novena Square - to Fusionopolis, Buona Vista

· Singapore Land Authority (2008), from Shenton Way to Revenue House, Newton Road

· Energy Market Authority (last year), from Somerset Road to Alexandra Road

No plans to move

· Ministry of Finance (The Treasury, High Street)

· Ministry of Foreign Affairs (Tanglin)

· Ministry of Information, Communications and the Arts (Hill Street)

· Ministry of Law (The Treasury, with some departments in Maxwell Road)

· Ministry of Manpower (Havelock Road)

· Ministry of Trade & Industry (The Treasury)

· Prime Minister's Office (Istana; with Public Service Division at The Treasury; Elections Department in Prinsep Link)

· Accounting and Corporate Regulatory Authority (International Plaza, Anson Road)

· Central Provident Fund Board (Robinson Road)

· Competition Commission of Singapore (Maxwell Road)

· Economic Development Board (Raffles City Tower, North Bridge Road)

· Intellectual Property Office of Singapore (Plaza by the Park, Bras Basah Road)

· International Enterprise Singapore (Bugis Junction Office Tower, Victoria Street)

· Monetary Authority of Singapore (Shenton Way)

· National Arts Council (Hill Street)

· National Heritage Board (Hill Street)

· Singapore Tourism Board (Orchard Spring Lane)

· Urban Redevelopment Authority (Maxwell Road)



NTUC, at One Marina Boulevard, has no plans to move yet. -- BT FILE PHOTO

ST : Orchard Central: Love it, hate it

Mar 14, 2010

Orchard Central: Love it, hate it

Mall's architects say it is ground-breaking and shoppers will like it in time to come

By Huang Lijie

It has been roundly criticised for being user-unfriendly, but the owners and architects behind Orchard Central are unfazed by the brickbats.

They say the design of the mall is 'ground-breaking' for Singapore and believe shoppers will grow to appreciate it in time.

Orchard Central's shopping experience will also be further enhanced when an adjacent site is built and linked to the mall, they added.

'As the mall design is ground-breaking, we are not surprised to receive such feedback from shoppers,' said Mr Tai Lee Siang, director of home-grown architectural firm DP Architects, which designed the mall.

'It will take time for them to become familiar with and like a mall that is less than conventional.'

Orchard Central opened last May at a cost of more than $700 million. At about 36,000 sq m, it is the smallest of three new shopping centres that have sprung up in Orchard Road.

Ion Orchard, which opened last July, is about 61,300 sq m, and the mall, together with its accompanying luxury residence, The Orchard Residences, cost $2 billion to build.

The mall 313@Somerset is about 39,400 sq m and opened last December at a cost of more than $900 million.

In a recent newspaper report, Orchard Central's tenants said they were hurting from poor business and few walk-in customers. At least one shop, Fox Salon, has closed and about 70 tenants were said to have gone to the landlord to plead for rental rebates. Shoppers said the mall's confusing layout kept them away.

Mr Tai said the floor plans for the different levels vary according to themes ranging from food to beauty. These thematic clusters are designed to form interlocking spaces rather than uniformly stacked areas.

Of the unusual layout, Mr Chng Kiong Huat, executive director of development and planning at Far East Organization, which owns Orchard Central, said: 'This is a long, narrow site, not a square site that is easy to handle, so we knew we could not use a traditional model and hope for the best.

'We embraced the challenge as an opportunity to create something distinct and new.'

He said Far East bid for the land because it was a chance to participate in the rejuvenation of the Orchard shopping belt. Far East also owns Pacific Plaza in Scotts Road and had built Far East Plaza and Far East Shopping Centre in the area.

Mr Chng added that Orchard Central's location was a draw because it houses Discovery Walk. This is a sheltered shopping street connecting Orchard Central, 313@Somerset, and the Specialists' Shopping Centre and Hotel Phoenix site. It is jointly owned by them.

DP Architects worked with Orchard Central's narrow piece of land by building vertically, resulting in an 11-storey mall, the tallest all-retail building here. The small land area also meant a circular carpark ramp instead of a straight one, which shoppers have complained is too steep.

Mr Tai said 11 floors with the same repetitive floor plan would have been 'quite boring'.

'To create visual excitement and spatial sensation, we zoned the space and matched the architecture of each zone to the tenant profile.'

Hence, the youth area has an edgy design - a winding ramp built around its own atrium, with small shops selling knick-knacks and apparel along the ramp.

The cluster of beauty and wellness shops, on the other hand, is ensconced in a far corner to offer customers privacy.

Vertical malls, though novel here, are common in population-dense cities such as Tokyo, and the architects drew inspiration for their design from malls in these cities, such as Herbis Osaka, Mr Tai said.

But shoppers' criticisms have not fallen on deaf ears. Mr Chng said Far East has added more lighting to increase the visibility of shops and put up more signs at a cost of almost $4 million.

It is also reviewing the performance of the outlets monthly and granting rental help when appropriate. It plans to pump about $5 million this year into advertising and promoting the mall.

Mr Chng added that Orchard Central's shopping experience will be further enhanced when the adjacent site, previously occupied by Specialists' Shopping Centre and Hotel Phoenix, is built.

OCBC Bank, which owns the land, recently announced that it was in talks with construction and property group United Engineers Limited to build a hotel and mall there.

Far East has worked with OCBC to have link bridges on the upper floors that connect Orchard Central to OCBC's future development. Currently, the bridges lead straight into a partition wall separating the mall from the adjacent site.

When the OCBC development is ready, the partition will be removed and shoppers will be able to walk around, with the Discovery Walk between the two buildings acting as an atrium.

Mr Nicholas Mak, a real estate lecturer at Ngee Ann Polytechnic, noted the importance of malls having user-friendly designs.

'If the layout does not register positively in the minds of customers, they might not return, especially in a competitive shopping area such as Orchard Road,' he said.

Mr John Ting, former president of the Singapore Institute of Architects, noted that mall layouts here are becoming 'more interesting'. Orchard Central, he felt, 'is too ahead of its time here and shoppers are not yet sophisticated enough to appreciate it'.

lijie@sph.com.sg

Do you prefer innovatively designed malls or conventional ones? Send your views to suntimes@sph.com.sg



Shoppers say they avoid Orchard Central because of its confusing layout. The mall is located on a long, narrow site, so DP Architects built vertically, resulting in an 11-storey mall. Its director Tai Lee Siang says it zoned the space and matched the architecture of each zone to tenant profile 'to create visual excitement'. -- ST PHOTO: KEVIN LIM

ST : Changi residential site up for tender

Mar 13, 2010

Changi residential site up for tender

FAIRLY strong interest from developers is expected in a 99-year leasehold residential site at the corner of Upper Changi Road North and Flora Drive, which will be launched for sale in two weeks' time.

It has been put to tender after an unnamed developer committed to bid at least $82 million, said the Urban Redevelopment Authority yesterday.

The 3.1ha site, which is not near any MRT station, can be developed into a condominium with about 390 units. Analysts expect fairly strong interest from developers, given the buoyant mass market.

They expect the top bids for the site to range from $300 per sq ft (psf) per plot ratio (ppr) to $400 psf ppr.

DTZ South-east Asia research head Chua Chor Hoon, who expects bids to fall between $300 and $350 psf ppr, said the units there could sell for $700 to $750 psf on average.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said the site is in a well-established residential area but is some distance from the Central Business District. Also, it is near Changi Prison.

'This land tender could still be quite popular with developers and could attract about six to 10 bids because the mass-market segment could still enjoy steady demand in the next 12 months.'

Mr Mak added that projects in the area, such as Edelweiss Park Condo and Carissa Park Condo, are quite popular with Japanese families as they are near a large Japanese primary school, which means the project could attract both owner-occupiers and investors, he said.

The latest launch in the area, The Gale, drew 294 buyers in July last year who paid a median price of $696 psf.

The Upper Changi Road North site is on the Government's reserve list, which means it is available for sale but is put up for public tender only after a developer pledges to put in a minimum bid.

It was first made available for sale on the reserve list in March 2008.

JOYCE TEO

CNA : Govt to build more Executive Condos if there is demand: Mah Bow Tan

Govt to build more Executive Condos if there is demand: Mah Bow Tan
Posted: 13 March 2010 1935 hrs

SINGAPORE: The government will build more Executive Condominiums (ECs) to meet the housing needs of what is described as the "sandwiched group".

For this year, ECs will make up 10 per cent of about 12,000 new flats to be built.

National Development Minister Mah Bow Tan said this on Channel NewsAsia's programme, "Talking Point". He was responding to a question on prices for the market for ECs, which is regarded as the intermediate market between HDB flats and private apartments.

He said: "The EC market is really a hybrid. It is HDB in the first five years, which will morph into private after ten years. And the reason is we wanted to cater to the so-called sandwiched group - the S$8,000 to S$10,000 group. So that is the reason why the income ceiling for ECs is not S$8,000 but S$10,000.

"And we still give the S$30,000 grant. So if you are a person, couple who are earning say S$9,000, ideally that is the housing type for you. It is well-designed; it is in good location. It is something that would have all the amenities. And at the same time, you still enjoy the grant.

"So that is the reason why we are putting up more ECs on the market. We are catering for 80 per cent of the population, so EC is one housing form that we are watching, and we have recently let out two tenders. And if there is a market and there is a demand, we will let out more."

This special edition of "Talking Point" can be viewed on Sunday night at 10.15pm on Channel NewsAsia.

- CNA/sc

ST : Illegal subletting: HDB to repossess man's flats

Mar 13, 2010

Illegal subletting: HDB to repossess man's flats

By Yeo Shang Long

IN A clear warning to those who sublet their flats illegally, the Housing Board (HDB) has moved to take back three apartments linked to a real estate agent who owns five private properties.

One flat to be repossessed belongs to the real estate agent, Mr Poh Boon Kay, 61, and his wife, Madam Khoo Kim Cheng, 52, who had illegally sublet their four-room flat in Bukit Batok.

The other two flats in Telok Blangah and Bukit Batok are owned by the couple's daughter and Madam Khoo's 91-year-old aunt respectively. Both flats were also illegally rented out.

He acted as agent for the elderly woman and collected rent on her behalf.

The HDB said it is taking legal action to take back the units.

It is the most serious case of illegal subletting in the last two years. Only three other flats have been compulsorily acquired in that time.

In November last year, the HDB checked and found that Mr Poh had sublet his flat to three Myanmar couples without HDB approval.

The Pohs, who were not living there at that time, had also breached the Minimum Occupation Period (MOP) of three years. This rule states that buyers who purchase resale flats without a housing grant from the Central Provident Fund Board have to live in the flat for three years before they can rent out the whole unit.

The HDB then told Mr Poh this was unauthorised, and that they were intending to repossess his flat. On Dec 23, the HDB pasted a notice of intention to compulsorily acquire his flat.

The HDB told The Straits Times yesterday that Mr Poh will continue to hold the title deeds until investigations are complete. It will then decide whether to take back the title deeds officially and compensate him to the amount of $125,000.

Mr Poh, who claims he paid $155,000 for the house, can lodge an appeal against the notice. When asked, he said he was intending to appeal.

Mr Poh, an ordinary member of the Institute of Estate Agents (IEA), pleaded ignorance of the three-year MOP; he said he had been told by the HDB's counter staff that he could sublet the flat after a year. He could not name the HDB employee.

But the HDB said that because of Mr Poh's links to the other illegal subletting cases, his claims of ignorance could not be substantiated.

'There is clear evidence that Mr Poh, a housing agent by profession, has been intentionally abusing HDB flats for monetary gains,' said the HDB spokesman.

Mr Poh said he had not seen the acquisition coming. He added: 'I can't believe a notice can be served within a month of the HDB giving a warning letter.'

He said it was more usual for the HDB to send a second warning, or even fine an errant owner first.

The Housing and Development Act says, however, that the HDB can compulsorily acquire a flat once it ascertains that the owner is illegally subletting it.

'HDB takes a stern view of unauthorised subletting, and will not hesitate to take strong action against those who flout the rules,' it said.

The Board added that it will bring Mr Poh's case to the attention of the IEA.

Mr Poh, who claims his daughter is stuck in the United States with marital problems, declined to discuss the cases involving her and his wife's aunt.

He said he did not know for sure when they bought their flats.

The HDB has taken action against 56 such owners in the last two years, dishing out punishments ranging from fines of $1,000 to $21,000, to repossessing the flats involved.

HDB added that there was no discernible upward trend.

Flat owners who wish to rent out their flats must obtain approval from the Board and fulfil the MOP. The current MOP for subletting flats is five years for flats bought directly from the HDB or resale flats purchased with a CPF Housing Grant, and three years for resale flats bought without the CPF grant.

About 682,000 flats are eligible for subletting, but only 3per cent of these flats are sublet.

yeoslong@sph.com.sg

Additional reporting by Joan Chew

ST : Lift upgrading in Eunos resumes

Mar 13, 2010

Lift upgrading in Eunos resumes

HDB agrees to 10 of 15 requests from residents, ending 10-month delay

By Ang Yiying

WORKS on a lift upgrading project in Eunos that had been delayed for about 10 months restarted yesterday.

Progress was made at a meeting on Thursday when the Housing Board agreed to 10 out of 15 requests from unhappy residents.

The home owners in Blocks 411, 415 and 417 in Eunos Road 5 had protested that new lift shafts already built blocked light and ventilation to their flats.

The HDB, which stopped work in the middle of last year to attend to the grievances, agreed to modify the external lift shafts and install extra lighting and ventilation fins.

It did not agree to some other requests, such as replacing residents' windows with new slide and casement windows, and installing full-floor tiles and false ceilings for the lift lobbies.

Most of the dissenters said they wanted the project to move on.

One of them, Block 415 resident Lee Wong Mun, 61, a retired technical adviser, said: 'I think the lift (works) should go on, then the rest - the minor things - we can thrash out later.

'Some residents have problems climbing up stairs, especially the older ones.'

Altogether, 14 units out of 116 in each of the three U-shaped blocks had been affected by the new lifts, and some home owners had wanted them torn down.

HDB is picking up the tab for the 10 measures it is now extending, which will come up to $780,000.

The requests were gathered through a work group formed in January, comprising some unhappy residents as well as representatives from the residents' committee, town council and the HDB.

Another affected resident, Madam Shamshiyati Sayas, 54, an operations assistant who lives in Block 417, said she was not totally happy with the package but wanted a closure. 'What to do? You cannot turn back the clock.'

She said the unfinished works and construction site were an eyesore and could not be left indefinitely.

But others were unhappy that not all requests were granted.

Retiree Eng Ah Hee, 63, a resident in Block 417, said he did not accept HDB's reasons: ''Non-standard' and 'norms' are not good enough.'

But the HDB said it had agreed only to items that had an impact on the primary concerns of the light, view and ventilation being blocked.

Responding, Dr Ong Seh Hong, the MP for the precinct, said he felt HDB's solutions were reasonable.

He noted that some of the works not granted were also not part of lift upgrading programmes in other areas, and that HDB had to be prudent with public funds.

'I think there must be a line drawn. Those that are for mitigating (the problem) have been agreed to,' he said.

With works resuming, the entire project - which was supposed to have been completed this year - will now be completed by the second quarter of next year.

Yesterday, an HDB spokesman said: 'This will be the final package of goodwill and mitigation measures that HDB will be able to provide to affected residents.

'HDB cannot continue to engage in discussions to improve the package, as works have been delayed by 10 months. It is also not fair to the majority of residents who are waiting for the lift upgrading works to be completed.'

One of them is Block 417 resident Goh Tee Juan, a 59-year-old plumber living on a non-lift landing floor, who said in Mandarin, 'Of course, I hope for the lifts to be operational. They will be more convenient.'

But he said he could empathise with the predicament of the home owners who were getting less light and air.

ayiying@sph.com.sg


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What HDB is funding



CHANGES AGREED TO:

· Rebuilding part of the lift lobby wall facing flats so it is angled and becomes a niche for potted plants on alternate floors.

· Replacing part of the same wall with horizontal and vertical fins to allow ventilation.

· Adding daytime lighting to the corridor outside the bedrooms of blocked flats.

· Adding ventilation fans to bedrooms and living rooms, if residents want them.

· Using a different material for the canopy at lift lobbies to reduce the sound of rain.

· Rounding the sharp edges of the column facing front doors.

· Using daytime lighting instead of warm lighting at lift lobbies.

IN ADDITION:

· Residents may also choose to replace their bedroom windows with windows that are angled, with HDB paying 80 per cent of the cost as a goodwill measure.



Workers carrying out lift upgrading works at Block 411, Eunos Road 5 yesterday. Works had been delayed because some home owners protested that new lift shafts already built blocked light and ventilation to their flats. the HDB agreed to modify the external shafts. -- ST PHOTO: CHEW SENG KIM

ST : HDB started checks after getting tip-off

Mar 13, 2010

HDB started checks after getting tip-off

IT ALL started with a tip-off to the Housing Board (HDB): A four-room flat in Bukit Batok was being rented out illegally.

Further checks confirmed that the flat - bought by Mr Poh Boon Kay and his wife Khoo Kim Cheng in June 2007 - had been sublet without the HDB's prior approval to three Myanmar couples at a monthly rent of $1,900.

Mr Poh, a housing agent, and his family did not live in the flat.

They were told to evict the sub-tenants immediately on Nov 25 last year, failing which the board would take possession of the flat.

But the sub-tenants did not go.

On Dec 23, the HDB sent Mr Poh a notice to say it would take back his flat.

But Mr Poh, 61, claimed his tenants had agreed in writing to vacate the flat by the end of December.

The next day, he and his wife appealed against the HDB's move. They said they intended to sell the flat to one of the tenants, who needed to sort out his finances.

The HDB then interviewed the couple on Jan 5 this year, during which they claimed they did not know that they needed prior approval to sublet the flat.

They also claimed that they were not aware of the minimum occupation period (MOP) of three years before they were allowed to sublet the flat.

But further HDB investigations showed that Mr Poh was connected with two other cases of unauthorised subletting of flats belonging to his relatives in Bukit Batok and Telok Blangah.

The flat in Bukit Batok belonged to his aunt, aged 91, and had been sublet to Myanmar monks since July last year for a monthly rent of $1,400.

The monks used it as a meditation centre, and the rent was paid to Mr Poh, who acted as his aunt's housing agent.

The Telok Blangah flat, meanwhile, was owned by his daughter.

It had been rented out for $900 monthly since May.

Checks with neighbours confirmed that Mr Poh's daughter was not living there.

Both flats were also sublet without obtaining the HDB's prior consent, and the board said that it would be taking steps to acquire them compulsorily.

In a statement yesterday, the HDB said that the additional cases of illegal subletting by Mr Poh showed that his claims of being unaware of the HDB's rules cannot be substantiated.

'These regulations are publicly available from many sources,' it said, adding that 'there is clear evidence that Mr Poh, a housing agent by profession, has been intentionally abusing HDB flats for monetary gains'.

It concluded: 'As he has blatantly flouted HDB's rules, there are no grounds for leniency.'

ST : Rush for condo units despite record prices

Mar 13, 2010

Rush for condo units despite record prices

100 units of The Vision, a mass market project, sold out upon release

By Joyce Teo

BUYERS have snapped up units at a West Coast condominium despite the developer setting record prices for a mass market project.

Cheung Kong (Holdings) has sold all 100 units of The Vision released for its Phase 1 sale at prices 'from $1,000 to $1,200 per sq ft (psf)' for the two- to four-bedroom units, according to sales manager Cannas Ho yesterday.

However, market talk suggests that around 130 units or more have been booked. Sales apparently started on Thursday, when buyers handed over their cheques to confirm sales of 80 or so units without even viewing the showflat.

'The response is unexpected. However, it proves that there is strong demand for mass market homes,' said Colliers International's director for research and advisory, Ms Tay Huey Ying.

The Hong Kong-based developer said the 100 units sold included two penthouses and 'nearly half of the 14 strata terrace units'.

The Vision, a 99-year leasehold condo across the road from West Coast Park, has 281 apartments and 14 strata terrace units.

It is next to Blue Horizon, where units in the resale market have gone for $764 to $841 psf this year.

Ms Ho told a media briefing on Wednesday that The Vision will be the most luxurious building in the area.

She said then that the plan was to offer a second phase for sale by the end of the year.

The highest price done - for a strata terrace unit - was $3.2 million, she added yesterday.

About 70 per cent of the buyers are locals. The rest are from Malaysia, China and the United States.

More than 60 per cent are upgraders, while the rest are long-term investors in the leasing market, Ms Ho said.

Yesterday, Cheung Kong would say only that it had sold 100 units and that it would release another 20 units over the weekend.

A property expert said some buyers are clearly motivated by low interest rates and the fear of prices rising further, given the high land bids seen in recent tenders.

Colliers' Ms Tay said: 'There's a possibility that these record prices can help to raise the negotiation power of home owners in the vicinity in asking for higher prices.

'It is also likely to have the effect of raising the value of mass market homes in Singapore.'

joyceteo@sph.com.sg



Potential buyers packing the showroom of the West Coast development during its soft launch yesterday. -- PHOTO: CHEUNG KONG (HOLDINGS)

ST : Water World

Mar 13, 2010

life! home and garden

Water World

By tay suan chiang

Imagine walking along a horseshoe-shaped bridge on a Sunday morning, catching the first glimpse of the sun as it rises from a waterway.

Or in the evening, heading to another similarly shaped bridge, but this one with a shaded dome, where you can see the setting sun reflected in the water.

And best of all, there is no need to travel overseas to enjoy these scenes.

By the end of the year, all this will be possible when a 4.2km waterway at Punggol is completed.

Besides viewing sunrises and sunsets, visitors to the more than $25 million waterway, called My Waterway@Punggol, will be able to kayak or canoe as well as dine alfresco.

Four footbridges will provide access to both banks of the promenade. Two of them will be prime spots to enjoy sunrise and sunset views.

Construction of the waterway is underway on an empty field in Punggol that is parallel to Punggol Drive. The waterway is being built by damming two rivers at the east and west of Punggol, the Sungei Serangoon and Sungei Punggol, to form two reservoirs to meet Singapore's increasing water needs.

When completed, the waterway will link the two reservoirs to transfer water from one to the other.

Mr Alan Tan, principal architect and a deputy managing director at the Housing Board (HDB), which is in charge of the project, says that together with national water agency PUB, they saw that the waterway could 'complement the housing parcel for waterfront living'.

In May 2008, a landscape masterplan competition for the waterway was announced.

Local firm Surbana International Consultants and its Japanese partner Sen Inc were named winners in December that year.

The winning proposal not only showcased what could be done along the waterway, but also featured four distinctive footbridges that were both functional and reflective of the surroundings and Punggol's history.

'We want to give visitors an experiential journey from one end of the waterway to the other,' says Mr Tan.

Surbana's senior architectural associate Bonita Tan says the bridges are about 1km apart, helping give easy access to both sides of the 20m- to 60m-wide, and 4m-deep, waterway.

She adds that the two footbridges where the waterway meets the two rivers are designed to project out into the rivers, so visitors can fully enjoy the views of the sun rising and setting.

Another bridge, which resembles stilts on water, has been nicknamed the 'kelong' bridge.

'We wanted to bring home the idea of old Punggol,' says Ms Tan.

Back in the early days, Punggol was a fishing village and there were many kelongs that dotted the area. 'Walking on this bridge gives the experience of walking on water, like on a kelong,' she adds.

The last bridge, which will lead to a future commercial centre, has a more modern look. 'But it will have an undulating form that reflects the nature of the landscape,' says Ms Tan.

To make the bridges blend in with the surroundings, she says materials such as composite timber and steel, which will be painted for a more rustic look, will be used.

'There will also be plenty of greenery on the bridges,' she adds.

The team is also working on creating a heritage trail along the waterway to remind visitors of Punggol's transformation.

For example, photographs of Punggol during its early days will be put up along the waterway.

On a 280m-long wall at Punggol town centre, there will be panels depicting the old Punggol.

'It could be motifs of fishing villages, or even chilli crab, since the dish is well-known here,' suggests Mr Tan.

My Waterway @ Punggol is the first of its kind to be built in Singapore. It is part of the transformation plan to turn Punggol into a waterfront town.

Catching the sunset at Punggol

Plans for Punggol's makeover were first announced in 1996, by then Prime Minister Goh Chok Tong. But the Asian financial crisis halted the town's development.

Developments have accelerated in the last two years since Prime Minister Lee Hsien Loong offered a new vision for it in his 2007 National Day Rally Speech.

Today, the town has a population of about 53,600 and this is projected to grow to 70,000 by next year.

The Government aims to build an extra 21,000 homes along the waterway, comprising 60 per cent HDB flats and 40 per cent private homes.

Last November, the HDB unveiled the winning design for the first batch of flats that will line the waterway.

Designed by international architectural firm Group8asia and local firm Aedas, there will be 1,200 flats featuring sky terraces, roof gardens and panoramic views of the Punggol Waterway.

The HDB hopes to offer these flats for sale this year and residents are expected to get their flats by 2014 or 2015.

While Punggol resident Tan Bee Bee, 24, is not living near the waterway, she is excited about it. The tertiary student lives a five-minute drive away.

'I can imagine it will be so scenic then and I won't have to travel to East Coast Park to view the sunset,' she says.

taysc@sph.com.sg


--------------------------------------------------------------------------------

'We wanted to bring home the idea of old Punggol'

Surbana's senior architectural associate Bonita Tan on building a bridge along My Waterway @ Punggol that resembles a kelong



Apart from East Coast Park, Punggol's Sunrise Gateway (above) is the next place to catch sunrises. Located near Sungei Serangoon, it offers unblocked scenery views and has bridges that extend out to the water. -- PHOTOS: HDB

BT : Strong sales at Singapore launches of US, UK properties

Business Times - 13 Mar 2010

Strong sales at Singapore launches of US, UK properties

By CHEAH UI-HOON

SELL-OUT launches - that's what local property agents representing UK and US developers are enjoying.

The buying interest is thanks to depressed prices in the two markets and favourable currency rates; a confluence of factors that is giving Asians a buying opportunity like no other in recent years, leading some overseas developers to even bypass their own markets to market projects here.

When Savills Singapore marketed a high-end San Francisco condominium development last September, for example, it expected to sell fewer than 10 units. In the end, 24 sales for units ranging from US$650,000 to over US$3 million - were closed, says Julian Sedgewick, senior associate director for Savills Singapore's international residential sales section.

'It caught us by surprise, as we didn't expect this. It was the first American property we'd marketed in a couple of years,' says Mr Sedgewick, who heads the department created just last September to tap the overseas property investment market. San Francisco's Millennium Tower was built by New York-based Millennium Partners, which holds some Ritz Carlton franchises in the US. The developer had approached Savills to market the property in Asia, says Mr Sedgewick.

The weak US dollar and lower home prices are contributing to the foreign buying spate, especially as there's now some stability in the market, he says. 'For investors, this potentially can mean a 20 to 30 per cent capital growth in the next few years.'

The pound's current low is definitely the reason for the boom in London property sales in Singapore this year, says Stephen Ho, associate director of Colliers' International's projects team. 'The current 2.1 exchange rate is the biggest draw now, with high-end properties costing about 15-20 per cent less than they did in 2007,' he says.

Prices are creeping up, according to him. But Colliers is still seeing a 'steady flow of good buyers', rather than the kind of frenzied buying four or five years ago.

Developers are approaching international property agents, and Colliers expects to hold about three exhibitions a month in its bid to represent international developments at asking prices of £pounds;500-£pounds;800 psf in general, in mid-high to high-end projects.

Mr Ho's advice for would-be buyers is that they should be familiar with the area they're thinking of buying into. Colliers, for example, mainly markets projects in established locations, rather than regeneration areas in London.

Location, location and location is definitely the mantra when buying overseas, says Doris Tan, managing director of DST International Property Services which specialises in selling London property.

'With the booming international property market now, buyers have to be very careful about what they're buying,' says Ms Tan. A check with the newspaper this week showed some four to five London projects advertised daily, for example. 'Like all things, location is the most important as the properties in prime locations will come out alright when the economy picks up again,' she says. 'Cheap doesn't mean good.'

International selling activity picked up at the end of last year, says Ms Tan, with some projects, like the Central St Giles development marketed here last week, launching here instead of in London.

DST will also launch some New York property here, but a key drawback is capital gains tax and various other taxes in the US real estate market which the UK does not impose. 'That said, this is still a good time to consider investing in New York property, but one has to be prepared to hold it for five years or so,' says Ms Tan.

Who are the buyers? Agents are seeing a wide range - from first-time investors to parents who have children studying in London or US cities. 'About half are Singaporeans, followed by Malaysians and Indonesians and then about 5 per cent expatriates,' says Colliers' Mr Ho.

In London - by far the favoured and familiar market for Singaporeans - the majority buy as an investment, while the rest are mainly parents who buy properties for children studying or working there.

'Buyers include those who have made money from Asian property so they're now looking for another place to invest,' says Mr Ho.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : HDB steps up enforcement on illegal subletting

Business Times - 13 Mar 2010

HDB steps up enforcement on illegal subletting

Action taken against 56 owners from January 2008 to December last year

By UMA SHANKARI

THE Housing & Development Board yesterday said it has stepped up enforcement action against home-owners who illegally sub-let their government-subsidised flats. The move comes weeks after HDB unveiled policy changes designed to hurt speculators, including increases to the minimum occupation period (MOP).

HDB said that from January 2008 to December last year, it took enforcement action against 56 flat owners. They faced penalties that ranged from fines of $1,000 to $21,000, to repossession of their flats.

In particular, HDB shared details of a case in which a Bukit Batok flat owned by Poh Boon Kay and his wife Khoo Kim Cheng was repossessed after there was 'blatant flouting of sub-letting rules'.

Mr and Mrs Poh own five private properties and Mr Poh is also a registered real estate agent. The couple did not fulfil the MOP of three years, which is required under HDB's rules before a whole flat can be sub-let. They claimed that they were not aware of this policy. Further investigations showed that Mr Poh was related to two other cases of unauthorised sub-letting, at Bukit Batok and Telok Blangah. HDB will also take legal action to compulsorily acquire those two flats.

It reiterated yesterday that owners who wish to sub- let their whole flat must obtain approval from HDB and fulfil the MOP. The MOP for sub-letting is now five years for flats bought direct from HDB and resale flats bought with any CPF housing grant, and three years for resale flats bought without the CPF housing grant.

Home-owners must also comply with HDB rules regarding the maximum number of sub-tenants allowed for the flat's size.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.

BT : Hike in rentals at revamped Northpoint

Business Times - 13 Mar 2010

Hike in rentals at revamped Northpoint

By UMA SHANKARI

FRASERS Centrepoint Trust's (FCT) Northpoint mall has seen a 20 per cent hike in average rentals and a 70 per cent climb in shopper traffic after it was expanded and revamped.

The mall, which is located right next to Yishun MRT station, increased its net lettable area by more than 50 per cent with the addition of a $165 million new wing and a $38.6 million asset enhancement initiative. The new NLA is 235,000 sq ft, up from 149,200 sq ft.

With all the changes, the number of shoppers who visit the mall every month has jumped to 2.4 million, from 1.4-1.6 million three-and-a-half years ago, said Wendy Low, general manager of Frasers Centrepoint Malls. She was speaking to reporters at the 'new' Northpoint's official opening ceremony yesterday.

The average rental fetched by the landlord has also gone up by about 20 per cent on a per square foot (psf) basis. Rents are understood to be in the region of $12-14 psf. 'The enhancement is part of FCT's strategic initiative in unlocking values in existing assets,' said Mrs Low.

From 90 shops previously, Northpoint has almost doubled the number of shops to 168. Occupancy stands at close to 100 per cent.

Next in line for asset enhancement is Causeway Point at Woodlands. Work at the 419,000 sq ft mall could begin sometime later this year. The $710 million Causeway Point is the largest mall in FCT's portfolio and draws the most visitors on a yearly basis.

FCT, which is part of the Fraser and Neave group, listed in 2006 with three malls in its portfolio - Causeway Point, Northpoint and Anchorpoint.

Earlier this year, it bought another two properties - the newly built extension to Northpoint and YewTee Point in Choa Chu Kang - for $290 million from parent company Frasers Centrepoint, the property arm of Fraser and Neave.

FCT shares lost one cent to close at $1.34 yesterday.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



EXPANDED
With the addition of a $165 million new wing and a $38.6 million asset enhancement initiative, net lettable area of Northpoint mall is now 235,000 sq ft, up from 149,200 sq ft

BT : All units in phase1 of The Vision sold out

Business Times - 13 Mar 2010

All units in phase1 of The Vision sold out

Buyers pay $1,332 psf for two penthouses

By EMILYN YAP

HONG Kong developer Cheung Kong has set record selling prices for residential projects in the West Coast area.

It managed to sell all 100 units released in the first phase of sale for the 99-year-leasehold The Vision yesterday. Of these, two penthouses went for $3.6 million each, which works out to around $1,332 per square foot (psf).

Buyers paid around $1,000-$1,200 psf for two, three and four-bedroom units, which start from 818 sq ft in size. Cheung Kong also sold several strata terrace units, and the highest price fetched was $3.2 million.

According to the developer's sales manager Cannas Ho, upgraders made up more than 60 per cent of the buyers, and investors accounted for the remainder.

The Vision will have 281 apartments and 14 strata terrace units altogether. In view of the strong demand, the developer will release another 20 units of two to four-bedders for sale this weekend. Cheung Kong had planned to start the second phase of sale by Q4 this year. Whether it brings the release forward will depend on market response to the project, Ms Ho said.

Take-up so far surprised some market watchers, given that The Vision's asking prices are higher than those of other developments nearby.

One of the newer launches in the area, City Developments' Hundred Trees, achieved prices of above $1,100 psf in recent months. But those transactions involved mainly smaller units measuring 484 sq ft, and the project has a 956-year lease.

The robust take-up of units at The Vision 'shows the strong underlying demand for mass-market homes', said Colliers International research and advisory director Tay Huey Ying. The prices achieved could raise the value of homes in the vicinity, and provide a guide for future launches, she added.

Cheung Kong's Ms Ho attributed The Vision's attractiveness to 'good location and first-class amenities'. The site is across the road from West Coast Park and the sea.

Another developer felt that prices at The Vision are not that staggering, considering the attributes of the site, and that West Coast is home to several private housing estates. The market should not see the prices as signs of a bubble forming, he said.

Nevertheless, observers will be keeping watch on prices of upcoming launches nearby. Far East Organization's Horizon Residences, a freehold 72-unit project in the Pasir Panjang area, could be previewed in the next few weeks.

Elsewhere, the buzz is starting for property agents promoting 76 Shenton Way. Some will be presenting information on the 99-year-leasehold 202-unit project to potential buyers today. Asking prices are said to range from $1,600 psf to above $2,000 psf, depending on the level of the units.

Agents are also gathering interest for Fragrance Group's 161-unit Parc Elegance in Telok Kurau and Novelty Group's Primo Residences near Kovan MRT station.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



MEETING DEMAND
The Vision will have 281 apartments and 14 strata terrace units altogether. In view of strong demand, the developer will release another 20 units of two to four-bedders for sale this weekend

BT : It may look like a bubble, but it's stronger

Business Times - 13 Mar 2010

SHOW ME THE MONEY
It may look like a bubble, but it's stronger

Beijing, it seems, will have to come up with harsher measures to control the rapid rise in property prices

By TEH HOOI LING
SENIOR CORRESPONDENT

IS there or is there not a property bubble in China? That is the billion-dollar question that everybody is asking now. Before we attempt to answer that, it is instructive to examine what caused prices to race ahead in the last one year.

The obvious answer was the government's four trillion yuan (S$816 billion) stimulus package introduced to support the economy in view of the collapse in exports. In his weekly market report recently, Tan Teng Boo of Capital Dynamics outlined how the stimulus package led to the rapid increase in property prices last year.

As part of the stimulus package, the central government ordered banks to turn on the tap to give loans freely. Last year, China's financial institutions extended 9.59 trillion yuan in new credit. Of that, 1.4 trillion yuan went to individual housing loans and 576.4 billion yuan to housing development loans.

At the same time, the government was carrying out its stimulus programmes through the state-owned enterprises (SOEs). With slacking demand, many SOEs found themselves with excess capacities. Where to put the money that the government has injected? Since the property market has a reputation of generating quick and high returns, it became the natural choice for the SOEs to channel the extra money that they had received. Many SOEs established new business entities to venture into the lucrative property market. The participation of the SOEs with deep pockets into the property market initially sent land prices sky high. This subsequently led to elevated house prices.

Two, with the real economy slowing down significantly, some businesses decided to get out of their original business activities and instead used the profits that they had made in the past few years to invest in the property market. The switch gave further impetus to the property market. And three, in addition to the measures provided in the stimulus package to accelerate the construction of low-cost housing, the government also introduced other preferential policies in 2008-2009, directed specifically at the property sector. These included:

* Cutting the deed tax rate for first-time buyers of houses under 90 sq m from 3.5 per cent to one per cent;

* Exempting stamp duty on property purchases;

* Exempting land value-added tax on property sales;

* Cutting the minimum down payment for first-time home buyers to 20 per cent from 30 per cent;

* Cutting the interest rate for personal housing provident fund loans from 4.32 per cent to 4.05 per cent for five-year loans; for loans above five years, the reduction was from 4.86 per cent to 4.59 per cent;

* Cutting the interest rate on mortgages to 70 per cent of the benchmark lending rate;

* Reducing the ownership period eligible for tax exemption for sales of homes by individuals from five years to two years.

All the above measures drew in droves of buyers. Prices climbed. Then there was the hot money. China's economy bottomed out in the first quarter of 2009.

According to Mr Tan, when it became apparent that economic activities have been successfully revived by the Chinese government's aggressive expansionary policies, hot money began to flow in to take advantage of the opportunities presented by the fact that China's economy would recover earlier and faster than the other economies. In 2009, China's trade surplus fell US$99.4 billion from 2008, yet its foreign exchange reserves surged by US$453.1 billion to US$2.4 trillion. The strong inflow of hot money also played a role in pushing up property prices.

Meanwhile, there are compelling factors which ensure a strong and sustained domestic demand for property. First, the rapid rate of urbanisation. According to Lu Dadao, president of the Geographic Society of China, China took 22 years to increase its urbanisation rate from 17.9 per cent to 39.1 per cent. It took the UK 120 years, the United States 80 years and Japan more than 30 years to accomplish the same feat. With the relaxation of the household registration system, more and more people are moving to the cities, creating strong demand for urban housing.

Meanwhile, the psychological make-up of the Chinese, coupled with the lack of options in which to grow their nest eggs, make real estate an attractive place to park one's money. Real estate is like the proverbial bar of gold. In a recent article, Time magazine interviewed a taxi driver in Shanghai who owns three apartments in the city. He hasn't tried to rent out two of his three apartments, saying: 'It's not that important to gain income from them; there is security in just owning them. They are paid for, and I know that if I ever get into any kind of economic trouble, I can sell them. That's real security.'

Real estate makes for a good hedge against inflation given the sharp expansion in money supply in 2009. That many are using their savings to pay for the apartment is supported by the statistics that China's mortgage market constitutes only about 10 per cent of its gross domestic product. This compared with 48 per cent for Hong Kong. Keeping money in the bank yields only 2.25 per cent in a one-year fixed deposit.

Now, of course, the government is trying to reverse some of the policies. The question is, is it too late? For that, we need to answer how far ahead of fundamentals have property prices gone in China. In Japan, in the four years right before its property bubble went bust the average growth rate of residential land prices in the country's six major cities was 25 per cent. China's appreciation is nowhere near that.

And while the growth rate in US house prices in the 10 years before the sub-prime crisis broke out was not as strong as that of Japan's, it was stronger and more sustained than that of China's.

The worrying thing is, China's prices are catching up fast. House prices in 70 large and medium-sized Chinese cities climbed 3.9 per cent in October last year. The pace of increase picked up to 5.7 per cent in November, and yet even higher to 7.8 per cent in December. In January this year, the number was a 9.5 per cent rise from one year earlier, the fastest growth in 19 months.

The government, it seems, will have to come up with harsher measures to cool things down. The consolation is, the consequences of a reversal in property prices would not inflict that great a pain in the Chinese economy given the lesser extent of credit being used in the market.

In China, personal savings and parental contribution are the two major sources of financing for home purchases. According to Patrick Chovanec, a professor at Beijing's Tsinghua University who studies the Chinese real estate sector, only about 50 per cent of residential purchases are made using mortgages. The other half are paid for in full at the time of acquisition. (In the US, by contrast, over 90 per cent of residential housing transactions are financed with mortgages.) Wong Kok Hoi of APS Asset Management is of the view that if prices were to decline 20 per cent, a portion of the Chinese people's substantial savings would be moved to the property market.

Even if prices were to decline by 30 per cent, the majority of home-owners would still not walk away from their mortgage obligations, as we saw in the US, because they still have positive equity in their homes, reckons Mr Wong. In that scenario, Shanghai-based banks would see their non-performing loans rise to 2 per cent and their profits impacted by 7 per cent.

All in all, it seems the bubble trouble in China is not as big as a lot of people fear it to be.

Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.



VALUABLE ASSET
In China, property is like the proverbial bar of gold, and a good hedge against inflation given the sharp expansion in money supply last year.

CNA : HDB takes action against 56 flat owners for illegal sub-letting

HDB takes action against 56 flat owners for illegal sub-letting
By Mustafa Shafawi | Posted: 12 March 2010 1946 hrs

SINGAPORE : The Housing and Development Board (HDB) has taken action against 56 flat owners for illegal sub-letting between January 2008 and December last year.

Most were fined between S$1,000 and S$21,000.

One owner had his flat repossessed for blatantly flouting HDB's sub-letting rules.

Giving details of the case, HDB said it first received feedback on the unauthorised sub-letting of a unit in Block 336 Bukit Batok Street 32 on November 11 last year.

The flat was bought by Poh Boon Kay, who is a registered real estate agent. His wife was listed as an occupier.

He purchased the four-room flat from the open market in June 2007 without any loan.

HDB said the couple are also owners of five private properties. Its investigations found that the flat was sublet without its prior approval to three couples.

Mr Poh and his family did not live in the flat.

He was informed on November 25 to take immediate steps to evict the unauthorised sub-tenants, failing which HDB would take compulsory acquisition action.

However, the subtenants continued to occupy the flat. A notice to compulsorily acquire the flat was then served on December 23.

Mr Poh informed HDB on the same day that the sub-tenants had signed an undertaking to vacate the flat by the end of December.

A day later, the couple appealed. He claimed that the sub-tenant needed time to work out his finances before buying over the flat from Mr Poh.

He had therefore decided to rent out the flat to the sub-tenants in the interim.

On January 5, when the couple was interviewed by HDB, they claimed they did not know that they needed to seek the board's prior approval before subletting the flat.

They also claimed that they were not aware of the policy for flat owners to fulfil the Minimum Occupation Period (MOP) of three years before they were eligible to sublet the whole flat.

HDB's further investigations have shown that Mr Poh is also related to two other cases of unauthorised subletting at Bukit Batok and Telok Blangah.

With these further instances of unauthorised subletting related to Mr Poh, his claims that he is "unaware" of HDB rules cannot be substantiated.

HDB said as he has blatantly flouted HDB's rules, there are no grounds for leniency and legal action has been taken to compulsorily acquire the flat.

HDB will also be taking legal action to compulsorily acquire the other two flats.

HDB would like to emphasise the severity of unauthorised subletting. HDB flats are meant for owner occupation. Flat owners who wish to sublet their whole flat must obtain approval from HDB and fulfil the MOP.

The current MOP for the subletting of flats is as follows:

*Flats bought directly from HDB - 5 years

*Resale flats purchased with CPF Housing Grant - 5 years

*Resale flats purchased without CPF Housing Grant - 3 years

- CNA/ms

CNA : URA to launch sale of residential site

URA to launch sale of residential site
By Mustafa Shafawi | Posted: 12 March 2010 1439 hrs

SINGAPORE: Another Reserve List site has been triggered.

The Urban Redevelopment Authority (URA) said it will launch for sale a residential site at the junction of Upper Changi Road North and Flora Drive in two weeks' time.

It said a developer has committed to bid no less than S$82 million for the three-hectare site. The minimum price is acceptable to the government.

URA said the land parcel can yield 390 units.

Some analysts said the top bid for the Upper Changi Road North site could range between S$160 million and S$185 million.

That would translate to about S$350 to S$400 per square foot per plot ratio.

A residential site at Sengkang West Avenue has already been sold via the Reserve List in February.

Together these two sites can potentially yield about 855 residential units.

There are another 16 residential sites remaining on the Reserve List of the first half of 2010 Government Land Sales (GLS) Programme that can potentially be triggered for sale.

- CNA/sc/ms

CNA : Govt amends Stamp Duties Act

Govt amends Stamp Duties Act
By May Wong | Posted: 12 March 2010 2146 hrs

SINGAPORE: Parliament has passed changes to the Stamp Duties Act. The amendments will give legislative effect to the seller's stamp duty, which was re-introduced on February 20 as one of the measures to discourage property speculation.

Those who sell their residential properties and residential lands within one year of purchase February 20 will have to pay a duty of one per cent for the first S$180,000, two per cent for the next S$180,000 and three per cent for the balance.

Speaking at the second reading of the bill on Friday, Finance Minister Tharman Shanmugaratnam said the government first introduced the seller's stamp duty in 1996 to cool the overheating property market.

It was subsequently suspended in November 1997. Relevant provisions in the Stamp Duties Act were subsequently repealed in 2005.

Another key change - the government will now be able to introduce, vary or remove the seller's stamp duty, via a Ministerial Order that will be published in the Government Gazette.

The Finance Minister said the process of introducing and repealing provisions in the Stamp Duties Act each time the government wants to introduce, vary or remove the duty is not efficient, especially when it has to respond to changes in the property market cycle in a timely and calibrated manner.

Mr Tharman stressed that the government does not intend to change the seller's stamp duty liberally.

He said: "Any future change to the seller's stamp duty will be a carefully considered decision, taking into account all prevailing and projected factors at the time.” - CNA/vm

ASIAONE : Housing agent sublet flat illegally three times

Housing agent sublet flat illegally three times

HDB will now acquire his flat as they step up enforcement against illegal sub-letting. -AsiaOne

Fri, Mar 12, 2010
AsiaOne

In 2007, Mr Poh Boon Kay, a registered real estate agent with five other properties, bought his 4-room Bukit Batok flat at $150,000 without any loans, listing his wife, Mdm Khoo Kim Cheng as occupier.

However, in November 2009, the Housing and Development Board (HDB) discovered that Mr Poh was actually subletting the flat - without HDB's prior approval - to 3 Burmese couples (six adults and one child) at a monthly rent of $1,900. Mr Poh and his family were not residing in the flat.

Two weeks later, HDB informed him that unless the unauthorised sub-tenants are evicted, HDB would take compulsory acquisition action. As the subtenants continued to stay in the flat, a Notice of Board's Intention to compulsorily acquire the flat was served on December 23. On the same day, he said the sub-tenants had signed an undertaking that they would vacate the flat by the end of December.

Mr Poh appealed the next day, claiming that he rented out the flat to the sub-tenants while they worked out their finances in order to buy the flat from him.

When interviewed, he and his wife claimed they did not know that they needed to seek prior approval from HDB before subletting the flat, or that they needed to fulfill the Minimum Occupation Period (MOP) of three years before they are eligible to do so.

Two other cases of illegal sub-letting

HDB subsequently discovered that Mr Poh is related to two more cases of unauthorised sub-letting.

In the second case, he acted as the housing agent for his 91-year-old aunt, whose flat was sublet without HDB's approval to Burmese monks at a monthly rent of $1,400 since July last year. They had used it as a meditation centre, with monthly rents paid out to Mr Poh.

The third case involved his daughter's Telok Blangah flat which was again sublet without HDB's consent to subtenants for $900 a month.

According to a statement released by the HDB, "With these further instances of unauthorised subletting related to Mr. Poh, his claims that he is "unaware" of HDB rules cannot be substantiated. Furthermore, these regulations are publicly available from many sources such as HDB's InfoWeb or service hotline. There is clear evidence that Mr Poh, a housing agent by profession, has been intentionally abusing HDB flats for monetary gains."

HDB has now taken legal action to compulsorily acquire Mr Poh's flat. It plans to take the same action towards his aunt's and daughter's flats as well.

HDB ramps up enforcement against unauthorised subletting

In its statement, HDB said it 'would like to emphasize the severity of unauthorised subletting'.

It said it would take action in those who commit this infringement, from penalties that ranged from fines of $1,000 to $21,000, to repossession of flat. 56 owners have received these penalties from January 2008 to December 2009.

Flat owners who wish to sublet their whole flat must obtain approval from HDB and fulfil the Minimum Occupation Period (MOP). The current MOP for the subletting of flats is as follows:

Flats bought directly from HDB: 5 years
Resale flats purchased with CPF Housing Grant: 5 years
Resale flats purchased without CPF Housing Grant: 3 years
They must also comply with HDB's terms and conditions. For instance, the maximum number of subtenants allowed. 1-Room and 2-Room flats are allowed a maximum of four persons, 3-room flats can have 6 persons, while 4-Room and bigger flat types can have 9 persons in total.

Residents are encouraged to call our dedicated hotline at 1800-5556370 [Monday to Friday - 8am to 5pm] to report any suspected cases.