Business @ AsiaOne
Mistakes made when buying a house
It is important that when you consider a place to call your home, it must be a safe and pleasant place to be in.
Thu, Jul 22, 2010
The Star/Asia News Network
A home is a place of residence or refuge and comfort. It is usually a place where an individual or usually a family can rest and relax, communicate, share, feast and be able to collect and store their personal properties.
Therefore it is important that when you consider a place to call your home, it must be a safe and pleasant place to be in.
Buying a house is more often than not, the single largest investment most people ever make; yet all too often it's a decision made in rush without adequate thought and preparation.
In this article we will explore some of the house-buying mistakes to watch out for in your property hunt.
Solo Mission
Buying a house is a complex transaction and should not be undertaken alone.
You need to enlist the help of these individuals early in the buying process : Real Estate Agent, Banker, Lawyer and Property Inspector.
It is also wise to get referrals and advise or tips from family and friends.
When assembling your team, select rightly. Lack of experience in the person who's suppose to be your guide can make your property hunt a frustrating experience.
Love At First Sight
You may be in love with the house at first sight, but you have to ask yourself if the house fit your family's needs and budget.
You have to make sure that you make a list of your needs and wants and also check whether the house fits your requirements.
Besides that, you should check out the neighbourhood and the communities before you buy by visiting at different times of the day and week.
Even if you do not have kids, you should also check out the local schools to make sure your resale value will be good.
Get past the love at first sight to consider what it'd really be like to live there.
Pre-qualified and Pre-approved Financing
Being pre-qualified gives you a general idea of how much you can afford to borrow.
It is a good idea to get in touch with your banker or mortgage officer early in the buying process so that you are aware of the amount you can borrow as this will determine your budget for the home.
The mortgage officers will also be in a position to advise you on aspects of financing i.e. the possibility of having joint borrowers to strengthen the application or to lengthen loan tenures should a need arise.
Being pre-approved means your banker has verified your information and credit rating and agreed to provide you with a specific amount of money.
You are in a better position to go house hunting knowing exactly how much you can afford and that you have the financing ready.
Over-Buying
You may qualify to borrow more, but you have to ask yourself again whether you can afford it or not.
Borrowing more would mean higher monthly loan commitments for just the purchase of the house. You have not considered the cost of improvements on the house i.e. renovations and furnishings.
What you need to do is analyze your monthly costs - food, transportation, entertainment, car loans and other commitments. Therefore you have to be sure to budget enough to cover closing costs (often two to five percent of the purchase price), plus moving and maintenance.
Beyond mortgage payments, there'll be costs like insurance. You don't want your house to deprive you of your lifestyle.
Misplacing your trust
Remember that buying a house is a business transaction.
Your decision is binding.
You should do your own research and know your support team's roles and responsibilities and not just depending on what one says 100%.
Verbal Agreement
Get it right and get it in writing.
Written agreements almost always trump verbal ones when it comes to contracts.
Don't set yourself up for surprises when you move into that new house and some of the items in it are now missing.
There are many details that make up the purchase contract that governs the particulars of your house purchase.
It is not unusual for an item to be missed; especially those requests made by you of the seller or seller's agent. If you ask for a toilet to be repaired or a chipped tile to be repaired, don't simply take someone's word that the item will be repaired prior to transfer of the property. Make sure every item that you agree on is put in the purchase contract.
Verbal agreements are hard to prove and even harder to enforce. They can lead to an ugly "he said, she said" situation.
Once the property transfers to your name; problems or issues that you thought were going to be repaired are now your responsibility. Don't let miscommunication or failed promises ruin the purchase of your dream home.
Get all commitments - no matter how small - in writing.
Fine print
You need to understand what you're signing.
As soon as possible, review the documents you'll be signing. You must always ask for documents in advance, make time to read them and ask questions, where necessary.
Don't just skim through the purchase contract. Real estate contracts are long and dense, but you need to know what you're committing to.
Wrong assumptions, poorly written or missing clauses, and not understanding how the clauses affect the purchase can lead to increased costs or a void contract.
Do not sign documents in a hurry. Do not rush the closing.
Resale
You should avoid buying a home that costs much more than neighbouring homes and think before buying the most expensive house in the area.
Your neighbours' lower house values will weaken yours.
Remember, markets change.
If you buy intending to flip your investment and the market falls and you have to sell, your selling price may not be enough to even cover your mortgage.
Wrong Price
Many home-buyers forget that the market value of a house is affected a great deal by its neighbours.
The best way to gauge a fair offer price is to get your real estate agent to pull prices that comparable homes nearby recently fetched. The listings will show not just the amounts but how long the house has been on the market and its condition and size.
Note that the nearby houses will affect your house's value. That means the most expensive house on the street may be pulled down in value by its cheaper neighbours, while a low-end one will benefit from posher surroundings.
Conditional Offer
It is good practice to have your offer to purchase the house conditional upon securing financing.
The last thing you want happen to you is the forfeiture of your deposits for backing out on a purchase transaction because of it.
One thing is being pre-approved, the other is the property itself.
The banks will do a valuation on the property to confirm the market value and then to determine the margin of loan they are willing to offer you. There may be other conditions are well that you might want to add in at this point.
House Inspection
It is well worth your money engaging a House Inspector to check out the house before committing to the purchase.
These Inspectors know what to look out for and can advise you accordingly on the state of the house, whether it is in need of repairs so that you are fully aware of the additional expenses needed.
Don't take the word of the seller that certain repairs and maintenance has been made to the home. A formal inspection of wiring, plumbing, and general structure of the home is needed to avoid nasty surprises.
Inspection reports are great negotiating tools when it comes to asking the seller to make repairs.
If a professional home inspector cites specific repairs in the inspection report the seller is more likely to agree to them than if you simply try to negotiate based on your observations. As we mentioned above, make sure that any last minute items that arise based on the inspection report or your own visual inspection during the walk through are addressed in writing and completed before you take ownership of the property.
If the seller agrees to make repairs, have your inspector verify the work is completed properly. Do not assume that everything will be done as promised.
If you're buying a new house, off the plans from the developer, they will offer the Defect Liability Period upon Vacant Possession, where they will rectify problems, if any, with the house during Handover.
Buyer's Remorse
No place is perfect. There will always be surprises. Don't let a few initial blips spoil the whole ride.
And don't miss a great house waiting for the perfect one!
Failing to jump on an opportunity, I believe, is a mistake. Too much shopping around can backfire.
When you have done your homework and when you see something you that matches, go for it.
Friday, July 23, 2010
TODAY ONLINE : What price flooding?
What price flooding?
Homeowners worried property values in flood prone areas could fall
05:55 AM Jul 22, 2010
by Esther Ng
SINGAPORE - The floodwaters have receded, and the worry now on the minds of some homeowners in low-lying areas is that property and rental prices will follow.
Real estate experts have mixed views on whether values will dip or if this is just a premature, knee-jerk reaction.
"It's already clear in people's minds which areas are flood-prone. This could dampen demand and prices for these places," said ERA's Asia-Pacific associate director Eugene Lim, who reckoned that both residential and commercial premises could take a hit of 10 to 15 per cent.
While it is unlikely that homeowners will rush to sell their property, "potential rental values" in these areas, which include Telok Kurau, Opera Estate and Thomson, "could possibly be affected", he added.
Ngee Ann Polytechnic lecturer Nicholas Mak agreed: "There's always a risk that flooding will damage cars, paintwork, plants or cause the electrical system to short circuit, something which tenants will bear in mind."
Mr Faiek Peck, a tenant at one of the townhouses on Gentle Road, off Dunearn Road, told MediaCorp on Tuesday that he planned to move out. "We're discussing with the owner whether we can get out of the contract or not ... If he's not willing to improve the situation to do something to prevent it again, we've got to see what we can do, get lawyers involved and get out of here," he said.
While some homeowners may want out, buyers may not want to buy, said Mr Mak.
This was on the mind of a homeowner at the Gentle Reflections development, who has been staying at a hotel with her family of four since last Saturday's flood.
Declining to be named, she said: "Who's going to buy now after the bad publicity?"
Yet, in the past few days, Knight Frank's head of business unit Daniel Leong has received a few calls from buyers interested in Tessarina, a development along Wilby Road which has been hit twice by the floods, the first in November last year.
"They're hoping the owners would give up and sell at rock-bottom prices," said Mr Leong. "But these owners are not moving. If they have to sell, it's because they need a quick sale, but homeowners in Bukit Timah are solid financially."
While property consultants agree that property values in flood-prone areas may head south if flooding becomes a regular occurrence and flood-alleviating solutions prove ineffective, it is "too early to see long-lasting change in buying and renting preferences", said Mr Karamjit Singh, managing director of real estate consultancy Credo.
He described the three floods in the last month as "the exception" - a sentiment shared by property firm Cushman & Wakefield's managing director Donald Han.
"Bukit Timah is famous for flooding, yet districts 10 and 11 are the preferred location for prestigious living - people buy with their eyes open," he said.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
Homeowners worried property values in flood prone areas could fall
05:55 AM Jul 22, 2010
by Esther Ng
SINGAPORE - The floodwaters have receded, and the worry now on the minds of some homeowners in low-lying areas is that property and rental prices will follow.
Real estate experts have mixed views on whether values will dip or if this is just a premature, knee-jerk reaction.
"It's already clear in people's minds which areas are flood-prone. This could dampen demand and prices for these places," said ERA's Asia-Pacific associate director Eugene Lim, who reckoned that both residential and commercial premises could take a hit of 10 to 15 per cent.
While it is unlikely that homeowners will rush to sell their property, "potential rental values" in these areas, which include Telok Kurau, Opera Estate and Thomson, "could possibly be affected", he added.
Ngee Ann Polytechnic lecturer Nicholas Mak agreed: "There's always a risk that flooding will damage cars, paintwork, plants or cause the electrical system to short circuit, something which tenants will bear in mind."
Mr Faiek Peck, a tenant at one of the townhouses on Gentle Road, off Dunearn Road, told MediaCorp on Tuesday that he planned to move out. "We're discussing with the owner whether we can get out of the contract or not ... If he's not willing to improve the situation to do something to prevent it again, we've got to see what we can do, get lawyers involved and get out of here," he said.
While some homeowners may want out, buyers may not want to buy, said Mr Mak.
This was on the mind of a homeowner at the Gentle Reflections development, who has been staying at a hotel with her family of four since last Saturday's flood.
Declining to be named, she said: "Who's going to buy now after the bad publicity?"
Yet, in the past few days, Knight Frank's head of business unit Daniel Leong has received a few calls from buyers interested in Tessarina, a development along Wilby Road which has been hit twice by the floods, the first in November last year.
"They're hoping the owners would give up and sell at rock-bottom prices," said Mr Leong. "But these owners are not moving. If they have to sell, it's because they need a quick sale, but homeowners in Bukit Timah are solid financially."
While property consultants agree that property values in flood-prone areas may head south if flooding becomes a regular occurrence and flood-alleviating solutions prove ineffective, it is "too early to see long-lasting change in buying and renting preferences", said Mr Karamjit Singh, managing director of real estate consultancy Credo.
He described the three floods in the last month as "the exception" - a sentiment shared by property firm Cushman & Wakefield's managing director Donald Han.
"Bukit Timah is famous for flooding, yet districts 10 and 11 are the preferred location for prestigious living - people buy with their eyes open," he said.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
ST : Wrong timing, now family has no home
Jul 22, 2010
Wrong timing, now family has no home
MR W. H. Wong, 36, a manager, has been living apart from his wife and two young children for six months and sees no end to their plight in sight.
He sold his four-room flat last August to upgrade to a maisonette but while trying to secure a housing loan, HDB's loan policy changed and he now faces a cash shortfall for his next purchase.
He still hopes to buy a maisonette, so his parents can move in with him.
For now, his wife and their two children, aged six and four, stay with her parents in Serangoon, while he is with his parents in Chua Chu Kang.
Every evening, he drives to Serangoon to see his family, then heads back to his parents' four-room flat, which is too small to accommodate his family.
He is frustrated at the situation because, unlike some others, he did not sell his flat for easy cash but to upgrade to a bigger home.
When he sold his flat last August, he received cash proceeds of $57,000. Now, HDB has asked him to fork out half of that sum for his next purchase. HDB has also reduced the size of the loan it will grant him by that amount.
'The housing loan is now smaller, and the cash-over-valuation for flats is rising. With this new rule, HDB has reduced the amount of cash I have that I could have used to pay for the COV of the new flat,' he said.
A buoyant market has sent the COV - cash premiums for HDB flats - soaring.
Mr Wong has tried looking for flats with lower COV but to no avail. He also sought the help of his MP Cynthia Phua.
His query: 'I sold my flat before the policy was implemented. Why does it apply to me?'
In November last year, he applied for an HDB loan to finance the purchase of his second flat.
The board rejected the application as the couple's combined monthly income exceeded the cap of $8,000.
He re-applied. HDB finally gave him a loan in April. By then, his wife had left her job and the family income was below $8,000.
Now, the problem is that he does not have enough cash to buy a flat of the size he wants.
'Every maisonette seller is now asking for at least $50,000 in COV. If I give HDB half of my cash proceeds, where do I find the cash to pay for the COV?' he asked.
'It's all wrong timing,' he lamented.
TEO WAN GEK
Wrong timing, now family has no home
MR W. H. Wong, 36, a manager, has been living apart from his wife and two young children for six months and sees no end to their plight in sight.
He sold his four-room flat last August to upgrade to a maisonette but while trying to secure a housing loan, HDB's loan policy changed and he now faces a cash shortfall for his next purchase.
He still hopes to buy a maisonette, so his parents can move in with him.
For now, his wife and their two children, aged six and four, stay with her parents in Serangoon, while he is with his parents in Chua Chu Kang.
Every evening, he drives to Serangoon to see his family, then heads back to his parents' four-room flat, which is too small to accommodate his family.
He is frustrated at the situation because, unlike some others, he did not sell his flat for easy cash but to upgrade to a bigger home.
When he sold his flat last August, he received cash proceeds of $57,000. Now, HDB has asked him to fork out half of that sum for his next purchase. HDB has also reduced the size of the loan it will grant him by that amount.
'The housing loan is now smaller, and the cash-over-valuation for flats is rising. With this new rule, HDB has reduced the amount of cash I have that I could have used to pay for the COV of the new flat,' he said.
A buoyant market has sent the COV - cash premiums for HDB flats - soaring.
Mr Wong has tried looking for flats with lower COV but to no avail. He also sought the help of his MP Cynthia Phua.
His query: 'I sold my flat before the policy was implemented. Why does it apply to me?'
In November last year, he applied for an HDB loan to finance the purchase of his second flat.
The board rejected the application as the couple's combined monthly income exceeded the cap of $8,000.
He re-applied. HDB finally gave him a loan in April. By then, his wife had left her job and the family income was below $8,000.
Now, the problem is that he does not have enough cash to buy a flat of the size he wants.
'Every maisonette seller is now asking for at least $50,000 in COV. If I give HDB half of my cash proceeds, where do I find the cash to pay for the COV?' he asked.
'It's all wrong timing,' he lamented.
TEO WAN GEK
ST : Sentosa plans new attractions
Jul 22, 2010
Sentosa plans new attractions
International firms invited to discuss how to further develop island
By Tessa Wong
SENTOSA is looking at the possibility of adding to its list of attractions, even as visitors have been pouring in to check out new features such as the Resorts World Sentosa integrated resort.
Some 60 international companies have been sought out by the Sentosa Development Corporation in recent months for discussions on how to further develop the island, which already boasts close to 30 attractions.
At least two areas have been earmarked for further transformation, with Sentosa tendering for developers.
One is Palawan Beach, which already received a makeover in 2006. The upcoming revamp will feature an 800m landscaped walkway to incorporate the current stretch of bars, restaurants and a foodcourt along the area.
The new walkway, Palawan Link, will have additional restaurants and cafes, and will also feature a pirate-themed splashing zone for young children.
Sentosa is also exploring the idea of building a family entertainment centre in this area.
Also in line for development is the grassy 30ha slope bordered by the Images of Singapore attraction, the Merlion Tower and Siloso Beach. To be called Imbiah Garden Link, the area will be turned into a visitor attraction that will, at the same time, connect pedestrians to other attractions in the Imbiah and Siloso area.
It will have a garden theme and can host flower shows and garden events, and will also have space for public art displays and interactive exhibits.
On top of these two projects, Sentosa's management is currently mulling over several ideas, including building a massive artificial lagoon.
Chilean company Crystal Lagoon has proposed building a 12ha, 2m-deep pool along Siloso and Palawan beaches. This would be bounded by the small islets that lie off those beaches.
This pool would be bigger than Crystal Lagoon's most famous achievement, an 8ha pool at the southern Chilean resort of San Alfonso del Mar which, in 2008, earned the Guinness Book of Records title for the world's biggest swimming pool.
Like that pool, the proposed Sentosa lagoon would be filled with sea water that is treated and filtered to become clear blue salt water. It would also feature an artificial beach constructed around it, filled with white sand made from ground quartz.
Sentosa Development Corporation chief executive Mike Barclay said that while nothing has been signed yet, the company is definitely looking into the idea. 'There is nothing like this in our part of the world,' he said.
However, he stressed that it is just one of many ideas under consideration.
Any future developments are likely to cost Sentosa millions of dollars, if the $11 million bill for the 2006 makeover of Palawan Beach is anything to go by.
Estimates given to The Straits Times by Crystal Lagoon suggest that building the artificial lagoon could cost Sentosa US$4.2 million (S$5.8 million), while maintaining it would require a further US$504,000 per year.
The corporation, which is a government statutory board, appears to be in good financial health. According to its latest financial statement, it has $2.7 billion in total capital and reserves.
Future infrastructure developments such as Palawan Link and Imbiah Garden Link are likely to receive additional government funding.
The number of visitors to the island has grown steadily, with 6.2 million last year, a 50 per cent increase from 2003.
In that period, the island saw the upgrading of its beaches, the development of Sentosa Cove and the construction of new attractions such as the Sentosa Luge and the Sky Tower.
All of them were part of an $8 billion masterplan started in 2002 to rejuvenate the island. More private businesses have since gone in, with the opening of the integrated resort, a wave simulation attraction and a watersports centre all in the past 12 months.
Meanwhile, workers have been busy constructing a large boardwalk between the mainland and the island, the new Movenpick Hotel and a skydiving simulator, all due in coming months.
When asked why it was considering even more attractions such as the lagoon, spokesman Suzanne Ho said: 'To increase Sentosa's appeal as a choice leisure destination, we continually seek interesting ideas to refresh our existing island offerings and introduce innovative attractions.'
twong@sph.com.sg
Sentosa plans new attractions
International firms invited to discuss how to further develop island
By Tessa Wong
SENTOSA is looking at the possibility of adding to its list of attractions, even as visitors have been pouring in to check out new features such as the Resorts World Sentosa integrated resort.
Some 60 international companies have been sought out by the Sentosa Development Corporation in recent months for discussions on how to further develop the island, which already boasts close to 30 attractions.
At least two areas have been earmarked for further transformation, with Sentosa tendering for developers.
One is Palawan Beach, which already received a makeover in 2006. The upcoming revamp will feature an 800m landscaped walkway to incorporate the current stretch of bars, restaurants and a foodcourt along the area.
The new walkway, Palawan Link, will have additional restaurants and cafes, and will also feature a pirate-themed splashing zone for young children.
Sentosa is also exploring the idea of building a family entertainment centre in this area.
Also in line for development is the grassy 30ha slope bordered by the Images of Singapore attraction, the Merlion Tower and Siloso Beach. To be called Imbiah Garden Link, the area will be turned into a visitor attraction that will, at the same time, connect pedestrians to other attractions in the Imbiah and Siloso area.
It will have a garden theme and can host flower shows and garden events, and will also have space for public art displays and interactive exhibits.
On top of these two projects, Sentosa's management is currently mulling over several ideas, including building a massive artificial lagoon.
Chilean company Crystal Lagoon has proposed building a 12ha, 2m-deep pool along Siloso and Palawan beaches. This would be bounded by the small islets that lie off those beaches.
This pool would be bigger than Crystal Lagoon's most famous achievement, an 8ha pool at the southern Chilean resort of San Alfonso del Mar which, in 2008, earned the Guinness Book of Records title for the world's biggest swimming pool.
Like that pool, the proposed Sentosa lagoon would be filled with sea water that is treated and filtered to become clear blue salt water. It would also feature an artificial beach constructed around it, filled with white sand made from ground quartz.
Sentosa Development Corporation chief executive Mike Barclay said that while nothing has been signed yet, the company is definitely looking into the idea. 'There is nothing like this in our part of the world,' he said.
However, he stressed that it is just one of many ideas under consideration.
Any future developments are likely to cost Sentosa millions of dollars, if the $11 million bill for the 2006 makeover of Palawan Beach is anything to go by.
Estimates given to The Straits Times by Crystal Lagoon suggest that building the artificial lagoon could cost Sentosa US$4.2 million (S$5.8 million), while maintaining it would require a further US$504,000 per year.
The corporation, which is a government statutory board, appears to be in good financial health. According to its latest financial statement, it has $2.7 billion in total capital and reserves.
Future infrastructure developments such as Palawan Link and Imbiah Garden Link are likely to receive additional government funding.
The number of visitors to the island has grown steadily, with 6.2 million last year, a 50 per cent increase from 2003.
In that period, the island saw the upgrading of its beaches, the development of Sentosa Cove and the construction of new attractions such as the Sentosa Luge and the Sky Tower.
All of them were part of an $8 billion masterplan started in 2002 to rejuvenate the island. More private businesses have since gone in, with the opening of the integrated resort, a wave simulation attraction and a watersports centre all in the past 12 months.
Meanwhile, workers have been busy constructing a large boardwalk between the mainland and the island, the new Movenpick Hotel and a skydiving simulator, all due in coming months.
When asked why it was considering even more attractions such as the lagoon, spokesman Suzanne Ho said: 'To increase Sentosa's appeal as a choice leisure destination, we continually seek interesting ideas to refresh our existing island offerings and introduce innovative attractions.'
twong@sph.com.sg
ST : Some HDB buyers in a fix over cash proceeds rule
Jul 22, 2010
Some HDB buyers in a fix over cash proceeds rule
Half of gains must go towards next flat but they have spent money
By Teo Wan Gek
A SMALL number of HDB buyers now face a cash shortfall and cannot buy replacement homes of their choice, due to changes to the HDB loan policy in March.
These buyers sold their flats before a new rule stated that buyers must use 50 per cent of their cash proceeds to finance their next flat. They are now stuck because they have spent the cash.
A Straits Times check with 16 MPs found that a small number of such buyers have showed up at their Meet-the-People sessions.
Aljunied GRC MP Cynthia Phua has five constituents caught out by the policy change; Dr Lim Wee Kiak, an MP for Sembawang GRC, has seven; Mr Yeo Guat Kwang, also of Aljunied GRC, has two and Madam Ho Geok Choo of West Coast GRC has 10.
These buyers are divided into two groups: downgraders who sold their flats and used the cash proceeds to settle debts, or genuine upgraders who need a bigger flat for their families.
Among those who sought Madam Phua's help were a couple who sold their flat in 2006. When they tried to buy a flat this year, they were surprised that the loan amount granted by HDB was reduced by half the cash proceeds from the first sale.
HDB changed its loan policy in March to make second concessionary loans available to downgraders. Such loans were previously given only to upgraders. HDB also laid down a new rule - loan applicants must use the full CPF proceeds and half the cash proceeds from the sale of the previous flat or $25,000, whichever is less, to finance their next home. The change was to encourage financial prudence.
While Madam Phua supports the move to prevent home owners from cashing out on their flats, she does not think it is fair for those who sold their flats before the policy change in March to be subject to the new requirement.
'HDB will now give a loan only less half of the cash proceeds amount, but that's not enough money to buy a new home and most of them have already spent their cash proceeds,' she said.
During Monday's Parliament sitting, Madam Phua appealed to National Development Minister Mah Bow Tan on behalf of her constituent who sold his flat in 2006.
Mr Mah said in reply that the HDB gave home buyers a second subsidised loan so they could buy something they really needed. 'If you have already made a lot of money, then I think it is only fair that the HDB takes that into account, irrespective of when you have sold a flat,' he said.
He also felt that home buyers like the one Madam Phua cited were 'rare', as most bought a second flat soon after they sold their first. Still, he promised to review appeals on a case-by-case basis.
The HDB also provided figures to show that the policy change benefited large numbers of downgraders.
Between March and May 31 this year, HDB approved 2,439 applications for a second concessionary loan. Of these, more than half were downsizing or moving to a flat of the same size. These buyers would not have qualified for a second subsidised loan if the policy had not been changed.
On Monday, Mr Mah stressed that the size of the second loan could not be independent of the proceeds from the sale of the previous flat. If it were, that would create a 'perverse incentive' for people to upgrade and downgrade 'to automatically get a larger HDB loan'.
PropNex chief executive Mohamed Ismail said the policy change has helped many flat owners who faced financial hardship and needed to downgrade to a smaller flat. Before the change, they could not apply for a second HDB loan. Many were also unable to secure a bank loan because of their bad credit history, he said.
The new rule has made some more cautious. Mr Jerry Lee, 31, a property agent with HSR Property, has had five clients change their minds about selling since March. 'Many of them wanted to cash in on their property, but the policy change has made them think twice before selling.'
wangekt@sph.com.sg
Some HDB buyers in a fix over cash proceeds rule
Half of gains must go towards next flat but they have spent money
By Teo Wan Gek
A SMALL number of HDB buyers now face a cash shortfall and cannot buy replacement homes of their choice, due to changes to the HDB loan policy in March.
These buyers sold their flats before a new rule stated that buyers must use 50 per cent of their cash proceeds to finance their next flat. They are now stuck because they have spent the cash.
A Straits Times check with 16 MPs found that a small number of such buyers have showed up at their Meet-the-People sessions.
Aljunied GRC MP Cynthia Phua has five constituents caught out by the policy change; Dr Lim Wee Kiak, an MP for Sembawang GRC, has seven; Mr Yeo Guat Kwang, also of Aljunied GRC, has two and Madam Ho Geok Choo of West Coast GRC has 10.
These buyers are divided into two groups: downgraders who sold their flats and used the cash proceeds to settle debts, or genuine upgraders who need a bigger flat for their families.
Among those who sought Madam Phua's help were a couple who sold their flat in 2006. When they tried to buy a flat this year, they were surprised that the loan amount granted by HDB was reduced by half the cash proceeds from the first sale.
HDB changed its loan policy in March to make second concessionary loans available to downgraders. Such loans were previously given only to upgraders. HDB also laid down a new rule - loan applicants must use the full CPF proceeds and half the cash proceeds from the sale of the previous flat or $25,000, whichever is less, to finance their next home. The change was to encourage financial prudence.
While Madam Phua supports the move to prevent home owners from cashing out on their flats, she does not think it is fair for those who sold their flats before the policy change in March to be subject to the new requirement.
'HDB will now give a loan only less half of the cash proceeds amount, but that's not enough money to buy a new home and most of them have already spent their cash proceeds,' she said.
During Monday's Parliament sitting, Madam Phua appealed to National Development Minister Mah Bow Tan on behalf of her constituent who sold his flat in 2006.
Mr Mah said in reply that the HDB gave home buyers a second subsidised loan so they could buy something they really needed. 'If you have already made a lot of money, then I think it is only fair that the HDB takes that into account, irrespective of when you have sold a flat,' he said.
He also felt that home buyers like the one Madam Phua cited were 'rare', as most bought a second flat soon after they sold their first. Still, he promised to review appeals on a case-by-case basis.
The HDB also provided figures to show that the policy change benefited large numbers of downgraders.
Between March and May 31 this year, HDB approved 2,439 applications for a second concessionary loan. Of these, more than half were downsizing or moving to a flat of the same size. These buyers would not have qualified for a second subsidised loan if the policy had not been changed.
On Monday, Mr Mah stressed that the size of the second loan could not be independent of the proceeds from the sale of the previous flat. If it were, that would create a 'perverse incentive' for people to upgrade and downgrade 'to automatically get a larger HDB loan'.
PropNex chief executive Mohamed Ismail said the policy change has helped many flat owners who faced financial hardship and needed to downgrade to a smaller flat. Before the change, they could not apply for a second HDB loan. Many were also unable to secure a bank loan because of their bad credit history, he said.
The new rule has made some more cautious. Mr Jerry Lee, 31, a property agent with HSR Property, has had five clients change their minds about selling since March. 'Many of them wanted to cash in on their property, but the policy change has made them think twice before selling.'
wangekt@sph.com.sg
BT : Reining in unethical moneylending
Business Times - 22 Jul 2010
Reining in unethical moneylending
THE unusual urgency with which a housing bill was expedited through Parliament this week was well warranted and welcome - even (or perhaps especially) if it sounds the death knell for a small but insidious industry.
In going for the roof over the borrower's head, Singapore's moneylenders have been no less pernicious than latter-day Shylocks - indeed, every bit as artful and exploitative as the notorious Shakespearean character who coolly sought, as loan collateral, a pound of flesh. With the law amended to close an unfortunate loophole, Singapore's moneylenders - or legalised loan sharks, as it were - can no longer avail themselves of the sales proceeds when desperate HDB flat owners resort to cashing out their homes for quick funds.
For the lenders, this is a sudden turn of events leaving them lamenting their fate, with nary a trace of guilt nor any sense of wrongdoing. And this is an industry officially represented by an association - the Moneylender's (sic) Association of Singapore - that states, among its five objectives, a desire not only 'to project moneylending as an important and integral part of the business of financing individuals and businesses' but also 'to advocate ethical practice in the moneylending industry'.
No doubt, moneylending (legal and illegal) plays a key role in consumer financing, and indeed in small business financing as well. The average person sometimes finds it hard to get a bank loan to pay off urgent bills or debts, especially if he or she is unemployed or a low-income earner. But, while the moneylending association has a self-declared aim of advocating ethical practices, its president felt free to explain, in a newspaper report in January, why his members were targeting HDB sellers in need of quick cash. Indeed, ads by moneylenders were essentially saying: 'Only HDB sellers need apply'.
David Poh, the association's president, was reported to have said: 'If they take a personal loan which is based on their income, they may lose their job at any time, so it's not so secure for us.' Liquidating a HDB flat, on the other hand, virtually guarantees repayment, as the moneylenders - who would have lodged a caveat on the flat - get the first bite of the sales proceeds. The number of HDB resale applications with caveats lodged by moneylenders in just the first six months of 2010 has already exceeded the 2009 total of 546. The lenders might have insisted there was nothing unethical about this - indeed, it was entirely legal, until this week - but there was also collusion with housing agents who, for a fee, would refer flat sellers to lenders.
New rules in May ended the lucrative careers of lenders moonlighting as housing agents and vice versa, and a welcome new bill to regulate housing agents is on the cards. It remains to be seen how many of the several hundred moneylenders in town will actually close shop. If those weeded out are the firms that cannot thrive ethically, it would be no loss at all. And if the culling makes room for ethical, institutional microfinance to take root here and displace loan sharks, all the better.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Reining in unethical moneylending
THE unusual urgency with which a housing bill was expedited through Parliament this week was well warranted and welcome - even (or perhaps especially) if it sounds the death knell for a small but insidious industry.
In going for the roof over the borrower's head, Singapore's moneylenders have been no less pernicious than latter-day Shylocks - indeed, every bit as artful and exploitative as the notorious Shakespearean character who coolly sought, as loan collateral, a pound of flesh. With the law amended to close an unfortunate loophole, Singapore's moneylenders - or legalised loan sharks, as it were - can no longer avail themselves of the sales proceeds when desperate HDB flat owners resort to cashing out their homes for quick funds.
For the lenders, this is a sudden turn of events leaving them lamenting their fate, with nary a trace of guilt nor any sense of wrongdoing. And this is an industry officially represented by an association - the Moneylender's (sic) Association of Singapore - that states, among its five objectives, a desire not only 'to project moneylending as an important and integral part of the business of financing individuals and businesses' but also 'to advocate ethical practice in the moneylending industry'.
No doubt, moneylending (legal and illegal) plays a key role in consumer financing, and indeed in small business financing as well. The average person sometimes finds it hard to get a bank loan to pay off urgent bills or debts, especially if he or she is unemployed or a low-income earner. But, while the moneylending association has a self-declared aim of advocating ethical practices, its president felt free to explain, in a newspaper report in January, why his members were targeting HDB sellers in need of quick cash. Indeed, ads by moneylenders were essentially saying: 'Only HDB sellers need apply'.
David Poh, the association's president, was reported to have said: 'If they take a personal loan which is based on their income, they may lose their job at any time, so it's not so secure for us.' Liquidating a HDB flat, on the other hand, virtually guarantees repayment, as the moneylenders - who would have lodged a caveat on the flat - get the first bite of the sales proceeds. The number of HDB resale applications with caveats lodged by moneylenders in just the first six months of 2010 has already exceeded the 2009 total of 546. The lenders might have insisted there was nothing unethical about this - indeed, it was entirely legal, until this week - but there was also collusion with housing agents who, for a fee, would refer flat sellers to lenders.
New rules in May ended the lucrative careers of lenders moonlighting as housing agents and vice versa, and a welcome new bill to regulate housing agents is on the cards. It remains to be seen how many of the several hundred moneylenders in town will actually close shop. If those weeded out are the firms that cannot thrive ethically, it would be no loss at all. And if the culling makes room for ethical, institutional microfinance to take root here and displace loan sharks, all the better.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : London CBD costliest for car parking
Business Times - 22 Jul 2010
London CBD costliest for car parking
Hong Kong the most expensive in Asia-Pacific: survey
By EMILYN YAP
(SINGAPORE) Parking a car in Singapore's central business district (CBD) may seem expensive, but it still costs substantially less compared to other cities such as London and Hong Kong.
Colliers International tracked parking rates across the CBDs of 145 cities in June and found those in London to be the highest.
It would cost US$932.99 a month to park a car in the city of London.
In local currency terms, the rate had risen 2.1 per cent in the last 12 months, 'highlighting the bounce-back in a number of financial centres', Colliers said.
London's West End took second place with a parking rate of US$873.50 a month.
Hong Kong was third with a CBD parking rate of US$744.72 a month.
This also made it the most expensive Asia-Pacific city for parking.
Other Asia-Pacific cities on the top ten list are Tokyo (fourth), Sydney (sixth) and Perth (seventh).
Singapore ranked low in Colliers' survey with a monthly parking rate of US$192.89 in the CBD. In local currency terms, that increased by around 4.3 per cent year-on-year.
Colliers' research and advisory director Tay Huey Ying believes there will be upward pressure on parking rates in Singapore.
With more offices, hotels and shopping areas coming up in the CBD, demand for parking space can be expected to increase, she said.
But the demand can be price sensitive and carpark operators and landlords should take note of that, she added.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
London CBD costliest for car parking
Hong Kong the most expensive in Asia-Pacific: survey
By EMILYN YAP
(SINGAPORE) Parking a car in Singapore's central business district (CBD) may seem expensive, but it still costs substantially less compared to other cities such as London and Hong Kong.
Colliers International tracked parking rates across the CBDs of 145 cities in June and found those in London to be the highest.
It would cost US$932.99 a month to park a car in the city of London.
In local currency terms, the rate had risen 2.1 per cent in the last 12 months, 'highlighting the bounce-back in a number of financial centres', Colliers said.
London's West End took second place with a parking rate of US$873.50 a month.
Hong Kong was third with a CBD parking rate of US$744.72 a month.
This also made it the most expensive Asia-Pacific city for parking.
Other Asia-Pacific cities on the top ten list are Tokyo (fourth), Sydney (sixth) and Perth (seventh).
Singapore ranked low in Colliers' survey with a monthly parking rate of US$192.89 in the CBD. In local currency terms, that increased by around 4.3 per cent year-on-year.
Colliers' research and advisory director Tay Huey Ying believes there will be upward pressure on parking rates in Singapore.
With more offices, hotels and shopping areas coming up in the CBD, demand for parking space can be expected to increase, she said.
But the demand can be price sensitive and carpark operators and landlords should take note of that, she added.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : Credit Suisse analysts favour stocks of 'older office' landlords
Business Times - 22 Jul 2010
Credit Suisse analysts favour stocks of 'older office' landlords
By KAREN NG
THE recovery in the prime office sector of Singapore is faster than expected, say Credit Suisse analysts. In a July 20 research report on the Singapore property sector, they said that stocks that are 'prime office plays' have year- to-date outperformed the Straits Times Index (STI) by 13 per cent and stocks of residential developers by 23 per cent.
Citing this as a reason, the analysts say that stocks of residential developers and older office/commercial landlords now look attractive.
Taking a contrarian view, the Credit Suisse analysts recommend a switch to the laggard stock of City Developments (CDL) from Keppel Land as the latter, a prime office proxy, has already outperformed the indices by 14-18 per cent year-to-date.
Reasons that the analysts cited in favour of CDL are: potential rerating of its large yet older office/commercial portfolio and its South Beach project; its largest low-cost residential land bank; and its 54 per cent stake in its global hotel arm, M&C, which they see as a prime beneficiary of the strong growth in the Asian hospitality markets.
Other factors cited in support of residential developers are receding policy risks, 'given the moderate price increases'. The analysts expect investment sentiment to stay firm, given strong economic growth, low interest rates, continued population growth and residential developers' stocks lagging the physical market.
The research report, which sees CDL as a bellwether all-round play, downgraded Keppel Land to 'neutral' from 'outperform' with a target price of $4.13, and upgraded CDL to 'outperform' from 'neutral' with a target price of $13.18.
Other property stocks on which the analysts have an 'outperform' call are CapitaLand, Allgreen and Wing Tai. They maintain their 'outperform' call on CapitaLand for its attractive valuations and believe that the concerns over its China exposure have been overdone. Allgreen and Wing Tai are favoured for their attractive land bank and big discounts to revised net asset values (RNAVs).
The analysts said that the uptake and rents of new prime office have recovered earlier than expected, driven by expansion of financial institutions (FIs) and professional services on the back of economic recovery, FIs' flight to quality and their willingness to pay a premium, competitive rents (49 per cent discount to Hong Kong Central) and old office space conversions to residential use. As half of the new space is already pre-committed well ahead of completions, the analysts believe that average prime Grade-A rents had bottomed at $7.50-8/sq ft in 1Q10.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Credit Suisse analysts favour stocks of 'older office' landlords
By KAREN NG
THE recovery in the prime office sector of Singapore is faster than expected, say Credit Suisse analysts. In a July 20 research report on the Singapore property sector, they said that stocks that are 'prime office plays' have year- to-date outperformed the Straits Times Index (STI) by 13 per cent and stocks of residential developers by 23 per cent.
Citing this as a reason, the analysts say that stocks of residential developers and older office/commercial landlords now look attractive.
Taking a contrarian view, the Credit Suisse analysts recommend a switch to the laggard stock of City Developments (CDL) from Keppel Land as the latter, a prime office proxy, has already outperformed the indices by 14-18 per cent year-to-date.
Reasons that the analysts cited in favour of CDL are: potential rerating of its large yet older office/commercial portfolio and its South Beach project; its largest low-cost residential land bank; and its 54 per cent stake in its global hotel arm, M&C, which they see as a prime beneficiary of the strong growth in the Asian hospitality markets.
Other factors cited in support of residential developers are receding policy risks, 'given the moderate price increases'. The analysts expect investment sentiment to stay firm, given strong economic growth, low interest rates, continued population growth and residential developers' stocks lagging the physical market.
The research report, which sees CDL as a bellwether all-round play, downgraded Keppel Land to 'neutral' from 'outperform' with a target price of $4.13, and upgraded CDL to 'outperform' from 'neutral' with a target price of $13.18.
Other property stocks on which the analysts have an 'outperform' call are CapitaLand, Allgreen and Wing Tai. They maintain their 'outperform' call on CapitaLand for its attractive valuations and believe that the concerns over its China exposure have been overdone. Allgreen and Wing Tai are favoured for their attractive land bank and big discounts to revised net asset values (RNAVs).
The analysts said that the uptake and rents of new prime office have recovered earlier than expected, driven by expansion of financial institutions (FIs) and professional services on the back of economic recovery, FIs' flight to quality and their willingness to pay a premium, competitive rents (49 per cent discount to Hong Kong Central) and old office space conversions to residential use. As half of the new space is already pre-committed well ahead of completions, the analysts believe that average prime Grade-A rents had bottomed at $7.50-8/sq ft in 1Q10.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : Lack of sales and auctions stalling Dubai recovery
Business Times - 22 Jul 2010
Lack of sales and auctions stalling Dubai recovery
Buyers unable to gauge how far prices have fallen during 2-year slump
(DUBAI) A dearth of Dubai home sales and foreclosure auctions is stalling a recovery because buyers aren't able to gauge how far prices have fallen during the market's two-year slump.
'There are very few transactions at the moment,' said Craig Plumb, head of Middle East research at broker Jones Lang LaSalle Inc. 'We are not going to see the bottom of the market until we see transactions through the foreclosure process.'
Home prices in the sheikhdom have dropped about 50 per cent from their peak two years ago and Credit Suisse estimates a further decline of as much as 20 per cent. Though at least 70 foreclosure cases have been filed under Dubai's 2008 mortgage law, none has resulted in the sheikhdom's first auction, said Jody Waugh, a partner at law firm Al Tamimi & Co.
'People are only going to buy if they believe the price is realistic,' Mr Plumb said.
Data provided by the Dubai Land Department is too incomplete to provide a valuable guide to selling prices, he said. The credit crunch prompted some Dubai property buyers to abandon investments and leave the country while others tried to renegotiate contracts after finding that they owed more than their property was worth.
Purchases fell about 80 per cent last year from the previous year, said Jesse Downs, director of research at Dubai-based Landmark Advisory. They increased 24 per cent in the first half of this year from a year earlier.
A dozen banks have filed foreclosures, mostly involving residential properties, since London-based Barclays plc won the first judgment at the end of last year, Ms Waugh said. His firm has secured about 12 rulings under the emirate's 2008 mortgage law and the same number involving Islamic mortgages.
The first auction is unlikely to take place before the end of the year, following a 'quiet' summer and the holy month of Ramadan set to start in mid-August, according to Deepak Tolani, an analyst at Al Mal Capital.
Auctions 'might help us get to the bottom faster since prices are likely to be considerably less than asking prices in the market now', said JP Grobbelaar, director of research and advisory at property consultant Colliers International. 'But I don't believe prices won't drop below what is achieved at auctions.'
Credit Suisse's estimate of a 20 per cent decline would take average prices to about 837 dirhams (S$313) a square foot, based on its June estimate of 1,046 dirhams. Deutsche Bank AG analyst Nabil Ahmed predicted a price of 850 dirhams by the end of this year. UBS AG analyst Saud Masud sees a drop to about 600 dirhams.
Colliers estimated in a May 9 report that 41,000 new homes would be put on the market by the end of this year. That will lead to 'significant oversupply' and downward pressure on prices, regional director Ian Albert said in the report.
Banks that have seized real estate outside of the foreclosure process have been reluctant to put properties up for auction, said Mohammed Sultan Thani, assistant director-general at the Land Department. Developers have preferred renegotiating repayment terms with customers to foreclosures.
'The majority of banks are not eager to sell properties through auctions because the prices fetched may drag the market down,' Mr Thani said. 'Many prefer to reach deals allowing them to rent the properties for a few years.'
Barclays's foreclosure case hasn't been implemented, Dubai- based Faisal Iqbal, head of secured lending for the bank in the United Arab Emirates, said by e-mail. The Land Department 'is in control of the sales process on the instructions of the Dubai courts', he said.
Foreclosure sales will only provide a reliable guide if prices are set at a realistic level, said Mr Tolani. In Dubai's last auction, which didn't involve foreclosures, only one of four properties listed was sold, according to Mr Thani. Minimum prices at auctions are usually set by the courts in consultation with the land department, which conducts the sales.
If a property doesn't sell, the court can reduce the minimum price over subsequent auctions, said Ms Waugh. However, by the time a new auction is scheduled, the market may have slipped further and the decreased price may still be too high to attract a buyer.
'You're constantly trailing a market that is declining and that most likely won't result in transactions for a while,' Ms Downs said. Dubai developers have renegotiated thousands of mortgages and extended payment schedules rather than face defaults that would cut off their cash flow. Though that slowed the decline in prices by limiting distress sales, it has prevented the market from reaching its natural bottom.
'People are holding on as much as they can, refusing to adjust to market realities,' Ms Downs said. 'It's delaying the inevitable. If people accept the reality faster, prices will come down faster and in a way recover faster as well.' - Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Hidden downside: Skyscrapers in Dubai. Banks that have seized real estate outside of the foreclosure process have been reluctant to put them up for auction
Lack of sales and auctions stalling Dubai recovery
Buyers unable to gauge how far prices have fallen during 2-year slump
(DUBAI) A dearth of Dubai home sales and foreclosure auctions is stalling a recovery because buyers aren't able to gauge how far prices have fallen during the market's two-year slump.
'There are very few transactions at the moment,' said Craig Plumb, head of Middle East research at broker Jones Lang LaSalle Inc. 'We are not going to see the bottom of the market until we see transactions through the foreclosure process.'
Home prices in the sheikhdom have dropped about 50 per cent from their peak two years ago and Credit Suisse estimates a further decline of as much as 20 per cent. Though at least 70 foreclosure cases have been filed under Dubai's 2008 mortgage law, none has resulted in the sheikhdom's first auction, said Jody Waugh, a partner at law firm Al Tamimi & Co.
'People are only going to buy if they believe the price is realistic,' Mr Plumb said.
Data provided by the Dubai Land Department is too incomplete to provide a valuable guide to selling prices, he said. The credit crunch prompted some Dubai property buyers to abandon investments and leave the country while others tried to renegotiate contracts after finding that they owed more than their property was worth.
Purchases fell about 80 per cent last year from the previous year, said Jesse Downs, director of research at Dubai-based Landmark Advisory. They increased 24 per cent in the first half of this year from a year earlier.
A dozen banks have filed foreclosures, mostly involving residential properties, since London-based Barclays plc won the first judgment at the end of last year, Ms Waugh said. His firm has secured about 12 rulings under the emirate's 2008 mortgage law and the same number involving Islamic mortgages.
The first auction is unlikely to take place before the end of the year, following a 'quiet' summer and the holy month of Ramadan set to start in mid-August, according to Deepak Tolani, an analyst at Al Mal Capital.
Auctions 'might help us get to the bottom faster since prices are likely to be considerably less than asking prices in the market now', said JP Grobbelaar, director of research and advisory at property consultant Colliers International. 'But I don't believe prices won't drop below what is achieved at auctions.'
Credit Suisse's estimate of a 20 per cent decline would take average prices to about 837 dirhams (S$313) a square foot, based on its June estimate of 1,046 dirhams. Deutsche Bank AG analyst Nabil Ahmed predicted a price of 850 dirhams by the end of this year. UBS AG analyst Saud Masud sees a drop to about 600 dirhams.
Colliers estimated in a May 9 report that 41,000 new homes would be put on the market by the end of this year. That will lead to 'significant oversupply' and downward pressure on prices, regional director Ian Albert said in the report.
Banks that have seized real estate outside of the foreclosure process have been reluctant to put properties up for auction, said Mohammed Sultan Thani, assistant director-general at the Land Department. Developers have preferred renegotiating repayment terms with customers to foreclosures.
'The majority of banks are not eager to sell properties through auctions because the prices fetched may drag the market down,' Mr Thani said. 'Many prefer to reach deals allowing them to rent the properties for a few years.'
Barclays's foreclosure case hasn't been implemented, Dubai- based Faisal Iqbal, head of secured lending for the bank in the United Arab Emirates, said by e-mail. The Land Department 'is in control of the sales process on the instructions of the Dubai courts', he said.
Foreclosure sales will only provide a reliable guide if prices are set at a realistic level, said Mr Tolani. In Dubai's last auction, which didn't involve foreclosures, only one of four properties listed was sold, according to Mr Thani. Minimum prices at auctions are usually set by the courts in consultation with the land department, which conducts the sales.
If a property doesn't sell, the court can reduce the minimum price over subsequent auctions, said Ms Waugh. However, by the time a new auction is scheduled, the market may have slipped further and the decreased price may still be too high to attract a buyer.
'You're constantly trailing a market that is declining and that most likely won't result in transactions for a while,' Ms Downs said. Dubai developers have renegotiated thousands of mortgages and extended payment schedules rather than face defaults that would cut off their cash flow. Though that slowed the decline in prices by limiting distress sales, it has prevented the market from reaching its natural bottom.
'People are holding on as much as they can, refusing to adjust to market realities,' Ms Downs said. 'It's delaying the inevitable. If people accept the reality faster, prices will come down faster and in a way recover faster as well.' - Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Hidden downside: Skyscrapers in Dubai. Banks that have seized real estate outside of the foreclosure process have been reluctant to put them up for auction
BT : Seoul defers move to boost property market
Business Times - 22 Jul 2010
Seoul defers move to boost property market
Authorities fail to agree on whether to ease curbs on mortgage lending
(SEOUL) South Korea yesterday put on hold a plan to announce measures aimed at boosting the property market, as policymakers were unable to reach an agreement on whether to ease mortgage lending restrictions.
The cautious attitude comes in the face of widespread concern that eased mortgage lending rules could spark a property price bubble and sharply lift already heavy household debt.
The Land Ministry said on Monday that it would announce today ways to boost home transactions, which have been sluggish as household income has been slow to recover despite a fast pick-up in economic growth.
'We agreed to reach a conclusion on the measures after continuing discussions,' Land, Transport and Maritime Affairs Minister Chung Jong-hwan told reporters after a meeting with other economic and financial policymakers.
He did not say when the measures would be announced.
Housing prices have risen from a year earlier but sale transactions have been shrinking, partly because of strict restrictions on mortgage borrowing imposed in recent years.
The presidential office said in a statement that ministers would continue discussions without binding themselves to a specific date for an announcement, indicating President Lee Myung-bak wanted the government to give the matter more thorough consideration.
The government is seeking a way to prevent the property market from cooling and denting the still- nascent recovery in consumer spending without sparking a housing price bubble and mortgage borrowing frenzy.
Citing government sources, state-run KBS television reported that the ministry wanted regulations on mortgage lending eased while the Finance Ministry and the Financial Services Commission were opposed.
Analysts said the delayed announcement would not seriously hurt the government's credibility because there was a broad consensus among South Koreans that the government could not be overly careful in handling property policy.
'It's true that the government appears very careful in deciding on key measures, but it is not fair to link the delay directly to the government's credibility,' said Kwon Soon-woo, chief economist at Samsung Economic Research Institute.
South Korean households have debt totalling two-thirds of the country's annual gross domestic product and the financial authorities are concerned because the debt has continued to expand faster than income growth\. \-- Reuters
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Debt trap: Households in South Korea have debt totalling two-thirds of the country's annual GDP
Seoul defers move to boost property market
Authorities fail to agree on whether to ease curbs on mortgage lending
(SEOUL) South Korea yesterday put on hold a plan to announce measures aimed at boosting the property market, as policymakers were unable to reach an agreement on whether to ease mortgage lending restrictions.
The cautious attitude comes in the face of widespread concern that eased mortgage lending rules could spark a property price bubble and sharply lift already heavy household debt.
The Land Ministry said on Monday that it would announce today ways to boost home transactions, which have been sluggish as household income has been slow to recover despite a fast pick-up in economic growth.
'We agreed to reach a conclusion on the measures after continuing discussions,' Land, Transport and Maritime Affairs Minister Chung Jong-hwan told reporters after a meeting with other economic and financial policymakers.
He did not say when the measures would be announced.
Housing prices have risen from a year earlier but sale transactions have been shrinking, partly because of strict restrictions on mortgage borrowing imposed in recent years.
The presidential office said in a statement that ministers would continue discussions without binding themselves to a specific date for an announcement, indicating President Lee Myung-bak wanted the government to give the matter more thorough consideration.
The government is seeking a way to prevent the property market from cooling and denting the still- nascent recovery in consumer spending without sparking a housing price bubble and mortgage borrowing frenzy.
Citing government sources, state-run KBS television reported that the ministry wanted regulations on mortgage lending eased while the Finance Ministry and the Financial Services Commission were opposed.
Analysts said the delayed announcement would not seriously hurt the government's credibility because there was a broad consensus among South Koreans that the government could not be overly careful in handling property policy.
'It's true that the government appears very careful in deciding on key measures, but it is not fair to link the delay directly to the government's credibility,' said Kwon Soon-woo, chief economist at Samsung Economic Research Institute.
South Korean households have debt totalling two-thirds of the country's annual gross domestic product and the financial authorities are concerned because the debt has continued to expand faster than income growth\. \-- Reuters
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Debt trap: Households in South Korea have debt totalling two-thirds of the country's annual GDP
ST : Bill may put moneylenders out of business
Jul 21, 2010
Bill may put moneylenders out of business
By Mavis Toh
LICENSED moneylenders, hard hit by a new Bill that was passed in Parliament on Monday, say they are now left with no choice but to close down.
The new law disallows Housing Board home owners from using the proceeds of selling their homes as collateral for loans, or for the payment of debts, except under approved circumstances.
Simply put, this means moneylenders are now no longer able to lodge caveats against flats to ensure they get first bite of the proceeds from the property's sale if the borrower cannot pay up.
The Straits Times understands that at least 10 moneylenders who focus on loans for home sellers will be putting up the shutters in the coming weeks.
Moneylenders' Association of Singapore president David Poh said at least 30 members in his association are extremely discouraged by the changes.
In May, new rules prohibiting licensed moneylenders from working as property agents, and vice-versa, were announced.
One affected moneylender, who declined to be named, said she used to lodge caveats for the four cases she handles on average monthly.
'Now the law has closed all our options, we have no choice but to wind up,' said the 37-year-old.
Another moneylender, who wanted to be known only as Mr Tan, 44, said he will now focus on his property business. He started a moneylending arm late last year to complement his realty work.
'Now I just want to collect the loans I have given out, and close down the moneylending firm,' he said, adding that he used to lodge about two caveats monthly. 'Without caveats as security, who wants to risk lending out large amounts?'
The growing practice by some moneylenders of exploiting cash-strapped home owners desperate for loans was first flagged in Parliament in April.
Industry players estimate that of the 260 licensed moneylenders in the market, at least 30 per cent regularly lodged caveats on their borrowers' homes. There were 556 registered resale applications with caveats lodged by moneylenders in just the first half of this year, a spike from 546 for the whole of last year and just 12 in 2008.
Mr Poh's committee held a meeting yesterday to discuss the impact of the new rules. 'Those affected are rethinking how to continue their business,' he said, adding that most moneylenders will raise their interest rates by at least 10 percentage points per annum, now that they do not have the security of caveats.
The new rules could also put loansharks back in business. 'The demand for loans is still there. But if the people can't get loans, they will turn to the illegal lenders,' said Mr Poh.
Bill may put moneylenders out of business
By Mavis Toh
LICENSED moneylenders, hard hit by a new Bill that was passed in Parliament on Monday, say they are now left with no choice but to close down.
The new law disallows Housing Board home owners from using the proceeds of selling their homes as collateral for loans, or for the payment of debts, except under approved circumstances.
Simply put, this means moneylenders are now no longer able to lodge caveats against flats to ensure they get first bite of the proceeds from the property's sale if the borrower cannot pay up.
The Straits Times understands that at least 10 moneylenders who focus on loans for home sellers will be putting up the shutters in the coming weeks.
Moneylenders' Association of Singapore president David Poh said at least 30 members in his association are extremely discouraged by the changes.
In May, new rules prohibiting licensed moneylenders from working as property agents, and vice-versa, were announced.
One affected moneylender, who declined to be named, said she used to lodge caveats for the four cases she handles on average monthly.
'Now the law has closed all our options, we have no choice but to wind up,' said the 37-year-old.
Another moneylender, who wanted to be known only as Mr Tan, 44, said he will now focus on his property business. He started a moneylending arm late last year to complement his realty work.
'Now I just want to collect the loans I have given out, and close down the moneylending firm,' he said, adding that he used to lodge about two caveats monthly. 'Without caveats as security, who wants to risk lending out large amounts?'
The growing practice by some moneylenders of exploiting cash-strapped home owners desperate for loans was first flagged in Parliament in April.
Industry players estimate that of the 260 licensed moneylenders in the market, at least 30 per cent regularly lodged caveats on their borrowers' homes. There were 556 registered resale applications with caveats lodged by moneylenders in just the first half of this year, a spike from 546 for the whole of last year and just 12 in 2008.
Mr Poh's committee held a meeting yesterday to discuss the impact of the new rules. 'Those affected are rethinking how to continue their business,' he said, adding that most moneylenders will raise their interest rates by at least 10 percentage points per annum, now that they do not have the security of caveats.
The new rules could also put loansharks back in business. 'The demand for loans is still there. But if the people can't get loans, they will turn to the illegal lenders,' said Mr Poh.
ST : Jalan Eunos and Buangkok sites for sale
Jul 21, 2010
Jalan Eunos and Buangkok sites for sale
DEVELOPERS have been invited to lodge bids for a 4.1ha residential site in Jalan Eunos.
The 99-year leasehold land parcel can yield 525 low-rise housing units and is permitted a maximum gross floor area of 57,766 sq m.
The developer can opt to build landed homes of up to three storeys on the site, which is near the Eunos flyover.
The sale tender was launched by the Government yesterday.
CBRE Research executive director Li Hiaw Ho said the site is likely to fetch a land price of $218 million to $249 million, or $350 to $400 per sq ft per plot ratio (psf ppr). He said a low-rise condo on the site can probably fetch $850 psf on average.
Ngee Ann Polytechnic real estate lecturer Nicholas Mak expects the site to attract lower bids of $280 to $320 psf ppr.
'Developers may not want to bid very aggressively, given that there will be many sites coming up for sale,' he said.
Yesterday, the Urban Redevelopment Authority also made available another residential site for sale if developers show interest.
This 1.8ha site is at the junction of Buangkok Drive and Sengkang Central, and is near the Buangkok MRT station. With a maximum gross floor area of 55,027 sq m, it can yield 495 apartments.
In response to the strong demand for private homes - and the resulting demand for land from developers - the Government has placed a record 31 sites on its land sales programme for the second half of the year.
The tender for the Jalan Eunos site closes on Sept 7.
JOYCE TEO
Jalan Eunos and Buangkok sites for sale
DEVELOPERS have been invited to lodge bids for a 4.1ha residential site in Jalan Eunos.
The 99-year leasehold land parcel can yield 525 low-rise housing units and is permitted a maximum gross floor area of 57,766 sq m.
The developer can opt to build landed homes of up to three storeys on the site, which is near the Eunos flyover.
The sale tender was launched by the Government yesterday.
CBRE Research executive director Li Hiaw Ho said the site is likely to fetch a land price of $218 million to $249 million, or $350 to $400 per sq ft per plot ratio (psf ppr). He said a low-rise condo on the site can probably fetch $850 psf on average.
Ngee Ann Polytechnic real estate lecturer Nicholas Mak expects the site to attract lower bids of $280 to $320 psf ppr.
'Developers may not want to bid very aggressively, given that there will be many sites coming up for sale,' he said.
Yesterday, the Urban Redevelopment Authority also made available another residential site for sale if developers show interest.
This 1.8ha site is at the junction of Buangkok Drive and Sengkang Central, and is near the Buangkok MRT station. With a maximum gross floor area of 55,027 sq m, it can yield 495 apartments.
In response to the strong demand for private homes - and the resulting demand for land from developers - the Government has placed a record 31 sites on its land sales programme for the second half of the year.
The tender for the Jalan Eunos site closes on Sept 7.
JOYCE TEO
ST : Don't sell flat for funds, says Mah
Jul 21, 2010
Don't sell flat for funds, says Mah
His comments come a day after law is passed to close loophole exploited by moneylenders
By Jessica Cheam
HOME owners desperate for cash should look at other options to raise the funds rather than resort to selling their flats, National Development Minister Mah Bow Tan said yesterday.
'They will have to find other sources of funds as... the whole (home ownership) scheme was designed to provide affordable, good quality homes for them, not to use that as a collateral or source of funds for other uses - whether for business or other things,' he said.
Mr Mah's comments came a day after a housing Bill was sped through Parliament and passed to close a loophole which had allowed moneylenders to lodge caveats on HDB flats to claim a stake in sale proceeds.
In the past year or so, there has been a spike in the number of moneylenders who exploited a legal loophole that allowed them to file caveats. This was the reason the Bill had to be passed urgently, said Mr Mah yesterday.
He noted that although there was nothing to stop owners from selling their flats prematurely to raise funds, public education was crucial in explaining to people why they should not do so.
'We've always been telling people to be prudent, 'don't sell your flat unless you have alternatives'... that's always been our message.
'(If) they lose their flats, the roofs over their heads... where will they live, where will their children live?
'We've decided to be prudent as far as HDB flats are concerned, (so) if you want to raise funds for business and other things... look for other sources of funds.'
Mr Mah was speaking on the sidelines of the Ministry of National Development (MND) scholarship ceremony. The ministry awarded 39 undergraduate scholarships out of 1,490 applications it received. Building and Construction Authority scholarship holder Lee Si Min, 19, who is going to Cambridge University to study engineering, said she had always been fascinated by buildings and wanted to work in a related field. 'Being part of the ministry will enable me to contribute back to society when I've finished my studies,' she said.
The ministry also awarded 12 postgraduate scholarships. The courses covered by all the scholarships are diverse, from agricultural economics to civil engineering, and sociology to urban planning.
Speaking at the ceremony, Mr Mah highlighted the recently concluded World Cities Summit hosted by Singapore where policymakers and industry professionals converged to discuss issues on governance, sustainable cities and fostering harmonious communities.
'Just two generations ago, this would have been a most improbable feat for us... Once, some might have regarded us a tropical cesspit. Today, many parties... rank Singapore among the top 25 most liveable cities in the world,' he said.
He urged the scholarship holders to 'work hard, study hard, discover yourselves and find your passion'.
'One day, we will welcome all of you back, joining us in this common journey to make Singapore a better home for all of us,' he said.
jcheam@sph.com.sg
Don't sell flat for funds, says Mah
His comments come a day after law is passed to close loophole exploited by moneylenders
By Jessica Cheam
HOME owners desperate for cash should look at other options to raise the funds rather than resort to selling their flats, National Development Minister Mah Bow Tan said yesterday.
'They will have to find other sources of funds as... the whole (home ownership) scheme was designed to provide affordable, good quality homes for them, not to use that as a collateral or source of funds for other uses - whether for business or other things,' he said.
Mr Mah's comments came a day after a housing Bill was sped through Parliament and passed to close a loophole which had allowed moneylenders to lodge caveats on HDB flats to claim a stake in sale proceeds.
In the past year or so, there has been a spike in the number of moneylenders who exploited a legal loophole that allowed them to file caveats. This was the reason the Bill had to be passed urgently, said Mr Mah yesterday.
He noted that although there was nothing to stop owners from selling their flats prematurely to raise funds, public education was crucial in explaining to people why they should not do so.
'We've always been telling people to be prudent, 'don't sell your flat unless you have alternatives'... that's always been our message.
'(If) they lose their flats, the roofs over their heads... where will they live, where will their children live?
'We've decided to be prudent as far as HDB flats are concerned, (so) if you want to raise funds for business and other things... look for other sources of funds.'
Mr Mah was speaking on the sidelines of the Ministry of National Development (MND) scholarship ceremony. The ministry awarded 39 undergraduate scholarships out of 1,490 applications it received. Building and Construction Authority scholarship holder Lee Si Min, 19, who is going to Cambridge University to study engineering, said she had always been fascinated by buildings and wanted to work in a related field. 'Being part of the ministry will enable me to contribute back to society when I've finished my studies,' she said.
The ministry also awarded 12 postgraduate scholarships. The courses covered by all the scholarships are diverse, from agricultural economics to civil engineering, and sociology to urban planning.
Speaking at the ceremony, Mr Mah highlighted the recently concluded World Cities Summit hosted by Singapore where policymakers and industry professionals converged to discuss issues on governance, sustainable cities and fostering harmonious communities.
'Just two generations ago, this would have been a most improbable feat for us... Once, some might have regarded us a tropical cesspit. Today, many parties... rank Singapore among the top 25 most liveable cities in the world,' he said.
He urged the scholarship holders to 'work hard, study hard, discover yourselves and find your passion'.
'One day, we will welcome all of you back, joining us in this common journey to make Singapore a better home for all of us,' he said.
jcheam@sph.com.sg
ST : Guidelines on use of mall space for religion
Jul 21, 2010
Guidelines on use of mall space for religion
Govt outlines limits to the use of commercial complexes
By Lee Siew Hua
NEW government guidelines have made clear that it is all right for religious organisations to make use of commercial premises for their activities, subject to certain limits.
Christian groups have been using places such as hotel function rooms and convention centres on weekends for a number of years, as reported in the media.
From now, no more than 20,000 sq m of a commercial complex's gross floor area (GFA), or 20 per cent of GFA, whichever is lower, may be used for religious purposes. And such activities may be held for no more than two days a week.
A religious organisation is also limited to using 10,000 sq m, which is equivalent to about 11/2 football fields. This will ensure that a religious organisation does not dominate a particular commercial complex.
In a joint statement, the Urban Redevelopment Authority (URA) and the Ministry of Community Development, Youth and Sports (MCYS) explained they were prepared to exercise some flexibility and allow commercial premises such as hotels, auditoriums, function halls, convention centres and cinemas to be used in a 'limited, non-exclusive way' by religious groups that hold large gatherings.
This is provided the events do not cause noise, traffic or parking problems. To protect the secular nature of the venues, there must also be no signage or religious symbols, and the interiors should not be furnished to resemble a worship hall when not used by the religious group.
The guidelines take effect immediately and apply to all religions. Religious organisations using commercial space will have to register with the URA.
The clarification of land use rules was received with relief as most churches are currently not at any risk of flouting the rules.
It is understood that the URA discussed the guidelines on Monday with representatives of the bigger megachurches - 33,000-strong City Harvest Church, 10,000-strong Faith Community Baptist Church and 20,000-strong New Creation Church - and their landlords, Singapore Expo and Suntec Singapore.
Currently, Faith Community Baptist Church and City Harvest Church use less than 10,000 sq m atthe Singapore Expo each.
City Harvest Church has also made a controversial $310 million investment to become a co-owner of Suntec Singapore and hold services in a 12,000-seat auditorium there.
Regarding City Harvest's purchase, a URA spokesman told The Straits Times it does not regulate property ownership.
'However, the actual use of the premises must adhere to the planning and land use zoning intentions regardless of the ownership. The contractual agreement between City Harvest and Suntec City is a private matter between the two parties,' he said.
A City Harvest spokesman said: 'We are currently liaising with the relevant land owners and studying the implications of the new guidelines. City Harvest will abide by the new guidelines.'
Ngee Ann Polytechnic real estate lecturer Nicholas Mak saidthe guidelines make sense.
'Rather than let religious organisations slowly take over commercial spaces and make other users feel uncomfortable, the guidelines ensure that members of the public of all religions can use the premises,' he said.
National University of Singapore cultural geographer Lily Kong welcomed the guidelines, saying secular spaces should not be entirely off-limits to religious groups.
'What this new set of guidelines does is to relax the clear compartmentalisation of land use in a cautious and regulated way,' she said.
However, Senior Pastor Lawrence Khong of Faith Community Baptist Church felt that such explicit guidelines could be restrictive and preferred leaving it to the market to 'self-regulate'.
For example, he said, it would be in landlord Singapore Expo's interests to safeguard its commercial character and not lease all its space to religious groups.
For landlord Suntec Singapore, which currently leases space to New Creation Church, the guidelines mean 'business as usual'.
A spokesman said: 'We are in compliance with the guidelines set forth by the authorities.'
New Creation Church declined to comment.
siewhua@sph.com.sg
Guidelines on use of mall space for religion
Govt outlines limits to the use of commercial complexes
By Lee Siew Hua
NEW government guidelines have made clear that it is all right for religious organisations to make use of commercial premises for their activities, subject to certain limits.
Christian groups have been using places such as hotel function rooms and convention centres on weekends for a number of years, as reported in the media.
From now, no more than 20,000 sq m of a commercial complex's gross floor area (GFA), or 20 per cent of GFA, whichever is lower, may be used for religious purposes. And such activities may be held for no more than two days a week.
A religious organisation is also limited to using 10,000 sq m, which is equivalent to about 11/2 football fields. This will ensure that a religious organisation does not dominate a particular commercial complex.
In a joint statement, the Urban Redevelopment Authority (URA) and the Ministry of Community Development, Youth and Sports (MCYS) explained they were prepared to exercise some flexibility and allow commercial premises such as hotels, auditoriums, function halls, convention centres and cinemas to be used in a 'limited, non-exclusive way' by religious groups that hold large gatherings.
This is provided the events do not cause noise, traffic or parking problems. To protect the secular nature of the venues, there must also be no signage or religious symbols, and the interiors should not be furnished to resemble a worship hall when not used by the religious group.
The guidelines take effect immediately and apply to all religions. Religious organisations using commercial space will have to register with the URA.
The clarification of land use rules was received with relief as most churches are currently not at any risk of flouting the rules.
It is understood that the URA discussed the guidelines on Monday with representatives of the bigger megachurches - 33,000-strong City Harvest Church, 10,000-strong Faith Community Baptist Church and 20,000-strong New Creation Church - and their landlords, Singapore Expo and Suntec Singapore.
Currently, Faith Community Baptist Church and City Harvest Church use less than 10,000 sq m atthe Singapore Expo each.
City Harvest Church has also made a controversial $310 million investment to become a co-owner of Suntec Singapore and hold services in a 12,000-seat auditorium there.
Regarding City Harvest's purchase, a URA spokesman told The Straits Times it does not regulate property ownership.
'However, the actual use of the premises must adhere to the planning and land use zoning intentions regardless of the ownership. The contractual agreement between City Harvest and Suntec City is a private matter between the two parties,' he said.
A City Harvest spokesman said: 'We are currently liaising with the relevant land owners and studying the implications of the new guidelines. City Harvest will abide by the new guidelines.'
Ngee Ann Polytechnic real estate lecturer Nicholas Mak saidthe guidelines make sense.
'Rather than let religious organisations slowly take over commercial spaces and make other users feel uncomfortable, the guidelines ensure that members of the public of all religions can use the premises,' he said.
National University of Singapore cultural geographer Lily Kong welcomed the guidelines, saying secular spaces should not be entirely off-limits to religious groups.
'What this new set of guidelines does is to relax the clear compartmentalisation of land use in a cautious and regulated way,' she said.
However, Senior Pastor Lawrence Khong of Faith Community Baptist Church felt that such explicit guidelines could be restrictive and preferred leaving it to the market to 'self-regulate'.
For example, he said, it would be in landlord Singapore Expo's interests to safeguard its commercial character and not lease all its space to religious groups.
For landlord Suntec Singapore, which currently leases space to New Creation Church, the guidelines mean 'business as usual'.
A spokesman said: 'We are in compliance with the guidelines set forth by the authorities.'
New Creation Church declined to comment.
siewhua@sph.com.sg
BT : Government releases two residential sites for tender
Business Times - 21 Jul 2010
Government releases two residential sites for tender
By EMILYN YAP
THE government has put a site at Jalan Eunos up for tender - the fourth residential plot from the confirmed list to be launched this month.
On top of this, it has made a plot on the reserve list at Buangkok Drive/Sengkang Central available for application. The two sites will add an estimated 1,020 units to the residential supply pipeline if they are sold.
The Urban Redevelopment Authority (URA) released details of the sites yesterday. The 99-year leasehold plot at Jalan Eunos is 4.1 hectares and can be developed into a condominium, or landed or strata landed housing project.
The site has a maximum permissible gross floor area (GFA) of 621,787 sq ft for a condominium project, potentially yielding 525 units.
It is next to the Pan-Island Expressway and some distance from the Eunos and Kembangan MRT stations. Nature lovers are likely to appreciate having Bedok Town Park and the Siglap Park Connector nearby.
Knight Frank consultancy and research manager Ong Kah Seng expects about five developers to show interest in the site. The winning bid could range from $380-420 per sq ft per plot ratio (psf ppr).
Interest for state land is 'expected to moderate in view of the substantial supply available' through the second-half 2010 government land sales (GLS) programme, Mr Ong said. Nevertheless, developers that need to replenish land banks are likely to 'remain open in acquiring sites with potential'.
CBRE Research executive director Li Hiaw Ho believes the site could draw bids of $350-400 psf ppr.
Over at Buangkok Drive, interested developers can start submitting applications for a 99-year leasehold 1.8 ha site. It has a maximum GFA of 592,305 sq ft and can accommodate an estimated 495 units.
The plot is near Buangkok MRT station. It is also not far from Punggol Park and several schools such as Nan Chiau High and North Vista Primary.
Knight Frank's Mr Ong expects 'modest interest' in this site, as two other plots for executive condominiums were launched in the vicinity in H1.
URA reiterated yesterday that the second-half GLS programme will have 18 residential sites on the confirmed list and another 13 on the reserve list, which can generate 13,905 units in all.
Later this month, URA will launch a confirmed list white site - at Peck Seah and Choon Guan streets - for sale.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Government releases two residential sites for tender
By EMILYN YAP
THE government has put a site at Jalan Eunos up for tender - the fourth residential plot from the confirmed list to be launched this month.
On top of this, it has made a plot on the reserve list at Buangkok Drive/Sengkang Central available for application. The two sites will add an estimated 1,020 units to the residential supply pipeline if they are sold.
The Urban Redevelopment Authority (URA) released details of the sites yesterday. The 99-year leasehold plot at Jalan Eunos is 4.1 hectares and can be developed into a condominium, or landed or strata landed housing project.
The site has a maximum permissible gross floor area (GFA) of 621,787 sq ft for a condominium project, potentially yielding 525 units.
It is next to the Pan-Island Expressway and some distance from the Eunos and Kembangan MRT stations. Nature lovers are likely to appreciate having Bedok Town Park and the Siglap Park Connector nearby.
Knight Frank consultancy and research manager Ong Kah Seng expects about five developers to show interest in the site. The winning bid could range from $380-420 per sq ft per plot ratio (psf ppr).
Interest for state land is 'expected to moderate in view of the substantial supply available' through the second-half 2010 government land sales (GLS) programme, Mr Ong said. Nevertheless, developers that need to replenish land banks are likely to 'remain open in acquiring sites with potential'.
CBRE Research executive director Li Hiaw Ho believes the site could draw bids of $350-400 psf ppr.
Over at Buangkok Drive, interested developers can start submitting applications for a 99-year leasehold 1.8 ha site. It has a maximum GFA of 592,305 sq ft and can accommodate an estimated 495 units.
The plot is near Buangkok MRT station. It is also not far from Punggol Park and several schools such as Nan Chiau High and North Vista Primary.
Knight Frank's Mr Ong expects 'modest interest' in this site, as two other plots for executive condominiums were launched in the vicinity in H1.
URA reiterated yesterday that the second-half GLS programme will have 18 residential sites on the confirmed list and another 13 on the reserve list, which can generate 13,905 units in all.
Later this month, URA will launch a confirmed list white site - at Peck Seah and Choon Guan streets - for sale.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : Rules for religious use of commercial space
Business Times - 21 Jul 2010
Rules for religious use of commercial space
Such premises can't be owned or leased exclusively to religious bodies, guidelines say
By TEH SHI NING
(SINGAPORE) The government has clarified the extent to which commercial spaces can be used for religious activities.
The guidelines, which apply with immediate effect, include caps on how often religious activities can be held at commercial venues and how much space they can use in such buildings at any one time.
No more than 20,000 square metres or 20 per cent of any commercial development's gross floor area (whichever is lower) can be considered for religious use. And each religious group can only use up to 10,000 sq m of commercial space at any one time.
Also, commercial premises cannot be used for religious activities for more than two days a week, including the weekend.
Owners of convention centres must also ensure that the religious use of their facilities does not compromise the staging of other events over weekends, the Urban Redevelopment Authority (URA) and the Ministry of Community Development, Youth and Sports (MCYS) said yesterday.
These premises 'cannot be owned by or exclusively leased to religious organisations' and 'should be available to be rented out for other commercial events such as seminars, conferences and performances', the guidelines said.
Questions had been raised earlier over whether recent investments by the New Creation Church and City Harvest Church (CHC) into commercial spaces constitute a 'change of use' of sites zoned for commercial rather than 'place of worship' use under URA's Master Plan.
New Creation's Rock Productions has a joint venture with CapitaMalls Asia to build a $1 billion lifestyle hub at one-north, which will have retail outlets, a concert hall and a theatre when ready in 2012. New Creation, which intends to hold church services there in future, yesterday said it would not be responding to media yet.
CHC said in March that it would spend $310 million on a minority stake in Suntec Singapore, rent and renovation costs, to move its weekly services from Singapore Expo to the convention centre next year. It told the media earlier that it would not have exclusive use of any area in Suntec.
A CHC spokesman said yesterday that the church is 'liaising with the relevant land owners and studying the implications of the new guidelines', adding that it would abide by these and provide a substantive reply in due time.
URA and MCYS's joint statement said the guidelines are meant to allow flexibility for the limited religious use of commercial premises, while ensuring that their key use and character are not eroded. The idea is to make sure commercial spaces 'remain secular spaces that can be enjoyed by people from all segments of society', it said.
Currently, several groups lease commercial venues for regular religious services.
Singapore Expo leases Hall 8 to CHC and the Max Pavilion and Hall 9 to Faith Community Baptist Church (FCBC) on weekends. Each of these halls is 10,000 sq m in size, according to Singapore Expo's capacity sheet. But FCBC told MediaCorp that it would not be affected by the new guidelines.
Rock Productions, the business arm of New Creation, leases the Rock Auditorium in Suntec City from Suntec REIT. Its Sunday services utilise the Rock Auditorium, which covers less than 3,500 sq m, as well as cinema halls and other overflow rooms in Suntec City.
URA said it receives requests from religious organisations to use commercial space for their activities 'from time to time' and has approved some of these proposals on a case-by-case basis. Now, guidelines are being made known to 'provide greater clarity to religious organisations and building owners on what can and cannot be allowed within commercial developments', the URA spokesman said.
Both Suntec REIT and Suntec Singapore, current landlords of organisations renting for religious use, agreed that the guidelines make clearer the extent to which religious use of commercial spaces is permissible. Suntec Singapore's spokesman added: 'We have provided organisations equal access to our venue for their activities. We will continue to do so in line with the spirit of the guidelines.'
Chandran Nair, deputy general manger of Singex Venues, managing company of Singapore Expo, said: 'We are in full awareness and acceptance of the new guidelines. It is business as usual at Singapore Expo and we will continue to work with the authorities to ensure compliance.'
No records are kept of the total number of religious groups currently renting commercial premises for their activities, but URA said that those doing so on a regular basis are 'advised to submit their proposed use together with the building owner's consent to URA for consideration'.
It added that it is prepared to 'exercise flexibility to allow some religious organisations sufficient time to meet the guidelines, or up to the expiry of their current licence or lease period in order to minimise disruptions to their current activities'.
Other rules laid down yesterday govern the appearance of premises being used for religious activities. No signs, advertisements or posters of the religious events can be displayed, and premises cannot be furnished to look like a worship hall. When not in use by the religious group, the venue should have no religious symbols, icons or paraphernalia too.
URA said that it does not regulate property ownership, but the actual use of premises must adhere to planning and land use zoning intentions regardless of ownership.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Secular look: Commercial space should not resemble worship hall when not used by religious organisation
Rules for religious use of commercial space
Such premises can't be owned or leased exclusively to religious bodies, guidelines say
By TEH SHI NING
(SINGAPORE) The government has clarified the extent to which commercial spaces can be used for religious activities.
The guidelines, which apply with immediate effect, include caps on how often religious activities can be held at commercial venues and how much space they can use in such buildings at any one time.
No more than 20,000 square metres or 20 per cent of any commercial development's gross floor area (whichever is lower) can be considered for religious use. And each religious group can only use up to 10,000 sq m of commercial space at any one time.
Also, commercial premises cannot be used for religious activities for more than two days a week, including the weekend.
Owners of convention centres must also ensure that the religious use of their facilities does not compromise the staging of other events over weekends, the Urban Redevelopment Authority (URA) and the Ministry of Community Development, Youth and Sports (MCYS) said yesterday.
These premises 'cannot be owned by or exclusively leased to religious organisations' and 'should be available to be rented out for other commercial events such as seminars, conferences and performances', the guidelines said.
Questions had been raised earlier over whether recent investments by the New Creation Church and City Harvest Church (CHC) into commercial spaces constitute a 'change of use' of sites zoned for commercial rather than 'place of worship' use under URA's Master Plan.
New Creation's Rock Productions has a joint venture with CapitaMalls Asia to build a $1 billion lifestyle hub at one-north, which will have retail outlets, a concert hall and a theatre when ready in 2012. New Creation, which intends to hold church services there in future, yesterday said it would not be responding to media yet.
CHC said in March that it would spend $310 million on a minority stake in Suntec Singapore, rent and renovation costs, to move its weekly services from Singapore Expo to the convention centre next year. It told the media earlier that it would not have exclusive use of any area in Suntec.
A CHC spokesman said yesterday that the church is 'liaising with the relevant land owners and studying the implications of the new guidelines', adding that it would abide by these and provide a substantive reply in due time.
URA and MCYS's joint statement said the guidelines are meant to allow flexibility for the limited religious use of commercial premises, while ensuring that their key use and character are not eroded. The idea is to make sure commercial spaces 'remain secular spaces that can be enjoyed by people from all segments of society', it said.
Currently, several groups lease commercial venues for regular religious services.
Singapore Expo leases Hall 8 to CHC and the Max Pavilion and Hall 9 to Faith Community Baptist Church (FCBC) on weekends. Each of these halls is 10,000 sq m in size, according to Singapore Expo's capacity sheet. But FCBC told MediaCorp that it would not be affected by the new guidelines.
Rock Productions, the business arm of New Creation, leases the Rock Auditorium in Suntec City from Suntec REIT. Its Sunday services utilise the Rock Auditorium, which covers less than 3,500 sq m, as well as cinema halls and other overflow rooms in Suntec City.
URA said it receives requests from religious organisations to use commercial space for their activities 'from time to time' and has approved some of these proposals on a case-by-case basis. Now, guidelines are being made known to 'provide greater clarity to religious organisations and building owners on what can and cannot be allowed within commercial developments', the URA spokesman said.
Both Suntec REIT and Suntec Singapore, current landlords of organisations renting for religious use, agreed that the guidelines make clearer the extent to which religious use of commercial spaces is permissible. Suntec Singapore's spokesman added: 'We have provided organisations equal access to our venue for their activities. We will continue to do so in line with the spirit of the guidelines.'
Chandran Nair, deputy general manger of Singex Venues, managing company of Singapore Expo, said: 'We are in full awareness and acceptance of the new guidelines. It is business as usual at Singapore Expo and we will continue to work with the authorities to ensure compliance.'
No records are kept of the total number of religious groups currently renting commercial premises for their activities, but URA said that those doing so on a regular basis are 'advised to submit their proposed use together with the building owner's consent to URA for consideration'.
It added that it is prepared to 'exercise flexibility to allow some religious organisations sufficient time to meet the guidelines, or up to the expiry of their current licence or lease period in order to minimise disruptions to their current activities'.
Other rules laid down yesterday govern the appearance of premises being used for religious activities. No signs, advertisements or posters of the religious events can be displayed, and premises cannot be furnished to look like a worship hall. When not in use by the religious group, the venue should have no religious symbols, icons or paraphernalia too.
URA said that it does not regulate property ownership, but the actual use of premises must adhere to planning and land use zoning intentions regardless of ownership.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Secular look: Commercial space should not resemble worship hall when not used by religious organisation
BT : Rise in serviced apartment rents set to resume
Business Times - 21 Jul 2010
Rise in serviced apartment rents set to resume
After sliding 22% last year, rates are expected to increase by 5-10% this year
By KALPANA RASHIWALA
AVERAGE daily serviced apartment rental rates for the high-end and mid-tier segment here are expected to increase by about 5 to 10 per cent this year after sliding 22 per cent for the whole of last year, says Savills Singapore.
The property consultancy's index for serviced apartment rents in the segment reflects a 2.9 per cent quarter-on-quarter increase in Q1 2010. On average, daily rates ranged from $260-320 for mid-tier and high-end service apartments in Q1 2010. In a report on the Singapore serviced apartment market released yesterday, Savills noted that demand prospects are generally looking positive while supply is relatively stable.
'Going forward, the economy is likely to see firmer growth with many multinational companies expecting to increase their headcount this year. The latest survey by Hudson, a US-based employment services firm, shows that 51 per cent of the 400 companies surveyed intend to hire in Q1 2010, an increase from 34 per cent in Q4 2009. This could lead to a larger pool of expatriates working in Singapore in the coming quarters,' Savills said.
There are currently about 50 developments with a total of over 4,600 serviced apartments in Singapore. In the next four years (up to 2014), a further supply of about 1,200 units from eight developments are expected to enter the market, including the 300-unit Modena Singapore, 305-unit Park Avenue Residences Changi (both at Changi Business Park) and 370-unit Park Avenue Suites Rochester at Fusionopolis.
The average occupancy rate for high-end and mid-tier serviced apartments stood at 86 per cent in Q1 this year, reflecting a 1.5-percentage point rise from the preceding quarter and a 15.7-percentage point surge from the same period last year amid the economic recovery.
During the global financial crash, when many MNCs scaled back their operations in Singapore, the occupancy rate slipped from 89 per cent in Q3 2008 to a low of about 70 per cent in Q1 2009.
Savills noted that during the past two years, more high-end serviced apartments have come onto the market, including Ascott Raffles Place Singapore, Pan Pacific Serviced Suites and Orchard Scotts Residences. Asking rents for one-bedroom units can range from $16-20 per square foot per month.
'Highlights at the Pan Pacific Serviced Suites include grocery delivery, luggage packing services, a selection of pillow and bath menus and a 20-metre swimming pool filled with mineral water,' Savills noted in its report.
While most (81 per cent) of serviced apartments on the island are well located in prime districts, the industry is seeing a rising trend in the number of serviced apartments being built in the city fringe or suburban areas, especially near new regional hubs or commercial zones.
Most of these comprise mid-tier serviced apartments or budget serviced apartments with monthly asking rents of $10-13 psf or $6-7 psf respectively for a one-bedroom unit. An example is Fraser Place Fusionopolis, which opened last year to serve expats working at the biomedical, infocomm and media hub of Buona Vista's one-north.
Currently, Far East Organization has the lion's share or 24.8 per cent of Singapore's stock of serviced apartments. Far East's serviced apartments inventory is spread across more than 10 developments.
The Ascott Ltd, including Ascott Residence Trust, is in second position, with a 20.5 per cent share, followed by Frasers Hospitality Pte Ltd (9.7 per cent), Allgreen Properties (6.3 per cent) and Tan Chong Realty (5.1 per cent).
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Rise in serviced apartment rents set to resume
After sliding 22% last year, rates are expected to increase by 5-10% this year
By KALPANA RASHIWALA
AVERAGE daily serviced apartment rental rates for the high-end and mid-tier segment here are expected to increase by about 5 to 10 per cent this year after sliding 22 per cent for the whole of last year, says Savills Singapore.
The property consultancy's index for serviced apartment rents in the segment reflects a 2.9 per cent quarter-on-quarter increase in Q1 2010. On average, daily rates ranged from $260-320 for mid-tier and high-end service apartments in Q1 2010. In a report on the Singapore serviced apartment market released yesterday, Savills noted that demand prospects are generally looking positive while supply is relatively stable.
'Going forward, the economy is likely to see firmer growth with many multinational companies expecting to increase their headcount this year. The latest survey by Hudson, a US-based employment services firm, shows that 51 per cent of the 400 companies surveyed intend to hire in Q1 2010, an increase from 34 per cent in Q4 2009. This could lead to a larger pool of expatriates working in Singapore in the coming quarters,' Savills said.
There are currently about 50 developments with a total of over 4,600 serviced apartments in Singapore. In the next four years (up to 2014), a further supply of about 1,200 units from eight developments are expected to enter the market, including the 300-unit Modena Singapore, 305-unit Park Avenue Residences Changi (both at Changi Business Park) and 370-unit Park Avenue Suites Rochester at Fusionopolis.
The average occupancy rate for high-end and mid-tier serviced apartments stood at 86 per cent in Q1 this year, reflecting a 1.5-percentage point rise from the preceding quarter and a 15.7-percentage point surge from the same period last year amid the economic recovery.
During the global financial crash, when many MNCs scaled back their operations in Singapore, the occupancy rate slipped from 89 per cent in Q3 2008 to a low of about 70 per cent in Q1 2009.
Savills noted that during the past two years, more high-end serviced apartments have come onto the market, including Ascott Raffles Place Singapore, Pan Pacific Serviced Suites and Orchard Scotts Residences. Asking rents for one-bedroom units can range from $16-20 per square foot per month.
'Highlights at the Pan Pacific Serviced Suites include grocery delivery, luggage packing services, a selection of pillow and bath menus and a 20-metre swimming pool filled with mineral water,' Savills noted in its report.
While most (81 per cent) of serviced apartments on the island are well located in prime districts, the industry is seeing a rising trend in the number of serviced apartments being built in the city fringe or suburban areas, especially near new regional hubs or commercial zones.
Most of these comprise mid-tier serviced apartments or budget serviced apartments with monthly asking rents of $10-13 psf or $6-7 psf respectively for a one-bedroom unit. An example is Fraser Place Fusionopolis, which opened last year to serve expats working at the biomedical, infocomm and media hub of Buona Vista's one-north.
Currently, Far East Organization has the lion's share or 24.8 per cent of Singapore's stock of serviced apartments. Far East's serviced apartments inventory is spread across more than 10 developments.
The Ascott Ltd, including Ascott Residence Trust, is in second position, with a 20.5 per cent share, followed by Frasers Hospitality Pte Ltd (9.7 per cent), Allgreen Properties (6.3 per cent) and Tan Chong Realty (5.1 per cent).
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
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