Business Times - 18 May 2010
Hillview Terrace site up for collective sale
(SINGAPORE) A smallish site in Hillview Terrace is up for collective sale with unanimous consent from the owners.
The site - which covers numbers 12 to 24, even numbers only - is expected to fetch almost $49 million, or $617 per sq ft per plot ratio.
A Development Charge payable, based on March 2010 rates, is estimated at $15.2 million.
Marketing agent DTZ says the property, off Hillview Avenue, is being sold through a tender that closes on June 22 at 3 pm.
The freehold site covers 4,567.5 sq metres (49,164 sq ft). According to the Master Plan 2008, it can be developed into a 10-storey condominium with a gross plot ratio of 1.92. This translates into total gross floor area of 103,835 sq ft including additional 10 per cent balcony area, or about 100 apartments averaging 900 sq ft.
Shaun Poh, DTZ's senior director for investment advisory services and auction, said: 'We expect that the property will attract developers keen to develop a boutique condominium project. In today's market, it is rare for freehold residential land of this size to be available in popular areas.
'The property's appeal also lies in its excellent location, surrounded by lush greenery of the Bukit Batok Town Park and Little Guilin.'
The sale site can be accessed through Hillview Avenue, Upper Bukit Timah Road, Dairy Farm Road, the Pan Island Expressway and the Bukit Timah Expressway.
The Bukit Batok and Bukit Gombak MRT stations are close by. The area will also be served by Hillview and Beauty World MRT stations on the Downtown Line when it starts operating in 2015.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Wednesday, May 19, 2010
BT : Australia's weak population growth may hit rentals
Business Times - 18 May 2010
Australia's weak population growth may hit rentals
(SYDNEY) A slowdown in Australia's population growth, as long-term visitors leaving outnumber those arriving, could ease pressure on rental markets and lead to a 'relatively benign interest rate environment', BIS Shrapnel senior economist Jason Anderson said.
Population growth will slow to about 1.5 per cent in the 2011 fiscal year and to 1.3 per cent in 2012, on the exit of visitors holding student and business visas of about four years, Sydney-based Mr Anderson said in an emailed statement. Those visa holders arrived over the past three years, he said.
'Overall, a few years of weakening population growth will have some mixed effects on the economy,' Mr Anderson said. 'It will lead to more moderate growth in household spending, at a time when the income gains from the commodity cycle will already be boosting national income.'
The nation's population increased 2.1 per cent in the year to September 2009, the fastest expansion since the mid-1960s and three quarters of a percentage point quicker than the average for the past 20 years, according to the Reserve Bank of Australia.
Net migration jumped 34 per cent from a year earlier, statistics bureau data show, as a labour shortage and low unemployment pushed up the number of people coming on long-term visitor visas.
Moderate employment growth as population growth slows will result in less inflationary pressures and only two rate increases in 2011, Mr Anderson said. -- Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Australia's weak population growth may hit rentals
(SYDNEY) A slowdown in Australia's population growth, as long-term visitors leaving outnumber those arriving, could ease pressure on rental markets and lead to a 'relatively benign interest rate environment', BIS Shrapnel senior economist Jason Anderson said.
Population growth will slow to about 1.5 per cent in the 2011 fiscal year and to 1.3 per cent in 2012, on the exit of visitors holding student and business visas of about four years, Sydney-based Mr Anderson said in an emailed statement. Those visa holders arrived over the past three years, he said.
'Overall, a few years of weakening population growth will have some mixed effects on the economy,' Mr Anderson said. 'It will lead to more moderate growth in household spending, at a time when the income gains from the commodity cycle will already be boosting national income.'
The nation's population increased 2.1 per cent in the year to September 2009, the fastest expansion since the mid-1960s and three quarters of a percentage point quicker than the average for the past 20 years, according to the Reserve Bank of Australia.
Net migration jumped 34 per cent from a year earlier, statistics bureau data show, as a labour shortage and low unemployment pushed up the number of people coming on long-term visitor visas.
Moderate employment growth as population growth slows will result in less inflationary pressures and only two rate increases in 2011, Mr Anderson said. -- Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : Owning home ranks above marriage in UK
Business Times - 18 May 2010
Owning home ranks above marriage in UK
(LONDON) Britons looking to buy a new home believe that owning their own property is a higher priority in life than getting married or starting a family, according to a ComRes Ltd poll.
Asked to rate the importance of home ownership, 71 per cent of those polled scored it as at least eight on a scale of 10, compared with 46 per cent for marriage and 44 per cent for having children, according to the poll, which was carried out for the UK's biggest homebuilder, Barratt Developments plc.
'These results demonstrate that the economic problems of the last three years have not diminished the huge appetite for home ownership in Britain,' Barratt chief executive officer Mark Clare said in a statement.
The polling agency surveyed 2,905 prospective homebuyers from March 19 to March 25 who registered with Barratt Homes's website in the last nine months.
Taking holidays abroad and having an active social life were at the bottom of the scale of priorities, polling 24 per cent and 27 per cent, respectively.
ComRes also conducted polls for the UK's May 6 general election and counts the Independent on Sunday newspaper, Lloyd's Banking Group plc and the British Red Cross among its clients, according to the company's website\. \-- Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Top priority: In the poll, 71% scored home ownership as at least eight on a scale of 10, compared with 46% for marriage and 44% for having children
Owning home ranks above marriage in UK
(LONDON) Britons looking to buy a new home believe that owning their own property is a higher priority in life than getting married or starting a family, according to a ComRes Ltd poll.
Asked to rate the importance of home ownership, 71 per cent of those polled scored it as at least eight on a scale of 10, compared with 46 per cent for marriage and 44 per cent for having children, according to the poll, which was carried out for the UK's biggest homebuilder, Barratt Developments plc.
'These results demonstrate that the economic problems of the last three years have not diminished the huge appetite for home ownership in Britain,' Barratt chief executive officer Mark Clare said in a statement.
The polling agency surveyed 2,905 prospective homebuyers from March 19 to March 25 who registered with Barratt Homes's website in the last nine months.
Taking holidays abroad and having an active social life were at the bottom of the scale of priorities, polling 24 per cent and 27 per cent, respectively.
ComRes also conducted polls for the UK's May 6 general election and counts the Independent on Sunday newspaper, Lloyd's Banking Group plc and the British Red Cross among its clients, according to the company's website\. \-- Bloomberg
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Top priority: In the poll, 71% scored home ownership as at least eight on a scale of 10, compared with 46% for marriage and 44% for having children
BT : Developers brace for muted May after active April
Business Times - 18 May 2010
Developers brace for muted May after active April
Private home sales rose 25.3%, highest monthly figure in nine months
By KALPANA RASHIWALA
(SINGAPORE) April was a good month for developers, with private homes sales surging 25.3 per cent month-on-month to a higher-than-expected 2,207 units. This is the highest monthly figure in nine months and takes the sales tally for the first four months of this year to 6,587 units, nearly 45 per cent of the figure for the whole of last year.
But far from opening the bubbly, industry players are watching how home buyers react to ongoing stock market jitters and fears about a contagion effect in Europe from Greece's problems.
Developers' sales activity is expected to fall in May as there have been few launches so far this month. But projects such as The Minton in Hougang are expected to be launched next week. Allgreen is also previewing The Cascadia at Bukit Timah this week to retail buyers, after selling 187 of the project's 536 units to two funds a few years ago.
Last week, Frasers Centrepoint began sales of Flamingo Valley at an average price of about $1,200 psf to former owners of the site as well as to some of its loyal customers, and will soft launch the freehold project this weekend.
'There'a wait-and-see approach because of Greece but the economic fundamentals of Singapore and the region like China and India are still very strong,' says Frasers Centrepoint Homes chief operating officer Cheang Kok Kheong.
Knight Frank managing director of residential services Peter Ow says another reason developers here have not been active with project launches this month is that they may not have obtained all the approvals for launch, or their showflats or promotional materials are not ready.
Once such hurdles have been cleared, developers with mass-market projects will likely proceed to launch them as 'there's demand in this segment', Mr Ow suggests.
'Those with high-end projects may be more cautious as fears of a contagion effect from the Greece crisis tend to affect this segment more,' he added.
Knight Frank's Mr Ow and DTZ's South-east Asia research head Chua Chor Hoon both reckon developers' private homes sales in May could still cross the 1,000-unit level.
Mr Ow's full-year 2010 forecast is 10,000-12,000 units and Ms Chua predicts the number will 'exceed 10,000 units'. The figure for the whole of last year was 14,688 units.
The 2,207 unit-home sales by developers in April is the second highest level since Urban Redevelopment Authority began releasing monthly developer homes sales data in June 2007. The highest sales volume was 2,772 units in July last year.
The strong sales in April were a function of the surge in launches. Developers launched a total 2,084 homes last month, up 16.4 per cent from March.
Colliers International director Tay Huey Ying observed that 82 per cent of units sold last month were in the '$1,500 psf and below' range, a higher proportion than in the preceding six months.
Besides attributing this trend to a prevalence of units launched in this price band last month, she suggests that it could be an early sign of price resistance.
Urban Redevelopment Authority's figures released yesterday show that 47 per cent or 1,044 units of the 2,207 units sold last month were in Rest of Central Region. Take-up in the location was buoyed by the successful launch of Waterbank at Dakota by UOL Group and new units released at The Interlace.
Sales in the Outside Central Region (771 units) was driven by City Developments Ltd's launch of Tree House condo at Chestnut Avenue.
Islandwide, the top three selling projects in the primary market last month were Waterbank at Dakota (573 units sold at a median price of $1,178 psf), Tree House (374 units at a median price of $835 psf) and The Interlace (144 units at $1,067 psf median price).
'In the high-end segment, 31 units of Marina Bay Suites were sold at the median price of $2,678 psf. Goodwood Residence reported 29 units sold at a median price of $2,488 psf while The Laurels sold another 22 units at $2,904 psf. At the top of the range, one unit of The Orchard Residences was sold at $4,207 psf, followed by a unit in Scotts Square at $3,670 psf and two units in (Hong Leong Holdings') Sage at Nassim Road at $3,205 psf,' says CBRE Research executive director Li Hiaw Ho.
BT understands The Orchard Residences unit sold last month was a four-bedroom apartment above the 40th level while the Scotts Square unit is a two-bedder on a low floor.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Freehold project: Frasers Centrepoint will soft launch Flamingo Valley this weekend
Developers brace for muted May after active April
Private home sales rose 25.3%, highest monthly figure in nine months
By KALPANA RASHIWALA
(SINGAPORE) April was a good month for developers, with private homes sales surging 25.3 per cent month-on-month to a higher-than-expected 2,207 units. This is the highest monthly figure in nine months and takes the sales tally for the first four months of this year to 6,587 units, nearly 45 per cent of the figure for the whole of last year.
But far from opening the bubbly, industry players are watching how home buyers react to ongoing stock market jitters and fears about a contagion effect in Europe from Greece's problems.
Developers' sales activity is expected to fall in May as there have been few launches so far this month. But projects such as The Minton in Hougang are expected to be launched next week. Allgreen is also previewing The Cascadia at Bukit Timah this week to retail buyers, after selling 187 of the project's 536 units to two funds a few years ago.
Last week, Frasers Centrepoint began sales of Flamingo Valley at an average price of about $1,200 psf to former owners of the site as well as to some of its loyal customers, and will soft launch the freehold project this weekend.
'There'a wait-and-see approach because of Greece but the economic fundamentals of Singapore and the region like China and India are still very strong,' says Frasers Centrepoint Homes chief operating officer Cheang Kok Kheong.
Knight Frank managing director of residential services Peter Ow says another reason developers here have not been active with project launches this month is that they may not have obtained all the approvals for launch, or their showflats or promotional materials are not ready.
Once such hurdles have been cleared, developers with mass-market projects will likely proceed to launch them as 'there's demand in this segment', Mr Ow suggests.
'Those with high-end projects may be more cautious as fears of a contagion effect from the Greece crisis tend to affect this segment more,' he added.
Knight Frank's Mr Ow and DTZ's South-east Asia research head Chua Chor Hoon both reckon developers' private homes sales in May could still cross the 1,000-unit level.
Mr Ow's full-year 2010 forecast is 10,000-12,000 units and Ms Chua predicts the number will 'exceed 10,000 units'. The figure for the whole of last year was 14,688 units.
The 2,207 unit-home sales by developers in April is the second highest level since Urban Redevelopment Authority began releasing monthly developer homes sales data in June 2007. The highest sales volume was 2,772 units in July last year.
The strong sales in April were a function of the surge in launches. Developers launched a total 2,084 homes last month, up 16.4 per cent from March.
Colliers International director Tay Huey Ying observed that 82 per cent of units sold last month were in the '$1,500 psf and below' range, a higher proportion than in the preceding six months.
Besides attributing this trend to a prevalence of units launched in this price band last month, she suggests that it could be an early sign of price resistance.
Urban Redevelopment Authority's figures released yesterday show that 47 per cent or 1,044 units of the 2,207 units sold last month were in Rest of Central Region. Take-up in the location was buoyed by the successful launch of Waterbank at Dakota by UOL Group and new units released at The Interlace.
Sales in the Outside Central Region (771 units) was driven by City Developments Ltd's launch of Tree House condo at Chestnut Avenue.
Islandwide, the top three selling projects in the primary market last month were Waterbank at Dakota (573 units sold at a median price of $1,178 psf), Tree House (374 units at a median price of $835 psf) and The Interlace (144 units at $1,067 psf median price).
'In the high-end segment, 31 units of Marina Bay Suites were sold at the median price of $2,678 psf. Goodwood Residence reported 29 units sold at a median price of $2,488 psf while The Laurels sold another 22 units at $2,904 psf. At the top of the range, one unit of The Orchard Residences was sold at $4,207 psf, followed by a unit in Scotts Square at $3,670 psf and two units in (Hong Leong Holdings') Sage at Nassim Road at $3,205 psf,' says CBRE Research executive director Li Hiaw Ho.
BT understands The Orchard Residences unit sold last month was a four-bedroom apartment above the 40th level while the Scotts Square unit is a two-bedder on a low floor.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Freehold project: Frasers Centrepoint will soft launch Flamingo Valley this weekend
BT : Smaller developers post strong results too
Business Times - 18 May 2010
Smaller developers post strong results too
By JAMIE LEE
SEVERAL smaller property companies followed in the footsteps of their bigger peers, posting strong results in the latest quarter ended March.
Property and hotel operator Fragrance Group posted a 42.6 per cent surge in its first-quarter net profit to $14.4 million, thanks in part to higher selling prices of its units. It registered a higher gross profit margin of 42.2 per cent, up from 23.6 per cent recorded in the same period a year ago. The increase in net profit came despite a 17.7 per cent drop in revenue to $41.8 million, dragged by lower sales in the property development division, which made up nearly 80 per cent of total revenue. It contributed $32.6 million in sales, down 23.8 per cent from a year ago, which largely came from the sale of units at 138-unit project Parc Imperial that would soon be completed. The fall in revenue was partly offset by higher sales in its hotel division under its Fragrance Hotel chain. This rose 15 per cent to $9.23 million. This month, it placed the highest bid of $16.3 million for a private residential plot along Tampines Road, or about 700m from Kovan MRT Station.
Orchard Parade Holdings - a subsidiary of Far East Organization - also posted sterling numbers. Net profit for the developer - which runs Orchard Parade Hotel - stood at $9.3 million, up from $107,000 a year ago. This was thanks to firmer sales and a fair-value gain on its investment properties, as opposed to a revaluation loss posted a year ago. Revenue more than doubled to $28.1 million from $11.7 million mainly due to sale of units of the residential project Floridian, which it is developing with Wing Tai Holdings. Revaluation of its investment properties also reaped a gain of $1.56 million, contrasting with a loss of $3.05 million a year ago.
Lee Kim Tah Holdings - which owns 50 per cent of Jurong Point Shopping Mall - said net profit for the first quarter jumped 84.5 per cent to $9.53 million, thanks to a surge in sales. The company posted a more than tripling in revenue to $40.8 million from $12.6 million a year ago, largely due to the sales from the completed residential development in Neutral Bay, Australia.
Hiap Hoe bucked the trend despite higher revenue, dragged by a slow recognition of sales from one of its residential projects. It reported a 43.5 per cent plunge in net profit to $3.9 million for Q1. Sales, however, were up 68.7 per cent to $26 million. Due to huge marketing costs for Waterscape at Cavenagh - which was launched in that quarter - the group's selling and distribution expenses surged to $6.5 million from $21,000 a year ago.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Smaller developers post strong results too
By JAMIE LEE
SEVERAL smaller property companies followed in the footsteps of their bigger peers, posting strong results in the latest quarter ended March.
Property and hotel operator Fragrance Group posted a 42.6 per cent surge in its first-quarter net profit to $14.4 million, thanks in part to higher selling prices of its units. It registered a higher gross profit margin of 42.2 per cent, up from 23.6 per cent recorded in the same period a year ago. The increase in net profit came despite a 17.7 per cent drop in revenue to $41.8 million, dragged by lower sales in the property development division, which made up nearly 80 per cent of total revenue. It contributed $32.6 million in sales, down 23.8 per cent from a year ago, which largely came from the sale of units at 138-unit project Parc Imperial that would soon be completed. The fall in revenue was partly offset by higher sales in its hotel division under its Fragrance Hotel chain. This rose 15 per cent to $9.23 million. This month, it placed the highest bid of $16.3 million for a private residential plot along Tampines Road, or about 700m from Kovan MRT Station.
Orchard Parade Holdings - a subsidiary of Far East Organization - also posted sterling numbers. Net profit for the developer - which runs Orchard Parade Hotel - stood at $9.3 million, up from $107,000 a year ago. This was thanks to firmer sales and a fair-value gain on its investment properties, as opposed to a revaluation loss posted a year ago. Revenue more than doubled to $28.1 million from $11.7 million mainly due to sale of units of the residential project Floridian, which it is developing with Wing Tai Holdings. Revaluation of its investment properties also reaped a gain of $1.56 million, contrasting with a loss of $3.05 million a year ago.
Lee Kim Tah Holdings - which owns 50 per cent of Jurong Point Shopping Mall - said net profit for the first quarter jumped 84.5 per cent to $9.53 million, thanks to a surge in sales. The company posted a more than tripling in revenue to $40.8 million from $12.6 million a year ago, largely due to the sales from the completed residential development in Neutral Bay, Australia.
Hiap Hoe bucked the trend despite higher revenue, dragged by a slow recognition of sales from one of its residential projects. It reported a 43.5 per cent plunge in net profit to $3.9 million for Q1. Sales, however, were up 68.7 per cent to $26 million. Due to huge marketing costs for Waterscape at Cavenagh - which was launched in that quarter - the group's selling and distribution expenses surged to $6.5 million from $21,000 a year ago.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : Vacant homes aplenty but building goes on in Vegas
Business Times - 18 May 2010
Vacant homes aplenty but building goes on in Vegas
City trying to fuel recovery by building, which creates more jobs
(LAS VEGAS) In a plastic tent under a glorious desert sky, Richard Lee preached the gospel of the second chance.
The chance to make money on the next housing boom 'is like it's never been', Mr Lee, a real estate promoter, assured a crowd of agents, investors and bankers. 'We're going to come back like you've never seen us before.'
Home prices in Las Vegas are down by 60 per cent from 2006 in one of the steepest descents in modern times. There are 9,517 spanking new houses sitting empty. An additional 5,600 homes were repossessed by lenders in the first three months of this year and could soon be for sale.
Yet builders here are putting up 1,100 homes, and they are frantically buying lots for even more.
Las Vegas is trying to recover by building what it does not need. It is an unlikely pattern being repeated in many of the areas where the housing crash was most severe.
'There's a surprising rebound in the hardest-hit markets,' said Brad Hunter, chief economist with the consultant Metrostudy. 'People are buying again.'
From the recession's lows, construction has nearly doubled in Las Vegas, Phoenix and Tucson. It is up 74 per cent in inland Southern California and soaring in Florida.
Some of the demand is coming from families that are getting shut out of the bidding for foreclosures by syndicates that pay in cash, and some is from investors who are back on the prowl.
Land and labour costs have fallen significantly, so the newest homes are competitively priced. Some of the boom-era homes, meanwhile, are in developments that feel like ghost towns. And many Americans will always believe the latest model of something is their only option, an attitude that builders are doing their utmost to reinforce.
In Phoenix, a billboard for Fulton Homes summed up the builders' marketing approach. 'Does your foreclosure have tenants?' it asks, next to a picture of a mammoth cockroach.
Brent Anderson, a marketing executive with another Southwest builder, Meritage Homes, said that it bought 713 lots in stricken Arizona last year, and was on the verge of starting construction in a new Phoenix community called Lyon's Gate.
'We're building them because we're selling them,' Mr Anderson said. 'Our customers wouldn't care if there were 50 homes in an established neighbourhood of 1980 or 1990 vintage, all foreclosed, empty and for sale at US$10,000 less. They want new. And what are we going to do, let someone else build it?'
All of this goes contrary to conventional wisdom, which suggests an improved market for builders is years away. Nationwide, new home sales at the beginning of this year plunged to a level below any recorded since 1963, when the figures were first officially tabulated.
Simply put, the country already has too many houses, the legacy of wide-scale overbuilding during the boom. The Census Bureau says that there are two million vacant homes for sale, about double the historical level. Fewer new households, moreover, are being formed as families double up for economic reasons, putting a further brake on demand.
Even some builders agree with the pessimists when it comes to Las Vegas. Meritage Homes, for example, has largely withdrawn from the city. 'We don't think it will come back for a long time,' Mr Anderson said.
American West is betting the opposite is true. The developer, which is privately held and is based here, builds nowhere else. The evening under the tent with Mr Lee was the official start of American West's new community, called Reserve at Coronado Ranch.
Before it opened, buyers began putting down money for the houses, which sell for under US$300,000. 'For the first time in three or four years, we have pent-up demand,' said American West's vice-president for sales, Jeff Canarelli.
Disregard what you may have heard about how hard times may usher in an era of restraint. 'With our buyers, they always want bigger,' Mr Canarelli said. An American West home introduced during the recession comes equipped with an elevator.
There is a benefit to the seeming madness in places like Las Vegas. Building homes is the traditional fuel of a recovery. 'Housing is construction. It's tables. It's paint. It's couches. It's toilets,' said Sally Taylor, a specialist in liquor and gambling establishments who attended the American West festivities. 'If we build more houses, we're creating more jobs.'
Across the street from Reserve's three model homes is a new strip mall. Only one building is occupied, a gambling parlour. Others will start to be filled when more buyers join Snider and Hallman finds a renter.
Analysts have calculated that it could take as long as a decade for inventories to return to their pre-crash levels and for demand to once again exceed supply. That is a grim prospect for any owner who hopes to accrue equity through rising prices.
A few experts, however, are starting to think the path to a better market will be much shorter. Stephen Auth, chief investment officer at financial services company Federated Investors, is a housing bull.
He says he does not believe that many extended families will end up all living in one place.
'That's an unsustainable environment - Grandma coming home, Johnny moving back in with his new wife,' Mr Auth said. 'They're going to move back out. The great housing depression is nearly over.'
New-home sales in March rose 27 per cent. But most analysts attributed the jump to the pending expiration of yet another government incentive, a tax credit for buyers, and said that sales would quickly slump again. -- NYT
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
No takers: Bank-owned homes in the Silverado neighbourhood of Las Vegas. The US has too many houses, the legacy of wide-scale overbuilding during the boom
Vacant homes aplenty but building goes on in Vegas
City trying to fuel recovery by building, which creates more jobs
(LAS VEGAS) In a plastic tent under a glorious desert sky, Richard Lee preached the gospel of the second chance.
The chance to make money on the next housing boom 'is like it's never been', Mr Lee, a real estate promoter, assured a crowd of agents, investors and bankers. 'We're going to come back like you've never seen us before.'
Home prices in Las Vegas are down by 60 per cent from 2006 in one of the steepest descents in modern times. There are 9,517 spanking new houses sitting empty. An additional 5,600 homes were repossessed by lenders in the first three months of this year and could soon be for sale.
Yet builders here are putting up 1,100 homes, and they are frantically buying lots for even more.
Las Vegas is trying to recover by building what it does not need. It is an unlikely pattern being repeated in many of the areas where the housing crash was most severe.
'There's a surprising rebound in the hardest-hit markets,' said Brad Hunter, chief economist with the consultant Metrostudy. 'People are buying again.'
From the recession's lows, construction has nearly doubled in Las Vegas, Phoenix and Tucson. It is up 74 per cent in inland Southern California and soaring in Florida.
Some of the demand is coming from families that are getting shut out of the bidding for foreclosures by syndicates that pay in cash, and some is from investors who are back on the prowl.
Land and labour costs have fallen significantly, so the newest homes are competitively priced. Some of the boom-era homes, meanwhile, are in developments that feel like ghost towns. And many Americans will always believe the latest model of something is their only option, an attitude that builders are doing their utmost to reinforce.
In Phoenix, a billboard for Fulton Homes summed up the builders' marketing approach. 'Does your foreclosure have tenants?' it asks, next to a picture of a mammoth cockroach.
Brent Anderson, a marketing executive with another Southwest builder, Meritage Homes, said that it bought 713 lots in stricken Arizona last year, and was on the verge of starting construction in a new Phoenix community called Lyon's Gate.
'We're building them because we're selling them,' Mr Anderson said. 'Our customers wouldn't care if there were 50 homes in an established neighbourhood of 1980 or 1990 vintage, all foreclosed, empty and for sale at US$10,000 less. They want new. And what are we going to do, let someone else build it?'
All of this goes contrary to conventional wisdom, which suggests an improved market for builders is years away. Nationwide, new home sales at the beginning of this year plunged to a level below any recorded since 1963, when the figures were first officially tabulated.
Simply put, the country already has too many houses, the legacy of wide-scale overbuilding during the boom. The Census Bureau says that there are two million vacant homes for sale, about double the historical level. Fewer new households, moreover, are being formed as families double up for economic reasons, putting a further brake on demand.
Even some builders agree with the pessimists when it comes to Las Vegas. Meritage Homes, for example, has largely withdrawn from the city. 'We don't think it will come back for a long time,' Mr Anderson said.
American West is betting the opposite is true. The developer, which is privately held and is based here, builds nowhere else. The evening under the tent with Mr Lee was the official start of American West's new community, called Reserve at Coronado Ranch.
Before it opened, buyers began putting down money for the houses, which sell for under US$300,000. 'For the first time in three or four years, we have pent-up demand,' said American West's vice-president for sales, Jeff Canarelli.
Disregard what you may have heard about how hard times may usher in an era of restraint. 'With our buyers, they always want bigger,' Mr Canarelli said. An American West home introduced during the recession comes equipped with an elevator.
There is a benefit to the seeming madness in places like Las Vegas. Building homes is the traditional fuel of a recovery. 'Housing is construction. It's tables. It's paint. It's couches. It's toilets,' said Sally Taylor, a specialist in liquor and gambling establishments who attended the American West festivities. 'If we build more houses, we're creating more jobs.'
Across the street from Reserve's three model homes is a new strip mall. Only one building is occupied, a gambling parlour. Others will start to be filled when more buyers join Snider and Hallman finds a renter.
Analysts have calculated that it could take as long as a decade for inventories to return to their pre-crash levels and for demand to once again exceed supply. That is a grim prospect for any owner who hopes to accrue equity through rising prices.
A few experts, however, are starting to think the path to a better market will be much shorter. Stephen Auth, chief investment officer at financial services company Federated Investors, is a housing bull.
He says he does not believe that many extended families will end up all living in one place.
'That's an unsustainable environment - Grandma coming home, Johnny moving back in with his new wife,' Mr Auth said. 'They're going to move back out. The great housing depression is nearly over.'
New-home sales in March rose 27 per cent. But most analysts attributed the jump to the pending expiration of yet another government incentive, a tax credit for buyers, and said that sales would quickly slump again. -- NYT
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
No takers: Bank-owned homes in the Silverado neighbourhood of Las Vegas. The US has too many houses, the legacy of wide-scale overbuilding during the boom
BT : Bringing bids in govt residential land tenders down to earth
Business Times - 18 May 2010
NEWS ANALYSIS
Bringing bids in govt residential land tenders down to earth
To encourage more rational bids and impose greater discipline on developers, close tenders for several sites at the same time, suggests KALPANA RASHIWALA
GOVERNMENT land tenders for private residential land are seeing an anomaly of sorts. As the state launches more sites, land keeps getting sold at higher prices with each successive tender closing.
Behind this is a short-term supply crunch created by the low volume of suburban housing land released and bought at state tenders over the past few years vis-a-vis strong home buying demand since last year. (Please see supply chart from Credo Real Estate.)
Some market observers suggest the escalation in winning bids is also being caused by the current system of tender closings, with just one site offered per tender. What's happening now is that each time a tender closes for a site and it attracts say 14 bids, only one party clinches the plot and some of the other 13 unsuccessful bidders go back and sharpen their pencils for the next tender, pushing up land bids with each consecutive tender.
Nudging developers to rationality
Perhaps tweaking tender closings could nudge developers to make more rational bids.
Rather than having one tender closing for a single site at a time, the authorities could try reverting to the system we had in 1997, for instance, when tenders for several sites (up to five) closed at the same time. This may impose greater discipline on developers when formulating their bids as there is a danger of them ending up with all the sites on offer if they bid too aggressively for everything. They'll have to narrow down which plot they really want.
'The current system of a tender closing for one site at a time, if it's having the effect of sites being awarded at successively higher prices, does help the state to maximise land revenues. But government then can't complain if the finished product prices are higher,' said a developer.
The current surge in top bids at state tenders, if read by government as a sign of strong demand for land, would prompt it to step up supply. However, if the market suddenly turns, this could potentially create a massive oversupply in the mass-market private housing segment (for which state land sales is the major source of supply).
For now at least, an increase in state land supply for private housing in H2 2010 is a foregone conclusion. Strong housing sales, rising end-unit prices and bullish top bids for state land sales amid high participation rates by developers are all creating the impetus for government to release more land as well as a greater variety of sites to try and contain a housing bubble.
The trick for the government will be in gauging just how much it needs to boost supply. This will entail taking into account a host of factors including intake of new permanent residents/citizens, while managing supply-side risks that could emanate if the market suddenly turns, given that there is increasing danger of this happening as prices continue to surge.
According to one school of thought, there's actually enough supply right now.
As at the end of Q1 this year, there were 34,233 private homes (including exec condos) that had yet to be sold in projects with planning approval.
Land sold by the state so far this year as well as sites whose tenders are scheduled to close in May and June can yield a further 6,270 private homes. Adding this figure to the 34,233 units, the total supply of 40,503 units could be sufficient to last three to four years, depending on demand.
It is notewothy that the 40,503-unit supply number is not far off from the recent peak of 43,414 units in Q4 2008 when sentiment in the property market plummeted following the collapse of Lehman Brothers. The lowest the supply number has been is 29,754 units - in Q4 2005.
Faster turnaround
Another trend these days is the relatively quick turnaround time between a developer clinching a site at a state tender and launching a project on it. UOL Group managed to release its Waterbank at Dakota condo in April, just seven months after it was awarded the plot.
It makes sense for developers to launch projects quickly on pricey sites to recoup their investments quickly. The idea is to catch the market while it's still hot. Such a strategy alleviates risks for developers and also allows them to cater to strong demand from home buyers. However, this may also introduce a surge in launches of mass-market projects that could precipitate a market turn in this segment.
So there's a case for government adopting a measured approach in land sales for H2 2010.
Let's look at the other side of the coin.
While the supply of 40,503 units seems ample for now, this number can be whittled down quite quickly if home sales continue to be strong. Already in the first four months of this year, developers sold 6,587 homes and industry forecasts of full-year sales are at about 10,000 to 14,000 units - supported by low interest rates, improving economic outlook and keen interest by foreign buyers in the local property market.
Developers may also not be willing to release everything in their landbank anytime soon. Those with substantial supply in a single location would want to stagger the launch of projects over several phases to maximise selling prices. There are also many projects on sites acquired at peakish prices and whose developers are banking on further price appreciation before launching them. Most developers have the financial muscle for such a strategy.
With developers tending to hold back some projects in their landbanks, there is a role for the state to inject further supply.
One could ask how strong demand really is. Yes there is a lot of genuine buying, from upgraders and others, driven by low interest rates and other factors. But there is also anecdotal evidence of people who are buying second, third or more 'investment' properties with a view to making quick gains. They may not be bothered if rents come down. Then there are foreign buyers, an important source of demand especially in the high end but who can vaporise overnight when things become uncertain as seen during the recent global financial crisis.
With economic and property cycles shrinking, assessing how much land to release is hardly a cut-and-dried affair. And that's not even counting the political and social dimensions of this issue, such as balancing the needs of younger citizens who lament that property prices are beyond reach with potential negative equity pressures that some home owners could face from banks if the values of their homes drop.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
The supply factor: Strong housing sales, rising end-unit prices and bullish top bids for state land sales amid high participation rates by developers are all creating the impetus for govt to release more land to try and contain a housing bubble
NEWS ANALYSIS
Bringing bids in govt residential land tenders down to earth
To encourage more rational bids and impose greater discipline on developers, close tenders for several sites at the same time, suggests KALPANA RASHIWALA
GOVERNMENT land tenders for private residential land are seeing an anomaly of sorts. As the state launches more sites, land keeps getting sold at higher prices with each successive tender closing.
Behind this is a short-term supply crunch created by the low volume of suburban housing land released and bought at state tenders over the past few years vis-a-vis strong home buying demand since last year. (Please see supply chart from Credo Real Estate.)
Some market observers suggest the escalation in winning bids is also being caused by the current system of tender closings, with just one site offered per tender. What's happening now is that each time a tender closes for a site and it attracts say 14 bids, only one party clinches the plot and some of the other 13 unsuccessful bidders go back and sharpen their pencils for the next tender, pushing up land bids with each consecutive tender.
Nudging developers to rationality
Perhaps tweaking tender closings could nudge developers to make more rational bids.
Rather than having one tender closing for a single site at a time, the authorities could try reverting to the system we had in 1997, for instance, when tenders for several sites (up to five) closed at the same time. This may impose greater discipline on developers when formulating their bids as there is a danger of them ending up with all the sites on offer if they bid too aggressively for everything. They'll have to narrow down which plot they really want.
'The current system of a tender closing for one site at a time, if it's having the effect of sites being awarded at successively higher prices, does help the state to maximise land revenues. But government then can't complain if the finished product prices are higher,' said a developer.
The current surge in top bids at state tenders, if read by government as a sign of strong demand for land, would prompt it to step up supply. However, if the market suddenly turns, this could potentially create a massive oversupply in the mass-market private housing segment (for which state land sales is the major source of supply).
For now at least, an increase in state land supply for private housing in H2 2010 is a foregone conclusion. Strong housing sales, rising end-unit prices and bullish top bids for state land sales amid high participation rates by developers are all creating the impetus for government to release more land as well as a greater variety of sites to try and contain a housing bubble.
The trick for the government will be in gauging just how much it needs to boost supply. This will entail taking into account a host of factors including intake of new permanent residents/citizens, while managing supply-side risks that could emanate if the market suddenly turns, given that there is increasing danger of this happening as prices continue to surge.
According to one school of thought, there's actually enough supply right now.
As at the end of Q1 this year, there were 34,233 private homes (including exec condos) that had yet to be sold in projects with planning approval.
Land sold by the state so far this year as well as sites whose tenders are scheduled to close in May and June can yield a further 6,270 private homes. Adding this figure to the 34,233 units, the total supply of 40,503 units could be sufficient to last three to four years, depending on demand.
It is notewothy that the 40,503-unit supply number is not far off from the recent peak of 43,414 units in Q4 2008 when sentiment in the property market plummeted following the collapse of Lehman Brothers. The lowest the supply number has been is 29,754 units - in Q4 2005.
Faster turnaround
Another trend these days is the relatively quick turnaround time between a developer clinching a site at a state tender and launching a project on it. UOL Group managed to release its Waterbank at Dakota condo in April, just seven months after it was awarded the plot.
It makes sense for developers to launch projects quickly on pricey sites to recoup their investments quickly. The idea is to catch the market while it's still hot. Such a strategy alleviates risks for developers and also allows them to cater to strong demand from home buyers. However, this may also introduce a surge in launches of mass-market projects that could precipitate a market turn in this segment.
So there's a case for government adopting a measured approach in land sales for H2 2010.
Let's look at the other side of the coin.
While the supply of 40,503 units seems ample for now, this number can be whittled down quite quickly if home sales continue to be strong. Already in the first four months of this year, developers sold 6,587 homes and industry forecasts of full-year sales are at about 10,000 to 14,000 units - supported by low interest rates, improving economic outlook and keen interest by foreign buyers in the local property market.
Developers may also not be willing to release everything in their landbank anytime soon. Those with substantial supply in a single location would want to stagger the launch of projects over several phases to maximise selling prices. There are also many projects on sites acquired at peakish prices and whose developers are banking on further price appreciation before launching them. Most developers have the financial muscle for such a strategy.
With developers tending to hold back some projects in their landbanks, there is a role for the state to inject further supply.
One could ask how strong demand really is. Yes there is a lot of genuine buying, from upgraders and others, driven by low interest rates and other factors. But there is also anecdotal evidence of people who are buying second, third or more 'investment' properties with a view to making quick gains. They may not be bothered if rents come down. Then there are foreign buyers, an important source of demand especially in the high end but who can vaporise overnight when things become uncertain as seen during the recent global financial crisis.
With economic and property cycles shrinking, assessing how much land to release is hardly a cut-and-dried affair. And that's not even counting the political and social dimensions of this issue, such as balancing the needs of younger citizens who lament that property prices are beyond reach with potential negative equity pressures that some home owners could face from banks if the values of their homes drop.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
The supply factor: Strong housing sales, rising end-unit prices and bullish top bids for state land sales amid high participation rates by developers are all creating the impetus for govt to release more land to try and contain a housing bubble
ST Forum : Do your checks before investing in land abroad
May 17, 2010
Do your checks before investing in land abroad
I REFER to last Friday's report, '200 lose $6m in British land deals', which revealed that 200 persons have, at various times since 2006, purchased plots of land in rural places like Swindon and Gatwick in Britain through Land International (Far East), a Singapore company which is the subsidiary of parent Land International, shut down by the British government in 2008.
These 200 persons had been promised high returns with regular payouts for three years.
Singapore investors may wish to know that Britain's Land Registry published a guide in 2008 on 'land banking schemes' to alert the public on schemes often touted as offering huge returns on investment. Apparently, land sold in such schemes is usually in areas protected from development by planning law - that is, land in the 'green belt' or agricultural land where no development is ever likely to be permitted.
According to the guide, known in short as Public21, such land is first acquired at a low price and divided into smaller plots. The plots are then offered for sale (even online) to the public on the premise that when planning permission is secured in the future for the site for housing, the plots will be more valuable. Potential investors may be misled about the prospects of obtaining planning permission or redevelopment and this in turn may lead them into thinking that they will have the opportunity to sell the plots at even greater profit to developers in the future.
The guide mentions that those operating land banking schemes often claim that they have well-known banks, other lending institutions and established developers as their partners in the schemes when this may not be the case. In some extreme cases, forged Land Registry letters have been produced to suggest that there is official Land Registry planning approval.
Singapore investors keen on land in Britain should at least peruse such a guide, and make inquiries with the Land Registry or a credible international property firm based in Singapore with overseas networks in those countries of interest to them. Singapore Accredited Estate Agencies agrees with the Consumers Association of Singapore that due diligence and background checks of both the locally registered land banking company and its parent or counterpart in the country of origin must be stringent before investors part with their monies.
Dr Tan Tee Khoon
Chief Executive Officer
Singapore Accredited Estate Agencies
Do your checks before investing in land abroad
I REFER to last Friday's report, '200 lose $6m in British land deals', which revealed that 200 persons have, at various times since 2006, purchased plots of land in rural places like Swindon and Gatwick in Britain through Land International (Far East), a Singapore company which is the subsidiary of parent Land International, shut down by the British government in 2008.
These 200 persons had been promised high returns with regular payouts for three years.
Singapore investors may wish to know that Britain's Land Registry published a guide in 2008 on 'land banking schemes' to alert the public on schemes often touted as offering huge returns on investment. Apparently, land sold in such schemes is usually in areas protected from development by planning law - that is, land in the 'green belt' or agricultural land where no development is ever likely to be permitted.
According to the guide, known in short as Public21, such land is first acquired at a low price and divided into smaller plots. The plots are then offered for sale (even online) to the public on the premise that when planning permission is secured in the future for the site for housing, the plots will be more valuable. Potential investors may be misled about the prospects of obtaining planning permission or redevelopment and this in turn may lead them into thinking that they will have the opportunity to sell the plots at even greater profit to developers in the future.
The guide mentions that those operating land banking schemes often claim that they have well-known banks, other lending institutions and established developers as their partners in the schemes when this may not be the case. In some extreme cases, forged Land Registry letters have been produced to suggest that there is official Land Registry planning approval.
Singapore investors keen on land in Britain should at least peruse such a guide, and make inquiries with the Land Registry or a credible international property firm based in Singapore with overseas networks in those countries of interest to them. Singapore Accredited Estate Agencies agrees with the Consumers Association of Singapore that due diligence and background checks of both the locally registered land banking company and its parent or counterpart in the country of origin must be stringent before investors part with their monies.
Dr Tan Tee Khoon
Chief Executive Officer
Singapore Accredited Estate Agencies
ST : 2010 still likely a banner year for private property
May 17, 2010
DESPITE SLOWDOWN...
2010 still likely a banner year for private property
Number of new homes sold in 1st quarter suggests return to near boom levels
By Joyce Teo
THE private homes market has slowed in the past fortnight but experts feel 2010 will still emerge as a banner year for the sector.
They say sales of new private homes will come close to matching levels seen in the boom days of 2007, but transaction values are likely to be higher given the rise in prices.
According to a report by consultant CB Richard Ellis (CBRE), the total value of new home sales this year is expected to reach a level between the $16.22 billion transacted in 2007 and the $23.52 billion recorded last year.
CBRE's executive director for residential properties, Mr Joseph Tan, said in the report that the residential market at the start of this year reflected 'a follow-through of the momentum begun last year'.
The numbers so far certainly point to a similar boom-time result.
Developers sold 4,380 new homes - landed and non-landed - in the first quarter. That suggests momentum for similar full-year transactions of around 14,000 achieved last year and in 2007, the report said.
A record was set in 2007 when 14,811 new private homes were sold, although 2009 came close with 14,688 changing hands.
Mr Tan noted: 'Prices are generally higher in 2010, with demand remaining robust. Thus, the total value at the end of the year should be higher than that in 2009.'
In the first three months of this year, caveats lodged in the primary market accounted for about $4.2 billion, or 26 per cent, of last year's total transaction value, said CBRE.
'On a like-for-like basis, if we sold the same number of units or even slightly fewer this year, the value would still be higher than that seen last year,' Mr Tan said.
The slowdown in recent weeks could just be the market taking a breather, say experts.
'In every cycle, there are some hitches and hurdles. We have been on a smooth ride and now we have hit a bump. But we are not even a month into the situation,' said Mr Tan.
More people have turned cautious because of fears over a possible fallout from the Greek debt crisis, though there were already signs of slowing last month, said DTZ head of South-east Asia research Chua Chor Hoon.
That was when the resale market began to quieten, though new launches were still taking place and doing fairly well in general.
Waterbank at Dakota, for instance, saw strong demand last month when it was released for sale and, now, only a handful of units are left at the 99-year leasehold, 616-unit condo.
But there have been no new launches to excite people so far this month, said Ms Chua, although some are being held over the coming weeks.
Property developers have also been busy since March marketing projects overseas, mostly those launched in the past year that still have a significant amount of unsold units.
'When the market was active last year, there was hardly any time to do overseas exhibitions,' said Mr Tan.
Still, property experts say it is too soon to tell if the market is really hitting the brakes.
'It's early days. The quietness may just be a knee-jerk reaction. We are still getting quite good inquiries on suburban projects, so it all boils down to pricing,' Mr Tan told The Straits Times.
'There is enough support from the upgraders' market itself. If sales don't hit the level we predicted, they may still reach 12,000 units. I don't see them falling below 10,000 units.'
Ms Chua concurred: 'The economy is growing. Unless there are major shocks, the property market should do fairly well this year. Sales (of new homes) could easily reach 10,000 units - which already exceeds the yearly average of around 9,000 units over the past 10 years.'
An industry source who declined to be named said the market seemed to have slowed because developers were not ready to launch their projects.
'Either their brochures or their showflats weren't ready. Or they hadn't got all the planning approvals,' he said. But condo previews were to start again the past weekend, with Flamingo Valley, he noted.
Volumes are unlikely to exceed levels seen last year as prices have since risen and some buyer resistance would have set in, he added.
But transaction values should rise as most of the upcoming launches will be in the mid- to high-tier segment.
Apart from Flamingo Valley in Siglap, new condo releases expected this month include The Cascadia in Bukit Timah and The Minton in Hougang. Waterfront Gold at Bedok Reservoir and Grangeford in Orchard may be released late this month or next month.
The 1,145-unit Minton, with an indicative pricing of around $900 per sq ft, is the only mass-market project on the launch pad.
joyceteo@sph.com.sg
DESPITE SLOWDOWN...
2010 still likely a banner year for private property
Number of new homes sold in 1st quarter suggests return to near boom levels
By Joyce Teo
THE private homes market has slowed in the past fortnight but experts feel 2010 will still emerge as a banner year for the sector.
They say sales of new private homes will come close to matching levels seen in the boom days of 2007, but transaction values are likely to be higher given the rise in prices.
According to a report by consultant CB Richard Ellis (CBRE), the total value of new home sales this year is expected to reach a level between the $16.22 billion transacted in 2007 and the $23.52 billion recorded last year.
CBRE's executive director for residential properties, Mr Joseph Tan, said in the report that the residential market at the start of this year reflected 'a follow-through of the momentum begun last year'.
The numbers so far certainly point to a similar boom-time result.
Developers sold 4,380 new homes - landed and non-landed - in the first quarter. That suggests momentum for similar full-year transactions of around 14,000 achieved last year and in 2007, the report said.
A record was set in 2007 when 14,811 new private homes were sold, although 2009 came close with 14,688 changing hands.
Mr Tan noted: 'Prices are generally higher in 2010, with demand remaining robust. Thus, the total value at the end of the year should be higher than that in 2009.'
In the first three months of this year, caveats lodged in the primary market accounted for about $4.2 billion, or 26 per cent, of last year's total transaction value, said CBRE.
'On a like-for-like basis, if we sold the same number of units or even slightly fewer this year, the value would still be higher than that seen last year,' Mr Tan said.
The slowdown in recent weeks could just be the market taking a breather, say experts.
'In every cycle, there are some hitches and hurdles. We have been on a smooth ride and now we have hit a bump. But we are not even a month into the situation,' said Mr Tan.
More people have turned cautious because of fears over a possible fallout from the Greek debt crisis, though there were already signs of slowing last month, said DTZ head of South-east Asia research Chua Chor Hoon.
That was when the resale market began to quieten, though new launches were still taking place and doing fairly well in general.
Waterbank at Dakota, for instance, saw strong demand last month when it was released for sale and, now, only a handful of units are left at the 99-year leasehold, 616-unit condo.
But there have been no new launches to excite people so far this month, said Ms Chua, although some are being held over the coming weeks.
Property developers have also been busy since March marketing projects overseas, mostly those launched in the past year that still have a significant amount of unsold units.
'When the market was active last year, there was hardly any time to do overseas exhibitions,' said Mr Tan.
Still, property experts say it is too soon to tell if the market is really hitting the brakes.
'It's early days. The quietness may just be a knee-jerk reaction. We are still getting quite good inquiries on suburban projects, so it all boils down to pricing,' Mr Tan told The Straits Times.
'There is enough support from the upgraders' market itself. If sales don't hit the level we predicted, they may still reach 12,000 units. I don't see them falling below 10,000 units.'
Ms Chua concurred: 'The economy is growing. Unless there are major shocks, the property market should do fairly well this year. Sales (of new homes) could easily reach 10,000 units - which already exceeds the yearly average of around 9,000 units over the past 10 years.'
An industry source who declined to be named said the market seemed to have slowed because developers were not ready to launch their projects.
'Either their brochures or their showflats weren't ready. Or they hadn't got all the planning approvals,' he said. But condo previews were to start again the past weekend, with Flamingo Valley, he noted.
Volumes are unlikely to exceed levels seen last year as prices have since risen and some buyer resistance would have set in, he added.
But transaction values should rise as most of the upcoming launches will be in the mid- to high-tier segment.
Apart from Flamingo Valley in Siglap, new condo releases expected this month include The Cascadia in Bukit Timah and The Minton in Hougang. Waterfront Gold at Bedok Reservoir and Grangeford in Orchard may be released late this month or next month.
The 1,145-unit Minton, with an indicative pricing of around $900 per sq ft, is the only mass-market project on the launch pad.
joyceteo@sph.com.sg
BT : Homebuyers reeling from Beijing property measures
Business Times - 17 May 2010
Homebuyers reeling from Beijing property measures
One such measure is barring people who have not paid taxes
(BEIJING) Accountant Jiao Yurong carefully organised her family's finances to put her son through university in the United States.
Now that he has the coveted degree, she has been saving to buy him a flat.
But soaring property prices in China - and a series of moves by the government to rein them in - are throwing a spanner in the 50-year-old mother's plans, and she admits she does not know how to proceed. 'Just when we had saved enough for a down payment, prices surged,' Ms Jiao, a Beijing resident, told AFP.
'The policy is so unstable . . . I'm so confused.' Ms Jiao is not alone. Prospective home buyers are reeling from a series of measures put in place by the Chinese government to curb rocketing prices amid persistent fears about a ballooning bubble in the real estate sector.
Authorities have tightened restrictions nationwide on advance sales of new property developments, introduced new curbs on loans for third home purchases and raised minimum down payments for second homes.
The Beijing city government has gone even further, limiting families to one new apartment purchase and barring people who have not paid taxes or made social security contributions in the city for one year from getting home loans. 'Sellers have started to lower the prices,' said Hu Jinghui, vice-general manager of 5i5j, a real estate agency chain that has around 600 outlets in eight cities across China. 'But the buyers are still waiting.'
At the Beijing Real Estate Expo last month, the average price of a new apartment in the city was around 21,164 yuan (S$4,302.7) per square metre, double that of last year, state media said. That means a 90-square-metre apartment in Beijing would cost 1.9 million yuan, compared with the average per capita income of 26,738 yuan in 2009.
Since the capital put in place austerity measures on April 30, prices have dropped an average 10-15 per cent, with the number of home purchases slumping by 50 per cent, according to Mr Hu.
Jack Guan, a securities firm executive from the coastal city of Qingdao, searched last year on the outskirts of Beijing for his first home, but said he could not make a deal as prices 'went insane'.
'I am going to wait and see. I think this is an approach that many people have adopted as now there is a possibility for a price cut,' said the 27-year-old. 'It will not cost me much if I wait for another two years.'
In 2008, China also introduced a range of policies to dampen the market frenzy, but a government stimulus package to prop up the economy during the financial crisis quickly negated any progress made.
The new measures so far seemed to have had a limited effect, as official data showed last Tuesday that prices in major Chinese cities rose 12.8 per cent in April, a double-digit rise for the third straight month.
Analysts also said the rules contained apparent loopholes that could be exploited by speculators.
China lacks a nationwide database on property sales, which means banks have no way of checking if mortgage applicants already own apartments in other cities. And higher down payments will have little impact on speculators who mostly pay the full value of properties in cash.
State media reported last Friday that people are even briefly resorting to divorce to acquire a second property, taking advantage of lower down payment and interest rate benefits offered to first-time buyers before remarrying.
Ms Jiao said she was often told the properties she was interested in were sold out, leading her to suspect the developers were hoarding to keep prices high.
'The government has always been saying they would keep the policy unchanged. But they changed it whenever they wanted. We ordinary people just cannot do anything,' she said.
Mr Hu however, said he believed the government was more determined this time around to hold firm, as prices had become so out of reach for many ordinary Chinese that the measures were needed to keep a lid on social discontent.
Lina Wong, managing director for east and south-west China of real estate firm Colliers International, said even more tough measures could be expected as curbing price rises had become a 'political task' for the ruling Communists. -- AFP
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Homebuyers reeling from Beijing property measures
One such measure is barring people who have not paid taxes
(BEIJING) Accountant Jiao Yurong carefully organised her family's finances to put her son through university in the United States.
Now that he has the coveted degree, she has been saving to buy him a flat.
But soaring property prices in China - and a series of moves by the government to rein them in - are throwing a spanner in the 50-year-old mother's plans, and she admits she does not know how to proceed. 'Just when we had saved enough for a down payment, prices surged,' Ms Jiao, a Beijing resident, told AFP.
'The policy is so unstable . . . I'm so confused.' Ms Jiao is not alone. Prospective home buyers are reeling from a series of measures put in place by the Chinese government to curb rocketing prices amid persistent fears about a ballooning bubble in the real estate sector.
Authorities have tightened restrictions nationwide on advance sales of new property developments, introduced new curbs on loans for third home purchases and raised minimum down payments for second homes.
The Beijing city government has gone even further, limiting families to one new apartment purchase and barring people who have not paid taxes or made social security contributions in the city for one year from getting home loans. 'Sellers have started to lower the prices,' said Hu Jinghui, vice-general manager of 5i5j, a real estate agency chain that has around 600 outlets in eight cities across China. 'But the buyers are still waiting.'
At the Beijing Real Estate Expo last month, the average price of a new apartment in the city was around 21,164 yuan (S$4,302.7) per square metre, double that of last year, state media said. That means a 90-square-metre apartment in Beijing would cost 1.9 million yuan, compared with the average per capita income of 26,738 yuan in 2009.
Since the capital put in place austerity measures on April 30, prices have dropped an average 10-15 per cent, with the number of home purchases slumping by 50 per cent, according to Mr Hu.
Jack Guan, a securities firm executive from the coastal city of Qingdao, searched last year on the outskirts of Beijing for his first home, but said he could not make a deal as prices 'went insane'.
'I am going to wait and see. I think this is an approach that many people have adopted as now there is a possibility for a price cut,' said the 27-year-old. 'It will not cost me much if I wait for another two years.'
In 2008, China also introduced a range of policies to dampen the market frenzy, but a government stimulus package to prop up the economy during the financial crisis quickly negated any progress made.
The new measures so far seemed to have had a limited effect, as official data showed last Tuesday that prices in major Chinese cities rose 12.8 per cent in April, a double-digit rise for the third straight month.
Analysts also said the rules contained apparent loopholes that could be exploited by speculators.
China lacks a nationwide database on property sales, which means banks have no way of checking if mortgage applicants already own apartments in other cities. And higher down payments will have little impact on speculators who mostly pay the full value of properties in cash.
State media reported last Friday that people are even briefly resorting to divorce to acquire a second property, taking advantage of lower down payment and interest rate benefits offered to first-time buyers before remarrying.
Ms Jiao said she was often told the properties she was interested in were sold out, leading her to suspect the developers were hoarding to keep prices high.
'The government has always been saying they would keep the policy unchanged. But they changed it whenever they wanted. We ordinary people just cannot do anything,' she said.
Mr Hu however, said he believed the government was more determined this time around to hold firm, as prices had become so out of reach for many ordinary Chinese that the measures were needed to keep a lid on social discontent.
Lina Wong, managing director for east and south-west China of real estate firm Colliers International, said even more tough measures could be expected as curbing price rises had become a 'political task' for the ruling Communists. -- AFP
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
ST : Suburban condo plots are red-hot
May 16, 2010
Suburban condo plots are red-hot
Developers and buyers are keenly eyeing heartland condos, possibly pushing prices to $1,000 psf again
By Joyce Teo
Can condos and HDB flats co-exist happily?
Property developers certainly think so, going by their high bids for state land for private housing, even if the plots are smack in the middle of an HDB estate.
Going by recent tender results, developers have no qualms paying a lot more, if the sites in these established or up-and-coming HDB estates are near MRT stations. Just last week, a tender for a plot in Simei Street 3 closed with an impressive 18 bids. Chip Eng Seng topped all rivals with an offer of $523 per sq ft (psf) per plot ratio.
This means, at that price, Singapore will likely see another suburban condo selling at or near the $1,000 psf mark, previously thought to be a resistance level.
Property experts said a key attraction of the Simei site - in the middle of an HDB estate - is its proximity to an MRT station and amenities. The land is just across the road from Simei MRT station and Eastpoint Mall.
'Actually, land next to MRT stations has always commanded higher prices than those that are not,' said Mr Nicholas Mak, a real estate lecturer at Ngee Ann Polytechnic. He said there were few attractive private sites for sale in the past 15 months. This is why many developers are competing hard in the Government's land sales tenders.
Said DTZ's head of South-east Asia research, Ms Chua Chor Hoon: 'Developers need to have a portfolio of sites to continually develop to maintain operations. So those with a smaller land bank would bid more aggressively to secure sites.' Also, developers are scrambling for suburban land because there is money to be made. Sales of mass market homes have remained strong since February last year, Mr Mak said.
Mass market launches, such as Caspian in Jurong, Double Bay Residences in Simei, Optima @ Tanah Merah and Trevista in Toa Payoh, met with strong demand last year. At Trevista, some units were sold for more than $1,000 psf.
'Rising prices of new mass market launches give confidence to developers to bid higher for government sites, especially attractive ones,' he added. Hence, the fact that the plot is located within an HDB estate is not a disadvantage when the market is hot.
This was not so in the 1980s to perhaps the early 1990s, when buyers did not see living in a condo in an HDB estate as moving up the social ladder.
'In the past, HDB estates were not as nice and HDB prices were low. People were not too happy to be too near them, if they could afford a private property,' said a property expert.
Ms Chua concurred: 'People weren't keen to buy a private condo next to an HDB estate unless it was priced low.' So, when a developer tries to test the market by launching a project that is not priced as low as expected, there would be 'disbelief and some resistance', she said. 'When the second one is launched, and there's good demand, then it becomes more accepted. That's how new trends start,' she added.
Times have changed. Old HDB estates have been spruced up or had some blocks torn down for rebuilding, while new HDB estates have more whistles and bells, experts said. HDB flats are in hot demand these days, with resale prices at record highs. HDB data showed that resale prices rose 2.8 per cent in the first quarter over the previous one, lifting it to yet another high.
Those living in upper-mid to high-end projects will still prefer more exclusive sites, experts said. But if they are buying and eyeing the rental market, a condo in an HDB estate brings attributes that tenants want. 'There are more expats employed on local terms, with less generous housing budgets. They usually have no cars and thus prefer to stay near MRT stations,' said Mr Mak.
joyceteo@sph.com.sg
Suburban condo plots are red-hot
Developers and buyers are keenly eyeing heartland condos, possibly pushing prices to $1,000 psf again
By Joyce Teo
Can condos and HDB flats co-exist happily?
Property developers certainly think so, going by their high bids for state land for private housing, even if the plots are smack in the middle of an HDB estate.
Going by recent tender results, developers have no qualms paying a lot more, if the sites in these established or up-and-coming HDB estates are near MRT stations. Just last week, a tender for a plot in Simei Street 3 closed with an impressive 18 bids. Chip Eng Seng topped all rivals with an offer of $523 per sq ft (psf) per plot ratio.
This means, at that price, Singapore will likely see another suburban condo selling at or near the $1,000 psf mark, previously thought to be a resistance level.
Property experts said a key attraction of the Simei site - in the middle of an HDB estate - is its proximity to an MRT station and amenities. The land is just across the road from Simei MRT station and Eastpoint Mall.
'Actually, land next to MRT stations has always commanded higher prices than those that are not,' said Mr Nicholas Mak, a real estate lecturer at Ngee Ann Polytechnic. He said there were few attractive private sites for sale in the past 15 months. This is why many developers are competing hard in the Government's land sales tenders.
Said DTZ's head of South-east Asia research, Ms Chua Chor Hoon: 'Developers need to have a portfolio of sites to continually develop to maintain operations. So those with a smaller land bank would bid more aggressively to secure sites.' Also, developers are scrambling for suburban land because there is money to be made. Sales of mass market homes have remained strong since February last year, Mr Mak said.
Mass market launches, such as Caspian in Jurong, Double Bay Residences in Simei, Optima @ Tanah Merah and Trevista in Toa Payoh, met with strong demand last year. At Trevista, some units were sold for more than $1,000 psf.
'Rising prices of new mass market launches give confidence to developers to bid higher for government sites, especially attractive ones,' he added. Hence, the fact that the plot is located within an HDB estate is not a disadvantage when the market is hot.
This was not so in the 1980s to perhaps the early 1990s, when buyers did not see living in a condo in an HDB estate as moving up the social ladder.
'In the past, HDB estates were not as nice and HDB prices were low. People were not too happy to be too near them, if they could afford a private property,' said a property expert.
Ms Chua concurred: 'People weren't keen to buy a private condo next to an HDB estate unless it was priced low.' So, when a developer tries to test the market by launching a project that is not priced as low as expected, there would be 'disbelief and some resistance', she said. 'When the second one is launched, and there's good demand, then it becomes more accepted. That's how new trends start,' she added.
Times have changed. Old HDB estates have been spruced up or had some blocks torn down for rebuilding, while new HDB estates have more whistles and bells, experts said. HDB flats are in hot demand these days, with resale prices at record highs. HDB data showed that resale prices rose 2.8 per cent in the first quarter over the previous one, lifting it to yet another high.
Those living in upper-mid to high-end projects will still prefer more exclusive sites, experts said. But if they are buying and eyeing the rental market, a condo in an HDB estate brings attributes that tenants want. 'There are more expats employed on local terms, with less generous housing budgets. They usually have no cars and thus prefer to stay near MRT stations,' said Mr Mak.
joyceteo@sph.com.sg
ST : Expats leaving HK for 'cleaner' pastures
May 16, 2010
Expats leaving HK for 'cleaner' pastures
Worsening air pollution driving finance professionals to S'pore
By Sherry Lee
When financial analyst Terry Dunne looks at Hong Kong's smoggy skies these days, he thinks of his toddler son - and of packing up and moving his family to another city.
Worsening air pollution is cited as the main push factor for hundreds of expatriate bankers, stock analysts and other finance professionals leaving Hong Kong each year for 'cleaner' and not just greener pastures elsewhere.
Experts find this outflow of expatriate expertise a worrying trend that could threaten Hong Kong's status as a regional financial centre in the long term.
Noting that many of the expatriates move on to new jobs in Singapore, the experts express concern that Hong Kong's loss would be Singapore's gain.
Mr Ben Tyrell, whose company Relocasia handles about 2,000 expatriate moves annually, said the number of expatriates who left Hong Kong citing its air pollution has risen sharply in the past 10 years - from 20 per cent a decade ago to 60 per cent, or 1,200.
'Pollution is among the top three reasons,' said Mr Tyrell, adding that better career prospects and personal reasons are the other two.
He notes that in pollution-triggered cases, the deciding factor for expatriates is often the health of their children.
'Singapore is attracting senior expatriate families because it is cleaner and provides a better living environment,' said Mr Tyrell.
Last month alone, his company packed off 50 expatriates who cited air pollution as a factor.
Entire financial firms are also pulling out of Hong Kong, said Mr Tyrell.
And such anecdotes, said political analyst Michael DeGolyer, are just 'the tip of the iceberg'.
About one in five people in the city of seven million is considering leaving because of its air pollution, according to his 2008 report on air pollution, Hong Kong's Silent Epidemic, and this group consists mostly of high-income earners, professionals and managers.
'Worsening pollution tends to drive out those with young children, those with higher education and more marketable skills, and the older but more experienced employees,' said Professor DeGolyer, director of the Hong Kong Transition Project at Baptist University.
Last month, the city's leading authority on air quality, Mr Anthony Hedley, was forced to leave Hong Kong for health reasons.
The 69-year-old Briton, who created the Hedley Environmental Index, had campaigned for radical measures to fight the city's pollution for two decades.
Prof DeGolyer said he believed that Hong Kong's pollution woes, if left unchecked, could undermine its leading position as a financial hub to China as well as the region.
An Environment Bureau spokesman did not comment, but the Hong Kong government said it has adopted a multi-pronged strategy to cut emissions. It attaches great importance to improving air quality, 'both for our citizens' health and for our city's competitiveness', said a spokesman.
Dr Raymond So Wai Man of the finance department at the Chinese University of Hong Kong notes that for those who want to leave Hong Kong but wish to continue working in the region, Singapore will be an obvious choice.
'Hong Kong will be affected especially if financial talent goes to Singapore, another financial hub,' he said, adding that major international fund managers are increasingly using Singapore as their base.
'Then Singapore will become the 'brain', the part that brings in revenue, and Hong Kong will be just the 'limbs', handling front-line deals.'
Hong Kong also faces increasing competition from Shanghai, which is shaping up as China's financial centre.
'When that time comes, the 'brain' will be in Singapore, and the operational front lines and financial deals will go to Shanghai. Hong Kong will be left with nothing,' said Dr So.
But Mr Richard Vuylsteke, the president of the American Chamber of Commerce in Hong Kong, is more optimistic. He said: 'People leave, but they can be replaced. I haven't seen any significant downsizing in the financial sector. It is not an issue.'
Dr So pointed out, however, that many of the replacements may not have as much experience.
Financial headhunter Ryan Marshall noted that people who come to work in Hong Kong these days are younger - mostly in their 20s or 30s - and are unlikely to stay beyond two years.
For Mr Dunne, a 40-year-old Canadian from Vancouver, what is most important is his young son's health and well-being.
He remembers the day dust from a sandstorm originating in northern China caused the city's air pollution to hit a record high.
It was March 22, the same day his 21-month-old son Augustus ran a high fever and developed breathing difficulties.
'He got really sick. He had a high fever of 41 deg C, his chest was congested and he had difficulty breathing,' he recalled.
Augustus got better, but continues to be susceptible to coughs and colds. He had been hospitalised twice in the past six months.
Mr Dunne, who also has a five-year-old daughter, says he has been thinking about returning to Canada or moving his family to another city like Singapore.
'I have friends in Singapore. The air is clean and the sky is so clear, you can see much farther,' he said.
'Here in Central, you can't even see what's across the harbour.'
sherryah@gmail.com
--------------------------------------------------------------------------------
SMOG CITY
Just how bad is it?
In the air
· Hong Kong's air contains 1.3 times more particles of soot and other pollutants than Tokyo's, 1.7 times Singapore's and 3 times more than New York's.
· Roadside pollution exceeded 100 API (Air Pollution Index) on 23.8 per cent of the last quarter of last year, up from 3.6 per cent in the same quarter of 1999. An API of 101-200 is considered unhealthy, while 51-100 is moderate.
· Monthly roadside API average hit 143 last October, the highest monthly average in the past 10 years.
Bad for sports
· Just 41 days of healthy breathable air in 2006, with 30 days safe for outdoor sports.
· 4,800 in marathons needed medical treatment in February, with 22 taken to hospital.
Bad for health
· 1,600 die prematurely from air pollution every year.
· 81,000 hospital bed days and over seven million doctor visits caused by pollution in 2008.
· Costs from premature deaths, hospitalisations and doctor visits topped HK$2.2 billion (S$390 million) in 2008.
Where is it coming from?
· More than half from its own power plants, vehicles and ships' burning bunker fuel.
· 40 per cent from roadside emissions by buses.
· Roadside nitrogen dioxide levels last year were 2.8 times the recommended World Health Organisation guidelines, and particulate matter levels three times.
What are they doing about it?
· Tax incentives to promote the use of environment-friendly vehicles and fuels.
· Green transport fund to test green and low-carbon transport technology.
· Trying out cleaner fuel for ferries.
· But no legally binding laws yet.
Expats leaving HK for 'cleaner' pastures
Worsening air pollution driving finance professionals to S'pore
By Sherry Lee
When financial analyst Terry Dunne looks at Hong Kong's smoggy skies these days, he thinks of his toddler son - and of packing up and moving his family to another city.
Worsening air pollution is cited as the main push factor for hundreds of expatriate bankers, stock analysts and other finance professionals leaving Hong Kong each year for 'cleaner' and not just greener pastures elsewhere.
Experts find this outflow of expatriate expertise a worrying trend that could threaten Hong Kong's status as a regional financial centre in the long term.
Noting that many of the expatriates move on to new jobs in Singapore, the experts express concern that Hong Kong's loss would be Singapore's gain.
Mr Ben Tyrell, whose company Relocasia handles about 2,000 expatriate moves annually, said the number of expatriates who left Hong Kong citing its air pollution has risen sharply in the past 10 years - from 20 per cent a decade ago to 60 per cent, or 1,200.
'Pollution is among the top three reasons,' said Mr Tyrell, adding that better career prospects and personal reasons are the other two.
He notes that in pollution-triggered cases, the deciding factor for expatriates is often the health of their children.
'Singapore is attracting senior expatriate families because it is cleaner and provides a better living environment,' said Mr Tyrell.
Last month alone, his company packed off 50 expatriates who cited air pollution as a factor.
Entire financial firms are also pulling out of Hong Kong, said Mr Tyrell.
And such anecdotes, said political analyst Michael DeGolyer, are just 'the tip of the iceberg'.
About one in five people in the city of seven million is considering leaving because of its air pollution, according to his 2008 report on air pollution, Hong Kong's Silent Epidemic, and this group consists mostly of high-income earners, professionals and managers.
'Worsening pollution tends to drive out those with young children, those with higher education and more marketable skills, and the older but more experienced employees,' said Professor DeGolyer, director of the Hong Kong Transition Project at Baptist University.
Last month, the city's leading authority on air quality, Mr Anthony Hedley, was forced to leave Hong Kong for health reasons.
The 69-year-old Briton, who created the Hedley Environmental Index, had campaigned for radical measures to fight the city's pollution for two decades.
Prof DeGolyer said he believed that Hong Kong's pollution woes, if left unchecked, could undermine its leading position as a financial hub to China as well as the region.
An Environment Bureau spokesman did not comment, but the Hong Kong government said it has adopted a multi-pronged strategy to cut emissions. It attaches great importance to improving air quality, 'both for our citizens' health and for our city's competitiveness', said a spokesman.
Dr Raymond So Wai Man of the finance department at the Chinese University of Hong Kong notes that for those who want to leave Hong Kong but wish to continue working in the region, Singapore will be an obvious choice.
'Hong Kong will be affected especially if financial talent goes to Singapore, another financial hub,' he said, adding that major international fund managers are increasingly using Singapore as their base.
'Then Singapore will become the 'brain', the part that brings in revenue, and Hong Kong will be just the 'limbs', handling front-line deals.'
Hong Kong also faces increasing competition from Shanghai, which is shaping up as China's financial centre.
'When that time comes, the 'brain' will be in Singapore, and the operational front lines and financial deals will go to Shanghai. Hong Kong will be left with nothing,' said Dr So.
But Mr Richard Vuylsteke, the president of the American Chamber of Commerce in Hong Kong, is more optimistic. He said: 'People leave, but they can be replaced. I haven't seen any significant downsizing in the financial sector. It is not an issue.'
Dr So pointed out, however, that many of the replacements may not have as much experience.
Financial headhunter Ryan Marshall noted that people who come to work in Hong Kong these days are younger - mostly in their 20s or 30s - and are unlikely to stay beyond two years.
For Mr Dunne, a 40-year-old Canadian from Vancouver, what is most important is his young son's health and well-being.
He remembers the day dust from a sandstorm originating in northern China caused the city's air pollution to hit a record high.
It was March 22, the same day his 21-month-old son Augustus ran a high fever and developed breathing difficulties.
'He got really sick. He had a high fever of 41 deg C, his chest was congested and he had difficulty breathing,' he recalled.
Augustus got better, but continues to be susceptible to coughs and colds. He had been hospitalised twice in the past six months.
Mr Dunne, who also has a five-year-old daughter, says he has been thinking about returning to Canada or moving his family to another city like Singapore.
'I have friends in Singapore. The air is clean and the sky is so clear, you can see much farther,' he said.
'Here in Central, you can't even see what's across the harbour.'
sherryah@gmail.com
--------------------------------------------------------------------------------
SMOG CITY
Just how bad is it?
In the air
· Hong Kong's air contains 1.3 times more particles of soot and other pollutants than Tokyo's, 1.7 times Singapore's and 3 times more than New York's.
· Roadside pollution exceeded 100 API (Air Pollution Index) on 23.8 per cent of the last quarter of last year, up from 3.6 per cent in the same quarter of 1999. An API of 101-200 is considered unhealthy, while 51-100 is moderate.
· Monthly roadside API average hit 143 last October, the highest monthly average in the past 10 years.
Bad for sports
· Just 41 days of healthy breathable air in 2006, with 30 days safe for outdoor sports.
· 4,800 in marathons needed medical treatment in February, with 22 taken to hospital.
Bad for health
· 1,600 die prematurely from air pollution every year.
· 81,000 hospital bed days and over seven million doctor visits caused by pollution in 2008.
· Costs from premature deaths, hospitalisations and doctor visits topped HK$2.2 billion (S$390 million) in 2008.
Where is it coming from?
· More than half from its own power plants, vehicles and ships' burning bunker fuel.
· 40 per cent from roadside emissions by buses.
· Roadside nitrogen dioxide levels last year were 2.8 times the recommended World Health Organisation guidelines, and particulate matter levels three times.
What are they doing about it?
· Tax incentives to promote the use of environment-friendly vehicles and fuels.
· Green transport fund to test green and low-carbon transport technology.
· Trying out cleaner fuel for ferries.
· But no legally binding laws yet.
TODAY ONLINE : End of the line for 5,000 agents?
End of the line for 5,000 agents?
05:55 AM May 15, 2010
by Wong Siew Ying siewying@mediacorp.com.sg
SINGAPORE - A major shake-up is expected among real estate agents as their numbers are expected to fall by as much as 25 per cent when the new rules to regulate property agents kick in later this year.
Agents who do not measure up will likely leave the industry and market watchers said smaller real estate agencies in Singapore may also consolidate.
Currently, there are more than 20,000 real estate agents here and when the Government set up the Council of Estate Agencies to regulate them, market players said they expect the numbers to decline between 10 per cent and 25 per cent.
And while agencies are concerned about recruitment and compliance costs, home buyers on the other hand can soon shop with greater peace of mind, as the coming regulations weed out rogue agents and raises professional standards and accountability.
Under the new regulations, real estate agencies are expected to have systems for handling complaints and resolving disputes.
"For bigger companies, most of these systems are in place, so there's minimum add-on cost, but for the smaller companies, they would probably have difficulty doing all this," said Mr Eugene Lim, associate director of ERA Asia-Pacific. In the future, "most of them may come together to combine resources", he said.
More smaller agencies may also join forces with big players. PropNex, for example, has consolidated more than 10 companies under its wing in the last five years.
Depending on their experience, staff from these companies could either become district directors or branch directors.
Out of the 1,700 licensed agencies in Singapore, over 90 per cent have under 100 agents or are not operational, said the Institute of Estate Agents. These include those who are issued an agency licence but have decided to work for another real estate firm or outside the industry.
Meanwhile, the Dennis Wee Group (DWG) is reworking its training programmes and might consider increasing fees. Currently, an agent pays about $700 for 44 hours of basic training at DWG.
"We are exploring how to create a modular training (programme) for these new agents so that when they come in, one module will be for them to prepare for their exams, another module possibly some sales techniques on how to sell real estate," said Mr Chris Koh, director at Dennis Wee Group.
The new rules will also affect recruitment by agencies. Job seekers without at least four GCE O-Levels cannot become agents and a mandatory examination would bar agents from selling properties just days into the job.
Currently, larger agencies like DWG and ERA hire some 200 new agents a month, which could increase during a property boom.
With the proposed changes, agents who hold a licence to operate their own firm will no longer be allowed to be employed by real estate agencies.
This raises concerns as DWG has said it has a handful of such agents who tend to be the better performers.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
05:55 AM May 15, 2010
by Wong Siew Ying siewying@mediacorp.com.sg
SINGAPORE - A major shake-up is expected among real estate agents as their numbers are expected to fall by as much as 25 per cent when the new rules to regulate property agents kick in later this year.
Agents who do not measure up will likely leave the industry and market watchers said smaller real estate agencies in Singapore may also consolidate.
Currently, there are more than 20,000 real estate agents here and when the Government set up the Council of Estate Agencies to regulate them, market players said they expect the numbers to decline between 10 per cent and 25 per cent.
And while agencies are concerned about recruitment and compliance costs, home buyers on the other hand can soon shop with greater peace of mind, as the coming regulations weed out rogue agents and raises professional standards and accountability.
Under the new regulations, real estate agencies are expected to have systems for handling complaints and resolving disputes.
"For bigger companies, most of these systems are in place, so there's minimum add-on cost, but for the smaller companies, they would probably have difficulty doing all this," said Mr Eugene Lim, associate director of ERA Asia-Pacific. In the future, "most of them may come together to combine resources", he said.
More smaller agencies may also join forces with big players. PropNex, for example, has consolidated more than 10 companies under its wing in the last five years.
Depending on their experience, staff from these companies could either become district directors or branch directors.
Out of the 1,700 licensed agencies in Singapore, over 90 per cent have under 100 agents or are not operational, said the Institute of Estate Agents. These include those who are issued an agency licence but have decided to work for another real estate firm or outside the industry.
Meanwhile, the Dennis Wee Group (DWG) is reworking its training programmes and might consider increasing fees. Currently, an agent pays about $700 for 44 hours of basic training at DWG.
"We are exploring how to create a modular training (programme) for these new agents so that when they come in, one module will be for them to prepare for their exams, another module possibly some sales techniques on how to sell real estate," said Mr Chris Koh, director at Dennis Wee Group.
The new rules will also affect recruitment by agencies. Job seekers without at least four GCE O-Levels cannot become agents and a mandatory examination would bar agents from selling properties just days into the job.
Currently, larger agencies like DWG and ERA hire some 200 new agents a month, which could increase during a property boom.
With the proposed changes, agents who hold a licence to operate their own firm will no longer be allowed to be employed by real estate agencies.
This raises concerns as DWG has said it has a handful of such agents who tend to be the better performers.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
TODAY ONLINE : Shoebox units a lifestyle choice?
Shoebox units a lifestyle choice?
05:55 AM May 15, 2010
by Colin Tan
Sales of small apartments, also known as shoebox apartments or mickey mouse flats, skyrocketed last year. And demand continues to be robust this year.
A total of 696 flats of 500 sq ft or smaller and another 1,285 of between 500 and 800 sq ft were sold last year.
Buyer interest has remained strong this year with 533 units of 800 sq ft or less sold in the first four months.
Such apartment sizes comprise about 23 per cent of the 2,300 units sold in the primary market.
Some industry experts have attributed the strong demand to a change in lifestyle choices in an increasingly cosmopolitan environment.
LIFESTYLE CHOICES?
Hotel rooms are typically about 300 sq ft. A 500-sq-ft apartment is not much bigger. I would say nobody, not even singles, would choose to live in one, given the choice. It is more a case of having no choice.
It is no secret that developers continue to provide such units to an increasingly investor-dominated market. In a rising market, investors prefer such units as they are more affordable than family-sized flats. Developers can also maximise their returns by selling these units at a higher price per sq ft.
There is nothing wrong with the market providing micro units. The problem is when they form a significant proportion in a development - as high as 70 per cent in some cases.
The most likely occupants of such units are singles, with some couples. And the overwhelming majority of occupiers would be tenants. So, there is a transient feel about the place, with the occupiers more likely to use them as temporary shelter until they can afford something better. Singles relocate much more quickly than family tenants.
With singles dominating, there is also the lack of a family environment. Singles prefer to be out rather than cooped up in a tiny apartment. So, it can be very quiet at certain times and very rowdy when the singles invite their friends over to enjoy the common facilities.
The characteristic of a landlord-dominated project is also such that the majority of owners prefer to spend less to upkeep the estate. In a downturn, the small units become even more affordable and attract more financially-disadvantaged tenants. There will be even greater resistance to "unnecessary" maintenance expenditure.
So, the estate tends to age prematurely. Should home prices continue to stay down, the estate acquires an unsavoury image.
This trend is not easily reversible when prices return to high levels. No owner will want to take the lead and spend more to upkeep his unit if his neighbours do not do the same. Nobody wins in this waiting game.
If such projects are in a central location or close to the business district, some may be used as office premises when office rents are high. This will translate into more visitors and increased use of the lifts, which will mean longer waiting times and more noise.
So, if you are an owner- occupier, single or otherwise, do think carefully about whether you want to live in such projects.
Colin Tan is Head of Research and Consultancy at Chesterton Suntec International.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
05:55 AM May 15, 2010
by Colin Tan
Sales of small apartments, also known as shoebox apartments or mickey mouse flats, skyrocketed last year. And demand continues to be robust this year.
A total of 696 flats of 500 sq ft or smaller and another 1,285 of between 500 and 800 sq ft were sold last year.
Buyer interest has remained strong this year with 533 units of 800 sq ft or less sold in the first four months.
Such apartment sizes comprise about 23 per cent of the 2,300 units sold in the primary market.
Some industry experts have attributed the strong demand to a change in lifestyle choices in an increasingly cosmopolitan environment.
LIFESTYLE CHOICES?
Hotel rooms are typically about 300 sq ft. A 500-sq-ft apartment is not much bigger. I would say nobody, not even singles, would choose to live in one, given the choice. It is more a case of having no choice.
It is no secret that developers continue to provide such units to an increasingly investor-dominated market. In a rising market, investors prefer such units as they are more affordable than family-sized flats. Developers can also maximise their returns by selling these units at a higher price per sq ft.
There is nothing wrong with the market providing micro units. The problem is when they form a significant proportion in a development - as high as 70 per cent in some cases.
The most likely occupants of such units are singles, with some couples. And the overwhelming majority of occupiers would be tenants. So, there is a transient feel about the place, with the occupiers more likely to use them as temporary shelter until they can afford something better. Singles relocate much more quickly than family tenants.
With singles dominating, there is also the lack of a family environment. Singles prefer to be out rather than cooped up in a tiny apartment. So, it can be very quiet at certain times and very rowdy when the singles invite their friends over to enjoy the common facilities.
The characteristic of a landlord-dominated project is also such that the majority of owners prefer to spend less to upkeep the estate. In a downturn, the small units become even more affordable and attract more financially-disadvantaged tenants. There will be even greater resistance to "unnecessary" maintenance expenditure.
So, the estate tends to age prematurely. Should home prices continue to stay down, the estate acquires an unsavoury image.
This trend is not easily reversible when prices return to high levels. No owner will want to take the lead and spend more to upkeep his unit if his neighbours do not do the same. Nobody wins in this waiting game.
If such projects are in a central location or close to the business district, some may be used as office premises when office rents are high. This will translate into more visitors and increased use of the lifts, which will mean longer waiting times and more noise.
So, if you are an owner- occupier, single or otherwise, do think carefully about whether you want to live in such projects.
Colin Tan is Head of Research and Consultancy at Chesterton Suntec International.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
BT : Minimum sum raised for CPF, Medisave accounts
Business Times - 15 May 2010
Minimum sum raised for CPF, Medisave accounts
By TIMOTHY SEOW
THE minimum sum for both CPF and Medisave accounts have been increased, as well as the Medisave contribution ceiling, with the changes taking effect on the July 1, 2010, the CPF Board announced yesterday.
The prevailing CPF Minimum Sum (MS) will be raised to $123,000, up from $117,000. This is in adherence to the Ministry of Manpower's announcement in August 2003 that the MS will be raised gradually to reach $120,000 (in 2003 dollars) in 2013.
The increase in MS, which includes an adjustment for inflation, is to ensure that Singaporeans set aside sufficient savings for their retirement.
Members who can set aside the full MS will receive about $1,100 per month when they reach their draw-down age. The new MS will apply to CPF members who turn 55 from July 1, 2010 to June 30, 2011.
In addition, the Medisave Minimum Sum (MMS) will be raised to $34,500 from $32,000. Members will be able to withdraw their Medisave savings in excess of the MMS at or after 55 years of age.
As a result of this, the Medisave Contribution Ceiling (MCC) - the maximum balance a member may have in his Medisave Account - will be increased correspondingly to $39,500, from $37,000. The MCC is fixed at $5,000 above MMS.
The CPF Board also reiterated in its announcement that any Medisave contribution in excess of the prevailing MCC will be transferred to the member's Special Account if he is below age 55. This would go to his Retirement Account if he is above age 55 and has an MS shortfall.
The CPF Board is also launching three complimentary mega seminars at Suntec City on June 26 and June 27, in conjunction with its turning 55 on July 1.
At each seminar, members will find out what happens to their CPF savings when they reach 55, and learn about the new CPF LIFE scheme. Go to www.cpf.gov.sg for details.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Minimum sum raised for CPF, Medisave accounts
By TIMOTHY SEOW
THE minimum sum for both CPF and Medisave accounts have been increased, as well as the Medisave contribution ceiling, with the changes taking effect on the July 1, 2010, the CPF Board announced yesterday.
The prevailing CPF Minimum Sum (MS) will be raised to $123,000, up from $117,000. This is in adherence to the Ministry of Manpower's announcement in August 2003 that the MS will be raised gradually to reach $120,000 (in 2003 dollars) in 2013.
The increase in MS, which includes an adjustment for inflation, is to ensure that Singaporeans set aside sufficient savings for their retirement.
Members who can set aside the full MS will receive about $1,100 per month when they reach their draw-down age. The new MS will apply to CPF members who turn 55 from July 1, 2010 to June 30, 2011.
In addition, the Medisave Minimum Sum (MMS) will be raised to $34,500 from $32,000. Members will be able to withdraw their Medisave savings in excess of the MMS at or after 55 years of age.
As a result of this, the Medisave Contribution Ceiling (MCC) - the maximum balance a member may have in his Medisave Account - will be increased correspondingly to $39,500, from $37,000. The MCC is fixed at $5,000 above MMS.
The CPF Board also reiterated in its announcement that any Medisave contribution in excess of the prevailing MCC will be transferred to the member's Special Account if he is below age 55. This would go to his Retirement Account if he is above age 55 and has an MS shortfall.
The CPF Board is also launching three complimentary mega seminars at Suntec City on June 26 and June 27, in conjunction with its turning 55 on July 1.
At each seminar, members will find out what happens to their CPF savings when they reach 55, and learn about the new CPF LIFE scheme. Go to www.cpf.gov.sg for details.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
BT : $16-22b in new home sales for 2010: CBRE
Business Times - 15 May 2010
$16-22b in new home sales for 2010: CBRE
Good chance of the luxury segment making a notable return in the later half of the year
By UMA SHANKARI
THE total value of all new homes sold this year will amount to $16 billion-$22 billion as the property market sees a follow-through of the momentum that begun a year ago, said CB Richard Ellis (CBRE) in a new report.
Last year, a total transaction value of $16.22 billion was recorded, based on caveats lodged for the full twelve months in the year. In comparison, the total value of new home sales for the whole of 2007 (the height of the property market boom) was $23.52 billion worth of primary transactions. CBRE's analysis of URA data indicates that the dollar value of 2009's transactions in the new home market accounted for only 68.9 per cent of the total value in 2007.
But the total number of new homes sold last year was similar to that of 2007. For the full year 2009, URA statistics show that 14,688 new homes were sold in the private residential market - comparable to the all-time high of 14,811 new home sales seen in 2007.
The lower transaction value in dollar terms recorded last year compared to 2007 can be attributed to the large number of small- format homes of less than 500 square feet that were sold last year. These small units fetched relatively lower price quantums.
Another reason was the popularity of mass-market homes last year. By contrast, much of the demand in 2007 came from the luxury segment where the overall price quantums were high.
For this year, CBRE's executive director for residential Joseph Tan predicts that the total transaction value (in dollar terms) will lie between the $16.22 billion seen last year and the $23.52 seen billion in 2007 - even though the number of units sold will be similar.
The total transaction value of caveats from January to March this year account for some $4.2 billion in primary sales - or about 26 per cent of last year's total transaction value.
And a total of 4,380 new homes were sold in the first quarter of this year - paving the way for similar transaction volumes recorded in 2009 and 2007 at 14,000 units each year.
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' Mr Tan said. 'In addition, there is a good chance of the luxury segment making a notable return in the later half of the year, as competitive tax rates and a highly- rated liveable environment might attract more high-net-worth foreigners to Singapore.'
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
HEADING HIGHER
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' says Mr Tan
$16-22b in new home sales for 2010: CBRE
Good chance of the luxury segment making a notable return in the later half of the year
By UMA SHANKARI
THE total value of all new homes sold this year will amount to $16 billion-$22 billion as the property market sees a follow-through of the momentum that begun a year ago, said CB Richard Ellis (CBRE) in a new report.
Last year, a total transaction value of $16.22 billion was recorded, based on caveats lodged for the full twelve months in the year. In comparison, the total value of new home sales for the whole of 2007 (the height of the property market boom) was $23.52 billion worth of primary transactions. CBRE's analysis of URA data indicates that the dollar value of 2009's transactions in the new home market accounted for only 68.9 per cent of the total value in 2007.
But the total number of new homes sold last year was similar to that of 2007. For the full year 2009, URA statistics show that 14,688 new homes were sold in the private residential market - comparable to the all-time high of 14,811 new home sales seen in 2007.
The lower transaction value in dollar terms recorded last year compared to 2007 can be attributed to the large number of small- format homes of less than 500 square feet that were sold last year. These small units fetched relatively lower price quantums.
Another reason was the popularity of mass-market homes last year. By contrast, much of the demand in 2007 came from the luxury segment where the overall price quantums were high.
For this year, CBRE's executive director for residential Joseph Tan predicts that the total transaction value (in dollar terms) will lie between the $16.22 billion seen last year and the $23.52 seen billion in 2007 - even though the number of units sold will be similar.
The total transaction value of caveats from January to March this year account for some $4.2 billion in primary sales - or about 26 per cent of last year's total transaction value.
And a total of 4,380 new homes were sold in the first quarter of this year - paving the way for similar transaction volumes recorded in 2009 and 2007 at 14,000 units each year.
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' Mr Tan said. 'In addition, there is a good chance of the luxury segment making a notable return in the later half of the year, as competitive tax rates and a highly- rated liveable environment might attract more high-net-worth foreigners to Singapore.'
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
HEADING HIGHER
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' says Mr Tan
TODAY ONLINE : He forged signatures to steal $500k
He forged signatures to steal $500k
05:55 AM May 14, 2010
by Shaffiq Alkhatib
SINGAPORE - A former employee of a real estate company has pleaded guilty to forging signatures to withdraw more than $500,000 from the bank accounts of a condominium management committee.
Chew Swee Siong, 31, pleaded guilty to 28 charges. Another 158 were taken into consideration. He committed the offences between Nov 18, 2006, and July 10, 2007, while he was an employee of Kenwood Property Consultants. In total, Chew told police he had siphoned off about $1.5 million from the condominium over 18 months.
Chew, who was then based at West Bay Condominium at West Coast Crescent to manage its affairs, had forged the signatures of two people. They are Mr Baey Yam Chye, the former chairman of the management corporation strata title of West Bay Condominium, and Mr Yeoh Kiat Boon, its treasurer. Both are the authorised signatories of bank accounts with OCBC and Citibank.
Chew had collected the money for his own use. In mitigation, Chew's lawyer, Mr Gregory Vijayendran, cited medical reports which said his client suffers from a mental disorder known as pathological gambling.
Mr Vijayendran told District Judge Liew Thiam Leng that Chew has a "total loss of self-control when it comes to gambling activities". The lawyer asked for a lenient sentence as Chew had surrendered voluntarily.
Assistant Public Prosecutor, Kalidass Murugaiyan told the judge that he only received the written mitigation yesterday and requested for an adjournment to study it.
The case will be mentioned again on June 3.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
05:55 AM May 14, 2010
by Shaffiq Alkhatib
SINGAPORE - A former employee of a real estate company has pleaded guilty to forging signatures to withdraw more than $500,000 from the bank accounts of a condominium management committee.
Chew Swee Siong, 31, pleaded guilty to 28 charges. Another 158 were taken into consideration. He committed the offences between Nov 18, 2006, and July 10, 2007, while he was an employee of Kenwood Property Consultants. In total, Chew told police he had siphoned off about $1.5 million from the condominium over 18 months.
Chew, who was then based at West Bay Condominium at West Coast Crescent to manage its affairs, had forged the signatures of two people. They are Mr Baey Yam Chye, the former chairman of the management corporation strata title of West Bay Condominium, and Mr Yeoh Kiat Boon, its treasurer. Both are the authorised signatories of bank accounts with OCBC and Citibank.
Chew had collected the money for his own use. In mitigation, Chew's lawyer, Mr Gregory Vijayendran, cited medical reports which said his client suffers from a mental disorder known as pathological gambling.
Mr Vijayendran told District Judge Liew Thiam Leng that Chew has a "total loss of self-control when it comes to gambling activities". The lawyer asked for a lenient sentence as Chew had surrendered voluntarily.
Assistant Public Prosecutor, Kalidass Murugaiyan told the judge that he only received the written mitigation yesterday and requested for an adjournment to study it.
The case will be mentioned again on June 3.
Copyright 2010 MediaCorp Pte Ltd | All Rights Reserved
ST : 200 lose $6m in British land deals
May 14, 2010
200 lose $6m in British land deals
Blow for investors here after UK real estate firm shut down by British govt
By Liew Hanqing
NEARLY 200 investors here who thought they had bought a piece of England have as good as lost an estimated $6 million in total.
They had at various times since 2006 purchased plots of land in rural places like Swindon and Gatwick for $15,000 each through Singapore company Land International (Far East), and had been promised 'high returns with regular payouts for three years'.
But the company's parent, Land International, was shut down by the British government in 2008, following an insolvency probe.
Despite this, land plots continued to be sold to investors here through Land International (Far East), British news reports said. Not only were the plots sold, their buyers were told the company would seek planning permission to develop these tracts of land for them.
But news reports there said investigations have revealed the land plots have been zoned as 'greenbelt' or protected land, on which no development is allowed.
Investors who spoke to The Straits Times said they realised something was amiss when payouts on their investments stopped coming late last year.
Mr Roel van Leeuwen, a Singapore permanent resident and retiree who invested $120,000 in Swindon through Land International (Far East), said he had been receiving quarterly payouts since 2007 to the tune of an 8 per cent annual return on his investment.
The payouts dried up last November, around the time he read reports that Land International had been shut down.
He said he approached the British authorities this week to check whether the land plots had been registered in his name but has not received a reply yet.
Mr Simon Beh, a director of Land International (Far East), confirmed that the company stopped payouts to investors when it ran out of money late last year following a financial dispute with its parent.
He said the investors had been issued title deeds for their plots, which made them official owners, so they were unlikely to get their money back.
He suggested that investors here band together to appoint their own consultant to get planning permission for the land, 'provided the land has potential for planning permission'.
Mr van Leeuwen said, however, that investors had been told upon signing up that a planning consultant would be hired on their behalf, but this never happened.
Land International began operating in 2004. It bought greenbelt land in various parts of rural Britain, sub-divided it into plots of around 4,360 sq ft, and then sold these to about 700 investors in various countries.
By the time it was ordered shut, it had raked in an estimated £10 million ($20.4 million), British news reports said.
Mr Beh declined to disclose the exact amount investors here had jointly parked with his outfit.
When contacted, the directors of the parent company distanced themselves from the Singapore business.
One of them, Mr Stephen Meissner, said he and Mr Michael Morris, the other director, had 'no say' in the day-to-day operations of Land International (Far East). He also claimed to have been unaware that the Singapore arm had introduced a programme promising regular payouts - until it was launched.
The programme, dubbed the 'Grand Max' scheme, promised payouts of between 6 and 8 per cent a year.
Mr Meissner said the scheme 'was not something that we had ever implemented in the United Kingdom and never would have'.
But Mr Beh disputed this, saying the directors in the parent company knew about Grand Max, but had chosen to 'abandon' their business here.
Meanwhile, Mr Seah Seng Choon, the executive director of the Consumers Association of Singapore, urged investors to do their due diligence before investing, and described land-banking projects as high-risk investments.
He said: 'Investors should get as much information as possible on the land being offered, such as the condition of the land, its leasehold and restrictions on its use.'
The investors here will find no shelter under the law for the kind of investment they have made.
A spokesman for the Monetary Authority of Singapore said the Securities & Futures Act (SFA) and the Financial Advisers Act (FAA) apply only to real estate-related investment products which are in the form of securities.
'Land-banking investments involve investors acquiring direct interests in real estate rather than in securities related to real estate and, as such, fall outside the scope of the SFA and FAA,' the spokesman said.
hanqing@sph.com.sg
--------------------------------------------------------------------------------
NO LEGAL RECOURSE HERE
'Land-banking investments involve investors acquiring direct interests in real estate rather than in securities related to real estate and, as such, fall outside the scope of the SFA and FAA.'
A Monetary Authority of Singapore spokesman, referring to the Securities & Futures Act (SFA) and the Financial Advisers Act (FAA)
The Swindon site which was divided into plots and sold to investors who said they were promised high returns with regular payouts for three years. -- PHOTO: LAND INTERNATIONAL (FAR EAST)
200 lose $6m in British land deals
Blow for investors here after UK real estate firm shut down by British govt
By Liew Hanqing
NEARLY 200 investors here who thought they had bought a piece of England have as good as lost an estimated $6 million in total.
They had at various times since 2006 purchased plots of land in rural places like Swindon and Gatwick for $15,000 each through Singapore company Land International (Far East), and had been promised 'high returns with regular payouts for three years'.
But the company's parent, Land International, was shut down by the British government in 2008, following an insolvency probe.
Despite this, land plots continued to be sold to investors here through Land International (Far East), British news reports said. Not only were the plots sold, their buyers were told the company would seek planning permission to develop these tracts of land for them.
But news reports there said investigations have revealed the land plots have been zoned as 'greenbelt' or protected land, on which no development is allowed.
Investors who spoke to The Straits Times said they realised something was amiss when payouts on their investments stopped coming late last year.
Mr Roel van Leeuwen, a Singapore permanent resident and retiree who invested $120,000 in Swindon through Land International (Far East), said he had been receiving quarterly payouts since 2007 to the tune of an 8 per cent annual return on his investment.
The payouts dried up last November, around the time he read reports that Land International had been shut down.
He said he approached the British authorities this week to check whether the land plots had been registered in his name but has not received a reply yet.
Mr Simon Beh, a director of Land International (Far East), confirmed that the company stopped payouts to investors when it ran out of money late last year following a financial dispute with its parent.
He said the investors had been issued title deeds for their plots, which made them official owners, so they were unlikely to get their money back.
He suggested that investors here band together to appoint their own consultant to get planning permission for the land, 'provided the land has potential for planning permission'.
Mr van Leeuwen said, however, that investors had been told upon signing up that a planning consultant would be hired on their behalf, but this never happened.
Land International began operating in 2004. It bought greenbelt land in various parts of rural Britain, sub-divided it into plots of around 4,360 sq ft, and then sold these to about 700 investors in various countries.
By the time it was ordered shut, it had raked in an estimated £10 million ($20.4 million), British news reports said.
Mr Beh declined to disclose the exact amount investors here had jointly parked with his outfit.
When contacted, the directors of the parent company distanced themselves from the Singapore business.
One of them, Mr Stephen Meissner, said he and Mr Michael Morris, the other director, had 'no say' in the day-to-day operations of Land International (Far East). He also claimed to have been unaware that the Singapore arm had introduced a programme promising regular payouts - until it was launched.
The programme, dubbed the 'Grand Max' scheme, promised payouts of between 6 and 8 per cent a year.
Mr Meissner said the scheme 'was not something that we had ever implemented in the United Kingdom and never would have'.
But Mr Beh disputed this, saying the directors in the parent company knew about Grand Max, but had chosen to 'abandon' their business here.
Meanwhile, Mr Seah Seng Choon, the executive director of the Consumers Association of Singapore, urged investors to do their due diligence before investing, and described land-banking projects as high-risk investments.
He said: 'Investors should get as much information as possible on the land being offered, such as the condition of the land, its leasehold and restrictions on its use.'
The investors here will find no shelter under the law for the kind of investment they have made.
A spokesman for the Monetary Authority of Singapore said the Securities & Futures Act (SFA) and the Financial Advisers Act (FAA) apply only to real estate-related investment products which are in the form of securities.
'Land-banking investments involve investors acquiring direct interests in real estate rather than in securities related to real estate and, as such, fall outside the scope of the SFA and FAA,' the spokesman said.
hanqing@sph.com.sg
--------------------------------------------------------------------------------
NO LEGAL RECOURSE HERE
'Land-banking investments involve investors acquiring direct interests in real estate rather than in securities related to real estate and, as such, fall outside the scope of the SFA and FAA.'
A Monetary Authority of Singapore spokesman, referring to the Securities & Futures Act (SFA) and the Financial Advisers Act (FAA)
The Swindon site which was divided into plots and sold to investors who said they were promised high returns with regular payouts for three years. -- PHOTO: LAND INTERNATIONAL (FAR EAST)
ST : Con men pose as landlords in online scams
May 14, 2010
Con men pose as landlords in online scams
They target expatriates, offer fake properties
By Mavis Toh
AS THE expatriate population grows, con men have started trawling Singapore-based rental websites, targeting foreigners who are looking to rent properties here.
Posing as owners of choice properties such as condominiums in District 10, they give potential tenants fake addresses and even pictures of well-furnished homes to trick unsuspecting foreigners into wiring down payments to them.
The police did not give details on how many people have been cheated in online property rental scams.
However, its statistics showed that one person fell victim to a property rental scam nearly every day for the past two years.
Police figures showed that there were 324 reports lodged last year from victims who claimed they were cheated in rental scams. In 2008, the figure was 355.
The number includes those who were fleeced after responding to advertisements and paying the down payments, only to find out that their landlords did not even own the properties.
Property experts told The Straits Times they are aware of such online rental scams, and have told their expatriate clients they should check with their companies' human resources departments to help them find apartments.
When The Straits Times recently posted a notice on some of these locally based property websites, posing as an expatriate looking for an apartment, three people claiming to be Singaporeans living overseas responded the same night.
Giving the excuse that they were not in Singapore, they said they could not arrange for any viewing of the apartments.
Instead, they sent images of well-renovated and well-furnished rooms, purportedly taken from inside the units.
However, a check showed that two addresses led to shops in Far East Plaza, and the other to a condominium in Mount Elizabeth Road which has not even been built yet.
When pressed for a viewing or for the unit number of the apartment, all three broke off contact.
An American expatriate working in the food and beverage industry here fell victim to a ruse earlier this year and lost $1,500 to a con man.
The man, who gave his name only as Marcus, was approached after he posted on a website here that he was looking for rental accommodation.
The con man e-mailed him photographs he claimed were of an apartment in South Bridge Road, and asked for $1,500 as rental and a deposit for the unit.
The con man even sent him a contract, and Marcus paid up because 'the apartment looks pretty good in the photos'.
But the moment the money was wired to a London bank account, the 'landlord' said the room had been rented out and promised to send the money back.
After a week, the 'landlord' stopped replying. 'That was when I knew I had been scammed,' said Marcus, who filed a police report in the United States.
Filipino system analyst Manuel Nacionales, 44, almost became another victim when he went apartment-hunting online in February this year.
He had posted a notice on a website after his rental lease in a Hougang flat expired. Within a day, a man claiming to be a Singaporean working in Britain e-mailed him, saying that he had an apartment in town for rent.
Said Mr Nacionales, who eventually backed out of the deal: 'He wanted me to wire $1,100 and said he would send the keys only after he got the money. Thankfully my colleagues cautioned me against it.'
mavistoh@sph.com.sg
--------------------------------------------------------------------------------
How to avoid falling victim to rental scams
TO AVOID falling prey to the con men, the police said that tenants should request that all parties - including landlords and agents - be present when signing the tenancy documents.
They should also avoid making large payments in cash, its spokesman said.
When it comes to dealing with property agents, the Consumers Association of Singapore (Case) said that tenants should use accredited agents and check with the property firms to ensure that these are bona fide agents, before engaging their services.
Dr Tan Tee Khoon, chief of Singapore Accredited Estate Agencies, said tenants could do an online check on the Inland Revenue Authority of Singapore's website, to make sure landlords are the genuine homeowners before they sign tenancy agreements or make any payments.
'Online scams are dangerous because one can easily conceal his identity and it'll be hard to trace the crime back to him and if he works fast enough, he can fleece people just like that,' said Dr Tan.
Con men pose as landlords in online scams
They target expatriates, offer fake properties
By Mavis Toh
AS THE expatriate population grows, con men have started trawling Singapore-based rental websites, targeting foreigners who are looking to rent properties here.
Posing as owners of choice properties such as condominiums in District 10, they give potential tenants fake addresses and even pictures of well-furnished homes to trick unsuspecting foreigners into wiring down payments to them.
The police did not give details on how many people have been cheated in online property rental scams.
However, its statistics showed that one person fell victim to a property rental scam nearly every day for the past two years.
Police figures showed that there were 324 reports lodged last year from victims who claimed they were cheated in rental scams. In 2008, the figure was 355.
The number includes those who were fleeced after responding to advertisements and paying the down payments, only to find out that their landlords did not even own the properties.
Property experts told The Straits Times they are aware of such online rental scams, and have told their expatriate clients they should check with their companies' human resources departments to help them find apartments.
When The Straits Times recently posted a notice on some of these locally based property websites, posing as an expatriate looking for an apartment, three people claiming to be Singaporeans living overseas responded the same night.
Giving the excuse that they were not in Singapore, they said they could not arrange for any viewing of the apartments.
Instead, they sent images of well-renovated and well-furnished rooms, purportedly taken from inside the units.
However, a check showed that two addresses led to shops in Far East Plaza, and the other to a condominium in Mount Elizabeth Road which has not even been built yet.
When pressed for a viewing or for the unit number of the apartment, all three broke off contact.
An American expatriate working in the food and beverage industry here fell victim to a ruse earlier this year and lost $1,500 to a con man.
The man, who gave his name only as Marcus, was approached after he posted on a website here that he was looking for rental accommodation.
The con man e-mailed him photographs he claimed were of an apartment in South Bridge Road, and asked for $1,500 as rental and a deposit for the unit.
The con man even sent him a contract, and Marcus paid up because 'the apartment looks pretty good in the photos'.
But the moment the money was wired to a London bank account, the 'landlord' said the room had been rented out and promised to send the money back.
After a week, the 'landlord' stopped replying. 'That was when I knew I had been scammed,' said Marcus, who filed a police report in the United States.
Filipino system analyst Manuel Nacionales, 44, almost became another victim when he went apartment-hunting online in February this year.
He had posted a notice on a website after his rental lease in a Hougang flat expired. Within a day, a man claiming to be a Singaporean working in Britain e-mailed him, saying that he had an apartment in town for rent.
Said Mr Nacionales, who eventually backed out of the deal: 'He wanted me to wire $1,100 and said he would send the keys only after he got the money. Thankfully my colleagues cautioned me against it.'
mavistoh@sph.com.sg
--------------------------------------------------------------------------------
How to avoid falling victim to rental scams
TO AVOID falling prey to the con men, the police said that tenants should request that all parties - including landlords and agents - be present when signing the tenancy documents.
They should also avoid making large payments in cash, its spokesman said.
When it comes to dealing with property agents, the Consumers Association of Singapore (Case) said that tenants should use accredited agents and check with the property firms to ensure that these are bona fide agents, before engaging their services.
Dr Tan Tee Khoon, chief of Singapore Accredited Estate Agencies, said tenants could do an online check on the Inland Revenue Authority of Singapore's website, to make sure landlords are the genuine homeowners before they sign tenancy agreements or make any payments.
'Online scams are dangerous because one can easily conceal his identity and it'll be hard to trace the crime back to him and if he works fast enough, he can fleece people just like that,' said Dr Tan.
BT : Factory rents may rise 10%: Colliers
Business Times - 14 May 2010
Factory rents may rise 10%: Colliers
By EMILYN YAP
(SINGAPORE) Rents, land values and capital values of conventional industrial space in Singapore could rise 10 per cent in the next 12 months, as the economy improves and institutional investors return, said Colliers International yesterday.
The consultancy found that the market for factories and warehouses has already picked up in the six months from October last year to March this year.
During the period, the average monthly gross rent for single-user factories in central Singapore increased by about 3.8 per cent to $1.35 per sq ft. Capital values for this type of property also inched up 3.6 per cent to $145 psf.
Separately, warehouses in the eastern part of the island saw their average monthly gross rent rise 6.7 per cent to $1.28 psf. Their capital values also went up 6.2 per cent to $138 psf.
Conditions were not as rosy for high-specification industrial developments - rents for this type of space continued to fall, albeit at a slower rate. Over the six-month period, the average monthly gross rent for high-spec space dropped 5.1 per cent to $2.78 psf.
The silver lining is that the occupancy rate for high-spec space has been stable. Colliers attributed this to firmer office rents in a recovering commercial market - this has discouraged tenants occupying high-spec space from moving back to offices.
Colliers expects the overall industrial property market here to do better as the economy continues to pick up. 'The recovery in the exports and manufacturing sector should support an expansion in demand from manufacturers,' its research and advisory director Tay Huey Ying said.
'Coupled with the return of institutional funds to the industrial market, rents, land and capital values of single-user factories and warehouses are expected to increase up to 10 per cent in the next 12 months.' Ms Tay also expects rents of high-spec space to bottom out this year.
Besides Singapore, most Asia-Pacific cities have seen their industrial property markets stabilise, Colliers noted. For instance, industrial rents in Delhi, Guangzhou, Shanghai and Hong Kong have hit the trough.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Factory rents may rise 10%: Colliers
By EMILYN YAP
(SINGAPORE) Rents, land values and capital values of conventional industrial space in Singapore could rise 10 per cent in the next 12 months, as the economy improves and institutional investors return, said Colliers International yesterday.
The consultancy found that the market for factories and warehouses has already picked up in the six months from October last year to March this year.
During the period, the average monthly gross rent for single-user factories in central Singapore increased by about 3.8 per cent to $1.35 per sq ft. Capital values for this type of property also inched up 3.6 per cent to $145 psf.
Separately, warehouses in the eastern part of the island saw their average monthly gross rent rise 6.7 per cent to $1.28 psf. Their capital values also went up 6.2 per cent to $138 psf.
Conditions were not as rosy for high-specification industrial developments - rents for this type of space continued to fall, albeit at a slower rate. Over the six-month period, the average monthly gross rent for high-spec space dropped 5.1 per cent to $2.78 psf.
The silver lining is that the occupancy rate for high-spec space has been stable. Colliers attributed this to firmer office rents in a recovering commercial market - this has discouraged tenants occupying high-spec space from moving back to offices.
Colliers expects the overall industrial property market here to do better as the economy continues to pick up. 'The recovery in the exports and manufacturing sector should support an expansion in demand from manufacturers,' its research and advisory director Tay Huey Ying said.
'Coupled with the return of institutional funds to the industrial market, rents, land and capital values of single-user factories and warehouses are expected to increase up to 10 per cent in the next 12 months.' Ms Tay also expects rents of high-spec space to bottom out this year.
Besides Singapore, most Asia-Pacific cities have seen their industrial property markets stabilise, Colliers noted. For instance, industrial rents in Delhi, Guangzhou, Shanghai and Hong Kong have hit the trough.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
Subscribe to:
Posts (Atom)
Posts
