Private home prices in city fringe could pick up soon: analysts

[princess_morbucks]

http://www.channelnewsasia.com/mobile/business/singapore/private-home-prices-in/1056918.html?cid=TWTCNA&utm_source=dlvr.it&utm_medium=twitter
SINGAPORE: Private residential property prices have been subdued, following cooling measures by the government last year.

Overall, they are expected to remain muted this year.

But some analysts have said prices of private homes in the city fringe could start picking up soon.

This is due to new project launches in attractive locations like Commonwealth Avenue, Kim Tian Road and Prince Charles Crescent.

Real estate agency OrangeTee expects units at these developments to be priced upwards of S$1,600 per square foot (psf).

Prices of non-landed private homes in the city fringe -- or rest of central region (RCR) -- took a sharp hit in the first quarter of this year, falling by 2.8 per cent, according to estimates from the Urban Redevelopment Authority.

Analysts said the drop was largely due to a lack of new launches and sales of units from existing projects which had lower psf pricing. For example, according to caveats lodged, OrangeTee said Bartley Ridge sold 21 units in the first quarter at a median price of S$1,183 psf.

However, property analysts said there could be an uptick during the current quarter, as new projects are released.

Christine Li, head of research and consultancy at OrangeTee, said: "With new launches coming up at RCR, I expect the price to rebound, probably slightly from Q1 level.

“Looking at the sites in the pipeline, the locations, they definitely command a premium. The price point could easily be S$1,600 and above, given that developers have paid high land prices for these three sites."

Ku Swee Yong, CEO of Century 21 Singapore, said: "If they (developers) plan to move project sales fast, let's say to achieve 50 per cent sell out within the first two months, they would have to (be) priced at 5 to 10 per cent below current prices, which means pricing from around S$1,300 to S$1,400 psf for the starting price. Kim Tian may have to start higher, S$1,600 plus or even S$1,700 upwards."

The three projects include Keppel Land's 500-unit Highline Residences at Kim Tian Road, and The Crest, a 469-unit development by Wing Tai Holdings at Prince Charles Crescent.

Both developers told Channel NewsAsia that the projects are still targeted to be launched this quarter.

Wing Tai added that the showflat may be ready by the end of the month.

The third project is the 845-unit development by Hong Leong, located opposite Queenstown MRT station at Commonwealth Avenue.

Analysts said the Kim Tian Road site has the highest land cost at S$1,163 psf per plot ratio (ppr), followed by the Prince Charles Crescent plot at S$960 psf ppr and around S$883 psf ppr for the site at Commonwealth Avenue.

Analysts said that since the introduction of loan curbs last year, home buyers have become more price sensitive, and in order to move units, developers have to ensure that their projects are priced more competitively compared to other developments in the area, and that probably means taking a smaller profit margin.

Market watchers also expect units to get smaller to keep the overall price quantum affordable.

Citing marketing materials, OrangeTee said that the Commonwealth Avenue project will comprise 612 one- and two-bedroom units -- that is over 70 per cent of the total units in the development.

OrangeTee added that the largest apartments at the project are four-bedroom units spanning some 1,300 square feet.

[Amber Woods]

Orange Tee is the only real estate agency to say that prices in the city fringe could pick up soon because they are the one marketing the upcoming Commonwealth Ave project.

[chestnut]

Orange Tee is the only real estate agency to say that prices in the city fringe could pick up soon because they are the one marketing the upcoming Commonwealth Ave project.

Read this

Prices of non-landed private homes in the city fringe -- or rest of central region (RCR) -- took a sharp hit in the first quarter of this year, falling by 2.8 per cent, according to estimates from the Urban Redevelopment Authority.

Analysts said the drop was largely due to a lack of new launches and sales of units from existing projects which had lower psf pricing. For example, according to caveats lodged, OrangeTee said Bartley Ridge sold 21 units in the first quarter at a median price of S$1,183 psf.


The ppi for rcr will rise because this new launches will be priced higher than resale thus resulting in a price increase in rcr....

[Kelonguni]

Read this

Prices of non-landed private homes in the city fringe -- or rest of central region (RCR) -- took a sharp hit in the first quarter of this year, falling by 2.8 per cent, according to estimates from the Urban Redevelopment Authority.

Analysts said the drop was largely due to a lack of new launches and sales of units from existing projects which had lower psf pricing. For example, according to caveats lodged, OrangeTee said Bartley Ridge sold 21 units in the first quarter at a median price of S$1,183 psf.


The ppi for rcr will rise because this new launches will be priced higher than resale thus resulting in a price increase in rcr....

I wonder if Trilinq is considered RCR. The new RCR developments are going to be priced comparably.

[Amber Woods]

Read this

Prices of non-landed private homes in the city fringe -- or rest of central region (RCR) -- took a sharp hit in the first quarter of this year, falling by 2.8 per cent, according to estimates from the Urban Redevelopment Authority.

Analysts said the drop was largely due to a lack of new launches and sales of units from existing projects which had lower psf pricing. For example, according to caveats lodged, OrangeTee said Bartley Ridge sold 21 units in the first quarter at a median price of S$1,183 psf.


The ppi for rcr will rise because this new launches will be priced higher than resale thus resulting in a price increase in rcr....

Orange Tee's statement is more of to create market buzz and not the technical details per se.

[walkthetiger]

Orange Tee is the only real estate agency to say that prices in the city fringe could pick up soon because they are the one marketing the upcoming Commonwealth Ave project.

...good news to KBW, no need to touch any CM, yet the prices picking up by itself.

[Amber Woods]

...good news to KBW, no need to touch any CM, yet the prices picking up by itself.

Generally, prices will come down as developers price their developments lower though index may shows otherwise due to higher psf for new launches as pointed by Chestnut.

[chestnut]

Generally, prices will come down as developers price their developments lower though index may shows otherwise due to higher psf for new launches as pointed by Chestnut.

I see resale prices to taper because less potential buyers... What I don't see is new project prices dropping. Why? Developers still bidding so high for land. Land prices form more than 1/2 of total price. Let's wait and see future land sales... The weird part I am seeing is there is land sales this 1/2 year compared to past year.

Resale sellers Re taking the cue from new launches... Look at queenstown condos... All shot up because of echelon,Alex residence, etc... Hahahahaha

This is like car prices... All old car prices shoot up when new car prices shoot up... That's the reference point...

Again, it's good the market take a breather if not bubble will form... Hahahahaha

With so much money printed and cheap financing, money is eroding... Hahahahaha

But property is not the only investment lar.... When people cannot invest in property and they are fearful of erosion of money, it will be channeled somewhere else... Hahahaha

[Amber Woods]

I see resale prices to taper because less potential buyers... What I don't see is new project prices dropping. Why? Developers still bidding so high for land. Land prices form more than 1/2 of total price. Let's wait and see future land sales... The weird part I am seeing is there is land sales this 1/2 year compared to past year.

Resale sellers Re taking the cue from new launches... Look at queenstown condos... All shot up because of echelon,Alex residence, etc... Hahahahaha

This is like car prices... All old car prices shoot up when new car prices shoot up... That's the reference point...

Again, it's good the market take a breather if not bubble will form... Hahahahaha

With so much money printed and cheap financing, money is eroding... Hahahahaha

But property is not the only investment lar.... When people cannot invest in property and they are fearful of erosion of money, it will be channeled somewhere else... Hahahaha

Agree that new launches may not be priced much lower but should be lower than if not for the cooling measures. It will come to a point where developers have to decide to lower prices further to move inventories or hold it out.

With developers now needing to sell all units within 2 years of obtaining TOP, this tug of war between developers and buyers will persist for sometime. Smaller developers may just decide to cut losses to generate cash.

Wheelock had already written off $100m for its project in AMK. More of such things to come.

[chestnut]

Agree that new launches may not be priced much lower but should be lower than if not for the cooling measures. It will come to a point where developers have to decide to lower prices further to move inventories or hold it out.

With developers now needing to sell all units within 2 years of obtaining TOP, this tug of war between developers and buyers will persist for sometime. Smaller developers may just decide to cut losses to generate cash.

Wheelock had already written off $100m for its project in AMK. More of such things to come.

Wheelock wrote off 100 mil but they did not drop the price leh... if they manage to sell all at current price, this amount will be reversed...

You are rite, if not for the last 2 cooling measures, the prices will be super scary.... now everyone can go back to life as normal and focus on work and increase productivity... hahahahaha... oops

[DC33_2008]

New property buyers got to be mindful of the land sale price and pricing of such development especially with the last few land sales at record price. Something will have to be compromised like type and quality of finishes, etc.
I see resale prices to taper because less potential buyers... What I don't see is new project prices dropping. Why? Developers still bidding so high for land. Land prices form more than 1/2 of total price. Let's wait and see future land sales... The weird part I am seeing is there is land sales this 1/2 year compared to past year.

Resale sellers Re taking the cue from new launches... Look at queenstown condos... All shot up because of echelon,Alex residence, etc... Hahahahaha

This is like car prices... All old car prices shoot up when new car prices shoot up... That's the reference point...

Again, it's good the market take a breather if not bubble will form... Hahahahaha

With so much money printed and cheap financing, money is eroding... Hahahahaha

But property is not the only investment lar.... When people cannot invest in property and they are fearful of erosion of money, it will be channeled somewhere else... Hahahaha

[chestnut]

New property buyers got to be mindful of the land sale price and pricing of such development especially with the last few land sales at record price. Something will have to be compromised like type and quality of finishes, etc.

you so smart :D:D:D

[Yuki]

New property buyers got to be mindful of the land sale price and pricing of such development especially with the last few land sales at record price. Something will have to be compromised like type and quality of finishes, etc.

If they cannot reduce the price, they will reduce the size of the unit.

Already the units they minted is sooo much smaller compared to 2009.

[Amber Woods]

Wheelock wrote off 100 mil but they did not drop the price leh... if they manage to sell all at current price, this amount will be reversed...

You are rite, if not for the last 2 cooling measures, the prices will be super scary.... now everyone can go back to life as normal and focus on work and increase productivity... hahahahaha... oops

That $100m write down was recorded for FY2013 for their land purchased which bring down their land cost by $100m. The issue here is that Wheelock is now in a position to lower their price for the AMK project without hurting their P/L for FY 2014 and beyond. Looking at the market now, Wheelock may well have to lower their price further if they want to move more units for the AMK project.

[Amber Woods]

If they cannot reduce the price, they will reduce the size of the unit.

Already the units they minted is sooo much smaller compared to 2009.

If people as reported have exhausted buying into such small units, developers may have not choice but to cut losses. Until then, the tug of war between buyers and developers will persist for a while.

[2824]

Think the write down is mainly earnings management. Their FY 2013 results allowed them to take an early hit. Think there might be some price reduction, but unlikely going to be the full amt.


That $100m write down was recorded for FY2013 for their land purchased which bring down their land cost by $100m. The issue here is that Wheelock is now in a position to lower their price for the AMK project without hurting their P/L for FY 2014 and beyond. Looking at the market now, Wheelock may well have to lower their price further if they want to move more units for the AMK project.

[chestnut]

Think the write down is mainly earnings management. Their FY 2013 results allowed them to take an early hit. Think there might be some price reduction, but unlikely going to be the full amt.

agree (might as well take the hit in 2013 and still post profit for FY2013, hahahaha)

Slow sales at The Panorama (pictured) have prompted developer Wheelock Properties to make an accounting provision of $110 million for the condominium for the year ended 31 December 2013.

"An allowance for diminution in value of $110 million was made on the Ang Mo Kio project (The Panorama) due to the weakening market conditions and the slow take up rate of the property," the firm said in a statement.

The move contributed to a $91 million loss in the fourth quarter, a decrease of 197 percent compared to the same period in 2012.

Data from the URA analysed by PropertyGuru yesterday showed that caveats have been lodged for 48 of the 120 launched units in the 698-unit project. The mean average price of units sold to date is $1,409 psf.

Located at Ang Mo Kio Avenue 2, the 99-year leasehold site was awarded to Wheelock in January 2013 after it submitted the top bid of $550 million under the Government Land Sales (GLS) Programme.

Set for completion in 2019, The Panorama comprises two 20-storey blocks, four 17-storey blocks, two levels of basement car parks and a clubhouse.

Meanwhile, Wheelock achieved a full-year profit of $40 million, down 37 percent when compared to the previous year.

[sunboy77]

Orange Tee is the only real estate agency to say that prices in the city fringe could pick up soon because they are the one marketing the upcoming Commonwealth Ave project.
Hur? No la. OT is not a marketing agent of this Commonwealth project la.

[amk]

The Panorama price will drop. You want to bet on it ? ;)

[chestnut]

The Panorama price will drop. You want to bet on it ? ;)


Data from the URA analysed by PropertyGuru yesterday showed that caveats have been lodged for 48 of the 120 launched units in the 698-unit project. The mean average price of units sold to date is $1,409 psf.

110mil divide by 650 unit = 170k drop ave per unit??? assume 1,100sq ft ave = 1409x1100sq ft = 1.55mil - (170k drop) = 1.38mil

1.38mil divide by 1100sq ft = $1,250 psf

10% drop.... not bad.... at least lower than thomson grand.... hahahahaha

my computation quite bad on this... hahahahahaha

correct me on the computation if sala.....

[seletar]

Agree that new launches may not be priced much lower but should be lower than if not for the cooling measures. It will come to a point where developers have to decide to lower prices further to move inventories or hold it out.

With developers now needing to sell all units within 2 years of obtaining TOP, this tug of war between developers and buyers will persist for sometime. Smaller developers may just decide to cut losses to generate cash.

Wheelock had already written off $100m for its project in AMK. More of such things to come.

According to URA, developers have over 30,000 unsold residential units and struggling to sell their inventory. Demand have crashed, over supply looming, vacancy rates and interest rates rising ... At the rate things are going, developers won't be able to meet the QC sales deadline and will have to pay hefty extension charges ... Prices are likely to be slashed by developers to move inventory before the deadline.

[teddybear]

You are more likely to see that they cut costs by giving laminates in bedrooms (instead of hardwoods), porcelain tiles (instead of marbles), and substitute everything else with cheapest materials they can find! :mad:


According to URA, developers have over 30,000 unsold residential units and struggling to sell their inventory. Demand have crashed, over supply looming, vacancy rates and interest rates rising ... At the rate things are going, developers won't be able to meet the QC sales deadline and will have to pay hefty extension charges ... Prices are likely to be slashed by developers to move inventory before the deadline.

[hopeful]

You are more likely to see that they cut costs by giving laminates in bedrooms (instead of hardwoods), porcelain tiles (instead of marbles), and substitute everything else with cheapest materials they can find! :mad:

actually ask you this question before.
what are laminates?
i see laminates used in wardrobes in bedrooms even for high end properties. if i see smooth looking wardrobe, without any grains using laminates, yes?

or even if can see grain, then they can be wood veneers, yes? so how to determinate if hardwood furniture?

[teddybear]

They use laminates for flooring! Yack! :doh:
For wardrobes, many kind of woods too!


actually ask you this question before.
what are laminates?
i see laminates used in wardrobes in bedrooms even for high end properties. if i see smooth looking wardrobe, without any grains using laminates, yes?

or even if can see grain, then they can be wood veneers, yes? so how to determinate if hardwood furniture?

[hopeful]

They use laminates for flooring! Yack! :doh:
For wardrobes, many kind of woods too!

laminates for flooring. me comprende.
thought u referring to wardrobes.