New Reporter
10-07-23, 09:52
On falling home prices and black-and-white houses
Leslie Yee
Jul 04, 2023
What goes up my have to come down eventually.
For the first time in three years, the Urban Redevelopment Authority’s (URA) widely watched overall private home price index has eased.
It contracted 0.4 per cent quarter-on-quarter (qoq) in Q2 2023, based on the latest flash estimate data released by URA on Jul 3, in sharp contrast with the 3.3 per cent qoq rise in Q1 2023.
The price fall in Q2 was driven largely by a 2.6 per cent qoq slide in prices of non-landed private homes in the city fringe or Rest of Central Region.
Meanwhile, flash estimates released by the Housing and Development Board (HDB) showed HDB resale flat volumes fell 4.6 per cent year-on-year to 6,409 flats in Q2 - the lowest since Q3 2020.
However, HDB resale prices rose 1.4 per cent in Q2 from the previous quarter. Property analysts observed that gains in resale prices were partly fuelled by buyers seeking larger homes, with four-room and five-room flats being the most popular.
While it may be too early to call the peak of the private residential property market cycle, state land tender closings for three 99-year leasehold sites last week reflected cautious sentiment among developers for biggish sites, which entail higher risks.
The offering of an executive condominium site at Plantation Close in Tengah drew the highest number of bidders, compared with the maiden residential plot in Marina South; and a commercial and residential site in Tampines Avenue 11.
Factors such as property cooling measures, a reduction in saleable area for non-landed residential projects due to changes in definitions of floor area, high interest rates and high construction costs appear to be weighing on sentiment among property developers.
There is still plenty of time for various parties to form joint ventures and do feasibility studies for the state tender of the 6.5 hectare white site in the Jurong Lake District, which closes on Mar 26, 2024.
Might sentiment for large sites among developers improve by early next year? Strategically, developing a large site in a location that will enjoy great transport connectivity, such as the Jurong Lake District site, could yield rich rewards for developers.
In this week’s The Level Ground, I argue that the Jurong Lake District site is worth serious consideration by major developers. Building premium office spaces on this site may draw a good response from potential users.
Developers can also look at two other sites that were recently put up for state tender - the Marina Gardens Crescent mixed-use parcel in the Marina South precinct and a housing plot along Media Circle in the Buona Vista area.
Upcoming launches will be closely watched for a gauge of home-buying sentiment. UOL Group’s Pinetree Hill 99-year leasehold condominium project in the Mount Sinai area was launched for preview recently, with prices starting at S$2,236 per square foot.
Separately, Singapore’s black-and-white colonial houses have been in the spotlight. Two ministers made statements and responded to questions on their rental of two state-owned bungalows in Ridout Road in the Tanglin vicinity.
The Singapore Land Authority’s (SLA) disclosures on rents at Ridout Road have stirred debate on the valuation of the state-owned black-and-white houses, with some in the real estate trade raising questions about how the rents were assessed and priced.
Also, the SLA is studying the feasibility of a longer leasehold period – such as 30 or 60 years – for an entire black-and-white bungalow estate so that a private developer can become the master leaseholder. To me, this arrangement sounds promising.
Looking at the bigger picture, there may be some merits to keeping an inventory of black-and-white houses. But these houses, which were built between the 1900s to 1950s, can be costly to maintain.
However, in a country where much of the old gives way to the new and land is scarce, maybe more sites housing colonial era homes could over time be redeveloped to meet housing and other needs.
https://www.businesstimes.com.sg/property/falling-home-prices-and-black-and-white-houses
Leslie Yee
Jul 04, 2023
What goes up my have to come down eventually.
For the first time in three years, the Urban Redevelopment Authority’s (URA) widely watched overall private home price index has eased.
It contracted 0.4 per cent quarter-on-quarter (qoq) in Q2 2023, based on the latest flash estimate data released by URA on Jul 3, in sharp contrast with the 3.3 per cent qoq rise in Q1 2023.
The price fall in Q2 was driven largely by a 2.6 per cent qoq slide in prices of non-landed private homes in the city fringe or Rest of Central Region.
Meanwhile, flash estimates released by the Housing and Development Board (HDB) showed HDB resale flat volumes fell 4.6 per cent year-on-year to 6,409 flats in Q2 - the lowest since Q3 2020.
However, HDB resale prices rose 1.4 per cent in Q2 from the previous quarter. Property analysts observed that gains in resale prices were partly fuelled by buyers seeking larger homes, with four-room and five-room flats being the most popular.
While it may be too early to call the peak of the private residential property market cycle, state land tender closings for three 99-year leasehold sites last week reflected cautious sentiment among developers for biggish sites, which entail higher risks.
The offering of an executive condominium site at Plantation Close in Tengah drew the highest number of bidders, compared with the maiden residential plot in Marina South; and a commercial and residential site in Tampines Avenue 11.
Factors such as property cooling measures, a reduction in saleable area for non-landed residential projects due to changes in definitions of floor area, high interest rates and high construction costs appear to be weighing on sentiment among property developers.
There is still plenty of time for various parties to form joint ventures and do feasibility studies for the state tender of the 6.5 hectare white site in the Jurong Lake District, which closes on Mar 26, 2024.
Might sentiment for large sites among developers improve by early next year? Strategically, developing a large site in a location that will enjoy great transport connectivity, such as the Jurong Lake District site, could yield rich rewards for developers.
In this week’s The Level Ground, I argue that the Jurong Lake District site is worth serious consideration by major developers. Building premium office spaces on this site may draw a good response from potential users.
Developers can also look at two other sites that were recently put up for state tender - the Marina Gardens Crescent mixed-use parcel in the Marina South precinct and a housing plot along Media Circle in the Buona Vista area.
Upcoming launches will be closely watched for a gauge of home-buying sentiment. UOL Group’s Pinetree Hill 99-year leasehold condominium project in the Mount Sinai area was launched for preview recently, with prices starting at S$2,236 per square foot.
Separately, Singapore’s black-and-white colonial houses have been in the spotlight. Two ministers made statements and responded to questions on their rental of two state-owned bungalows in Ridout Road in the Tanglin vicinity.
The Singapore Land Authority’s (SLA) disclosures on rents at Ridout Road have stirred debate on the valuation of the state-owned black-and-white houses, with some in the real estate trade raising questions about how the rents were assessed and priced.
Also, the SLA is studying the feasibility of a longer leasehold period – such as 30 or 60 years – for an entire black-and-white bungalow estate so that a private developer can become the master leaseholder. To me, this arrangement sounds promising.
Looking at the bigger picture, there may be some merits to keeping an inventory of black-and-white houses. But these houses, which were built between the 1900s to 1950s, can be costly to maintain.
However, in a country where much of the old gives way to the new and land is scarce, maybe more sites housing colonial era homes could over time be redeveloped to meet housing and other needs.
https://www.businesstimes.com.sg/property/falling-home-prices-and-black-and-white-houses