A few CCR transactions sold at a loss (reported in The Edge)

[stalingrad]

DUKES RESIDENCE

#03-05 1701 SQ FT

Bought 27 Nov 2007 1823psf
Sold 8 Oct 2013 1576psf

Ouch, that is painful.

[stalingrad]

1st loss for Belle Vue Residences

#03-30 2045 sq ft
Bought 2 Oct 2008 2248psf
Sold 30 Sep 2013 1858psf

-17.3%

as reference, #02-30 sold in nov 2010 at 2332psf and #04-30 sold in Jun 2010 at 2263psf, both also 2045 sq ft.

There is blood on the street in CCR. I hate to say this. But, I told you so.

[Ringo33]

There is blood on the street in CCR. I hate to say this. But, I told you so.

When CCR sneeze, RCR sure will be the first to catch the cold.

[mosaic]

Spottiswoode Residences

missed out this one in july:
#22-04 624 sq ft

Bought 12 Apr 2010 2043psf
Sold 10 Jul 2013 1983psf

This one lagi sian. Buy in 2010 still can lose money.....

[puffer_fish]

Excellent news....

[mosaic]

This one lagi sian. Buy in 2010 still can lose money.....

Actually i think most who bought spottiswoode over the last one year will lose money. Overpriced and in the middle of nowhere

[Ringo33]

Actually i think most who bought spottiswoode over the last one year will lose money. Overpriced and in the middle of nowhere

how come that transaction is not listed in URA site? Did they pay to remove it? Or could it be a case of decoupling transaction?

[hopeful]

Spottiswoode Residences

missed out this one in july:
#22-04 624 sq ft

Bought 12 Apr 2010 2043psf
Sold 10 Jul 2013 1983psf

wrong data.
spottiswoode residences launch oct/nov 2010. not earlier.

squarefoot.
#22-04 lodge 13 dec 2010 at 1994psf

[walkthetiger]

Excellent news....

Seems to mark the beginning…. Started with CCR, then RCR likely later. Guess OCR in no mood to pop champagne either.

[teddybear]

People forgot that:

Upon analysing the downcycles, we observed that regardless of tenure, the higher the price appreciation during the upturn, the greater the fall during the downturn.

In current property cycle,
* OCR like Jurong property price has gone up from $500 psf to like $1500 psf or 200%!
* CCR like Belle Vue property price has gone up from $1800 psf to $2000 psf or only 11%! That is to say, pay $500 psf more, you can be far away from the mother of all pollutions in Singapore!

So, if going forward, if property price still continue to go up, which has higher potential for bigger % price appreciation?

BUT if going forward the property price drop, Which has higher potential for huge % price drop?

I think the answer is very obvious.

Seems to mark the beginning…. Started with CCR, then RCR likely later. Guess OCR in no mood to pop champagne either.

============================================
higher price appreciation during upturn, greater fall during downturn
Is freehold property better than 99-year?

Thursday, Oct 17, 2013
Christine Li
The Business Times
THERE are generally two types of property tenure in Singapore: 99-year leasehold and freehold. We consider 999-year leasehold to be the same as freehold, because their difference in value is negligible.

Freehold properties hold a few advantages over their leasehold counterparts - higher en-bloc potential, slower pace of depreciation and no restrictions on the use of Central Provident Fund for home purchases.

In recent years, new leasehold condominiums seem to have dominated the market. The proportions of new leasehold and freehold condominium sales stand at 95 per cent to 5 per cent respectively as of first half of 2013. In contrast, back in 2006 and 2007, around 70 per cent of new sales were freehold. This could be attributed to the ramp-up of the government land sales programme in recent years and the tightening of en- bloc rules in October 2007.

Proponents of freehold properties might argue that the price appreciation of freehold properties always outstrips that of their leasehold counterparts. This is because leasehold properties will depreciate over the course of their lease.

In order to find out how properties with different tenures but similar attributes perform over time, we picked Southaven I and Southaven II for illustration. Both projects were developed by the Ho Bee Group and share similar attributes such as location, product quality and facilities. Both projects were also launched for sale in 1995, but completed two years apart.

The price gap between Southaven I and II seems to have widened from only 8 per cent at its launch in 1995 to 18 per cent in 2013. But this price trend alone is not conclusive due to uneven and thin transaction volumes. The attributes of units sold in the same year were also not comparable. But it gives a good glimpse of how two projects with different tenures located right next to each other fare over time.

If we are to look at the broader market, freehold condominiums might not always enjoy superior price appreciation over their leasehold counterparts. Our analysis of the freehold and leasehold indices over the last three property cycles shows that out of the three upcycles, the freehold index only outperforms the leasehold index over one cycle between Q3 2006 and Q2 2008.

This is the period just before the global financial crisis when the en-bloc frenzy reached all-time high in terms of number of deals and transaction values.During this upcycle, freehold properties moved up 54 per cent, outperforming leasehold properties which only appreciated 39 per cent. For the other two upcycles, en-bloc activities were fairly muted with fewer deals and much lower transaction values. We can thus infer that en-bloc potential plays a key role in determining the price performance of leasehold and freehold properties.

Interestingly, during the subsequent downturn, freehold condominiums also lost 27 per cent of their value compared to 24 per cent for leasehold condominiums. Upon analysing the downcycles, we observed that regardless of tenure, the higher the price appreciation during the upturn, the greater the fall during the downturn. This was what happened to leasehold properties during the dotcom crash between Q3 2000 and Q2 2002. The prices of leasehold condominiums gained 46 per cent as compared to a milder 38 per cent for freehold condominiums. However, leasehold condominiums fell almost twice as much as their freehold counterparts when the general market went into a slump after the dotcom crash.

In the landed segment, the performance of terrace houses seems to paint a different picture. Freehold terrace houses have outperformed the leasehold ones in all periods except for the downturn during dotcom crash. In good times, they perform better than leasehold ones and in downturns, they also seem more resilient. This could be because of the restrictions on foreigners owning landed properties in Singapore.

So, which is better, freehold or leasehold? Based on the analysis, the answer depends on whether one is buying a landed or non- landed property. If buying a landed property, historical data shows that freehold might be a better choice. If one is buying a leasehold non-landed property in the current upcycle, given the challenging en-bloc market, leasehold could help to lock in more percentage gains if it is bought and sold at the right time.

Indeed, property values are influenced by multiple factors. However, if we assume all else being equal, freehold properties will always command a premium over their leasehold counterparts.

The writer is the head of research and consultancy at property firm OrangeTee.

[puffer_fish]

Seems to mark the beginning…. Started with CCR, then RCR likely later. Guess OCR in no mood to pop champagne either.

best time to buy thus the excellent news

whatever it is, good location will always be good ( this is my own investment opinion thus no rebutting necessary cos it my own my monies, I spend it where I deemed is worthy)

[bargain hunter]

very sorry guys for the WRONG PROJECT NAME! hahahahaha

its 76 Shenton #22-04 624 sq ft

Bought 12 Apr 2010 2043psf
Sold 10 Jul 2013 1983psf

wrong data.
spottiswoode residences launch oct/nov 2010. not earlier.

squarefoot.
#22-04 lodge 13 dec 2010 at 1994psf

[thomastansb]

Jia lat. 2010 buy also lose so much money.

very sorry guys for the WRONG PROJECT NAME! hahahahaha

its 76 Shenton #22-04 624 sq ft

Bought 12 Apr 2010 2043psf
Sold 10 Jul 2013 1983psf

[bargain hunter]

not really a lot right? 3% loss and then another 3% stamp duty lor.

Jia lat. 2010 buy also lose so much money.

[hopeful]

not really a lot right? 3% loss and then another 3% stamp duty lor.

3% loss
3% stamp duty
1% agent fee
total 7%
initial dp + stamp duty cash outlay 23%.
loss on initial investment 30%.

leverage is a double edged sword.

[DC33_2008]

Choose the wrong development then for short term investment. At least he willing to cut losses.

Jia lat. 2010 buy also lose so much money.

[Singleton]

Choose the wrong development then for short term investment. At least he willing to cut losses.

Think 76 Shenton was sold out within few days at launch. So surprising 22 floor 1 roomer subsale went below 2000pfs. nearby Altez and skysuites high floor easily >2500pfs right now.

anything wrong with 76 Shenton?

[DC33_2008]

Facing of the unit?

Think 76 Shenton was sold out within few days at launch. So surprising 22 floor 1 roomer subsale went below 2000pfs. nearby Altez and skysuites high floor easily >2500pfs right now.

anything wrong with 76 Shenton?

[puffer_fish]

Allow me to share my part. Before 2013, developers were allowed to give rebates or discounts after the deal is complete thus creating an unfair buying platform for buyers,(happened to be one of the beneficiary)

This is detrimental to the market as a whole cos it created an artificial rises in property prices and an excellent platform for developers to raise prices further

most of my indonesian friends are buyers of this property.

there are reasons which us mortals wont understand on why they are willing to sell at a loss. Unless you are in their circle of trust

[DC33_2008]

cashflow can be one of the many reasons. This is a long term investment kind of project if you look at the masterplan.

Allow me to share my part. Before 2013, developers were allowed to give rebates or discounts after the deal is complete thus creating an unfair buying platform for buyers,(happened to be one of the beneficiary)

This is detrimental to the market as a whole cos it created an artificial rises in property prices and an excellent platform for developers to raise prices further

most of my indonesian friends are buyers of this property.

there are reasons which us mortals wont understand on why they are willing to sell at a loss. Unless you are in their circle of trust

[puffer_fish]

Dont know man thus dont want to speculate but all I know is that there are more than 1 reason

As I am just one of the mortals thus I wont know too

[stalingrad]

Allow me to share my part. Before 2013, developers were allowed to give rebates or discounts after the deal is complete thus creating an unfair buying platform for buyers,(happened to be one of the beneficiary)

This is detrimental to the market as a whole cos it created an artificial rises in property prices and an excellent platform for developers to raise prices further

most of my indonesian friends are buyers of this property.

there are reasons which us mortals wont understand on why they are willing to sell at a loss. Unless you are in their circle of trust

Yes, I got it. You meant they did not lose money. They paid less than the price indicated in the caveats?

[puffer_fish]

Hey man..I dont know every deal that is going on

just sharing the past practices before 2013. If you need more info, an experience property agent that has done many deals should has more info or just go browse the past advertisements

I was offered such deals in 2009 so I am speaking from my own capacities.

Anyway such deals are no longer legal

[mosaic]

not really a lot right? 3% loss and then another 3% stamp duty lor.

I mean as in buy in 2010 still can lose money. I ve rarely seen anyone buying between 2009 and 2011 lose money. To me those are the almost sure make money years. Must be damn suey. Unless he got super alot of rebates. haha....

[walkthetiger]

I mean as in buy in 2010 still can lose money. I ve rarely seen anyone buying between 2009 and 2011 lose money. To me those are the almost sure make money years. Must be damn suey. Unless he got super alot of rebates. haha....

Purchased one in 2010, it is still looking for buyer willing to buy at my already break-even price...hah...

When price going down hill I may lose from those bought in recent years, but I will save when buy later.

[teddybear]

Only ignorant fool will immediately come to such conclusion.

I personally know of numerous cases where the reported transaction price is at the low end or even below market rate is because of 1 & main reason: Decoupling of ownership!

What is "Decoupling of ownership"?
Very simple, the property is owned by 2 or more individuals (husband and wife is very common, though could also be siblings, children to fathers/mothers etc), and they are decoupling so that the other party (wife/husband/brothers/sisters/children) is clean and does not own any property so that they can buy another one without all sort of ABSD! Simple as that! In the case of "Decoupling", the lower the reported transacted price, the lower the stamp duties they need to pay!

Obviously, "Decoupling of ownership" is just 1 reason. There are others who report low transacted prices for other reasons, such as parents passing properties over to their children, people freeing up cash flow for better investment deals (hence no qualm about selling at a loss for better deal & return). However, such deals are only available to High Networth individuals. Is it any wonder we see more of the high-end high absolute priced properties being transacted at lower prices?

There is blood on the street in CCR. I hate to say this. But, I told you so.

Originally Posted by bargain hunter View Post
1st loss for Belle Vue Residences

#03-30 2045 sq ft
Bought 2 Oct 2008 2248psf
Sold 30 Sep 2013 1858psf

-17.3%

as reference, #02-30 sold in nov 2010 at 2332psf and #04-30 sold in Jun 2010 at 2263psf, both also 2045 sq ft.

[Patrickstar]

I personally feel those who live in prime CCR are not really bothered about minor ups and downs in psf. They just want to be in a prime district and not in the OCR.

[Ringo33]

I personally feel those who live in prime CCR are not really bothered about minor ups and downs in psf. They just want to be in a prime district and not in the OCR.

Perhaps you might want to say that people living in CCR are not interested in investing thats why they cant be be bother if they make money or not.

That I think people living in OCR are smart to growing their wealth.

[DC33_2008]

CCR owners are playing at different level and playground as OCR owners.

[Ringo33]

CCR owners are playing at different level and playground as OCR owners.

you should not presume that CCR property are all own by people living in CCR as there are many friends and relative that I know who live in OCR but own do properties in CCR, and that include landed property as well.