More HDB dwellers buying shoebox homes: DTZ

[princess_morbucks]

http://www.straitstimes.com/breaking...s-dtz-20140226

More Housing Board (HDB) flat dwellers buying private homes are opting for shoebox units, likely as investments, according to a report by consultancy DTZ on Wednesday.
A record 13.3 per cent of all private home purchases by people with HDB addresses last year were for shoebox units, which are homes of 500 sq ft or less.
These transactions were mainly at projects such as Bartley Ridge at Mount Vernon Road, J Gateway in Jurong East and D'Nest in Pasir Ris, the consultancy said.
"Given that most HDB flats are larger than 500 sq ft, these shoebox purchases by HDB addressees are not likely to have been purchased by HDB upgraders looking at owner-occupation and are more likely for investment," DTZ said.

[DC33_2008]

It is all about investment based on affordability. Anyway, all the 2 bedder has also come closer to MM sized units.

http://www.straitstimes.com/breaking...s-dtz-20140226

More Housing Board (HDB) flat dwellers buying private homes are opting for shoebox units, likely as investments, according to a report by consultancy DTZ on Wednesday.
A record 13.3 per cent of all private home purchases by people with HDB addresses last year were for shoebox units, which are homes of 500 sq ft or less.
These transactions were mainly at projects such as Bartley Ridge at Mount Vernon Road, J Gateway in Jurong East and D'Nest in Pasir Ris, the consultancy said.
"Given that most HDB flats are larger than 500 sq ft, these shoebox purchases by HDB addressees are not likely to have been purchased by HDB upgraders looking at owner-occupation and are more likely for investment," DTZ said.

[radha08]

old man old lady buying for retirement la...

[Amber Woods]

So 13.3% of all private flat buyer with HDB address bought units less than 500 sqft. In another word, 86.7% of the buyer with HDB addresses bought private flats more than 500 sq ft. Are these buyers consider upgraders? I believe majority of the 13,3% of buyers were singles buying for own stay.

I also believe the pattern is quite the same for buyers with private flat addresses. However, majority of these buyers should be investors since newer private flats are mostly much smaller than older private flats.

In another word, the report is saying that buyer with HDB addresses buying for investment is not significant.

[walkthetiger]

So 13.3% of all private flat buyer with HDB address bought units less than 500 sqft. In another word, 86.7% of the buyer with HDB addresses bought private flats more than 500 sq ft. Are these buyers consider upgraders? I believe majority of the 13,3% of buyers were singles buying for own stay.

I also believe the pattern is quite the same for buyers with private flat addresses. However, majority of these buyers should be investors since newer private flats are mostly much smaller than older private flats.

In another word, the report is saying that buyer with HDB addresses buying for investment is not significant.

For me, I don't believe this MM things... usually it gives me a funny feel about its real potential...Especially now realize the group who is buying.

Hope the HBD common folks are not buying blindly because these are the cheaper and affordable ones.

With the rental dropping, the bigger units(2 bedders or bigger ones) may appear a better bargain to tenant later on… If the rental is not expensive afterall, why living in a small small house...just some concerns.. Still this seem debateable topic.

[irisng]

Many HDB flat owners prefer shoebox units when it comes to purchasing private homes, according to a DTZ report.

The share of shoebox units, or homes measuring less than 500 sq ft, bought by owners with public housing addresses increased to 62 percent in 2013 from 60 percent the year before.

Shoebox units accounted for 17.3 percent of private property purchases by HDB dwellers in the fourth quarter of 2013, and 13.3 percent for the whole year.

Projects such as D’Nest, J Gateway and Bartley Ridge emerged as the most popular among this group of buyers.

DTZ noted that shoebox units purchased by flat owners were not likely to have been acquired for owner-occupation but rather for investment purposes, considering that most HDB flats are bigger than 500 sq ft.

Despite the rise in shoebox acquisitions by HDB dwellers, sales of such units fell 32 percent to 2,057 units in 2013 from the previous year’s 3,000 units.

This is in line with a drop in the overall private housing market, which saw sales plunge 40 percent in 2013 as buyers tightened their belts amid tough property curbs.

While the decline in private home purchases was evident across all buyer groups, “foreign purchases fell by a smaller extent compared to purchases by Singaporeans and Singapore Permanent Residents (PRs)”, said DTZ.

Specifically, purchases by foreigners climbed to nine percent in 2013 from six percent in 2012. However, this is still way below the 18 percent share they had in pre-ABSD 2011.

DTZ believes that 2014 will continue to be a buyer’s market, with purchase demand becoming increasingly project-specific and price-resistant while transaction volumes will remain weak.

“Buyers will continue to be selective as their purchasing power has been clipped by the TDSR rules and the earlier ABSD measures,” it added.

[CondoInterested]

Thought this is an old news found on Straits Time on 26 Feb and is being posted HERE

Pls search and read before posting.

[CondoInterested]

There is nothing wrong with people with HDB address buying BUC PC.

The DTZ statistic show nothing and tell no story.

For the start, I do not have data but maybe around half when PC TOP selling the HDB and the other half keeping HDB when PC TOP.

And of those who keep, maybe many singles cannot wait till 35 or waiting too long for 2 rm BTO to moved out of their parents (nagging them to get married and don't want their parents to stay with them) home and decide to stay on their own so buy PC or maybe many are 2 old folks (with money) planning for their upcoming retirement and planning to give their HDB to their soon getting married child, etc, etc.

So why care so much about why people with PC cannot buy HDB and people with HDB can buy PC. There is only 2 path, 1 is via HDB goes to PC and the other path (the lucky rich enough ones) goes directly to PC. The first group is further split to 1 sell HDB and 1 didn't sell HDB, as simple as that, why see things so complicated. Isn't life already complicated enough? Some of the old school of thought before the cooling measure is sell HDB to upgrade and some keep HDB rental to support PC installment, now new school of thought is die die cannot sell HDB if you can hold on to both HDB and PC.

[CondoInterested]

And finally the remaining of the group are those who buy as investment, the group this type of article and their advocates are trying to target, and how many are these people, maybe only the combine of HDB and URA info to give full picture.

[Royston8H]

Again, affordability does not mean cheap.

No surprise that HDB dwellers want to invest shoe box units because PCs may be too expensive to afford. Very likely, they are not going to stay there for sure.... 500sqft....that is a very small and only probably suit a single or almost a couple to live in.

This is a very smart mktg gimmick by the developers. They did pretty well to sell such concept. I wonder if more of such are to come in the next 1-2 years. Just imagine every shoebox unit owners will fight to get and maintain these tenants while making sure this is not a negative cashflow. OMG.

[Rosy]

Again, affordability does not mean cheap.

No surprise that HDB dwellers want to invest shoe box units because PCs may be too expensive to afford. Very likely, they are not going to stay there for sure.... 500sqft....that is a very small and only probably suit a single or almost a couple to live in.

This is a very smart mktg gimmick by the developers. They did pretty well to sell such concept. I wonder if more of such are to come in the next 1-2 years. Just imagine every shoebox unit owners will fight to get and maintain these tenants while making sure this is not a negative cashflow. OMG.

Currently, it seems like 1/2bedders are easier to rent out due to tighter tenant budgets.

Within the same project, rental difference between a 2 and 3 bedder can be as low as $200-300

I would think 500sqft is quite decent size for a 1bedder depending on the layout.
I would avoid all those <450sqft MM.

[hyenergix]

Currently, it seems like 1/2bedders are easier to rent out due to tighter tenant budgets.

Within the same project, rental difference between a 2 and 3 bedder can be as low as $200-300

I would think 500sqft is quite decent size for a 1bedder depending on the layout.
I would avoid all those <450sqft MM.

>500 sqft MM r recent 1-2 years launch after e MM cooling measure, when prices have already gone up quite a bit. Smaller MM near MRT with lower price n rental quantum is still king.

[reporter2]

http://www.straitstimes.com/archive/...eport-20140227

Ratio of HDB owners buying shoebox units up: Report

These units, 500 sq ft or less, likely for investment, not upgrading: DTZ

Published on Feb 27, 2014

By Melissa Tan


A BIGGER proportion of Housing Board flat owners are opting for shoebox units when they buy private homes, according to property consultancy DTZ yesterday.

The purchases were likely for investment and not upgrading, said the report, which also noted that private home sales tumbled 40 per cent last year.

The buyers' market is expected to continue this year, it added.

Shoebox units, which are homes that are 500 sq ft or less, accounted for 17.3 per cent of HDB dwellers' private home purchases in the fourth quarter last year.

Such units made up a record 13.3 per cent of all private home purchases last year by people with HDB addresses, with Bartley Ridge at Mount Vernon Road, J Gateway in Jurong East and D'Nest in Pasir Ris the most popular projects.

"Given that most HDB flats are larger than 500 sq ft, these shoebox unit purchases by HDB addressees are not likely to have been bought by HDB upgraders looking at owner-occupation and are more likely for investment," DTZ said.

HDB dwellers also took a bigger share of the shoebox unit market, accounting for 62 per cent of all sales in the segment last year, up from 60 per cent in 2012.

However, even the greater interest from HDB dwellers could not stem a fall in the transactions of shoebox apartments.

Sales of the so-called "Mickey Mouse" flats fell 32 per cent to 2,057 units last year from 3,000 the year before - their first annual decline since 2009 and one that is in line with a drop in the overall private home market.

DTZ said private home sales tumbled 40 per cent last year as tough property curbs caused buyers to tighten their purse strings.

Overall sales were dragged down by secondary transactions - these refer to sales before a project is completed or resales - which plunged to a 10-year low.

Secondary sales plummeted 50.5 per cent last year from the year before to just 7,755 units, the lowest volume since 2004, DTZ said.

DTZ said this year is expected to continue to be a buyers' market, with sales volumes remaining weak and buyer demand "becoming increasingly project-specific and price-resistant".

However, it also said that the "healthy response" to recent launches such as The Hillford suggests that there are still buyers waiting to snag a good deal.

The Hillford, which is on a 60-year lease, sold all 281 units in just one day when it was launched last month at a median price of $1,105 per sq ft (psf), according to Urban Redevelopment Authority data.

Its strong sales were "presumably due to the lower price quantum, reflecting the shorter tenure of the development", DTZ said. "Foreign demand could also be creeping back," it added.

Although private home transactions sank across all groups of buyers last year, foreign purchases fell by a smaller extent than those made by Singaporeans and permanent residents.

The share of private homes bought by foreigners inched up from 6 per cent in 2012 to 9 per cent last year, though that was still far below the 18 per cent posted in 2011 before the additional buyer's stamp duty was introduced in December that year.

Buyers from mainland China were in the top spot last year, followed closely by Malaysians, and Indonesians behind them.

[email protected]

[Royston8H]

Certainly gd to own 2brm unit for property investment purpose and resell later.

But if the unit is 500sqft or smaller, the only potential tenants will be just those who are single. When supply exceeds demand, problem will start to come.

Currently, it seems like 1/2bedders are easier to rent out due to tighter tenant budgets.

Within the same project, rental difference between a 2 and 3 bedder can be as low as $200-300

I would think 500sqft is quite decent size for a 1bedder depending on the layout.
I would avoid all those <450sqft MM.

[DC33_2008]

Older 2 or 2+1 PCs of 900-1000+ sqft are better bet.

Certainly gd to own 2brm unit for property investment purpose and resell later.

But if the unit is 500sqft or smaller, the only potential tenants will be just those who are single. When supply exceeds demand, problem will start to come.

[Royston8H]

Certainly....but not too old until we do not know if there is an en bloc or not. you know i know...

Older 2 or 2+1 PCs of 900-1000+ sqft are better bet.

[leesg123]

Currently, it seems like 1/2bedders are easier to rent out due to tighter tenant budgets.

Within the same project, rental difference between a 2 and 3 bedder can be as low as $200-300

I would think 500sqft is quite decent size for a 1bedder depending on the layout.
I would avoid all those <450sqft MM.

Cant just look at the sqft. my 366 sqft unit is very optimised, no wasted areas, even better than some 500sqft with super huge aircon ledge or baywindow in the bathroom.

location is the most impt factor for mm to be rented out.

[leesg123]

Certainly gd to own 2brm unit for property investment purpose and resell later.

But if the unit is 500sqft or smaller, the only potential tenants will be just those who are single. When supply exceeds demand, problem will start to come.

Well, number of mm has been limited by gov already, esp those <400 sqft.

my 366 sqft is rented to couple.

[hyenergix]

Certainly gd to own 2brm unit for property investment purpose and resell later.

But if the unit is 500sqft or smaller, the only potential tenants will be just those who are single. When supply exceeds demand, problem will start to come.

Smaller MM is fine. Larger units carry higher risks.

[Newbie1]

Well, number of mm has been limited by gov already, esp those <400 sqft.

my 366 sqft is rented to couple.

Some agents say MMs near to MRT & Mall esp near city is "recession proof"

sure can find tenants even in bad times.