New rules cool PR hunt for resale flats

[mr funny]

http://www.businesstimes.com.sg/sub/...02458,00.html?

Published September 3, 2010

New rules cool PR hunt for resale flats

Some delay house hunting to digest latest govt moves

By EMILYN YAP


NEW rules that prevent people from owning both public and private properties appear to have discouraged some permanent residents from buying resale flats here - at least for now.

Some agents have seen PRs delay house hunting, and they expect PRs to account for fewer resale flat sales going forward.

Behind the change in sentiment are rules introduced by the government this week to cool the residential property sector.

From Aug 30, a private property owner who buys a non-subsidised HDB flat will have to sell his private property within six months of the flat purchase. This is regardless of whether the property is here or abroad.

Also, a person who buys a non-subsidised flat can buy a private property here or overseas only after fulfilling a minimum occupation period of five years.

PRs, some of whom already own or intend to buy properties back home, could be caught by the new rules.

'We have got instances where PRs who were looking for properties have postponed the intention or the decision,' PropNex chief executive Mohamed Ismail told BT. 'They said that they want to have a clearer understanding.'

C&H Realty managing director Albert Lu also said a PR had decided not to go ahead with a resale flat purchase. The client not only has a home in Malaysia but also wants to buy another private property without having to wait five years.

The two industry insiders are among those who believe PRs' demand for resale flats will weaken. Currently, PRs account for about 20 per cent of all resale flat transactions.

Mr Ismail expects 30-40 per cent of the pool of PR buyers to have second thoughts on buying a flat in the short term. They may return after they have had time to digest the news, he said.

Mr Lu thinks the impact will be slight - some 10 per cent of prospective PR buyers could withdraw from the market.

But there are also agents who do not expect the new rules to affect PRs' appetite for resale flats much.

A senior agent who declined to be named suggested the Housing & Development Board may rely on PRs to declare whether they own properties overseas. Some PRs may declare otherwise so that they can still buy resale flats here, according to him.

Enforcing the new rules is one concern that several market watchers voiced. HDB has yet to say how it will keep track of foreign property ownership or what penalties it will impose on those who flout the rules.

HSR executive director (agency) Jeffrey Hong said there will always be PRs who can buy resale flats because they do not have properties back home. High net worth PRs are usually not interested in buying flats in the first place, he said.

Dennis Wee Group director Chris Koh shares similar views. He has been getting more phone calls from home owners concerned about other new rules relating to financing - those who already have one or more outstanding home loans will have to fork out a bigger downpayment and borrow less if they want to buy another home.

While some prospective flat buyers have got cold feet, one group of private property hunters has gone full steam ahead, snapping up all 68 units at the newly launched Dorsett Residences above Outram Park MRT station.

The 99-year leasehold project was previewed on Wednesday and sold out in a day, said marketing agent Knight Frank. The project has one and two-bedders ranging from 484-1,615 sq ft in size, and the average selling price was $1,800 psf. BT understands that agents had been gathering interest as early as July and started collecting cheques around two weeks ago.

[mr funny]

http://www.straitstimes.com/PrimeNew...ry_574202.html

Sep 3, 2010

HDB flat dilemma for PRs and Singaporeans with property abroad

By Esther Teo & Jessica Cheam


PERMANENT resident (PR) Michael Lim is keen to upgrade to a larger HDB flat but the new rules on dual property ownership have put him in a pickle.

Mr Lim's problem is that he also owns a condominium in Kuala Lumpur that he inherited when his father died. Previously, this would not have hindered his purchase of a resale flat. But now it will.

The HDB announced on Monday that people who buy an HDB resale flat on or after Aug 30 must dispose of their private property - including any held overseas - within six months of the HDB purchase.

The intention is to ensure that HDB flats go to owner occupiers first and are not viewed as an investment. This means Mr Lim, who has been living in Singapore for 10 years, must sell the condo in Kuala Lumpur if he wants to upgrade from a four-room to a five-room HDB flat to fit his family of four.

But his mother-in-law is living in the condo and he has no plans to sell it.

Mr Lim, 33, hopes the HDB will make an exception in his case, given that he did not buy the condo as an investment.

'Malaysia is also our home and it's weird if we go back and do not have a place to stay... It's not fair to make me choose when I have ties to both countries.'

Ms Bhavani Prakash, 40, a PR from India who has a home in Chennai, said the new rules will also deter her from buying an HDB flat.

'The measures are quite draconian. Whether someone owns a property overseas really does not have an impact on the Singapore market... There are other ways to counter speculation,' she said.

There are many other PRs who could find themselves in a similar dilemma.

Experts say a significant number of PRs still have homes in their native countries since overseas properties are often cheaper than real estate here and are not as great a financial burden. A number of them may also have families back home living in those properties.

Ms Prakash's Chennai condo cost her between $200,000 and $300,000 - a quarter of the cost of a suburban condo in Singapore.

ECG Property chief executive Eric Cheng estimates that 40 per cent of PRs - especially those from Malaysia - own homes abroad, while PropNex chief executive Mohamed Ismail puts the figure at up to 30 per cent.

ERA Asia Pacific associate director Eugene Lim believes that more than half of the PRs arriving over the past few years would still have properties back home.

The curbs could also catch out Singaporean retirees with property offshore that they had bought for rental income or retirement. With strong family ties and business connections here, they might also be looking at buying HDB flats for their frequent visits here.

Now, if they want to buy a resale HDB flat, they will have to dispose their overseas real estate or risk penalties by trying to dodge the new rules.

Despite the tougher measures aimed at cooling the property market, a 99-year luxury project, Dorsett Residences, above Outram MRT Station was sold out in one day when it was launched at an average price of $1,800 per sq ft yesterday. But The Straits Times understands that 40 per cent of the 68-unit project was bought by a single buyer.

[qianfugui]

http://www.straitstimes.com/PrimeNew...ry_574202.html

Sep 3, 2010

HDB flat dilemma for PRs and Singaporeans with property abroad

By Esther Teo & Jessica Cheam


PERMANENT resident (PR) Michael Lim is keen to upgrade to a larger HDB flat but the new rules on dual property ownership have put him in a pickle.

Mr Lim's problem is that he also owns a condominium in Kuala Lumpur that he inherited when his father died. Previously, this would not have hindered his purchase of a resale flat. But now it will.

The HDB announced on Monday that people who buy an HDB resale flat on or after Aug 30 must dispose of their private property - including any held overseas - within six months of the HDB purchase.

The intention is to ensure that HDB flats go to owner occupiers first and are not viewed as an investment. This means Mr Lim, who has been living in Singapore for 10 years, must sell the condo in Kuala Lumpur if he wants to upgrade from a four-room to a five-room HDB flat to fit his family of four.

But his mother-in-law is living in the condo and he has no plans to sell it.

Mr Lim, 33, hopes the HDB will make an exception in his case, given that he did not buy the condo as an investment.

'Malaysia is also our home and it's weird if we go back and do not have a place to stay... It's not fair to make me choose when I have ties to both countries.'

Ms Bhavani Prakash, 40, a PR from India who has a home in Chennai, said the new rules will also deter her from buying an HDB flat.

'The measures are quite draconian. Whether someone owns a property overseas really does not have an impact on the Singapore market... There are other ways to counter speculation,' she said.

There are many other PRs who could find themselves in a similar dilemma.

Experts say a significant number of PRs still have homes in their native countries since overseas properties are often cheaper than real estate here and are not as great a financial burden. A number of them may also have families back home living in those properties.

Ms Prakash's Chennai condo cost her between $200,000 and $300,000 - a quarter of the cost of a suburban condo in Singapore.

ECG Property chief executive Eric Cheng estimates that 40 per cent of PRs - especially those from Malaysia - own homes abroad, while PropNex chief executive Mohamed Ismail puts the figure at up to 30 per cent.

ERA Asia Pacific associate director Eugene Lim believes that more than half of the PRs arriving over the past few years would still have properties back home.

The curbs could also catch out Singaporean retirees with property offshore that they had bought for rental income or retirement. With strong family ties and business connections here, they might also be looking at buying HDB flats for their frequent visits here.

Now, if they want to buy a resale HDB flat, they will have to dispose their overseas real estate or risk penalties by trying to dodge the new rules.

Despite the tougher measures aimed at cooling the property market, a 99-year luxury project, Dorsett Residences, above Outram MRT Station was sold out in one day when it was launched at an average price of $1,800 per sq ft yesterday. But The Straits Times understands that 40 per cent of the 68-unit project was bought by a single buyer.

Actually, it's is a implicit msg for all PRs from Mudsland, Chennai, PRC blah blah ..out there. Don't hope to cash on our resale HDB to make investment money here for short-term capital gain, rental especially when we know you never never have no intention of laying your roots here eventually.... Don't squeeze our true blue S'porean out of their basic rights ... a home

[alamak]

Actually, it's is a implicit msg for all PRs from Mudsland, Chennai, PRC blah blah ..out there. Don't hope to cash on our resale HDB to make investment money here for short-term capital gain, rental especially when we know you never never have no intention of laying your roots here eventually.... Don't squeeze our true blue S'porean out of their basic rights ... a home

I agreed wholeheartedly. Actually, gahmen should make it a rule that only after 5 years of PRship, then the PR be allowed to touch our HDB resale flat. Then this is less speculative attempt to cash on our public housing ....

[DC33_2008]

You must HDB which is an agency of MND where our Mr M is heading needs to have income. Looking at the local population growth, HDB will have very low income.

[spikey69]

it appears that if they can't buy and if they need a place to stay, rental rates are on the up...or going to increase.

[cashrich]

it appears that if they can't buy and if they need a place to stay, rental rates are on the up...or going to increase.

Just sharing

Luxury Market = not really affected
Mid Market = Slightly affected
Mass Market = Improved demand but neutralised by quick sale

HDB resale = fall
HDB rental = up
Condo rental = up, as owners who have no holding power have to fire sale. Then rent in HDB. Condo rental now sought after by PR.

[Condorich]

Good Move, they can rent from me.

PR cannot hunt for resale HDB flat, they only way is for them to buy or rent condo..

Whoo Hoo~