Stage set for upmarket property launches

[mr funny]

http://www.businesstimes.com.sg/sub/...85540,00.html?

Published September 22, 2010

Stage set for upmarket property launches

Next 9 months could see slew of mid-tier and high-end projects in market

By UMA SHANKARI


(SINGAPORE) Developers here plan to launch another 34 residential developments with more than 8,800 units by June 2011, data compiled by Knight Frank shows.

Most of the new projects rolled out will be mid-tier and high-end developments. Knight Frank's list shows that 21 out of the 34 possible launches are located in the upmarket districts of 1, 2, 4, 9, 10 and 11.

Developers BT spoke to trust that the latest round of government measures to dampen demand for private homes and HDB flats announced on Aug 30 will impact mostly mass market homebuyers.

They are hopeful that new launches, which are mostly for homes in the mid-tier, high-end and luxury segments, will see healthy take-ups.

'I believe that the hardest hit projects will be the mass market ones,' said EL Development managing director Lim Yew Soon. 'For the mid to high-end projects, the impact will be somewhat lesser.'

The large number of upcoming mid-tier and high-end developments is not a reaction to the latest round of property measures, developers and analysts said. Rather, having pushed out numerous projects targeted at upgraders, many property groups are left with pending mid-tier and high-end project launches.

CB Richard Ellis executive director Joseph Tan said that many developers who bought mass market sites launched them within nine-12 months, with some even pushing out their projects in six-seven months to ride on the exuberant upgrader market.

'The fourth quarter will see more of the mid to high-end launches,' Mr Tan said.

Added one developer: 'Most developers rushed to launch mass market projects last year when that segment of the market was very hot, so there are mostly mid-tier and high-end projects that are waiting to be launched now anyway.'

But, many developers did not want to commit to a firm launch date - even though in some cases, showflats are ready and brochures have been printed.

CapitaLand recently said that it will go ahead with the launch of its new 1,715-unit condominium on the former Farrer Court site in Farrer Road by the end of this year.

The chief executive of the group's Singapore residential arm, Wong Heang Fine, said that while the new government measures have created some 'flux' in the market, things should 'settle in a couple of months'.

The launch of the Farrer Road project will be closely watched as it is the largest single residential development likely to be offered to homebuyers in the near future.

CapitaLand is likely to hedge its bets by rolling out the development in phases, similar to what City Developments and the Hong Leong Group did with their 642-unit NV Residences in Pasir Ris.

EL Development's Mr Lim also said that he intends to launch his 115-unit freehold project on the site of the former Diamond Tower in Jalan Rajah, in the Balestier area, in Q1 2011. But, despite the more bullish outlook for the mid-tier and high-end segments, several large suburban projects will be launched soon.

Esparina Residences, a 573-unit executive condominium (EC) project at Sengkang by Frasers Centrepoint and Lum Chang Building Contractors, will be launched next month.

Major private suburban launches in Q4 2010 include Hoi Hup Sunway Property's 473-unit Vacanza @ East at Lengkong Tujoh; Far East Organization's 214-unit The Lanai at Hillview Avenue; and Keppel Land's yet-unnamed residential development at Lakeside Drive, which will have more than 600 units.

On Aug 30, the government said that it will now disallow concurrent ownership of HDB flats and private residential properties within the specified minimum occupation period.

Other measures were aimed at potential buyers of second homes. Those with an existing mortgage can now borrow only up to 70 per cent of a property's value for a second home, down from 80 per cent previously. They must also pay 10 per cent in cash, up from 5 per cent.

Developers and analysts said then that the measures will hit prices and sales of private homes, but mostly in the mass market segment.

[mr funny]

Possible launches by June 2011

22/09/10

[hyenergix]

Many are in very good locations and are FH or 999. They should do better than the 99 LH launches in ulu locations recent months.

[cashrich]

Many are in very good locations and are FH or 999. They should do better than the 99 LH launches in ulu locations recent months.

Yes, at very good prices too

HDB worst Hit

Mass Market slightly Hit, but it is transitional, after a period of 3 to 5 years, things should be back to normal.

Mid and High Tier not really Hit.

[Wild Falcon]

Buy buy buy. Mid and high-end not affected by market sentiments and price can only go up. All the experts say so. Risk free investments. Buy! Only 2,000 - 3,000psf. Small "luxury" high-end units also available if you budget is low. Remember mid and high-end can only go up because the experts say so. No need to look at fundamentals like yields or development potential or whether the upside could be fully-priced in. Any price is good price as long as the name is called "high end". Remember HK has a deal at $12000 PSF (oops that was a fluke?)? Singapore at $3000psf still cheap. Just Buy.

[patricia]

Buy buy buy. Mid and high-end not affected by market sentiments and price can only go up. All the experts say so. Risk free investments. Buy! Only 2,000 - 3,000psf. Small "luxury" high-end units also available if you budget is low. Remember mid and high-end can only go up because the experts say so. No need to look at fundamentals like yields or development potential or whether the upside could be fully-priced in. Any price is good price as long as the name is called "high end". Remember HK has a deal at $12000 PSF (oops that was a fluke?)? Singapore at $3000psf still cheap. Just Buy.

Let them buy. Do use your own brain to think. Most so called expert are have self interest to guard by talking up the market. As a private individual, you have to very careful with the expert guidance. Buy with both eye open, OK. otherwise you may have to cry and bang your head against the wall .

[JuzMe]

Let them buy. Do use your own brain to think. Most so called expert are have self interest to guard by talking up the market. As a private individual, you have to very careful with the expert guidance. Buy with both eye open, OK. otherwise you may have to cry and bang your head against the wall .

+1. How many people can afford another 10% cash from pocket? Quite sure government will step in again if prices does still go up. Best to wait and see.

[hyenergix]

It's almost a month after the new measures were announced. Here's my observation after visiting a few show flats today as I was quite free: Condo prices seem to be defying gravity!

Tivoli Grande (FH): Prices didn't really drop.

Jupiter 18 (FH): The psf for 1 bedder is around $1200. 80% sold within a week and the developer will increase the price for remaining units by a few % next week for the remaining units.

Vacanza (FH at lousier location): Heard from agent that the estimated launch price for 1 bedder will also be around the same psf as Jupiter 18.

Waterfront Gold (99 LH): 900 psf+ (or higher?! - sorry didn't really hear properly!) for 2 bedder. Agent said that the next Waterfront X (99 LH) will be located at the current show flat site and launch is around end of this year. Psf will definitely be higher than Waterfront Gold. Saw some Koreans at the show flat too.

In a nutshell, HDB COV will drop so it is good news for first-time buyers. But current HDB owners can say good-bye to high COV, and have to save for several more years before they can buy condos. Meanwhile, the condo prices will still increase gradually due to limited land, growing population and restriction on PR buying HDB...

[rattydrama]

Same here, I visisted some LH low end re-sale condo and the asking was high, about 5-10% higher than the last transacted price. Whats going on??

[Wild Falcon]

10% is not that much lah. In the first place, what was the proportion that took up 80% loan? Do we have the statistics? Only that group might be affected. Prices are not dropping..... yet. As long as prices remain quite stable or increase at a respectable rate, e.g. 2-3%, government intervention will stop. but it also means property with low yields are no longer good investment.

In a developed stable market, yields should start to matter. Capital gains will be restricted only to areas with new developments, e.g. new MRT stations, new CBD etc. In areas with no new developments and poor yields, by all logic, prices will come down.

+1. How many people can afford another 10% cash from pocket? Quite sure government will step in again if prices does still go up. Best to wait and see.