New benchmark prices set at Thomson Grand

Buyers have set new benchmark prices at the preview of Thomson Grand in Upper Thomson, with apartments topping $1,600 per sq ft (psf). All 50 units released at the 99-year leasehold project were snapped up at prices between $1,100 and $1,600 psf for the two- to four-bedroom apartments, with average values at $1,400 psf. That priced the most expensive apartment sold at about $3.6 million. The units sold included 11 strata terrace units, with one going for $4.1 million, the highest transacted quantum price, said Hong Kong-based developer Cheung Kong. It is hard to compare benchmark prices as there have been no new high-rise projects in the area for more than a decade. But Thomson Grand's pricing is significantly above the highest price of $1,273 psf achieved in 2009 for a freehold unit at Meadows@Peirce - which is about 2km away - according to caveats lodged with the Urban Redevelopment Authority (URA). Cheung Kong said 30 per cent of the buyers were investors from Singapore, Malaysia, China, Indonesia and Taiwan while the rest were local upgraders. A further 20 units will be released this weekend on a first-come-first-served basis, it added. The project has 339 apartments and 22 strata-titled terrace units. Apartment sizes range from 904 sq ft for two-bedders to 2,314 sq ft for four-bedroom units in nine blocks of 20-storey residential towers. The landed terraces are up to 6,566 sq ft. Almost 70 per cent of the 361 units are three-bedders or larger. Cheung Kong has spared no expense in its marketing, with the 15,000 sq ft sales office built at a cost of more than $8 million, which includes the use of more than 100,000 Swarovski crystals.

-   The Straits Time, B21

10,000 new private homes in pipeline, says Savills

MORE than 10,000 new private homes are expected to hit the market over the remainder of the year, according to a new report.

Property consultancy Savills said these projects will mainly come from the Government Land Sales (GLS) programme with most of the upcoming homes catering to the mass market segment.

Based on the 8,000 units, including executive condominiums, put up for sale in the first five months this year, Savills estimates the total this year will surpass the 18,000 - including executive condominiums - launched for sale last year.

The Urban Redevelopment Authority (URA) has said the expected supply of new homes poised to hit the market over the next few years could be as high as 53,000.

Mr Alan Cheong, Savills' head of research, said it could take around four to five years for the market to fully absorb these unsold homes. His calculations are based on the average annual take-up over the past five years of about 12,000 new homes.

Data compiled by Savills shows that about 70 per cent of the homes will be in neighbourhoods along the city fringe such as Thomson and Bendemeer while 17 per cent will be in suburban areas, including Tampines, Bishan and Upper Serangoon. These are mainly GLS sites.

The remaining 12 per cent will be in city centre areas like Newton, Holland and Orchard Road. These mainly come from private land sales.

The large number of homes to be put up for sale later this year suggests that developers may be keen to launch their projects soon due to uncertainty about the global economy and the outlook for the property sector.

Another factor is that many of the sites are from the GLS programme.

Mr Lim Yew Soon, managing director of EL Development, said developers who have bought GLS sites are less likely to hold back from launching their projects.

He said: 'The Government is still releasing a lot of land so it doesn't make sense to hold on to the site and wait.

'GLS sites also come with a condition that the land must be developed within five years of its sale, so developers can delay their launches for up to two years but anything longer than that is not possible.'

Analysts are still cautiously optimistic that the buying momentum experienced so far this year will continue for the rest of the year.

Ms Wendy Tang, Knight Frank's executive director of residential services, said that while the market is cautious because of the uncertainty about future housing policies, she expects demand for new homes to remain healthy.

Mr Colin Tan, head of research and consultancy at Chesterton Suntec International, said global issues such as the euro zone debt crisis that have been impacting the stock market have also influenced buying sentiment.

'The recent (euro zone debt) crisis... has now passed. The economic fundamentals present in the first half of this year are still present so I don't see why the buying shouldn't continue,' he said.

Source: The Straits Times 

Private home prices continue to rise

The private residential property price index climbed 1.9 percent to 202.8 points in the second quarter, compared to a 2.2 percent increase in the previous quarter, according to the Urban Redevelopment Authority’s (URA) flash estimates.

In addition, prices of non-landed private residential properties grew 1.6 percent in the Core Central Region and Outside Central Region and 1.2 percent in Rest of Central Region.

“Price increases in Q2 were marginally below expectations. However, for the Core Central Region and Outside Central Region, the flash numbers were within expectations,” said Alan Cheong, Associate Director at Savills Research & Consultancy.

“We may expect further moderation in general prices in Q3 and Q4. Should Q3 numbers come in above expectations, it may signify that the market has re-invigorated itself during the quarter.”

However, “if Q3 numbers come in below expectations, it will probably signify that the private residential market is taking a breather from its strong momentum built over the past two quarters,” he said.

The flash estimates are determined based on transaction prices given in caveats lodged during the first 10 weeks of the quarter and supported by information on the number of new units sold.

Meanwhile, Joseph Tan, Executive Director of Residential at CB Richard Ellis (CBRE), believes that although the private residential price index for Q2 2011 increased, “this does not necessarily mean that home prices have fallen.”

“Prices have in fact remained stable although it has slowed down from a rise of 2.2 percent in the previous quarter and 2.7 percent rise in the fourth quarter of 2010.”

“New launches that sold well in the reference quarter will make a strong impact on price trends.”

Small homes a hit with singles and expats

Living in a tiny apartment might be a claustrophobic nightmare for some, but the prospect of a home, however small, that is affordable and centrally located is a hard combination to beat. The smallest types, the so-called shoebox apartments - they are less than 500 sq ft - have certainly proved popular, particularly with young singles and expatriate professionals. Consultants say they offer healthy yields of 3 to 4% depending on the project, while residential yields in general hover around 3%. Earlier this year, a 474 sq ft unit at Robertson Edge went for $858,000. Assuming a monthly rental of $3,000, the yield works out to 4%. While there were inconveniences, including clearly the lack of storage space, the ease of upkeep was a big plus. Tenants agreed the city-fringe location of most newly built shoebox developments - but without the sky-high rents - appealed most. Developers use measures such as higher ceilings, more windows and a more squarish layout to make the space seem larger. Experts say shoebox units are fetching healthy rents now as there are not many of such completed projects. Some of the smallest ones, such as Suites@Guillemard with units under 300 sq ft, are not ready yet. But ERA Realty key executive Eugene Lim said the test will be to see if rents hold even when thousands of completed shoebox units enter the market over the next few years.

- The Straits Times, B16