News Highlights Saturday 16 February 2008

The Straits Times, P1



$1.8 billion giveaways
Budget 2008 revealed yesterday includes:
1) $865m in growth dividends for all adult Singaporeans, including $400 for the low-income, $100 for national servicemen, and 50% more for the elderly,
2) $380m for a 20% personal income tax rebate, capped at $2000,
3) $300m to top up students’ Post Secondary Education Account,
4) $220m to top up Medisave accounts for those aged 51 and above by up to $450,
5) Help for the poor through Public Assistance allowance – upped by $40 to $330 per month,
6) Help for tertiary students with bigger bursaries for university and polytechnic education, as well as more subsidies for adults doing part-time degrees,
7) Help for start-up companies with tax exemptions and companies to reward staff with share options,
8) Initiatives to nurture R&D culture,
9) Bonuses up to $4,000 for those who sign on new CPF Life annuities scheme, and
10) Cheaper liquor.


The Straits Times, P1

Hongbao Budget
The $1.8 billion budget announced is made possible by a surplus of $6.45 billion from last year, a result of excellent economic growth and a buoyant property market. Finance Minister Tharman Shanmugaratnam said this good growth did not happen by chance, rather it was due to “broad-ranging efforts to restructure the economy, labour market and fiscal system”.



The Straits Times, P3

Estate duty R.I.P.
Government has removed estate duty in the budget announcement yesterday, with immediate effect. The estate duty is a tax imposed if the assets of a person who died exceeded certain limits. The Government believes the move will boost the wealth management industry by encouraging both Singaporeans and foreigners to base their assets here. Estate duty was taxed at 5% on the first $12 million of applicable assets and 10% on amounts above. KPMG Tax Services executive director Ooi Boon Jin said this will encourage the inflow of foreign talent as people will bring money and invest here.



The Straits Times, P4

Parkway top bidder for Novena hospital site
Parkway group emerged as top bidder for a 1.7 ha site on Irrawaddy Road to build a new private hospital at the Novena medical hub. The $1.2 billion bid worked out as close to $1,600 psf per plot ratio, the most expensive commercial land sale in recent years, said Knight Frank’s director Nicholas Mark. The sale of the site is part of a plan to beef up medical infrastructure to attract one million foreign patients a year by 2012. There are about 10 health-care providers in the area, including John Hopkins International Medical Centre and newly launched Novena Medical Centre. Coming up alongside the new hospital is Far East Organization hotel, Frasers Centrepoint’s Soleil condominium and SC Global Developments’ Newton 200 office building, all eyeing “medical” guests and tenants.



The Straits Times, PM17

Innovative economy, superior growth prospects
Extracts from Finance Minister Tharman Shanmugaratnam’s Budget speech:
1. Economic outlook for 2008 will depend largely on the global economy, especially the US. Despite many forecasts that US is entering recession, the IMF and other global forecasters still expect growth in Asia. China and India are expected to grow at 10 and 8% respectively. Singapore GDP growth is expected at 4 to 6% this year.
2. Five strategies to deal with inflation:
· Rising S$ - since last October, Sing dollar has been allowed to appreciate slightly faster.
· More food sources – The Government is helping importers to buy food from new sources overseas.
· Owning your home – Most Singaporeans own their homes so they need not face rent increases.
· Government aid for the needy by helping them to secure a job and stay at it. Those unable to work can seek Public Assistance relief.
· Strong economy – keeping the economy competitive and building up its capacity for good growth. Last year, real income rose for most Singaporeans, even the bottom 20% saw real income rose by 5% as more family members found jobs.
3. Budget 2008 key thrusts:
· Provide full range of education and training opportunities.
· Incentivising Enterprise and Innovation, including tax deductions for R&D done is Singapore from 100% to 150%, and broad-based R&D tax allowance up to an amount of 50% of the first $300,000 of chargeable income.
· Adjust tax policies to stay competitive, including start-up tax exemption and equity remuneration. No reduction in personal income tax rates but income tax rebate of 20% capped at $2,000.
· Building a resilient community by strengthening financial security for retirement and help less well-off members in the society.



The Straits Times, PM26

New home sales remain low with cautious property market
Developers sold just 316 new homes last month with 410 units launched, compared to 305 sold in December and 445 units launched. Despite the cautious sentiment, Wilkie 80 in Wilkie Road was sold out at a median price of $1,544 psf. Few homes were sold in the high-end sector, and none above $4,000 psf. Median prices for new private homes, excluding executive condos and landed homes, fell 3.2% from $1,124 psf in December to $1,088 psf last month. Projects outside the central region performed best with 220 units launched. Prices at Waterfront Waves have gone up to $909 psf. Zenith in Zion Road, launched in December, sold 22 units while 12 out of 50 units at Mounth Sophia Suites went for $1,719 psf. At the landed project Pavilion Park, 24 terrace houses were sold at between $1.8 million and $2 million. Colliers International said mass and mid-end segments are supported by en bloc sellers looking for replacement homes. Colliers forecasts developers could end up launching and selling up to 9,000 new private homes this year compared to 14,811 last year.


- The Business Times, P5

Some govt units moving out to free up city space
The government has decided to relocate several agencies out of the Central Area to free up space of 20,000 sq m or more by first quarter next year for use by the private sector. The government did not identify which agencies but market watchers suggest that they may include Singapore Land Authority currently at Temasek Tower near Tanjong Pagar MRT; the Energy Market Authority at Singapore Power Building on Somerset Road; Intellectual Property Office of Singapore at Plaza by the Park on Bras Basah Road; Info-communications Development Authority of Singapore now at Suntec City, The Workforce Development Agency housed at One Marina Boulevard, and The Economic Development Board is expected to vacate its offices at Raffles City when its lease expires next year and move into Fusionopolis at one-north in Buona Vista. The government has released 15 transitional office sites which will yield 150,000 sq m of additional office space.


The Business Times, P12

Demand for mass market projects shifts into higher gear
An analysis by Knight Frank shows the number of private homes (excluding executive condominiums) launched and sold in January in the Outside Central Region (covering traditional mass-market/ suburban locations) rose 190% and 123% respectively from December 2007. In contrast, launches and sales in the Core Central Region and Rest of Central Region fell in January. Median prices for CCR halved to $1,623 psf in January from $3,200 psf in December. In contrast, median prices in RCR edged up 1.6% to $1,053 psf and $811 psf in the OCR. Luxury prices remained firm despite a decline in sales volume. Units in Grange Infinite, Helios Residences, Hilltops and Scotts Square were sold at median prices between nearly $3,300 psf and $3,700 psf. At Sentosa Cove, Marina Collection and Turquoise were sold at above $2,650 psf. Colliers’ analysis shows the highest priced home sold in January was a $3,671 psf unit at Scotts Square.