News Highlights Tuesday 10th June 2008

Developers to unveil more modestly-priced condos
Developers are getting ready to release mass- to mid-market condos. City Developments Ltd (CDL) previewed the five-storey freehold Shelford Suites in the Shelford/Adam roads vicinity about a week ago at an average price of $1,500-1,700 psf. CDL is also aiming to preview by the end of this month or early July the first phase of 99-year leasehold Livia, a 724-unit condo at Pasir Ris Drive 1. Market expectation is that CDL will price the project at below $700 psf for the initial phase. The condo is targeted at the mass market and will comprise several blocks of 15-16 storeys with two-, three- and four-bedroom apartments, and penthouses. Ho Bee and NTUC Choice Homes will also preview 99-year leasehold The Dakota later this month, with average price expected to be under $1,000 psf. The 348-unit project is expected to be 20 storeys high and will front Geylang River. It will comprise six blocks with a mix of two-, three- and four-bedroom apartments, and penthouses. Elsewhere, freehold projects with tiny studio units (ranging from under 400-500 sq ft) have been selling fairly quickly at around $1,100-1,400 psf. UOL Group, Kheng Leong and Orix Corporation will officially launch today Nassim Park Residences condo. Nearly 50 units have been sold at an average $3,000-3,200 psf.

- The Business Times, P3




No more cheap mortgages as banks raise rates
Banks have quietly jacked up rates for new fixed-rate loans. Homebuyers would be hard-pressed to find rates fixed on the first year of a mortgage at below 2.68%, as some banks had raised the rates of certain packages by up to 1 percentage point to as high as 3.98%. This means new home buyers will face higher costs of borrowing, if they want the certainty of locking in their interest rates for the next few years. The higher fixed rates may prompt more home-buyers to take up loans linked to transparent rates, such as the Singapore Interbank Offered Rate (Sibor) and the swap offered rate (SOR). Customers with loans linked to the 12-month Sibor, which is hovering at about 1.7375%, are still enjoying rates as low as 2.4% that is fixed for a year. Some banks, however, have started to raise rates linked to Sibor and the three-month SOR, currently at 1.4307%.

- The Straits Times, H20




Stalemate over prices leads to lowest auction sales in 10 years
Only 31 properties worth $27.28 million that were auctioned were bought between January and last month, said Colliers. Residential sales had only six private homes worth $8.38 million over the five months. Collier said that the sales are likely the lowest in 10 years, but it is not a reflection of poor market conditions. It is mainly due to the lack of mortgagee sales which occur when a cash-strapped home owner cannot service the debt and the bank force-sells the property. Knight Frank said that there are offers made but owners are not accepting because the offers are about 10-15% below previous transacted levels. Of the 31 properties sold, 6 were residential properties, 16 were shop units or shophouses and 7 were industrial properties, said Colliers. Of the remaining 2 properties, one is an office unit and the other is a piece of land.

- The Straits Times, H19




S'pore is easiest city in the world to do business
Singapore is ranked fourth globally in the MasterCard Worldwide Centres of Commerce Index that ranks 75 countries, up two places from last year. It is now the second most influential centre in Asia, just behind Tokyo, according to the survey. In last year's ranking, Singapore came in fourth in one criterion used to compile the ranking - the ease of doing business, which covers factors including quality of life, investor protection, health and safety, and corporate tax levels. Singapore was also top in the Asia-Pacific for two of the other six criteria used in the ranking: economic stability and the legal/political framework. The other four criteria used in the ranking are volume and connectivity of financial flow, reputation as a business centre, knowledge creation and information flow, and liveability.

- The Straits Times, H18




Singapore is safest place in Asia: Mercer rankings
Singapore is 32nd in Mercer's 2008 global quality of living survey that covers 215 cities, up two places from 2007. In Asia (outside Australia and New Zealand), Singapore ranks highest. Mercer's survey evaluates cities on 39 key indicators in all the major areas that affect the living environment - socio-political and cultural climate; the economy; health and sanitation; education standard; public services; recreation; availability of consumer goods; housing; and the natural environment. It also produces a separate ranking on 'personal safety', covering issues such as internal stability; crime; effectiveness of law enforcement; and relationships with other countries. Singapore, at No 9 in the personal safety ranking, is safest in Asia.

- The Business Times, P9




China property market set to cool
A credit crunch, dwindling transactions and falling prices in some hot markets add up to trouble for China's real estate industry. Although investment in property grew 32% in the first four months from a year earlier, developers are battening down the hatches as bank loans dry up and the cost of tapping other sources of funds rises. The volume of residential transactions in Beijing fell 13.7% in April from March and was down 56.4% from a year earlier. The property outlook index that aims to capture the buoyancy of the market has been falling since reaching a peak last November. While average property prices in 70 cities were up 10.1% in April from a year earlier, prices have already seen monthly declines in southern China, especially in Shenzhen.

- The Business Times, P32




Viet market seen hurting S'pore firms
Singapore developers in Vietnam are likely to be affected by a cooling residential property market and tighter government regulations. Keppel Land, CapitaLand, Guocoland, Fraser & Neave, Allgreen and Chip Eng Seng are six developers with residential projects in Vietnam. While margins may exceed 30%, development risks are high. Sales have slowed down in the past few months and some speculators are leaving their deposits forfeited, BNP Paribas said. Morgan Stanley also projected a 38% devaluation of the Vietnamese dong against the US dollar over the next 12 months. A weaker dong would make residential property less affordable, since rents and prices are pegged to the US dollar. Morgan Stanley said that it foresees developers delaying launches amid poor sentiment. The residential property market could cool further when a 25% capital gains tax on property transactions takes effect in January 2009.

- The Business Times, P31



Nassim Park Residences – A Masterpiece
- A unique collaboration between three internationally acclaimed creative minds – Chan Soo Khian, Christian Liaigre, Shunmyo Masuno.
- Joint development by UOL Group, Kheng Leong Co and Orix

- The Straits Times, P5 - advertisement




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