Good-class bungalow prices up
http://www.straitstimes.com/premium/...rices-20121227
Good-class bungalow prices up
But fewer sales recorded this year due to weak market sentiment
Published on Dec 27, 2012
By Melissa Tan
THE elite end of the residential property sector, the bungalow market, has slowed since last year after cooling measures and tighter financing rules came in.
But analysts said prices were relatively resilient despite weak market sentiment stemming from poor global economic conditions.
Fewer good-class bungalows (GCBs) changed hands this year but, on average, the selling prices were higher.
There are about 2,400 GCBs in Singapore in 39 gazetted areas, such as Nassim, Dalvey and Tanglin.
Some 49 sales had taken place as of the first week of this month, compared with 57 over the full year of 2011.
The total value transacted this year fell to $1.05 billion in this period, down from $1.16 billion for the whole of last year.
However, prices per sq ft (psf) have moved in the opposite direction.
The average price of GCB sales this year was $1,406 psf, about 10 per cent higher than the average of $1,276 psf recorded last year.
"This demonstrates the resilience of GCB prices as well as the premium they command because of limited supply," said Mr Douglas Wong, director of luxury properties at CBRE.
He noted that the profile of GCB buyers has changed after recent cooling measures, such as the revised sellers' stamp duty of up to 16 per cent which was imposed in January last year.
The loan-to-value ratio was also lowered from 70 per cent to 60 per cent for buyers with an outstanding mortgage.
This means that a buyer might have to fork out $12 million in cash for a $30million home.
The revised stamp duty "more or less removed speculators and short-term traders from the GCB market. Today, buyers are owner occupiers and very long-term investors", Mr Wong said.
Still, this year saw the most expensive sale in two years when a bungalow in Ridout Road changed hands in late March for $60.6 million, or $1,490 psf.
This is the highest overall price for a GCB since 3, Leedon Park was sold for a record $61.4 million in December 2010.
The Ridout Road seller was former Goldman Sachs banker Thomas Chan, who gained control of it last year after a protracted legal battle between the former owner Agus Anwar and another party to whom Mr Agus had earlier granted an option, said The Business Times (BT).
Mr Chan picked up the property for $37 million based on an option granted to him in
2009, and BT said Mr Chan is understood to have sold the property to Tecity Group, which is controlled by the family of the late OCBC Bank chairman Tan Chin Tuan.
The second most expensive sale this year was a GCB at Leedon Park for $33 million in October or $2,110 psf.
The third and fourth most expensive GCBs sold were in Binjai Park, and the fifth was in Chatsworth Road. All of them are freehold.
By the time this month is over, Mr Wong expects GCB deals to number 50 to 55 for all of this year and the value of transactions to come in somewhere between $1billion and $1.1 billion, similar to last year's performance.
If current sentiment continues, GCB deals may number around 50 next year, he added.
"We expect the GCB market to move at a cautious pace, given the weaker market sentiment as a result of the debt crisis in Europe, the slower global economic growth and the prohibitive nature of current bank loan terms."
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Ridout Road
THIS was sold for $60.6 million in March this year, at $1,490 per sq ft.
This is the highest total price a good-class bungalow (GCB) has fetched since December 2010. The two-storey bungalow sits on a 40,679 sq ft freehold land plot, and is said to be more than 20 years old, with five bedrooms, a tennis court and swimming pool. The site could be subdivided to be redeveloped into two GCBs.
The house was the subject of a legal battle, concluded in October last year, between its former owner, Indonesian businessman Agus Anwar, and a company, EC Investment Holding (ECI).
Mr Agus had bought it through his company, Ridout Residence, for $28 million in 2006. He paid $11 million of that amount in cash, and paid the remaining $17 million from a $30 million loan from Hong Leong Finance.
When Hong Leong recalled the loan later, Mr Agus needed cash, so he sold other parties the right to buy the house at certain predetermined prices.
ECI paid Mr Agus $1.5 million to own an option to buy the house at $20 million.
Mr Agus and ECI agreed in September 2009 that ECI would not exercise its option to buy the house if Mr Agus paid ECI $3.5 million.
In October 2009, Mr Agus granted Goldman Sachs banker Thomas Chan the option to buy the home for a heftier $37 million.
When ECI found out, it warned Mr Agus that it would apply to the court to enforce its "buy" option on the house. Both parties then agreed Mr Agus would pay ECI $5 million to cancel ECI's purchase.
But Mr Agus failed to meet the November deadline for the settlement. ECI went to the High Court to try to enforce its contract, but it lost its case, and then lost the appeal.
Leedon Park
THE second most expensive sale this year was a bungalow in Leedon Park for $33 million in October. That translates to $2,110 per sq ft.
It received its temporary occupation permit in July last year.
The 15,640 sq ft site area was sold by bungalow investor George Lim. The house has six bedrooms and a pool; the built-up area is about 10,800 sq ft.
Another Leedon Park good-class bungalow holds the record for the most expensive home. The 41,852 sq ft site was sold in December 2010 for $61.4 million.
Binjai Park
Another freehold bungalow in Binjai Park was sold in April for $31 million, or $1,550 psf for the 20,000 sq ft land area.
It received its temporary occupation permit in June last year and was sold by GCB investor George Lim, who developed the property.
A GCB sitting on a 22,357 sq ft freehold plot was sold for $32.9 million in July, or $1,471 per sq ft (psf).
The new two-storey property, completed late last year, has seven en-suite bedrooms. The built-up area is about 17,000 sq ft.
Chatsworth Road
THIS freehold property was sold for $30 million in May, at $1,985 per sq ft for 15,113 sq ft.
The home is an old two-storey bungalow with six bedrooms, a guest room and swimming pool, said The Business Times.
It reported that both the seller and buyers are Singapore citizens. The buyers are understood to be in the gaming business outside of Singapore.
