mr funny
28-06-11, 01:02
http://www.straitstimes.com/Money/Story/STIStory_683699.html
Jun 25, 2011
property
Caution takes hold in property sector
Measured bids for recent land tenders show prices likely to stabilise: Experts
By Esther Teo, Property Reporter
THE talk was all about booms a few months ago but the muted response to two recent land tenders has brought a distinct air of caution to the property sector.
There are even suggestions that prices are likely to flatline as the new sentiment takes hold.
Developers are rapidly redoing their sums in the wake of a combination of factors weighing on the market.
There is the bumper supply of recently released state land, those four rounds of cooling measures, the expected easing of the Housing Board's $8,000 income ceiling, and the unexpected element - National Development Minister Khaw Boon Wan's cautionary remarks on his blog.
Experts say that while it is still early days, the more measured bids from developers indicate that prices are likely to stabilise or inch only slightly upwards in the next 12 months.
The clearest signs of cooling for some experts came when two government sites in Clementi and Upper Changi attracted bids below market expectations.
That prompted some observers to label the sales as turning points in the price cycle for mass-market condominium sites.
But Mr Nicholas Mak, head of research at SLP International, emphasised that while developers have factored in the possibility of prices softening, low land values do not necessarily mean low selling prices.
'The recent bids reflect their expectations and outlook for the next one to two years. But it might take two quarters of falling sales volume before selling prices might actually shift downwards,' he said.
Cushman & Wakefield Singapore vice-chairman Donald Han said new public housing projects, in particular, are expected to be launched in line with existing prices.
'The Government is keeping a close eye on the public market... The private market, however, might still see benchmark prices being set if its product is differentiated enough,' he added.
While some upcoming launches seem to be in line with existing prices, others look likely to be setting benchmark values for their areas.
Cheung Kong Holdings' 361-unit Thomson Grand in the Upper Thomson area, for example, is expected to be launched at an average of $1,400 per sq ft (psf) next month - a record for the area.
The freehold Skyline Residences in Telok Blangah will also be launched on the high side, at $1,900 psf on average, after an early-bird discount of 3 per cent, according to sales agents.
One-bedroom apartments at the Bukit Sembawang project will cost up to $1.2 million, while four-bedroom apartments will set buyers back up to $3.23 million.
Yet selling prices at Far East Organization's Seastrand in Pasir Ris - which began its preview on Thursday - started at $787 psf, according to agents.
A 710 sq ft two-bedroom apartment, for example, will cost about $656,000.
PropNex chief executive Mohamed Ismail said developers have different strategies in pricing.
'If buyers see value in a product, such as high-quality furnishings - even with higher prices - they will still bite,' he added.
[email protected]
Jun 25, 2011
property
Caution takes hold in property sector
Measured bids for recent land tenders show prices likely to stabilise: Experts
By Esther Teo, Property Reporter
THE talk was all about booms a few months ago but the muted response to two recent land tenders has brought a distinct air of caution to the property sector.
There are even suggestions that prices are likely to flatline as the new sentiment takes hold.
Developers are rapidly redoing their sums in the wake of a combination of factors weighing on the market.
There is the bumper supply of recently released state land, those four rounds of cooling measures, the expected easing of the Housing Board's $8,000 income ceiling, and the unexpected element - National Development Minister Khaw Boon Wan's cautionary remarks on his blog.
Experts say that while it is still early days, the more measured bids from developers indicate that prices are likely to stabilise or inch only slightly upwards in the next 12 months.
The clearest signs of cooling for some experts came when two government sites in Clementi and Upper Changi attracted bids below market expectations.
That prompted some observers to label the sales as turning points in the price cycle for mass-market condominium sites.
But Mr Nicholas Mak, head of research at SLP International, emphasised that while developers have factored in the possibility of prices softening, low land values do not necessarily mean low selling prices.
'The recent bids reflect their expectations and outlook for the next one to two years. But it might take two quarters of falling sales volume before selling prices might actually shift downwards,' he said.
Cushman & Wakefield Singapore vice-chairman Donald Han said new public housing projects, in particular, are expected to be launched in line with existing prices.
'The Government is keeping a close eye on the public market... The private market, however, might still see benchmark prices being set if its product is differentiated enough,' he added.
While some upcoming launches seem to be in line with existing prices, others look likely to be setting benchmark values for their areas.
Cheung Kong Holdings' 361-unit Thomson Grand in the Upper Thomson area, for example, is expected to be launched at an average of $1,400 per sq ft (psf) next month - a record for the area.
The freehold Skyline Residences in Telok Blangah will also be launched on the high side, at $1,900 psf on average, after an early-bird discount of 3 per cent, according to sales agents.
One-bedroom apartments at the Bukit Sembawang project will cost up to $1.2 million, while four-bedroom apartments will set buyers back up to $3.23 million.
Yet selling prices at Far East Organization's Seastrand in Pasir Ris - which began its preview on Thursday - started at $787 psf, according to agents.
A 710 sq ft two-bedroom apartment, for example, will cost about $656,000.
PropNex chief executive Mohamed Ismail said developers have different strategies in pricing.
'If buyers see value in a product, such as high-quality furnishings - even with higher prices - they will still bite,' he added.
[email protected]