View Full Version : Home prices slip 0.8% m/m in Dec
http://www.businesstimes.com.sg/sub/latest/story/0,4574,475629,00.html?
January 30, 2012, 12.54 pm (Singapore time)
Home prices slip 0.8% m/m in Dec
By KALPANA RASHIWALA
SINGAPORE - The overall Singapore Residential Price Index (SRPI) compiled by National University of Singapore slipped 0.8 per cent in December compared with November.
The subindex for the Central Region (excluding small apartments) fell 0.4 per cent month on month, a smaller dip than the 1 per cent drop for the Non-Central Region (also excluding small apartments).
However, the sub-index for small apartments islandwide (up to 506 sq ft or 47 sq metres) rose 3.4 per cent.
These figures are based on flash estimates released on Monday (Jan 30) by NUS' Institute of Real Estate Studies.
The Central Region comprises Districts 1-4 (which includes the financial district and Sentosa Cove) as well as the traditional prime residential districts of 9-11.
SRPI tracks prices of completed private apartments and condos, excluding executive condos.
Finally, some numbers to show "property prices in SG are falling" ;)
Hmmm CCR -0.4%, OCR -1% ... KBW must be happy :)
The numbers were as at 19 Jan 12. In another word, prices already soften before CM5. It will be interesting to see Feb figures.
Resale has been flattish for a long time. It's the new sale that's been cheong-ing.
I suspect new sales are going to lose some steam as the disparity of the demand of resale and new sales widens. It won't take too long before people start to notice the resale market again.
Well doesn't matter. At least some numbers show a fall. KBW is dying to see results. Now he has it.
I always believe most of the CMs benefit new sales on purpose. It's good for the construction and related industries. Otherwise why would the SSD not start from TOP ? And the upfront down payment is delayed by up to 2 yrs for new sale.
Well doesn't matter. At least some numbers show a fall. KBW is dying to see results. Now he has it.
I always believe most of the CMs benefit new sales on purpose. It's good for the construction and related industries. Otherwise why would the SSD not start from TOP ? And the upfront down payment is delayed by up to 2 yrs for new sale.
Make sense, resale only benefit sellers and govt, no effect on economy.
According to reports, most pf the new launches were purchased by first timers and upgraders. Season investors usually do not go for new launches. Should the market corrects as it should, first-timers and upgraders will end up buying high and achieving capital gain can be challenging.
Those who bought during the high of 1996 are just starting to breakeven as far as absolute price is concerned. I think the government is concerned with these group of people who may be highly gear for the properties they purchased on the high and when prices correct.
Think many people believe so. So obvious! They definitely want people to buy new launch! Why? So obvious also! :o
If buy new launch and lose money how? So obvious also? :p
Well doesn't matter. At least some numbers show a fall. KBW is dying to see results. Now he has it.
I always believe most of the CMs benefit new sales on purpose. It's good for the construction and related industries. Otherwise why would the SSD not start from TOP ? And the upfront down payment is delayed by up to 2 yrs for new sale.
One data point only!:rolleyes: Akan datang.............
The numbers were as at 19 Jan 12. In another word, prices already soften before CM5. It will be interesting to see Feb figures.Feb figures will shoot up coz of Hillier and Watertown... don't expect too much down from it... ;)
Feb figures will shoot up coz of Hillier and Watertown... don't expect too much down from it... ;)
I think the index track completed projects only so Hillier and Watertown will have no direct effect on it.........
Looks like I am right that resale prices suffered a contraction in the month of Dec which coincides with the start of the latest CM. Whereas URA quarterly index shows a positive growth.
Next few months will be very interesting to watch and it will determine whether it is just a knee jerk reaction or something bigger is coming.
Resale price should continue to soften going forward given that most of the buyers are not first timers. Buyers of resale properties are usually seasoned investors or buyers and understand the market better.
I suspect new sales are going to lose some steam as the disparity of the demand of resale and new sales widens. It won't take too long before people start to notice the resale market again.
As of now, for first timers that has no difficulty paying the mortgage but not the downpayment (decent paying job at the start but only worked 2-3 years with not much cpf contribution), going direct with the developer is the way to go.
There's extra cost such as reno to go if one go resale. So there must be a big enough gap in the pricing or at least, in how payment can be done for resale to capture this group of people.
Resale price should continue to soften going forward given that most of the buyers are not first timers. Buyers of resale properties are usually seasoned investors or buyers and understand the market better.
I think maximum 5% drop..... The support from low interest rates, rental income and no other alternative avenue for investment will provide a floor to the prices
I think maximum 5% drop..... The support from low interest rates, rental income and no other alternative avenue for investment will provide a floor to the prices
developers have such huge reserves i think they won't bother with massive price cuts and spoil market. the people going to suffer are the agents. :beats-me-man:
As of now, for first timers that has no difficulty paying the mortgage but not the downpayment (decent paying job at the start but only worked 2-3 years with not much cpf contribution), going direct with the developer is the way to go.
There's extra cost such as reno to go if one go resale. So there must be a big enough gap in the pricing or at least, in how payment can be done for resale to capture this group of people.
Your point is valid. So the question is how big a gap before one starts to pay attention to the resale market.
I'll take Simei's two most closely situated condo (one new and one resale) average psf as an example. Modena is $900psf and My Manhattan is $1200psf.
For a 1000sqft home it is a whopping $300k difference plus associated costs.
ikan bilis
31-01-12, 21:53
Well doesn't matter. At least some numbers show a fall. KBW is dying to see results. Now he has it.
I always believe most of the CMs benefit new sales on purpose. It's good for the construction and related industries. Otherwise why would the SSD not start from TOP ? And the upfront down payment is delayed by up to 2 yrs for new sale.
hur ??... got such thing arh? didn't know.... i thought no more dps liow... :cool:
or izit due to the progressive payment does not come so fast... like need wait until piling, floor constructed then pay 20% ??...
Your point is valid. So the question is how big a gap before one starts to pay attention to the resale market.
I'll take Simei's two most closely situated condo (one new and one resale) average psf as an example. Modena is $900psf and My Manhattan is $1200psf.
For a 1000sqft home it is a whopping $300k difference plus associated costs.
Resale will be a zombie for a long time. Sub-sale still has hope if the property was launched in 2009 or 2010. New launch is like an investment and saving plan now. When economy hopefully recovers by 2015 onward, the property market sentiment will also pick up.
I think when the resale gap reaches 35%, people will probably start to look towards resale.
Resale will be a zombie for a long time. Sub-sale still has hope if the property was launched in 2009 or 2010. New launch is like an investment and saving plan now. When economy hopefully recovers by 2015 onward, the property market sentiment will also pick up.
SG economy can drag on and finally give way on 2014/15?
We reached a major pivotal point - low volume/Zombie should continue for at least 2 quarters or so....
Resale will be a zombie for a long time. Sub-sale still has hope if the property was launched in 2009 or 2010. New launch is like an investment and saving plan now. When economy hopefully recovers by 2015 onward, the property market sentiment will also pick up.
Your point is valid. So the question is how big a gap before one starts to pay attention to the resale market.
I'll take Simei's two most closely situated condo (one new and one resale) average psf as an example. Modena is $900psf and My Manhattan is $1200psf.
For a 1000sqft home it is a whopping $300k difference plus associated costs.
300k is big enough for me in my opinion. That's 60k downpayment difference (if buying new) which could otherwise be put into reno. For me, the downpayment difference should tally with the estimated cost of reno that you'll be willing to pay assuming all conditions to be similar.
Speaking from the point of buyers for stay rather than investment. Then again, if it's for rental, i guess it's worthwhile getting resale too at that difference in prices since the yield would be better but that's just me. Everyone here would be looking at it differently.
some new launches psf is much higher than older resale. However the quantum is in fact lower than resale when we compare 2bedder with 2bedder or 3 with 3.
So it looks like recent OCR buyers do not mind a downgrade in living spaces and go for an upgrade in living 'status'
For renovations, don't forget that new apartments need some doing up as well however little. Basic fittings, lightings, curtains, painting...etc adds to costs. A resale may only need a re-paint or even just a minor re-decoration.
So a resale may not be necessarily cost more to render it into a rentable/livable condition, many times in fact I have found it to in fact cost less. Furthermore a resale is immediately available to capitalise returns.
I am most puzzled about the big gap which is in excess of 33%. Where is the upside for those who buy new launches? By the time these people want to (or have to) sell, the properties are considered resale and they have to compete against their neighbours which are a third cheaper at the time of purchase. Where is their bargaining power?
My conclusion is that these people buying these new launch OCR condos at these ridiculous prices are going in blindly. Its the Asian "Kiasu" mentality at work. Everyone wants to get in on the action regardless of the unreasonable mark-up by the developers
It's a set-up for a bubble that is being staved-off by a low interest and high employment rate environment.
300k is big enough for me in my opinion. That's 60k downpayment difference (if buying new) which could otherwise be put into reno. For me, the downpayment difference should tally with the estimated cost of reno that you'll be willing to pay assuming all conditions to be similar.
Speaking from the point of buyers for stay rather than investment. Then again, if it's for rental, i guess it's worthwhile getting resale too at that difference in prices since the yield would be better but that's just me. Everyone here would be looking at it differently.
I think it is the effect of CMs with SSD.
For renovations, don't forget that new apartments need some doing up as well however little. Basic fittings, lightings, curtains, painting...etc adds to costs. A resale may only need a re-paint or even just a minor re-decoration.
So a resale may not be necessarily cost more to render it into a rentable/livable condition, many times in fact I have found it to in fact cost less. Furthermore a resale is immediately available to capitalise returns.
I am most puzzled about the big gap which is in excess of 33%. Where is the upside for those who buy new launches? By the time these people want to (or have to) sell, the properties are considered resale and they have to compete against their neighbours which are a third cheaper at the time of purchase. Where is their bargaining power?
My conclusion is that these people buying these new launch OCR condos at these ridiculous prices are going in blindly. Its the Asian "Kiasu" mentality at work. Everyone wants to get in on the action regardless of the unreasonable mark-up by the developers
It's a set-up for a bubble that is being staved-off by a low interest and high employment rate environment.
My conclusion is that these people buying these new launch OCR condos at these ridiculous prices are going in blindly
just like other members pointed out , it's simply because :
some new launches psf is much higher than older resale. However the quantum is in fact lower than resale
and
I think it is the effect of CMs with SSD.
so if you *have to invest in property*, new sale small quantum is the way to go. never mind the high psf.
IMHO
Taking Modena's last transacted (which is unfortunately in Oct last year), one can see My Manhattan sold the same time at an unreasonable premium. Can't be the quantum as My Manhattan is pricier.
MODENA---------1,269,000-1,410sqft-900psf---Oct-11
MY MANHATTAN--1,330,000-1,076sqft-1,236psf-Oct-11
I do agree the CMs definitely has played a part but only at the initial part. If an astute person takes a medium term outlook at the investment aspect of the purchase than he will see that the upside potential, ROI...etc is challenging.
My suspicion is that many Singaporeans have fallen into the trap of the sweet talking cunning agents at showflats of new launches. I can understand a small gap in prices but 30+% is ridiculous..
...If an astute person takes a medium term outlook at the investment aspect ...
an astute investor would not have stepped into pty after CM4 (60% LTV and 4 yr SSD)
I figured you are very polite in your words but what you implied is obvious ;)
IMHO if the market turns sour, this group will be hit hard. These are not the group that have the capacity to hold. Therefore I dun know how KBW is going to tackle this. :(
IMHO
Taking Modena's last transacted (which is unfortunately in Oct last year), one can see My Manhattan sold the same time at an unreasonable premium. Can't be the quantum as My Manhattan is pricier.
MODENA---------1,269,000-1,410sqft-900psf---Oct-11
MY MANHATTAN--1,330,000-1,076sqft-1,236psf-Oct-11
I do agree the CMs definitely has played a part but only at the initial part. If an astute person takes a medium term outlook at the investment aspect of the purchase than he will see that the upside potential, ROI...etc is challenging.
My suspicion is that many Singaporeans have fallen into the trap of the sweet talking cunning agents at showflats of new launches. I can understand a small gap in prices but 30+% is ridiculous..
I would definitely go with Modena in your example. So much bigger yet cheaper. Problem is, for people like me (relatively new to workforce, not enough CPF) i can afford the mortgage of a 1mil+ property but not the downpayment. So it's a problem of the quantum involved if i really needed to get a place.
The options available up to 1mil is minimal for a unit of at least 1000sqft for resale unless you get the really old units or in far out places whereas if you up the range to 1.5mil, there's really alot more options for resale at decent locations, FH. There's really no reason why anyone should go for new launches at the current gap if you have enough budget.
New launches (what i have looked at during my search) appeals as it's able to offer a unit of at least 1000 sqft and up to 1 mil in quantum.
an astute investor would not have stepped into pty after CM4 (60% LTV and 4 yr SSD)
I figured you are very polite in your words but what you implied is obvious ;)
IMHO if the market turns sour, this group will be hit hard. These are not the group that have the capacity to hold. Therefore I dun know how KBW is going to tackle this. :(
It is just my observation. Not sure if what I think is correct.
I think CM4 with a 4year SSD should have forced a buyer to take at least a medium outlook. But by the end of last year however prices were still creeping up, Bedok Residences was hitting record highs for OCR. The trend was still up.
I guess CM5 was inevitable, though nobody expected such harsh measures.
What will KBW do? I don't know, but at 60% LTV, at least the banks are protected and if the banks are OK, Singapore will live to fight another day unlike our Western counterparts.
As for the private investors who beg borrow steal to stick their finger into the property pie at these levels, as long as it is not HDB, KBW wouldn't give a hoot about what happens to this group of people
Agree, quantum is certainly a factor. In the Simei condos' case, quantum would be lower if you were buying a smaller unit.
What I am simply suggesting is that anyone considering purchasing a new launch should take a look at the resale market in close proximity surrounding the new launch.
Then a comparison in prices would reveal the mark-up or premium in the new launch. Find out the rental in the resale market in the same area an ask yourself an honest question... can the projected rental justify the premium.
Cheers and Good Luck!
I would definitely go with Modena in your example. So much bigger yet cheaper. Problem is, for people like me (relatively new to workforce, not enough CPF) i can afford the mortgage of a 1mil+ property but not the downpayment. So it's a problem of the quantum involved if i really needed to get a place.
The options available up to 1mil is minimal for a unit of at least 1000sqft for resale unless you get the really old units or in far out places whereas if you up the range to 1.5mil, there's really alot more options for resale at decent locations, FH. There's really no reason why anyone should go for new launches at the current gap if you have enough budget.
New launches (what i have looked at during my search) appeals as it's able to offer a unit of at least 1000 sqft and up to 1 mil in quantum.
Agree, quantum is certainly a factor. In the Simei condos' case, quantum would be lower if you were buying a smaller unit.
What I am simply suggesting is that anyone considering purchasing a new launch should take a look at the resale market in close proximity surrounding the new launch.
Then a comparison in prices would reveal the mark-up or premium in the new launch. Find out the rental in the resale market in the same area an ask yourself an honest question... can the projected rental justify the premium.
Cheers and Good Luck!
Yup. Thanks. Got my place already. Not the best of development supposedly based on some of the comments from the experienced posters but it's something that ticks a lot of my requirements such as
1) more than 1000 sqft
2) near current location so i'm still familiar with the area
3) within my downpayment budget at 8XX psf and below 1mil
4) affordable mortgage at my current salary
I guess as long as i'm happy with my purchase and it's something its within my means, that's all it matters. Hopefully, it's the first of many properties in the next few decades.
Psf may be different but 1400sqft in Modena is 3beds vs 4beds in Manhattan... If we are to compare rooms vs rooms, the gap is smaller
Also no tnx for modena since oct, nobody seems wanting to obsence price of even $900psf regardless of what is manhattan price
For me I will be concerned for Modena residences bearing in mind the noise and dust of the constructions for the next 2-3 years in manhattan. If one look at manhattan site plan will also notice the multi storey car park shield manhattan residence fm mrt noise and could also means reflecting all the noise into Modena.
Has anyone factored in the fact that modena is at least 10 years old. 10yrs out of 99yrs is 10%. My manhatten is starting with a fresh new 99LH.
Another reason to buy FH, rather old FH than new LH if you're a long term invester.
Has anyone factored in the fact that modena is at least 10 years old. 10yrs out of 99yrs is 10%. My manhatten is starting with a fresh new 99LH.
Another reason to buy FH, rather old FH than new LH if you're a long term invester.
Will I go after a lady who is 10 year younger than one at 30 years old? Maybe.
Will I go after a lady who is 10 year younger than one at 60 years old? I must be crazy.
Will I go after a lady who is 10 year younger than one at 30 years old? Maybe.
Will I go after a lady who is 10 year younger than one at 60 years old? I must be crazy.
i do not understand your analogy
money cannot buy true love
Has anyone factored in the fact that modena is at least 10 years old. 10yrs out of 99yrs is 10%. My manhatten is starting with a fresh new 99LH.
Another reason to buy FH, rather old FH than new LH if you're a long term invester.
This is part of the reason why I don't think EC must be goods deals. 10 years of youth.
i do not understand your analogy
money cannot buy true love
99LH properties will age, and once they hit around 50-60 years old, they will no longer be appealing. A difference of 10 years is not crucial.
Why need to tackle this? Punish foreigners with ABSD, punish resale property transactions with 4-yrs SSD can already to make total transactions lower? They continue to sell more GLS land and get $$$? :beats-me-man:
an astute investor would not have stepped into pty after CM4 (60% LTV and 4 yr SSD)
I figured you are very polite in your words but what you implied is obvious ;)
IMHO if the market turns sour, this group will be hit hard. These are not the group that have the capacity to hold. Therefore I dun know how KBW is going to tackle this. :(
Spot on! The lower the LTV and the existence of SSD encourages people to buy new launch than resale, particularly those without so much cash. It is very obvious:
1) When you can only loan 60% (instead of 80%), you need to put up additional 20% cash upfront if you buy resale, cash of which can be used for renovations and other purposes (vs when you can loan 80%). To conserve cash and reduce cash upfront used, buy new lor! Don't have to pay 40% immediately, can space out cash payment over 4 years!
2) Since SSD start from completion of Sales & Purchase Agreement and not TOP, by the time new launch property ready, 4-years over and no more SSD, can flip with no penalty lor! :beats-me-man:
So, all those CMs encourage people to buy new launch even if they are priced at 25-40% more expensive than resale! CM policies really to help people or ??? :tsk-tsk:
I would definitely go with Modena in your example. So much bigger yet cheaper. Problem is, for people like me (relatively new to workforce, not enough CPF) i can afford the mortgage of a 1mil+ property but not the downpayment. So it's a problem of the quantum involved if i really needed to get a place.
The options available up to 1mil is minimal for a unit of at least 1000sqft for resale unless you get the really old units or in far out places whereas if you up the range to 1.5mil, there's really alot more options for resale at decent locations, FH. There's really no reason why anyone should go for new launches at the current gap if you have enough budget.
New launches (what i have looked at during my search) appeals as it's able to offer a unit of at least 1000 sqft and up to 1 mil in quantum.
which means 4 years later we are going to have plenty of firesale?
Fat hope lah! :p
Judging from the real demand out there, there won't be firesale, but for sure these people won't make money either after deducting interest costs and the high price they pay for the new launch (vs resale prices). :D
which means 4 years later we are going to have plenty of firesale?
Fat hope lah! :p
Judging from the real demand out there, there won't be firesale, but for sure these people won't make money either after deducting interest costs and the high price they pay for the new launch (vs resale prices). :D
So will resale close the gap with new sale 3-4 years on?
Why need to tackle this? Punish foreigners with ABSD, punish resale property transactions with 4-yrs SSD can already to make total transactions lower? They continue to sell more GLS land and get $$$? :beats-me-man:
It's not that. Just as some member commented, someone who otherwise would not have been able to invest now goes to invest in new sales, purely because the upfront part is easier, never mind the high psf. These buyers are the bulk of the market now, judging by 90% of HDB addresses in Watertown. KBW's job was *supposed* to make pte properties affordable. Now all thanks to his CMs, this group are really buying into it. If a crisis comes, this group are not the investors who will just blame the market. This group will most likely blame KBW for "tricking" them info property investment. KBW now is forced into a policy dilemma to ensure there is no crash in pty markets
Think all his CMs help the property buyers to make the decision of buying new launch at 30-50% higher price than resale very much easier? (otherwise how to justify that premium?) :p
It's not that. Just as some member commented, someone who otherwise would not have been able to invest now goes to invest in new sales, purely because the upfront part is easier, never mind the high psf. These buyers are the bulk of the market now, judging by 90% of HDB addresses in Watertown. KBW's job was *supposed* to make pte properties affordable. Now all thanks to his CMs, this group are really buying into it. If a crisis comes, this group are not the investors who will just blame the market. This group will most likely blame KBW for "tricking" them info property investment. KBW now is forced into a policy dilemma to ensure there is no crash in pty markets
I think Modena 1410sqft at $1.269M is a 4bedder whilst My Manhattan $1.33M at 1076sqft is a 2 bedder (I think it may be hard to squeeze 4bedrms in 1000sqft).
Granted not all can be determined just by looking at these figures as we don't know the facing, floor level, fengshui ....etc. And yes, true the data was for Oct2011, but remember both transactions were in Oct2011.
So the question that begs to be asked is whether the MyManhattan buyer has considered the options carefully. I have not even mentioned Double Bay yet which is also selling average below $1000psf (still)
Again, in 4 years time, what is the upside...?
Psf may be different but 1400sqft in Modena is 3beds vs 4beds in Manhattan... If we are to compare rooms vs rooms, the gap is smaller
Also no tnx for modena since oct, nobody seems wanting to obsence price of even $900psf regardless of what is manhattan price
For me I will be concerned for Modena residences bearing in mind the noise and dust of the constructions for the next 2-3 years in manhattan. If one look at manhattan site plan will also notice the multi storey car park shield manhattan residence fm mrt noise and could also means reflecting all the noise into Modena.
I believe the government has underestimated the impact of MM and small units which are attracting new set of buyers or investors due to its affordability (despite their high psf cost). URA has been taking the approach to let market forces dictate the demand for such small units. Despite warning from KBW, many people see MM as an opportunity to invest in property.
Unless the government take some measures to contain the demand for MM, it will take a few years when these MM units are ready for occupation to gauge their worth or ease to rent out. If there is not much demand for rental, the MM market will collapse and then price will fall.
The CMs certainly did not address this new set of buyers or investors; or perhaps the government was "caught" off guarded.
It's fine if the buyers bought MM units for self stay. But if they can't find enough tenants, they might be caught off guard.
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