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dtrax
23-03-13, 13:38
Yields dip as prices outpace rents in Q4
Rochor pulls in highest yield of 4.2%, while Newton lodges weakest 2.2%
Mar 23, 2013
By Esther Teo Property Correspondent

Yields for city-centre apartments dipped slightly in the final quarter of last year as prices edged up at a quicker pace than rents.
Non-landed homes in the segment recorded gross yields of 3.1per cent in the final three months of last year, down a tad on the 3.2 per cent in the previous quarter, according to analysis by Square Foot Research.
Rental growth has been poor, with median rents inching up a mere 2.6 per cent to $4.81 per sq ft (psf) per month in the fourth quarter since the start of last year.
Average resale prices rose 4 per cent in the same period.
Overall yields of homes in the city centre were the lowest of all non-landed privatehousing segments at 3.1 per cent.
City-fringe homes posted yields of 3.6 per cent in the fourth quarter, while suburban apartments netted yields of 3.8 per cent.
The Rochor planning area - a sub-market in the city centre - performed the best, pulling in yields of 4.2 per cent. Median rents there were $5.71 psf a month. Projects there include 8 @ Mount Sophia and Parc Sophia, both enjoying healthy yields of 4.4 per cent.
Some areas with yields above 3.5 per cent were the sub-markets of Novena and "Museum", which includes projects in Handy Road and Oxley Rise.
The Newton planning area lodged the lowest yield of 2.2 per cent, just a touch ahead of the Southern Islands - largely homes in Sentosa Cove - where yields were 2.3 per cent.
The highest yielding project in the city centre in the three months to Dec 31 was freehold Newton Edge in district 9 at 4.5 per cent, Square Foot Research director Ooi Yi Tung noted.
Completed in 2011, a fifth of its 103 apartments are shoebox units, a factor that has helped to lift yields since smaller homes typically have higher psf rents.
A two-bedroom apartment of between 700 and 800 sq ft, for instance, was leased at $4,000 per month in February, while a 400 to 500 sq ft unit fetched $3,600.
Experts say an increase in supply of completed homes and the crimped rental budgets of expatriates have affected the top end of the market.
Square Foot said there were about 11,360 homes in the city centre that were still unsold as of Dec 31, with about 95 per cent yet to be completed.
Savills Singapore research head Alan Cheong noted in a fourth- quarter report that the rental market for luxury homes softened for the sixth consecutive quarter.
Rents of high-end condominiums tracked by Savills showed a 1.4 per cent quarter-on-quarter dip to $4.88 psf per month in the period.
On a year-on-year basis, prime rents have fallen 7.4 per cent from $5.27 psf in the fourth quarter of 2011.
"The fall could be due to more intense competition from an increased supply of high-end completions over the past few months and lower number of big-budget tenants who are concurrently facing rental budget constraints," he added.
Coupled with the increasing supply of completed luxury homes, high-end rents could correct a further 5 per cent to 10 per cent this year, added Mr Cheong.
HSR Property Group special adviser Donald Han noted that areas like Sentosa Cove have seen low yields due to the huge supply of unsold homes on the market.
Developers like Ho Bee and City Developments have taken to leasing out their completed projects rather than finding buyers for them as they wait for the prime market to pick up.
"This adds on quite a bit of supply, and hence leads to more competitive rentals," Mr Han said.

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kane
23-03-13, 15:44
interesting list, though some of the data is skewed because of MM units. but a good crude list for starters.

star
23-03-13, 15:50
It's good to have this kind of news so they will not have further cooling. Newspaper should post more negative news on property so govt may remove cm7.

kane
23-03-13, 15:51
newton's yield is very low already, cool some more the owners there will cry...

DC33_2008
23-03-13, 16:02
Rochor is really strong. Just renewed one of my units near there with an increase of 15%.

dtrax
23-03-13, 16:28
Median (psf/mth)
Orchard 6.61
Downtown Core 6.34
Museum 5.76
Rochor 5.23
Singapore River 5.01
River Valley 4.84
Bukit Merah 4.59
Newton 4.58
Novena 4.53
Southern Islands 4.14
Tanglin 4.03
Outram 3.97
Kallang 3.95
Queenstown 3.9
Marine Parade 3.75
Bukit Timah 3.62
Toa Payoh 3.6
Clementi 3.44
Jurong West 3.44
Bedok 3.35
Geylang 3.28
Serangoon 3.22
Bishan 3.15
Sengkang 3.07
Tampines 3.03
Ang Mo Kio 2.96
Woodlands 2.96
Pasir Ris 2.87
Choa Chu Kang 2.85
Hougang 2.84
Jurong East 2.83
Yishun 2.76
Bukit Batok 2.72
Sembawang 2.69
Mandai 2.56
Bukit Panjang 2.49

mcmlxxvi
23-03-13, 16:57
purposely left out geylang. its not even a secret.

kane
23-03-13, 16:58
Rochor is really strong. Just renewed one of my units near there with an increase of 15%.

no wonder 4.2%. you contributing to that number there.

radha08
23-03-13, 22:10
It's good to have this kind of news so they will not have further cooling. Newspaper should post more negative news on property so govt may remove cm7.

i also say...:D:D:D

DC33_2008
24-03-13, 14:06
Just rented out my D1 unit today with an increase rent of 13%.. Macro environment is still important IMO.
no wonder 4.2%. you contributing to that number there.

reporter2
28-03-13, 10:26
http://www.straitstimes.com/archive/saturday/premium/money/story/yields-dip-prices-outpace-rents-q4-20130323

CITY-CENTRE APARTMENTS

Yields dip as prices outpace rents in Q4

Rochor pulls in highest yield of 4.2%, while Newton lodges weakest 2.2%

Published on Mar 23, 2013

By Esther Teo Property Correspondent


YIELDS for city-centre apartments dipped slightly in the final quarter of last year as prices edged up at a quicker pace than rents.

Non-landed homes in the segment recorded gross yields of 3.1per cent in the final three months of last year, down a tad on the 3.2 per cent in the previous quarter, according to analysis by Square Foot Research.

Rental growth has been poor, with median rents inching up a mere 2.6 per cent to $4.81 per sq ft (psf) per month in the fourth quarter since the start of last year.

Average resale prices rose 4 per cent in the same period.

Overall yields of homes in the city centre were the lowest of all non-landed private housing segments at 3.1 per cent.

City-fringe homes posted yields of 3.6 per cent in the fourth quarter, while suburban apartments netted yields of 3.8 per cent.

The Rochor planning area - a sub-market in the city centre - performed the best, pulling in yields of 4.2 per cent. Median rents there were $5.71 psf a month. Projects there include 8 @ Mount Sophia and Parc Sophia, both enjoying healthy yields of 4.4 per cent.

Some areas with yields above 3.5 per cent were the sub-markets of Novena and "Museum", which includes projects in Handy Road and Oxley Rise.

The Newton planning area lodged the lowest yield of 2.2 per cent, just a touch ahead of the Southern Islands - largely homes in Sentosa Cove - where yields were 2.3 per cent.

The highest yielding project in the city centre in the three months to Dec 31 was freehold Newton Edge in district 9 at 4.5 per cent, Square Foot Research director Ooi Yi Tung noted.

Completed in 2011, a fifth of its 103 apartments are shoebox units, a factor that has helped to lift yields since smaller homes typically have higher psf rents.

A two-bedroom apartment of between 700 and 800 sq ft, for instance, was leased at $4,000 per month in February, while a 400 to 500 sq ft unit fetched $3,600.

Experts say an increase in supply of completed homes and the crimped rental budgets of expatriates have affected the top end of the market.

Square Foot said there were about 11,360 homes in the city centre that were still unsold as of Dec 31, with about 95 per cent yet to be completed.

Savills Singapore research head Alan Cheong noted in a fourth- quarter report that the rental market for luxury homes softened for the sixth consecutive quarter.

Rents of high-end condominiums tracked by Savills showed a 1.4 per cent quarter-on-quarter dip to $4.88 psf per month in the period.

On a year-on-year basis, prime rents have fallen 7.4 per cent from $5.27 psf in the fourth quarter of 2011.

"The fall could be due to more intense competition from an increased supply of high-end completions over the past few months and lower number of big-budget tenants who are concurrently facing rental budget constraints," he added.

Coupled with the increasing supply of completed luxury homes, high-end rents could correct a further 5 per cent to 10 per cent this year, added Mr Cheong.

HSR Property Group special adviser Donald Han noted that areas like Sentosa Cove have seen low yields due to the huge supply of unsold homes on the market.

Developers like Ho Bee and City Developments have taken to leasing out their completed projects rather than finding buyers for them as they wait for the prime market to pick up.

"This adds on quite a bit of supply, and hence leads to more competitive rentals," Mr Han said.

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