View Full Version : StanChart sees further S'pore home price drop
SINGAPORE'S home prices will probably fall further before the housing curbs introduced in the past five years are scaled back, says Standard Chartered Plc's Southeast Asia head.
"You would start to take away some of these measures if price growth reaches a certain level of equilibrium," Lim Cheng Teck, StanChart's CEO for Asean, said in an interview yesterday.
"I don't think we are at an equilibrium yet."
The city's private home prices dropped by the most in almost five years following a campaign that started in 2009 to curb property market speculation, with government curbs ranging from taxes on property sales, additional levies on foreign buyers and mortgage limits.
Mr Lim declined to predict how much of a downside he expects for home prices before housing measures would be lifted.
Monetary Authority of Singapore (MAS) managing director Ravi Menon said on May 24 that the property measures may not be permanent and will only be used from time to time, The Business Times reported, citing a speech made by him.
Under Singapore's loan framework, lenders must consider a borrower's total debt when granting mortgages, the central bank said last year. A borrower's loan repayments, including mortgages, shouldn't exceed 60 per cent of income, based on the policy guidelines.
"It's still too early to remove curbs," said Donald Han, managing director of Chesterton Singapore Pte, a real estate consulting company. "The government will monitor but its fingers won't be pressing any buttons at this point in time." Some developers that have cut prices by 10-15 per cent are drawing buyers, he said.
Mr Lim's outlook mirrors that of CapitaLand Ltd, Singapore's biggest developer, which said in February that the government may start easing some of its property measures if home prices drop 5-10 per cent this year. Some curbs that were introduced were for the "short term", such as stamp duties or taxes for homebuyers, CapitaLand CEO Lim Ming Yan said in an interview at the time.
An index tracking private residential prices fell 1.3 per cent in the first quarter this year, following a 0.9 per cent drop from a record in the previous three months, according to government data. The latest decline is the largest since June 2009.
Declining home sales also eased demand for housing loans. Mortgages increased just 7.9 per cent in March - the slowest pace since June 2007, according to central bank data.
The curbs "really prevented the bubble from forming", StanChart's Mr Lim said. "This downward adjustment in prices is not a very drastic and sharp drop. That would add to the stability of the market."
Elsewhere in the region, he said the "big growth markets" for the bank are Indonesia, the Philippines and Malaysia. Standard Chartered, which employs 30,000 people in South-east Asia, is "keen to participate" in the Myanmar banking sector when it's opened to foreign lenders, he said. The bank has a representative office in Yangon. Bloomberg
Wapianoh! Wasted 5 mins to read something i can say also. Dont need CEO to say i think i guess, barring this and that. Please dont post waste time news
My guess CMs will only be removed when developers finally let go at $600-$700 psf. The ball is now at developers' court.:cheers1:
Every day advertisements shout lalong no use. Price still more or less the same. Only let go some kachang puteh units to attract carrot heads.:D
Stop day dreaming lah...
Yes good. This is what you should be reading. Very specific figures not something equilibrium but no figures
Yes good. This is what you should be reading. Very specific figures not something equilibrium but no figures
That's only if you think those figures makes any sense. Because I don't.
Developer selling at 600-700psf?? Assuming construction cost is 350psf so land cost is 250 to 350psf?
Continue day dreaming lah.
walkthetiger
01-06-14, 10:07
That's only if you think those figures makes any sense. Because I don't.
Developer selling at 600-700psf?? Assuming construction cost is 350psf so land cost is 250 to 350psf?
Continue day dreaming lah.
…really unsure 600-700psf(OCR) will happen next few years.... but do take note that developers have started spending less on construction, and less aggressive on land bidding(bidded too high, ended with higher risk to sell).... many are now aware that what buyers want are the low price....this trend has already started...seem will go on for sometimes...
Just imagine, you may see many PC(OCR) having EC's quality...
Allthepies
01-06-14, 10:21
CM will be removed when liquidity goes back to normal...tat the objective of CMs in the first place... it is not meant to crash the market...
…really unsure 600-700psf(OCR) will happen next few years.... but do take note that developers have started spending less on construction, and less aggressive on land bidding(bidded too high, ended with higher risk to sell).... many are now aware that what buyers want are the low price....this trend has already started...seem will go on for sometimes...
Just imagine, you may see many PC(OCR) having EC's quality...
Construction cost will continue to rise as a result tight labor supply and higher workers levy. The average construction cost for mass market condo is around $300 psf, so to sell at 600-700psf and still make money, land price will have to be $200psf.
At the moment, even EC land price is going at around 350-400psf, so it will be impossible for PC to be selling at below EC price.
walkthetiger
02-06-14, 20:36
Construction cost will continue to rise as a result tight labor supply and higher workers levy. The average construction cost for mass market condo is around $300 psf, so to sell at 600-700psf and still make money, land price will have to be $200psf.
At the moment, even EC land price is going at around 350-400psf, so it will be impossible for PC to be selling at below EC price.
...tight labor will cause project delay.....higher workers levy made up smaller % of the overall...if you ever try asking a developer how many man-hours to complete a project, exact figure is impossible...as it depends how many sub-contractors they have, and how expensive is their sub-contractors, right from design to construction stage.... most of the time, it is the complexity of the design and the quality of the construction, will incur higher cost...
...tight labor will cause project delay.....higher workers levy made up smaller % of the overall...if you ever try asking a developer how many man-hours to complete a project, exact figure is impossible...as it depends how many sub-contractors they have, and how expensive is their sub-contractors, right from design to construction stage.... most of the time, it is the complexity of the design and the quality of the construction, will incur higher cost...
Workers levy is a big cost component for construction companies and When labors supply is tight construction companies will be less likely to compete for projects and when projects gets delay developers cash flow will also affected. These are all cost. IMO No chance for construction cost to come down in today's environment and there is very little developers can do to cut cost on material either due to competitions for buyers. Only chance is for developers is to lower their bud for land.
http://www.mom.gov.sg/foreign-manpower/foreign-worker-levies/Pages/levies-quotas-for-hiring-foreign-workers.aspx
I hope the PC developers would not be too agressive or even stop a while introducing PC in Spore. Let all the unsold property to clear first and focus elsewhere...Once the supply stops, the demand will slowly pickup for sure. If they continue to supply like HDB..of cos it will be a nightmare for all...
Construction cost will continue to rise as a result tight labor supply and higher workers levy. The average construction cost for mass market condo is around $300 psf, so to sell at 600-700psf and still make money, land price will have to be $200psf.
At the moment, even EC land price is going at around 350-400psf, so it will be impossible for PC to be selling at below EC price.
quick google for australia construction cost
http://www.bmtqs.com.au/construction-cost-table
http://www.payscale.com/research/AU/Job=Construction_Laborer/Hourly_Rate
so for low finishing, "8 or more level unit complex, including lift and basement car parking $1,710 sqm",
materials cost should be roughly the same.
labour cost in australia is AU$20.
bangla worker still price at $2 per hour back in 2003 or in 2014.
http://www.straitstimes.com/the-big-story/case-you-missed-it/story/150-hour-just-too-little-anyone-20140212
any idea why construction cost for singapore is high?
or that figure of $300psf can be squeezed further to $200psf when times get tough?
That worker has been exploited and under-paid lah! :beats-me-man:
They should be getting about $900-$1000 pm but think company will say deduct costs to provide lodging, food etc and end up they only get $600-800 pm???
Other things to note is that higher levels building cost more to build, basement car park cost more to build than multi-storey car park...........
So cheapest no frill like HDB I estimate is about $100-120 psf ppr.
Basic OCR condo cheap quality almost full furnishing with facilities may be $250-350 psf ppr.
CCR condo higher quality may be $450-750 psf ppr.
quick google for australia construction cost
http://www.bmtqs.com.au/construction-cost-table
http://www.payscale.com/research/AU/Job=Construction_Laborer/Hourly_Rate
so for low finishing, "8 or more level unit complex, including lift and basement car parking $1,710 sqm",
materials cost should be roughly the same.
labour cost in australia is AU$20.
bangla worker still price at $2 per hour back in 2003 or in 2014.
http://www.straitstimes.com/the-big-story/case-you-missed-it/story/150-hour-just-too-little-anyone-20140212
any idea why construction cost for singapore is high?
or that figure of $300psf can be squeezed further to $200psf when times get tough?
Below HDB construction contract will give you a rough idea of how much it costs to build the HDB flats (but note that below include communal facilities like car park lots, some void-deck space which may be tenanted as PA offices, convenient shops etc, which by right should not be included in the actual cost of HDB flats since the HDB buyers don't own these car park lots and shop spaces).................. ;)
So, from the below I estimate it costs HDB about $120 psf ppr to build a HDB flat EXCLUDING communal facilities (land costs is negligible if acquired in 197x-198x, remember, only about $1 psf of FH land or about $0.10 psf ppr of 99LH land)..................:cool:
quick google for australia construction cost
http://www.bmtqs.com.au/construction-cost-table
http://www.payscale.com/research/AU/Job=Construction_Laborer/Hourly_Rate
so for low finishing, "8 or more level unit complex, including lift and basement car parking $1,710 sqm",
materials cost should be roughly the same.
labour cost in australia is AU$20.
bangla worker still price at $2 per hour back in 2003 or in 2014.
http://www.straitstimes.com/the-big-story/case-you-missed-it/story/150-hour-just-too-little-anyone-20140212
any idea why construction cost for singapore is high?
or that figure of $300psf can be squeezed further to $200psf when times get tough?
PUBLISHED JUNE 03, 2014
Chip Eng Seng unit secures $165m HDB contract
BYLYNETTE KHOO
CONSTRUCTION company Chip Eng Seng's wholly owned unit, Chip Eng Seng Contractors (1988), has secured a $165 million HDB contract for building works in Sembawang.
The building works, to be carried out over 36 months, cover the construction of eight residential blocks, housing a total of 1,220 dwelling units with other community facilities. Completion is expected to be in the second quarter of 2017.
As at March 31, the group's order book stood at $453 million. With this latest contract win, its order book has reached $618 million.
"Our strong track record in construction projects has allowed us to grow our pipeline of projects steadily over the years and we will continue to improve and strive to deliver quality projects to our clients in the times to come," said group executive chairman Lim Tiam Seng.
[QUOTE=teddybear;482489].....
the question is why construction cost in singapore is so much higher compare to australia.
material cost should be same
labour cost in australia is much higher.
what accounts for the difference?
according to R33, only land price can go down.
what is construction price can also go down?
what if the $300psf construction cost is earning the construction companies super-normal profits and when bad times hit, they can still live on $150 psf cost, similar to australia cost.
walkthetiger
03-06-14, 12:58
[QUOTE=teddybear;482489].....
the question is why construction cost in singapore is so much higher compare to australia.
material cost should be same
labour cost in australia is much higher.
what accounts for the difference?
according to R33, only land price can go down.
what is construction price can also go down?
what if the $300psf construction cost is earning the construction companies super-normal profits and when bad times hit, they can still live on $150 psf cost, similar to australia cost.
...take note of the things that are going to back basic.... fundamental 'swift' backward
Typical construction cost in the region.
http://i332.photobucket.com/albums/m356/DC33_2008/ConstructionCostMalaysiaEdgeMay2014_zpsa95f9f45.jpg (http://s332.photobucket.com/user/DC33_2008/media/ConstructionCostMalaysiaEdgeMay2014_zpsa95f9f45.jpg.html)
You can get more comparison here
http://www.bca.gov.sg/keyconstructioninfo/keystats.html
You can get more comparison here
http://www.bca.gov.sg/keyconstructioninfo/keystats.html
thanks.
it looks like construction cost fall during 2009 period.
thanks.
it looks like construction cost fall during 2009 period.
Its due to rise in US$. in 2009, US$-S is around 1.40 vs. 1.25 in 2014
That worker has been exploited and under-paid lah! :beats-me-man:
They should be getting about $900-$1000 pm but think company will say deduct costs to provide lodging, food etc and end up they only get $600-800 pm???
Other things to note is that higher levels building cost more to build, basement car park cost more to build than multi-storey car park...........
So cheapest no frill like HDB I estimate is about $100-120 psf ppr.
Basic OCR condo cheap quality almost full furnishing with facilities may be $250-350 psf ppr.
CCR condo higher quality may be $450-750 psf ppr.
Talk rots again. KP things ex want to raise over cost of building. Then things get more ex then KP again. Really dumb anal logy.
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