Category Archives: Property Market / Real Estate

Unit at The Sail @ Marina Bay hits $2,999 psf

Posted on 2 Jun 2011 | Comments Off on Unit at The Sail @ Marina Bay hits $2,999 psf

Residents of the 1,111-unit The Sail @ Marina Bay enjoy a spectacular view of Marina Promenade.

There has been a flurry of transactions at The Sail @ Marina Bay, with prices playing catchup with those at Marina Bay Residences (MBR).

Last month, a unit at MBR hit an alltime high of $4,368 psf. A 2,368 sq ft apartment on the 46th floor was sold for $10.3 million on April 15. This trumped the previous record of $3,790 psf, which was achieved when a 1,959 sq ft unit on the 46th floor was sold for $7.2 million in Sept 2010.

At the 1,111-unit The Sail @ Marina Bay, prices breached the $3,000 psf level for the first time this year, when a 1,184 sq ft unit on the 61st storey was sold for $3.6 million ($3,040 psf) on April 4. Prices peaked in April 2008, when a 1,033 sq ft unit was sold for $3.5 million ($3,387 psf).

The two condominiums are located along Marina Boulevard and enjoy spectacular views of Marina Promenade. MBR is a 55-storey, 428-unit luxury waterfront condo located within the Marina Bay Financial Centre, a mixed development built by the consortium of Hongkong Land, Keppel Land and Cheung Kong (Holdings). The condo was completed last year. Meanwhile, The Sail, developed by City Developments and AIG Real Estate, was completed in 4Q2008, at the height of the global financial crisis.

Desmond Tan, group director of Dennis Wee Realty, says, “There is strong demand for both The Sail and MBR, as they are the only two condos with a good bay view. MBR commands a better price than The Sail, as it is farther away from the financial centre and nearer to the integrated resort. MBR is also newer. In terms of monthly rental, a studio unit at The Sail can fetch about $4,000, while a one-bedroom unit at MBR can command between $4,500 and $4,800.”

According to a private investor who owns several units at The Sail, “there’s no doubt that The Sail currently offers the best value for money. That’s why it continues to be the most highly transacted of the properties in the area”.

Between April 29 and May 10, The Sail saw three transactions, with prices ranging from $2,503 to $2,999 psf, according to caveats lodged with URA Realis.

A 2,077 sq ft unit on the 59th floor was sold for $6.23 million ($2,999 psf) on April 29. This represents a 169% gain over the last transacted price of $2.3 million ($1,116 psf) in 2004.

Subsequently, a 1,797 sq ft unit on the 16th floor changed hands for $4.5 million ($2,503 psf) on May 4.

A third transaction was for a 613 sq ft unit on the 24th floor, which was sold for $1.57 million ($2,559 psf) on May 9. This represented a 50% gain over the last transacted price of $1.04 million ($1,701 psf) in April 2007. Prior to this, the unit sold for $921,000 ($1,501 psf) in January 2007 and $726,240 ($1,184 psf) in December 2005.

Tan says, “Asking prices at The Sail are $3,200 to $3,500 psf currently. Most buyers are foreigners. We see quite a few buyers from China and Hong Kong.” He adds that the strong prices at MBR will have a positive impact on condos at One Shenton and The Cliff, al- though it is hard to quantify the extent of the impact, as “there is a big difference” in the view from condos along Shenton Way and from those at Marina Boulevard.

The latest transaction at the 341- unit One Shenton was for a 581 sq ft unit on the 20th floor, which changed hands for $1.28 million ($2,202 psf) on May 9. Prices at the condo hit a high of $2,757 psf in 2007, when a 1,894 sq ft unit on the 44th floor was sold for $5.2 million. The condo was developed by City Developments and completed earlier this year.

Another project completed this year is The Clift along Mccallum Street, a short walk from the Tanjong Pagar MRT Station. The latest transaction at the 312- unit condo developed by Far East Organization was for a 527 sq ft unit on the 17th floor. It was sold for $1.05 million ($1,998 psf) on May 9, representing a 44% gain over the last transacted price of $727,000 ($1,378 psf) in 2007. Prior to that, the unit sold for $577,786 ($1,095 psf) in 2006.

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Source : TheEdge – 2 Jun 2011

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Singapore’s property market headed towards a perfect storm

Posted on 2 Jun 2011 | Comments Off on Singapore’s property market headed towards a perfect storm

When a country registers a 15 percent growth rate, as Singapore did last year, there is bound to be a spill-over wealth effect. Singapore’s housing market has been cashing in on this big time – prices have rebounded 50 percent in just two years, according to the Urban Redevelopment Authority, and cooling measures by the government have done little to calm them.

At a recent real estate conference organized by the National University of Singapore, which explored the theme “Will the boom never end,” Chua Chor Hoon, Head of South East Asia Research at property consultancy DTZ, said the Singapore residential market is not likely to decline much because of strong economic growth. But, she also outlined a worst-case scenario, which could unfold as early as 2013-2014. “If all the ingredients come together it will make a perfect storm,” she told the audience.

These ingredients include falling demand, more supply and higher interest rates all kicking in together.

Interest rates in Singapore are currently at record lows because lending rates in the city-state track U.S. monetary policy. That’s allowed some homebuyers to pay less than one percent in the first year of their loans, says Chua. Most analysts, however, expect interest rates to begin moving higher later this year.

Second, in 2014 an unprecedented number of housing units are expected to enter the market. According to the URA’s latest quarterly report, 32,359 units will be completed over 2013 and 2014 that is 85 percent more than the 17,501 units expected over 2011 and 2012.

Add to this the fact that Singapore’s price-to-rent ratio has increased from 20 in 2009, during the financial crisis, to 25 currently, according to URA and DTZ research. That means it will take 25 years for a homebuyer to recover, through rents, what he paid for the house. As a result, Chua says, people investing in this market often have a short-term view looking to “flip” the property for capital gains.

Foreign buyers are also helping boost Singapore’s property market, especially at the high end. According to DTZ’s latest report, foreign buyers of private homes in the first quarter of 2011 touched a record high of 16 percent. But Chua points out that this could drop, if the government further tightens immigration rules.

“Local concerns about high housing prices and the influx of foreigners that were magnified during the recent General Election will be a catalyst for the review of immigration and housing policies, which could dampen demand in the residential market in the coming months, ” Chua wrote in a report.

While growth forecasts for Singapore over the next five years at 4-6 percent will support the property market says Chua, one cannot rule out another unforeseen external crisis like the financial meltdown, which could also lead to a market crash. While the bulls might find it hard to believe that something like that can happen again, another speaker at the same conference had this to say: “We always think this time it will be different, but it never is.”

Source : CNBC – 29 May 2011

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