Tag Archives: Hougang

Shoebox influx in 2017

Investors of shoebox units may face some difficulty renting them out, reported The Straits Times.

This is because a bumper supply of shoebox units are expected to enter the market, peaking by around 2017, revealed R’ST Research data. Leasing demand for such units is also untested, with fewer foreigners able to afford them.

“Increasingly, many (overseas nationals) can’t even afford renting a single shoebox unit, but would instead rent a room in an apartment… Rents will be under further pressure,” noted Alan Cheong, research head at Savills Singapore.

Based on caveats lodged, majority of the supply will come from District 19Sengkang, Hougang and Punggol – with at least 700 units expected to be completed during this period.

R’ST Research noted that at least 527 shoebox units could come from District 14, and at least 383 units from District 12. Over in the suburbs, districts 17 and 22 will contribute at least 224 units and 151 units respectively.

In the Guillemard to Changi Road area (Districts 14 and 15), Cheong stated that prices of newly-completed shoebox units stood at around $1,350 psf in 2013, increasing to more than $1,400 psf late last year and this year.

However, rents for such units fell from $2,600 per month in 2013 to around $2,000 to $2,200, bringing the gross yield down from 5.2 percent in 2013 to 4.1 percent.

Most shoebox owners have holding power, opting to keep their units rather than sell them at a low price. Hence, yields have more room to fall into the mid-three percent level in more accessible areas such as District 14, where rents stood at less than $2,500 per month.

“Once we venture into the new developments in the outlying HDB estates, the market is untested. There, yields may tend closer to three percent or even dip below that,” said Cheong.

Overall, prices of shoebox units fell by about 10 percent from their last peak in August 2013, based on flash estimates of the NUS Singapore Residential Price Index. Prices dropped about 1.1 percent in June from the month before.

R’ST Research director Ong Kah Seng said while prices of shoebox units keep falling due to growing supply, such units are still relevant.

“These tend to be occupied by younger tenants or owners, who will bring energy to the development and area – especially important for newer residential areas like Bartley, or those undergoing rejuvenation like Hillview and Lakeside.”

HDB launches 8,000 flats for sale under joint BTO and SBF exercise

The Housing and Development Board (HDB) has launched 8,000 flats for sale under the joint Build-To-Order (BTO) and Sale of Balance Flats (SBF) exercise. Three new housing measures to help first-timers, second-timers, divorcees, and the elderly will also take effect from this sales exercise.

To help more first-timers buy a flat earlier, HDB will extend the Parenthood Priority Scheme (PPS) to married first-timers who are expecting a child.

For second-timers who are right-sizing, HDB will double the quota of two-room and three-room BTO flats for second-timers in non-mature estates from 15 per cent to 30 per cent.

Out of the 30 per cent quota, five per cent will be set aside for second-timer applicants who are divorced or widowed with children below 16 years old under the Assistance Scheme for Second-Timers (Divorced/Widowed Parents), also known as ASSIST.

HDB will reserve 50 per cent of the studio apartment (SA) supply in BTO and SBF exercises for eligible elderly applicants under the Studio Apartment Priority Scheme (SAPS). This will provide greater assurance of success for elderly who want to right-size to an SA near their current flat or private property, or near their married children.

HDB will offer 4,900 BTO flats over eight projects in five non-mature towns, namely Choa Chu Kang, Hougang, Jurong West, Sembawang, and Woodlands. The projects are EastBrook@Canberra, EastWave@Canberra, Golden Mint, Hougang Crimson, Keat Hong Crest, Spring Haven@Jurong, and Woodlands Pasture I & II.

The Multi-Generation Priority Scheme (MGPS) for parents and married children to apply jointly for flats in the same BTO project will be available to those applying for flats at EastBrook@Canberra and Spring Haven@Jurong. Fifty per cent of the SAs in Golden Mint will be set aside for eligible elderly flat applicants under the SAPS.

Analysts expect the BTO projects in Woodlands and Hougang to draw the strongest demand.

Observers added that both BTO and balance flats offer a more affordable option compared to the resale market.

“Woodlands is now undergoing a potential transformation into a regional centre. If you look at some of the past incidences of regional centres like in Tampines and Jurong Lake area, we have seen tremendous demand heading towards these areas,” said Donald Han, special adviser at HSR International Realtors.

Mr Han added: “Mainly because these are areas where the centre of commercial where your work goes towards your residential element. Woodlands will probably be the next area where demand will filter into. Prices have been quite attractive if you’ve been looking at like some of the price points. The differential between BTO price and resale can be as high of a difference as about 20 to 40 per cent.”

HDB will offer another 3,100 balance flats in 11 non-mature and 15 mature towns/estates under the SBF Exercise, the first such exercise in 2013.

The non-mature towns are Bukit Batok, Bukit Panjang, Choa Chu Kang, Hougang, Jurong East, Jurong West, Punggol, Sembawang, Sengkang, Woodlands, and Yishun.

The mature towns are Ang Mo Kio, Bedok, Bishan, Bukit Merah, Bukit Timah, Central, Clementi, Geylang, Kallang Whampoa, Marine Parade, Pasir Ris, Queenstown, Serangoon, Tampines, and Toa Payoh.

Twenty-eight per cent of the flats are already completed and ready for occupation while the remaining are still under construction.

It is the shorter waiting time before moving in that seems to be a big selling point for potential home buyers.

“It is faster and I need a house as soon as possible, because presently I’m staying in a rental unit,” said Angel Parimala who is keen to apply under the SBF Exercise.

Another potential home buyer Darryl Lim said: “My wife is pregnant with a second one and she is due next month… so I need to quickly find a place where I can move in straight away and not wait for a BTO.”

Among the mature estates, Queenstown and Bukit Merah have the most number of units on offer and market-watchers said these are likely to be the most popular.

However, all eyes are expected to be on the two units at the iconic Pinnacle@Duxton.

One unit, the equivalent of a four-room flat, is going at S$609,000 excluding grants. The unit is located on the 17th floor.

The other unit, similar to a five-room flat, is going at S$769,000 excluding grants. It is located at the 46th floor.

Last September, a unit at the Pinnacle@Duxton was offered under the Sale of Balance Flats exercise and it received 203 applications.

Director of property firm Chris International, Chris Koh said: “Everyone’s talking about Pinnacle and how it is going to hit five years (Minimum Occupation Period) in another year to come and some perceive that those people will be millionaires when they sell those flats. Many would think that it is a good location where you would not see many more flats coming up in that area so if you really want to be in the heart of the city, you’d want to go for these two units at the Pinnacle.”

He had a word for caution for home buyers though.

“We are looking at two flats only. It is not going to be easy to get. If you really need a flat and you want to make sure you get one, then the BTO will be a better option.”

Applications for new flats launched in the May 2013 BTO and SBF Exercises can be submitted online from May 30 to June 5. Applicants can apply for only one flat type/category in one town under either the BTO or SBF Exercise.

In the next BTO launch in July 2013, HDB will offer about 3,800 BTO flats in Bukit Merah, Sengkang, and Yishun.

Source CNA – 30 MAy 2013