Tag Archives: The Oceanfront

UOB’s non-performing housing loans hit 10-year high

UOB’s non-performing housing loans soared to 34.2 percent in Q2 2014, or its highest level since Q4 2004, reported the media.

The sharp spike surprised Maybank Kim Eng given the perception that UOB is one of Singapore’s more conservative home lenders, with only a slight year-to-date correction in Singapore’s house prices.

“We understand its NPLs were isolated to a group of borrowers who had invested in Turquoise, a high-end condominium project in Sentosa,” said Maybank in a report.

URA data showed that two units there changed hands in Q2 2014 at 45 percent discount to their launch prices.

The report noted that the transactions “stoked fears that it is a matter of time before default cases become widespread, undermining Singapore banks’ profitability that has been propped up by low charge-off rates.”

To ascertain sentiment on the Sentosa micromarket, Maybank examined recent transactions of non-landed properties there.

It found that there are nine condominium projects in Sentosa. The first four, launched during the nascent recovery of Singapore’s property market in 2004 to 2005, had an average selling price of below $1,600 psf, while the remaining five, which were launched later, were priced above $2,600 psf.

“In our view, the large losses at Turquoise can be partially explained by the project’s higher launch price,” said Maybank.

Notably, Turquoise’s launch price of $2,605 psf is about 75 percent higher than the average price at The Oceanfront ($1,360 psf) and The Coast ($1,592).

“These two were launched one year ahead of Turquoise. This could mean that higher-priced projects at Sentosa are at greater risk of a price correction,” said the report.

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Paradise Island prices back to 2007 peak

Interest in waterfront homes at Sentosa Cove seems to have returned in recent months, as the opening of Resorts World at Sentosa looms. Since the beginning of November, a total of six properties — three luxury condominiums and three landed homes — have changed hands in the resale market at $1,406 to $2,423 psf.

In the week of Nov 6 to 13, one of the 29 villas on Ho Bee Group’s Paradise Island — a double-storey unit on 8,105 sq ft of land — was sold for $11.4 million, or $1,406 psf. The villas were completed in May and Ho Bee sold the last one for $22 million in August. Each villa has a private berth and all rooms have views of the waterways. The owner had purchased the villa in April 2007 for $9.18 million, or $1,133, hence reaping a 24% capital gain. In early November, a 7,029 sq ft villa sold for $10.8 million, or $1,536 psf. The owner had lso purchased it at launch for $7.1 million ($1,010 psf) in April 2007 and saw the price appreciate 52% in the past 2½ years.

When the villas at Paradise Island were launched, prices ranged from $1,047 to $1,208 psf, according to the URA Realis database of caveats. Since then, prices have climbed, reaching $1,500 psf two months ago, a level last seen in October 2007.

Meanwhile, a terraced house in the 99-year leasehold Ocean 8 enclave developed by IJM Properties Sdn Bhd, a unit of the Malaysian conglomerate IJM Corp Bhd, was sold for $6.4 million, or $2,423 psf, in a caveat dated Nov 13. The 2,637 sq ft house had changed hands twice before. The original owner purchased the property in October 2006 for $2.92 million ($1,109 psf), and flipped it in January 2007 for $3.5 million ($1,326 psf), enjoying an 20% gain.

The $2,423 psf is the highest psf price achieved at Ocean 8 to date. The last time a unit in the stretch of eight terraced homes changed hands above $2,000 psf was in May last year, when two units were sold for $5.5 million each — a 2,626 sq ft unit went for $2,097 psf, while a 2,691 sq ft unit was sold for $2,046 psf.

Just up the street along Ocean Drive is the 116- unit The Azure, a 99-year leasehold waterfront condo development by Frasers Centrepoint and completed last year. The property was launched in September 2005 at around $900 psf.

According to a Nov 10 caveat, a 1,701 sq ft apartment on the third floor was sold for $2.9 million, or $1,705 psf. This is the second time this year the unit has changed hands. It was last sold in June for $2.43 million ($1,429). The original owner purchased the property in October 2005 for $1.77 million ($1,043 psf).

At the end of Ocean Drive is the 264-unit The Oceanfront @ Sentosa Cove, which is being developed jointly by TID Pte Ltd and City Developments Ltd and expected to be completed in 1Q2010. A two-bedroom apartment on the eighth floor has changed hands three times since it was purchased in August 2006. The 1,711 sq ft unit was most recently sold for $3.1 million, or $1,811 psf. The seller appears to have made a quick flip as, according to URA Realis, the previous transaction was just this September for $3 million, or $1,753 psf. The initial owner purchased the unit at launch in 2006 for $2.28 million ($1,337 psf) and sold it in April 2007 for $3.25 million ($1,899 psf), a 42% price gain.

Source : The Edge – 7 Dec 2009