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(05-12-2014, 12:28 PM)specuvestor Wrote: [ -> ]Sounds right to me if they are engineering a soft landing rather than a crash?

What does the others suggest they should have done? Continue to oversupply (which was considered UNDERsupply just 18 months ago) with 3 years lag?

I think they did well... though late. Credit where credit's due. They also had to be reactive to external liquidity flows, rather than hindside proactive.

removal of ABSD could cause too sharp a upward reaction !!
so instead they're "tapering" the land supply

just loosen the supply, impose gain-off tax from property sales...
Encourage long term holders, rather than doing all these technical stuffs..

Land-scare singapore should not encourage property investments to be too pricey...rather, offer abundance supply and variety of property choices for rentals, purchases for long term holders..

This provides us with a competitive edge and brings down expenses due to housing cost..

http://www.straitstimes.com/news/busines...s-20141205

Sentosa condos sold at a loss as interest in waterfront projects wanes
Published on Dec 5, 2014 8:50 AM


The Oceanfront@Sentosa Cove. -- PHOTO: CDL

By Cheryl Ong

SINGAPORE - Two luxury condominium units at Sen tosa Cove were sold at record prices this week.

Spanish tycoon Ricardo Portabella Peralta, chief executive of Luxembourg-based investment holding firm Ventos SA, was reported to have snapped up two units at SC Global's Seven Palms Sentosa Cove project, at $4,131 per square foot (psf).

However, this sale was probably an exception. No thanks to a weakening property market, many units have recently been sold for losses or put up for mortgagee sales.

A check of sales of District 4, which includes Sentosa Cove, shows that just 210 homes were sold, compared with 480 transactions in the same period a year ago.

Some units at these projects chalked up a loss for their sellers:

1. The Coast at Sentosa Cove


Two units at the 99-year leasehold project in Ocean Drive were sold at hefty losses.

In August, a 2,024 sq ft unit was sold for $1,900 psf, though it was bought for $2,020 psf in July 2007. This meant a loss of $242,880 for the seller.

Separately, a 2,820 sq ft unit went for $1,702 psf in December last year, making a loss of $1.2 million as it was first bought for $2,128 psf in January 2011.

Units at the project developed by Ho Bee Group have sold for an average price of $1,810 psf in the past six months.

2. The Oceanfront@Sentosa Cove

A recent sale in October led to a loss of $64,700 for its seller. The 1,216 sq ft unit was bought in July 2007 at $1,700 psf before being transacted in October at $1,646 psf.

Another loss came in September, when a 2,077 sq ft unit was sold at $1,925 psf. Its owner bought the unit in August 2010 for $2,261 psf, chalking up a loss of $701,000.

One 2,982 sq ft unit even racked up a seven-digit loss of $1.55 million when it was sold for $1,895 psf in November last year. It was first snapped up in April 2008 for $7.2 million, or $2,415 psf.

The average price of units at the City Developments' project sold over the last six months was $1,705 psf.

3. The Berth by The Cove


Two units that were bought on the same day in September 2007 recently suffered the same fate of being resold for a loss.

One was a 1,647 sq ft unit that went for $1,588 psf in April - or a loss of $315,00 - after it was bought for $1,779 psf.

The other 1,668 sq ft unit that was bought for $1,780 psf chalked up a slightly smaller loss of $250,200 when it was sold for $1,630 psf in Dec last year.

Units at the project have sold for an average of $1,384 psf in the last six months. The project is developed by Ho Bee.

4. Turquoise


The biggest losses suffered in Sentosa Cove have been at another Ho Bee project in Cove Drive, with two apartments that went under the hammer for losses of up to $3.2 million.

The 2,777 sq ft apartments that were bought in 2009 for about $2,550 psf were both sold for about $1,400 psf in July.

In the past six months, units were sold for an average of $1,424 psf.

Looks like we are seeing more and more naked swimmers as the tide goes out at Sentosa...

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The seven-fold sound alarming, but it is due to a small base. I reckon the batch is among the high-end market speculators...

Homes put up for mortgagee 
sale at auctions rise seven-fold

SINGAPORE — The number of homes put up for mortgagee sale at auctions surged seven-fold this year, property agency Colliers International said yesterday, warning that the worst had yet 
to come.

Of 529 properties put up for auction this year, 159, or 30 per cent, were mortgagee sales, five times the 32 properties put up by lenders in 2013. Of the mortgagee sales, 123 or 77 per cent were for housing, more than seven times the 17 homes listed by mortgagees last year.

“The higher number of mortgagee listings this year was on the back of the stricter regulatory and financing environment, in which borrowers in default are finding it challenging to sell properties on their own, as buyers generally remain cautious,” said Ms Annie Chan, director of Auction and Sales at Colliers.

“In addition to buyers having to fork out a higher cash outlay with measures such as Additional Buyers’ Stamp Duty and Total Debt Servicing Ratio, there are concerns of a mounting supply of residential units and an impending increase in interest rates. The high number of bankruptcies could have also contributed to the increase in the number of properties put up for mortgagee sale,” she added.
...
http://www.todayonline.com/business/home...seven-fold

Personal Opinions: The residential market will hold up for the time being. This is because many individuals who own second properties are on loan repayments of 70% to their income. So this is not too bad. The only time massive foreclosures will happen in our country is when individuals lose their jobs. From the 08/09 recession, it is observed the government is possibly aware of the linkage of work income to mortgage repayment. Attempts were made to ensure workers by introducing the jobs credit scheme in 2009. I will not be surprised if this scheme is reactivated when our economy experiences another recession. This will prevent the domino effects of no income-foreclosure of homes.

Office space- This area is of greater concern to me. With 1.1B sq metre of office space coming out by 2018, similar demand has to be met. Current demand for office space is 6.8B sq m. This means a 16% increase in demand has to be achieved in 3 yrs time. Is this possible? I seriously doubt EDB's capability to do so. Do note in Straits Time today, the money section mentioned the increase is 3.2B sq m by 2018. I do not which figure is true so I stuck to the URA's statistics.

Therefore with this scenario, it is likely office rentals will plummet in 2018. My own estimation is office rentals will be 10% lower than current. If there is a recession, it will be a lot worse. Secondly, some office complexes are held by REITs. Therefore, expect lower yields and possibility of share placements since valuations will fall. There are no "job credit schemes" to save office owners unless the government is creative; maybe pay 20% of their interest payments to banks?

Retail- is less of a concern since the strawberry generation is coming of age. I believe this generation spends more of their income in consumption than the 1965s generation and before. So yup retail demand will meet the retail supply of approx 16%. Retail vacancy rate may increase slightly but this will not be much of an issue.

My comments to above:

Resi - those eligible for job credit don't own second property.

Retail - 'showrooming' - Internet will take more business from retail. My own example is sim lim square. SSD is cheaper on Amazon with free shipping than buying from SLS shops



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it's fine, let all property types drop, both in price and rentals, this will lower the "business cost" of everyone, making singapore more cost competitive.

afterall, the biz itself should be the one bringing in the money, we need more new biz ideas.

(13-12-2014, 11:29 PM)opmi Wrote: [ -> ]My comments to above:

Resi - those eligible for job credit don't own second property.

Retail - 'showrooming' - Internet will take more business from retail. My own example is sim lim square. SSD is cheaper on Amazon with free shipping than buying from SLS shops



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Hi Opmi,

The job credit scheme had an indirect benefit to many Singaporeans in 2009. Summary of this scheme: The government will pay the a certain % of the first $2,500 of every private sector worker's wages to sustain their jobs. The end result was that 1.4M private sector workers benefited from it. Total workforce participation (inclusive of non-residents) excluding construction and maids was approx 2.55M . Assuming 35% of this 2.55M were employed by the Ministries and Statutory Boards (which is the rough proportion now). The private sector thus employs about 1.65M workers.

http://www.iras.gov.sg/irashome/jobscredit.aspx

For retail: I cant say much as it is each individual's view. I still prefer brick & mortar shops to purchase my apparels; education agencies are sprouting out in retail malls and a lot of ppl are "free enough" to set up their own F&B/recreational business

(13-12-2014, 10:19 PM)CY09 Wrote: [ -> ]Office space- This area is of greater concern to me. With 1.1B sq metre of office space coming out by 2018, similar demand has to be met. Current demand for office space is 6.8B sq m. This means a 16% increase in demand has to be achieved in 3 yrs time. Is this possible? I seriously doubt EDB's capability to do so. Do note in Straits Time today, the money section mentioned the increase is 3.2B sq m by 2018. I do not which figure is true so I stuck to the URA's statistics.

Therefore with this scenario, it is likely office rentals will plummet in 2018. My own estimation is office rentals will be 10% lower than current. If there is a recession, it will be a lot worse. Secondly, some office complexes are held by REITs. Therefore, expect lower yields and possibility of share placements since valuations will fall. There are no "job credit schemes" to save office owners unless the government is creative; maybe pay 20% of their interest payments to banks?

Hi cy09, I'm a bit confused by this. If demand will far outstrip supply by 2018, why will office rentals drop?

I understood that the government is releasing very little land to mitigate any oversupply, heard from the grapevine that even non cbd mapletree biz city is fully leased out (including the new in construction mbc2).

If there is any trigger, probably would be due to financially poor companies shutting down. I remember singapore companies have one of the highest debt in the region currently, surely some will be hit badly by eventual interest hikes.



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