Resale market for Tanglin Halt hotting up

Housing Board flats in Tanglin Halt are hitting the resale market and starting to fetch premiums after June’s announcement that the estate will be redeveloped.

At least two units have been sold since then, with more than 30 listed on property websites.

Such flats are attractive because their owners will eventually be offered brand new units at five sites in the nearby Dawson estate in Queenstown under the Selective En bloc Redevelopment Scheme (Sers).

In prime locations such as Queenstown, resale units are pricey and Build-To-Order projects scarce, so the Sers exercise is a good chance to secure a flat there, said agents.

Most of the 3,480 units across the 31 blocks in Tanglin Halt Road and Commonwealth Drive are two- and three-room flats. The replacements range from two- to five-roomers, with larger units popular with families, said agents.

To give owners time to consider their options, there was a month-long freeze on resale applications. This ended on July 27, and applications can be submitted up till Aug 31 next year.

In anticipation of demand, property agents have been leaving fliers in letter boxes and going door to door in Tanglin Halt.

The attraction of a Sers flat was clear in the case of a Tanglin Halt three-roomer which was sold last week. A flat had been marketing it since February, with an asking price of $310,000 to $315,000.

There were no takers initially. But interest rose after the Sers announcement, and the flat went for $355,000, about $35,000 above its valuation.

Some Tanglin Halt owners might want to sell so they can upgrade to private property. Another reason is that the replacement units are expensive, said agents and flat owners.

Even though they are subsidised, estimated prices for three-room replacement units at Dawson range from $284,000 to $386,000, according to the HDB.

“Actually, a resale flat somewhere else might even be cheaper,” noted a flat owner who wanted to be known only as Mr Teh.

In the second quarter this year, the median price of a three-room flat was $357,000 in Queenstown, and as low as $311,000 in Yishun.

Mr Teh, a 34-year-old who works in sales, is open to the idea of selling his three-roomer in Tanglin Halt. But he has not decided whether to do so yet as the prime location of the replacement flats is still a draw. “You cannot find another place as good as this,” he said.

The drawback of selling, of course, is missing out on a prized new flat in Dawson.

This is why transport driver Ngeow Chee Hoe, 41, does not plan to sell his three-roomer: “The new flats will be of high value.”

For many older residents, there is a simpler reason for not selling: being able to stay in a familiar, convenient place.

Said retiree Arif Supaat, 74: “This place is easy for me to get around: There are the buses, the MRT, it’s near the mosque.”

Retiree Helen Lee, 70, agreed, adding: “If you move somewhere else, you won’t know the neighbourhood any more.”

Source: The Straits Times – 26 August 2014

Lease Buyback: ‘Better, but limited take-up expected’

While letting owners of four-room Housing Board flats sell part of their lease back to the Government is a good move, it will probably appeal to only a small section of the population, said property experts and academics.

They do not expect a spike in applications in response to this extension of the Lease Buyback Scheme, which was previously for three-room and smaller flats. Rather, the scheme will continue to have a limited appeal, they said – to low-income households who are short of retirement funds on the one hand, and savvier owners on the other.

Under the scheme, flat owners sell part of their flats’ lease back to the HDB. The proceeds from selling the lease are used to top up owners’ Central Provident Fund (CPF) Retirement Accounts, for larger monthly payouts under the CPF Life scheme.

The required top-up level is the Minimum Sum for those aged 70 and younger, and slightly less for older flat owners. The owners will receive the funds in excess of this as cash.

Response has been lukewarm since the scheme’s launch in 2009. As of last month, just under 800 households have benefited.

“There is likely to be a better take-up than the current state of things, but we do not expect a surge,” said ERA Realty key executive officer Eugene Lim.

One obstacle to a wider take-up is the fear of outliving one’s lease. Under the scheme, flat owners keep the next 30 years of their lease and sell the rest back to the HDB.

The HDB has said that “no elderly flat owner will be left homeless” and that “appropriate housing arrangements” will be provided for flat owners who cannot pay for a lease extension.

But it is unclear what this means and the big fear is that the flat owner will get chased out of his home, said experts.

Another obstacle is cultural. Many Singaporeans wish to keep their flats so they can leave them for their children.

“This bequest motive is a very strong motivation,” said National University of Singapore Associate Professor Chia Ngee Choon.

It is thus the “more open-minded, more educated or investment-savvy” home owners who may be comfortable with this option.

But investment-minded owners have other reasons to be reluctant. Flats under the scheme cannot be wholly sublet or resold, thus limiting their options.

Subletting out the entire flat for rental income would probably derive greater returns compared to payouts by CPF Life.

The median rent for a flat was $2,300 last month.

About one in 10 flat owners above 55 either sublets a room or the entire flat for income, said the HDB.

It added that the scheme is aimed at low-income owners with limited monetisation options, which is why it was not previously open to larger flats.

Civil servant Lim Swee Leong, 59, owns a four-room flat and could qualify for the scheme when he retires. But he, too, sees it as being chiefly for the lower income.

“For me, it’s quite different because I don’t need the money,” said Mr Lim.

There is the off chance that the scheme will generate a lot of demand, which would mean that the Government has to buy back many leases, which will cost it a tidy sum.

But NUS Associate Professor Albert Tsui noted that the Government is buying an asset which it can resell or use as rental housing.

“You can see it as just a transaction. It should not be a big problem,” said Prof Tsui.

Source: The Straits Times – 19 August 2014

Pinnacle of HDB flat resales soon?

The first flat from premier Housing Board project Pinnacle@Dux- ton has hit the market, with its owner obtaining special permission from the authorities to sell the unit.

The four-room flat, with a floor area of 90 sq m and located “above the 20th floor”, has been on the market for about a month. But it has already had more than 50 viewings, said Mr Bruce Ang, one of two agents marketing the unit. He said that several “verbal offers” have been received, the highest being $830,000.

The unit is being sold despite the owner not having lived in the unit for five years, which is a legal requirement known as the minimum occupation period (MOP).

Most Pinnacle@Duxton home owners will meet this MOP in December.

But the HDB has allowed the early resale of the unit “with a short deviation from MOP, after considering the flat owners’ circumstances”, said a spokesman.

A Straits Times check showed there were at least eight other units listed on various property websites. All but one – a five- roomer – are four-room flats.

An agent behind a listing of a 38th-storey four-roomer, Mr Benjamin Tan, said that the owner is “not in a rush to sell”, but simply sounding out the market.

Comprising 1,848 units in seven 50-storey blocks, the project in Tanjong Pagar faced overwhelming response at its launch in 2004.

Its four- and five-roomers have long been expected to fetch high resale prices, with National Development Minister Khaw Boon Wan himself saying in 2012 that when the Pinnacle@Duxton flats hit the market, “there will be many millionaires there”.

In 2004, new four-room flats there cost $289,200 to $380,900. Its five-room flats were priced from $345,100 to $439,400.

Though the resale market has been cooling over the past year, large flats in prime locations are still fetching high prices. Two four-roomers in nearby Tanjong Pagar Plaza went for $730,000 in June and $710,000 in March.

Six five-roomers have been sold in nearby Cantonment Close so far this year, all going for above $800,000.

PropNex Realty chief executive Mohamed Ismail Gafoor expects the Pinnacle@Duxton flats to fetch handsome prices in the resale market. “I will not be surprised if people even pay $1 million for a four-room flat there. It’s an iconic building in a really good, central location.”

But R’ST Research director Ong Kah Seng pointed out that the ongoing cooling measures would make it difficult to achieve benchmark prices. “Prices for five-room flats are unlikely to go beyond $850,000, as the mortgage servicing ratio cap is expected to restrain excessively large loans,” he said. “Resale competition from other sellers in the locality will also drive prices down.”

But that has not stopped agents from aggressively hawking their services to residents there. Pinnacle@Duxton residents said property agents have been going door-to-door and calling them at home, particularly in the last few months. Namecards and fliers offering to help sell their flats have also been left in letterboxes and at individual units, said residents.

But for many of them, selling is the furthest thing on their minds. “We are not planning to sell. It’s difficult to find such a central location elsewhere. We can easily jog or cycle to Marina Bay,” said offshore diver Muhd Shaifullah Latif, 30, who lives in a 28th-floor four-room flat with his wife.

Many are also reluctant to uproot because of their children. “My kids go to school in this area, so moving would (disrupt) their schooling,” said housewife and mother-of-two Joanne Lee, 34, who lives in a five-roomer there.

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Source: The Straits Times – 9 August 2014

HDB resale flat prices dip for 6th straight month: SRX

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As expected, HDB resale flat prices fell again for the sixth straight month to hit a low not seen since February 2012, going by figures from the Singapore Real Estate Exchange (SRX).

Prices slipped 0.9 per cent last month, after a 0.8 per cent dip in June – proof that June’s fall in prices was not due solely to the school holidays and the World Cup distracting buyers from making home purchases, analysts said. They believe larger factors were at play, chiefly the loan curbs in the form of the mortgage servicing ratio (MSR), the total debt servicing ratio (TDSR), and loan tenures being capped at 25 years.

Since the beginning of this year, prices have declined 4 per cent. Consultants expect resale prices to fall up to 8 per cent for the whole of 2014, with the government continuing to emphasise that it is still premature to pull back cooling measures.

The HDB resale market is expected to take a hit also because a huge supply of new build-to-order flats, as well as balance flats, executive condo units and flats under the design, build and sell scheme (DBSS) are coming onstream.

Resale volume improved by a slight 2 per cent to 1,341 flats sold in July’s resale market, after the numbers contracted in May and June. Resale volumes are expected to shrink in August, during the “hungry ghost month”, when fewer people would do house-hunting.

Rental volume rose 1.7 per cent to about 1,600 flats rented in July, possibly because some flat owners are waiting out the price weakness by renting their flats out in the meantime.

ERA Realty’s key executive officer Eugene Lim said flats are enjoying “fairly attractive returns” of 6 to 8 per cent, compared to the 2 to 4 per cent yields of private properties.

Rental prices were, however, 1.5 per cent lower than in June, marking a three-year low.

Source: Business Times – 8 August 2014

Integrated project’s studio flats prove to be a hit

Studio apartments were hotter than usual in this month’s launch of Housing Board flats, due to their being part of the Kampung Admiralty integrated project.

Also proving popular were two-room flats and a Toa Payoh project, as the Build-To-Order (BTO) exercise drew to a close last night.

By 5pm yesterday, there were 5.8 applicants for each Kampung Admiralty unit.

In contrast, other recent studio apartment projects, which can be bought only if one applicant is a Singaporean aged at least 55, have tended to draw about one to three applicants per unit.

Kampung Admiralty is located near Admiralty MRT station and boasts comprehensive amenities.

Among these are a medical centre, an eldercare centre, a hawker centre and a community farm, all in one building.

Madam Hazimah Aziz, 54, for instance, is planning to sell her five-room family home.

“All my children are getting married. For the two of us, a studio apartment is enough,” said the housewife, who applied for one in Kampung Admiralty with her husband.

As usual, two-room flats were popular. Last July’s BTO – the first time singles could buy the flats alone – saw 57.5 singles chasing each available one.

Demand has since cooled but is still high, with 17.5 singles for each available two-room flat at 5pm yesterday.

“This shows that demand has still not been satisfied,” said ERA Realty key executive officer Eugene Lim.

Also sought after was Toa Payoh Apex, a rare BTO launch in a mature estate, with 3.9 applicants for each three-room flat and 9.1 for each four-room unit.

But projects in Punggol were less popular than expected, said Mr Lim. Two-room flats aside, application rates ranged from 1.2 for each five-room unit to 2.1 for each three-room flat.

This might have been due to buyers’ fatigue from many BTO launches in Punggol, he added. “It has been one after another.”

Source: The Straits Times – 26 July 2014

2016 ‘expiry date’ for Dakota Crescent flats

Dakota Crescent, one of Singapore’s oldest public housing estates, is making way for developments under Mountbatten’s estate renewal plans.

Residents of the 17 low-rise rental blocks off Old Airport Road must leave by end-2016. Those who choose to buy a new flat anywhere else will get a relocation grant of up to $15,000.

Only about 400 of the 648 units, built by the Singapore Improvement Trust in 1958, are occupied and about two-thirds of the households have at least one member aged 60 and above.

Retiree Lee Choong Hian, 68, who lives alone in a two-room rental flat, will miss the estate where he has lived for 20 years. “The environment is good. At night it’s peaceful, and transport is convenient,” he said.

Those who want to keep renting will get priority and their rents will not go up. Their options of one- or two-room flats include those in a new block in nearby Cassia Crescent, to be completed in 2016.

They can also choose to buy a new flat from the HDB. Eligible first-timers will get a Central Provident Fund relocation grant of $15,000 for families or singles jointly buying a place; lone singles get $7,500.

This grant is being offered for the first time in this relocation exercise. All tenants will also get a moving allowance of $1,000.

The estate was named by experts as a piece of public housing history that should be saved. It was also one of the sites deemed “sacred” by readers in a Straits Times poll.

The HDB said Blocks 13 and 21 “will be retained for interim use, as there is no immediate redevelopment plan”.

“Purely from a heritage point of view, I think it certainly has value,” said Dr Yeo Kang Shua, conservation architect and Singapore Heritage Society secretary, while agreeing that the state has to balance competing needs.

Mountbatten Member of Parliament Lim Biow Chuan said: “Those who like the heritage mostly don’t live here.”

Even residents who do not welcome the move acknowledge that it has been a long time coming. Mr Yap Boon Hoo, 59, said: “We’ve lived here so many decades, we knew it was just a matter of time.”

The HDB said it would “take cognisance of the social memories of the area when redevelopment takes place in the future”.

The estate’s landmarks include an old-school playground with a blue mosaic-tiled dove design and a provision shop dating back to 1959, revived as a cafe last month.

Source: The Straits Times – 25 July 2014

HDB to allow flat sellers to extend stay

Flat sellers will, with immediate effect, be able to negotiate with buyers for a temporary extension of stay in their flats by up to three months.

This will give them more time to move out of their sold flats, the Housing & Development Board (HDB) announced yesterday.

This relaxed rule is likely to benefit about 15 per cent of total resale transactions, or some 2,700 households a year, it added.

Minister for National Development Khaw Boon Wan and property consultants welcomed the change; the latter even expect this to boost resale transaction volume in the months to come.

Currently, flat sellers must move out as soon as they complete the resale transaction because flat buyers are required under the lease to immediately occupy their new homes.

According to the new policy, flat sellers who wish to extend their stay temporarily must have committed to buy a completed home (be it the exercising of an option to purchase, or signing of a sale and purchase agreement) in Singapore at the time of the resale application.

They have to submit their requests for the extension to HDB when applying for the resale, and the extension will automatically cease at the end of three months. Any earlier termination must also be communicated to HDB, as this will impact flat buyers’ minimum occupation period, which starts on the day when they take over the flat.

Both parties must privately negotiate and agree on the details of the extension, including the duration and any monetary compensation.

“This move will facilitate sellers who are transiting to their next homes, including those who may need more time for renovation or those awaiting funds from the sale of their current flats, eg contra cases,” HDB said.

Contra cases refer to the buying and selling of a home simultaneously, sometimes even on the same day.

In a blog post yesterday, Mr Khaw commended HDB for the move. The previous arrangement often led to flat sellers having to “frantically look for some short interim rental arrangement, resulting in some disruption to their daily life”, he said.

“We settled on a three- month period as we think it should be sufficient time for flat sellers to complete the purchase of their next home, or make the necessary arrangements to shift into their next home.”

Property consultants agreed that the policy tweak was “long overdue” and that its facilitation of smoother transitions may boost resale transactions going forward, as some HDB owners may be encouraged to consider their upgrading plans.

ERA Realty key executive officer Eugene Lim said: “It is something the market has been pushing for some time and it is certainly a relief that we now have an official policy to allow for this temporary extension of stay for the seller after the completion of the sale.”

Source: Business Times – 23 July 2014

Toa Payoh 4-room flats top draw at BTO launch

Four-room units in Toa Payoh may be the priciest on offer in the latest sale of new Housing Board (HDB) flats yesterday, but they proved to be the most popular.

By 5pm yesterday, the 419 units available in the new Toa Payoh Apex estate were over-subscribed by 1.3 times, with 551 applications received.

With prices starting from $413,000, they were the most expensive of the 3,841 flats rolled out in yesterday’s Built-to-order (BTO) launch.

Included in the launch were 104 studio apartments in Woodlands Kampung Admiralty, which property analysts say will attract a fair share on interest.

Described by HDB as a “modern vertical village”, the development, where prices start from $91,000, is aimed at the elderly, bringing together medical, childcare and eldercare centres, shops and homes under one roof.

The apartments there already attracted 0.6 applications for each unit by 5pm yesterday. The launch concludes on Friday.

Madam Hindon Abushah, a 60-year-old part-time cleaner, is eyeing a place there.

“Having the MRT nearby means I can travel easily to meet my friends and family members. I don’t need a big place too as I live alone, now that my husband has passed away.”

Being near Braddell MRT and Toa Payoh MRT stations was one of Toa Payoh Apex’s draws, along with its proximity to the city, the maturity of its estate, with its wide range of facilities, and the fact that new flats have not been launched in the district in recent years.

“HDB upgraders would be attracted as they may be looking for a place with more amenities,” said ERA Realty key executive officer Eugene Lim.

Toa Payoh’s location around the heart of Singapore is the topmost reason that 56-year-old private tutor James Tan is hoping to secure a four-room flat in the neighbourhood, where 138 three-room units are also on offer.

“The price is quite high. But I think it is expected because of the convenient location,” he said.

Four-room flats in Punggol, Sembawang and Yishun were also part of yesterday’s launch. Prices start from $236,000 to $278,000.

But they were not as popular as the ones in Toa Payoh, with Punggol and Yishun having the next highest application rate of 0.3 when it came to their four-roomers.

Also attracting plenty of interest were the 120 two-room flats in Yishun, which had 1.3 applicants vying for each unit. Analysts said data from previous launches showed that BTO two-roomers were popular among singles.

The flats launched yesterday also included five-room and the larger Three-Generation, or 3Gen, flats meant for multi-generational families.

Buyers said there was a good range of flats to fit varying needs, but some were not available at their preferred locations. Said operations manager Patsy Lai, 43: “We were hoping that 3G flats would be launched in Punggol but that was not the case. We live there with our children. It would be nice to have a bigger flat so my parents can move in.”

Source: The Straits Times – 20 July 2014