21 May 2016
The Housing and Development Board (HDB) granted a third housing loan to around 900 families last year, according to National Development Minister Lawrence Wong during a parliamentary session on Monday (14 March), reported Channel NewsAsia.
Of this, 25 percent are concessionary loans, while about 75 percent consisted of non-concessionary loans, which are based on market rates.
He explained that the agency is willing to help families obtain a third HDB housing loan, but it will only be allowed for exceptional cases, usually for households that cannot acquire mortgages from banks, but are in urgent need of such financing.
However, a requirement is that these families should have ample savings and stable incomes to repay their monthly loan instalments.
“As I said, HDB would want to assist applicants to buy a home. But HDB is also wary of people or families, who overstretch themselves, and end up with more debt. I don’t think we want that to happen just for the pursuit of buying a home,” Mr Wong added.
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For the fifth year in a row, JLL has been named the top real estate investment advisory firm in Asia Pacific, based on the total value of sales completed, according to data from Real Capital Analytics (RCA).
RCA is an independent body that monitors global real estate transaction volumes. JLL has been ranked in first place since RCA began releasing data in 2011.
In 2015, the consultancy advised on investment deals worth US$16.6 billion, which corresponds to a 27.8 percent market share in the region.
JLL also took top spot in the hotel sector for the fifth year in a row, with a total of US$2.9 billion in hotel sales last year, representing a regional market share of 57 percent.
“2015 was a stellar year for real estate investment in Asia Pacific thanks to continuing demand from investors wanting to buy into the growth story in the region,” said Stuart Crow, Head of Asia Pacific Capital Markets, JLL.
Picture Source: JLL is the region’s top dealmaker by volume for 2015.
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Two newly launched private residential projects reported brisk sales over the weekend, an indication that units within integrated developments remain popular despite the lacklustre housing market.
The Wisteria in Yishun sold more than 80 percent, or 116 of the 138 units released for sale.
Its developer Northern Resi initially launched 108 units on Saturday (12 March), priced from $1,030 psf to $1,050 psf on average. Subsequently, another 30 units were released due to keen interest for the smaller units, leading to more sales.
“Buyers are drawn to this project because of its affordability and its convenience of being above a lifestyle mall,” said Michael Leong, CEO of Keppel Land Retail Management, the project and marketing manager for The Wisteria.
The 99-year leasehold project features 216 condominium units spread across three nine-storey towers, built on top of a two-storey shopping mall. Prospective buyers can choose from one- to four-bedroom apartments, with unit sizes ranging from 441 sq ft to1,173 sq ft.
The Wisteria is expected to be completed by the end of 2018.
Meanwhile, CapitaLand’s 268-unit Cairnhill Nine development in the Orchard area has found buyers for 70 percent, or 134 of the 200 units launched on Saturday.
The 99-year leasehold condominium is part of an integrated development that includes a serviced residence called the Ascott Orchard Singapore.
The units sold include one, two, and four-bedroom units as well as penthouses, measuring between 591 sq ft and 3,864 sq ft. The one-bedroom+guest units have been the most well-received to date, with 80 percent of the 90 apartments sold.
Around 50 percent of the project’s buyers are Singaporeans, while the rest are from Indonesia, Malaysia and China.
Commenting, a spokesman from CapitaLand said: “We are pleased with the strong response to the VIP preview and official launch, and will be stepping up our marketing efforts by having roadshows in cities such as Jakarta, Surabaya, Solo, Shanghai and Hong Kong.”
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The Housing and Development Board (HDB) allowed 218 flats to be sold last year, even though the owners did not fulfill the required minimum occupation period (MOP) of five years, reported The Straits Times.
But this figure only represents around one percent of the 19,306 flats sold last year, as this practice is only permitted under “exceptional circumstances”, said a HDB spokesperson.
Valid reasons include emigration, wanting to live near a terminally ill family member, and financial problems – like the death of a breadwinner.
ERA Realty agent Ken Lee noted that “others might also need to relocate to be closer to their relatives for childcare or eldercare purposes”.
However, the majority of these special approvals were granted due to divorce.
The HDB spokesperson explained that “some divorcees may not be eligible to retain the flat upon their divorce. Since the breakdown of the marriage is beyond the couple’s control, HDB may consider allowing them to sell the flat so that they can each move on with their lives”.
According to PropNex agent James Lin, the housing board’s consideration is helpful to flat owners facing genuine hardships. “But it’s good that they are strict with these approvals. If they give everyone the green light, people will abuse the system.”
“It shouldn’t be easy to sell one’s flat early. The MOP is there to safeguard the interests of other residents,” added Lee.
Picture Source: Flat owners facing hardships can seek HDB’s approval to sell their units before the five-year MOP. (Photo: Nikki De Guzman)
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The US National Association of Realtors (NAR) has stated that demand from foreign buyers is weakening, with the strong US dollar and rising home prices forcing some investors to look at other countries that offer more value, reported The Wall Street Journal recently.
Many experts had predicted that foreigners would flood the US property market last year, as they seek a safe haven from the volatile global economy. Realtors revealed that the Chinese had surpassed Canadians as the top foreign buyers of US property in June 2015.
However, it looks as though this trend is reversing and more foreign buyers are now avoiding the US market, as prices in preferred cities like New York and San Francisco have increased dramatically. This has been made worse by the strong US dollar.
According to research from the NAR, the median price of existing US homes increased by 14 percent for Chinese buyers in January 2016 compared to a year ago, once currency exchange rates are factored in.
Another reason for the waning interest in US real estate is that China’s government is now cracking down on buyers who try to evade a US$50,000 annual limit on how much money they can transfer out of the country.
Previously, Chinese buyers would transfer money overseas through friends, family members or employees, but the government is now monitoring such activity more closely.
Lawrence Yun, NAR’s chief economist, explained that it remains to be seen just how much Chinese demand for US homes will fall.
The country recently reported growth of more than six percent amid a tough economic climate. In addition, many Chinese residents are looking to diversify their investments, after having lost money in the stock market downturn.
Picture Source: Housing prices in US cities, such as New York, have skyrocketed.
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The 534-unit Wandervale project in Choa Chu Kang, the first executive condominium (EC) to launch in 2016, has beaten market expectations after its developer managed to sell 50 percent of the units last weekend.
“Despite tepid market conditions, it was well received by the market,” said Wong Xian Yang, Senior Manager for Research and Consultancy at OrangeTee.
The good performance is unsurprising, given the lower prices of Wandevale’s units. Prices for a three-bedroom apartment start from $655,000. Based on the percentage of units sold in the first month of sales, Wong noted that it has outperformed all the seven EC launches in 2015.
However, only about 267 units were successfully transacted even though the project was more than 40 percent oversubscribed, receiving a total of 750 e-applications by the end of the application period on 28 February.
But Wong said that “a conversion rate of approximately 30 percent to 40 percent from e-applications to sales is common in the EC segment”.
He added that there could be several reasons for why more sales didn’t materialise, such as buyers changing their minds, their inability to secure an 80 percent loan-to-value (LTV) ratio, and insufficient CPF funds to cover the next 15 percent of progressive payments.
Developed by Sim Lian Group, Wandervale comprises 130 three-bedroom, 322 three-bedroom premium and 82 four-bedroom units, spread across nine residential blocks. Unit sizes range from 958 sq ft to 1,249 sq ft, while prices average between $750 psf and $770 psf.
The 99-year leasehold EC is expected to be completed by 2019.
As to whether Choa Chu Kang will see an oversupply of EC units with three properties being developed there, namely MCL Land’s Sol Acres, Wandervale and the future launch of Qingjian Realty’s EC at Choa Chu Kang Avenue 5, Wong noted that these projects will inject a total of 2,350 units in the area.
“Sol Acres sold 259 units during the first month of launch in August 2015, and at least 10 units have been sold each month since. Likewise, we expect a steady flow of sales (for Wandervale) in the coming months.
“The introduction of another EC project by Qingjian may dilute demand, but we believe that the market should be able to absorb the additional supply, assuming that it is priced right.”
Picture Source: URA,OrangeTee Research
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