Tag Archives: Singapore

Housing in high demand, prices stable

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Sep 5, 2011 – PropertyGuru.com.sg

Singapore property prices will remain stable in the medium term, with key home-buying factors like upgrading and investment still expected to drive up demand, said a My Paper report.

This comes amid the expected slowdown in Singapore’s economic growth, led by the debt crisis in western countries.

As home buyers are likely to be more cautious, prices will not increase or decline by over five percent by end-2012, said property experts. They added that rental yields are also expected to rise by between two and three percent in 2012, in line with historical averages.

“The Asia-Pacific region, including Singapore, remains on track for continued growth and can weather a global slowdown,” said Ong Kah Seng, Senior Manager at Cushman & Wakefield for Asia-Pacific.

He noted that Singapore, like Hong Kong, is in the “high-risk range” when it comes to its vulnerability to the economic crisis in the West.

Ong pointed out that home buyers will likely see a 10 to 15 percent capital appreciation on their properties over the next five years.

“If you are looking at the nearer term, property prices here will generally remain fairly flat in the next year, with the potential for some downward adjustment,” he said.

“But there is always underlying demand stemming from individuals looking at upgrading or for investment, and opportunistic buyers may be quick to react to the lower housing prices, thereby pushing the market up again.”

Meanwhile, Mark Teo, Senior Group-Division Director at ERA Realty Network, said that while external factors affecting Singapore’s economy are important, what affects the property market most are the government’s policies and measures.

He cited how government investment in the development of the Marina South area has led to prices of several properties in the area skyrocketing.

“The development became a global product that commands international pricing,” he said. “Government policy in Singapore is very, very powerful, so make sure to track this especially if you are looking at properties for investment purposes.”

For young couples seeking to acquire properties for the first time, Teo recommended Build-To-Order (BTO) flats, as they are usually cheaper and have “higher capital appreciation value”.

Catherine Tan, Senior Executive Estates Officer with the HDB, also said that buyers need to “refer to transacted resale prices of comparable flats and not on cash-over- valuation in your negotiation so that they will not overpay.”

“The transacted flat prices can be found on the HDB info-web,” she added.

To contact the journalist, you may send your message to editor@propertyguru.com.sg

S’poreans should save for rainy days: Khaw

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Aug 8, 2011 – PropertyGuru.com.sg

Global economic uncertainties have affected Singapore and Singaporeans need to “save for a rainy day”, said National Development Minister Khaw Boon Wan.

Delivering his message yesterday on the sidelines of a national day observance ceremony in Sembawang, the minister called on Singaporeans to be more prudent and reminded them that spending more than one earns is unwise.

He noted that the US and Europe are in debt because they did not save and worse, have overspent.

“You earn S$1,000 but you spend S$1,200, where does the S$200 come from? These are common-sense values but sometimes, people forget,” he said.

In comparison, he said the Japanese are much better in managing debt but their lack of political leadership is their greatest problem.

“For 20 years, no (Japanese) political leader came forward to say the right thing. Everyone tried to be popular, be populist, and say what people like to hear. But what people like to hear, sometimes, may not be the right thing,” he said.

He stressed that political leaders have the responsibility to lead a country but sometimes “get punished by voters for saying the right thing.”

“So, Singaporeans have to decide — do you always want to hear pleasant things even though they are dishonest?”
“Sometimes you get fine weather, sometimes rainy. But if you have always saved for the rainy day, you’ll be pretty steady and safe,” he noted.

His comments followed Deputy Prime Minister Tharman Shanmugaratnam’s warning that it will be tough for the country in the next three to four years, as advanced economies experience slow growth and possible bouts of recession.

To contact the journalist, you may send your message to editor@propertyguru.com.sg

Big banks compete to offer best home loan rates

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Jul 13, 2011 – PropertyGuru.com.sg
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Two Singapore banks have been offering home loan rates for as low as 0.2 percent on selected properties.

Some analysts said the moves by the two banks – United Overseas Bank (UOB) and DBS Bank – reflect intensifying competition in the mortgage market to maintain high loan volume amid uncertainty.

According to a Straits Times report, the two banks offered mortgage rates set at two commonly used benchmark interest rates, which are the Singapore interbank lending rate (Sibor) and swap offer rate (SOR).

The three-month Singapore dollar Sibor has hit a record low of 0.438 percent since January, while the three-month SOR has moved between 0.189 percent and 0.3 percent since April. It now stands at 0.21 percent.

The new record low interest rates are usually imposed for a promotional period like the first year, after a higher rate is applied.

Compare a SOR plus zero package that increases to SOR +1 percent after three years and a flat SOR +0.7 percent package to a S$1 million 30-year loan.

Vinod Nair, Chief Executive of website Smartloans.sg, said a borrower paid a total interest of S$5,430 for the first three years under the first package compared with S$25,557 for the same package. However, the borrower would actually pay less using the second package for a 30-year loan tenure.

Dr Chua Hak Bin, economist at Bank of America-Merrill Lynch, said the latest trend could be due to the lower mortgage applications and the “intensified competition among banks to maintain mortgage loan volumes.”

To contact the journalist, you may send your message to editor@propertyguru.com.sg

S’pore ranks 8th most expensive expat city

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Jul 13, 2011 – PropertyGuru.com.sg
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Singapore has been ranked the eighth most expensive city for expats globally, overtaking Hong Kong, which took the ninth spot, according to a survey conducted by Mercer.

The human resource firm said the strengthening of the Singapore dollar has pushed the country up three places to the top 10 list of most expensive cities for expats worldwide. The cost of housing, which is the biggest expense for expats, also plays a significant role in determining the cities’ ranking, it added.

According to the survey, Luanda, Angola’s capital city, remained the world’s most expensive city for expats, with Tokyo in second spot.

Meanwhile, only three European cities made the top 10 list. Moscow, which was ranked fourth globally, remained the most expensive city in Europe, followed by Geneva and Zurich in the fifth and seventh spot respectively.

Tokyo remained the costliest city in Asia, followed by Osaka, Singapore and Hong Kong in second, third and fourth place respectively.

Australian cities also witnessed the most dramatic jump in the rankings, as the local currency grew nearly 14 percent against the US dollar. Sydney landed in 14th spot, while Melbourne rose from 33rd to 21st place, and Perth climbed 30 places to reach the 30th spot.

“Multinational companies have long understood the competitive advantage of a globally mobile workforce, though the enduring challenge is to balance the cost of their expatriate programmes with the needs for foreign talent,” said Phil Stanley, a principal at Mercer.

“Currency fluctuations, inflation, housing costs, income tax rates and the cost of international schools are all factors that influence the cost of living for expats. It is essential that employers understand their impact, for cost-containment purposes but also to ensure they retain talented employees by offering competitive compensation packages.”

The Mercer cost of living survey covers 214 cities globally and measures the relative cost of more than 200 items in each city, including housing, clothing, food, household goods, entertainment and transport.

To contact the journalist, you may send your message to editor@propertyguru.com.sg