Issue 113

Copyright 2011-2013 www.Propwise.sg. All Rights Reserved.

CONTENTS
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p6 p7 p11
4 Must-Ask Questions Before You Buy
That Overseas Property Property Selling Tip #6: Notify your Tenant Singapore Property News This Week Resale Property Transactions (July 3 July 9)

FROM THE

EDITOR

Welcome to the 113th edition of the Singapore Property Weekly.

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SINGAPORE PROPERTY WEEKLY Issue 113

4 Must-Ask Questions Before You Buy That Overseas Property

By Property Soul (guest contributor)
I have recently been getting messages from my blog readers, asking whether they should invest in overseas properties. Locations that people are interested in include Iskandar, Kuala Lumpur, Penang, Australia, UK, US, Japan, Thailand and the Philippines. There is only one reason to justify buying an overseas property Basically, I am not against the idea of investing overseas if the pasture is really greener on the other side. However, I believe that it is only justified to put your money overseas when the cashflow and profit are much better than what you can find at home.
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SINGAPORE PROPERTY WEEKLY Issue 113 I am not a property agent selling overseas properties. I won't invite you to a free threehour property investment seminar, and push overseas projects towards the end. I am also not selling you a thousand-dollar three-day get-rich-quick property course that promises to turn you into a millionaire, and make sure you place a deposit for that overseas project before you leave the room. market, only in markets no one shows any interest in yet, or where things are so depressed you can see 'blood all over the streets'. And every time before I commit, I will ask myself four key questions. 1. Who are the other buyers? Look at the profile of the people who are buying the same thing. That should give you clues on the quality of the investment project. Are they sophisticated buyers or just laymen of the market? Are they savvy investors or just an average joe like you?

Why I am not buying now

As a property investor, I have researched the property market in selected countries, which includes reading everything I can get my hands on, talking to local developers and property agents, interviewing sellers and owners, and viewing new and old properties on the actual sites. Don't ask me where the potential investments are. I won't buy in any hot and overpriced
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Try to understand the rationale behind their purchase. Are they just following the herd to dump their spare cash after they faced buying restrictions of local properties? Have they calculated the net return and run through the worst case scenario?
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SINGAPORE PROPERTY WEEKLY Issue 113 2. Can you trust them? How much do you know about the developer? Can you trust that it will complete the project on time and with acceptable quality? Will it run away when the market tanks? Who is going to manage the property on your behalf? Can you trust the local management, security and laws of the country? Will they ask you to pay and pay, but with you still ending up having to travel there frequently to clean up the mess? 3. Why are the locals not buying? If the return of that overseas project is so attractive, why are the units not already being snapped up by the locals? Why does the developer have to spend so much time, money and effort to go overseas, repackage and market to you?
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Look at the rental return promised by the developer. Are the locals avoiding those projects because of oversupply, bad location or poor rental demand? If even the locals are not attracted by the potential of the project, what make you think that you, as a foreigner, will be able to get credit terms, government taxes, rental return, etc. more favorable than the locals? 4. Is there a secondary market? Do you know there are property projects built only to target foreign buyers? Some areas in the US, UK and Australia have properties mainly targeted at Asian buyers. Similarly, some high-end condos and landed properties in Malaysia are only marketed to foreign investors.

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SINGAPORE PROPERTY WEEKLY Issue 113 Developers can continue building new projects and sell to foreigners at a premium. But one day when you want to sell yours, who will be your buyer? The locals are not interested to stay where you bought. The amenities are only suitable for foreigners. They are not interested to invest there either. Why would they buy overpriced properties from a foreigner that comes with so many restrictions? What about other foreign buyers? Can you find anyone to take it over from you? What if they have already lost confidence in the market? I completely agree with what Donald Trump said in his book Trump: Think Like a Billionaire: Just because you don't understand something doesn't make it a good investment... the words new venture sound to me like a loan that will never get paid back ... They want your money, pure and simple, so they'll have a chance to make money. I am not saying that all overseas property investments are unprofitable, or all overseas property marketing projects are scams. But before you plunge in, why don't you conduct a thorough study on the property market in that country and on that specific property project? If you are using your hard-earned money to invest, it's better to be safe than sorry. And when in doubt, leave it out. By Property Soul, a successful property investor and enthusiast who shares her experiences and knowledge on her blog.

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SINGAPORE PROPERTY WEEKLY Issue 113

Property Selling Tip #6: Notify your Tenant

Be nice to your Tenants and they will be nice to you too, especially when you want to arrange viewings which are disturbing to their stay. You can have a short discussion with them to let them know about your intention to sell the property and find out if they intend to continue to stay.You would then be able to decide if you are selling the property with or without tenancy. If the property is to be sold vacant, do give your Tenant ample notice (as per the Tenancy Agreement) for them to source for an alternative rental unit. In the event the property is to be sold with tenancy, do inform your Tenant about the change of rental payment bank account number to avoid incorrect payment issues. The deposit that you have received from the Tenant would be transferred to the Buyer. This will be handled by your Solicitor when they handle the sales proceeds. By Eileen Tan and Ui Wei Teck, property investors and authors of Enjoying Mid-Life Without Crisis. This tip and dozens more are from their book.

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SINGAPORE PROPERTY WEEKLY Issue 113

Singapore Property This Week

Residential
Sales at Vue 8 affected by new home loan curbs Only 50-plus units were sold at Vue 8 Residence, a 99-year leasehold project in Pasir Ris, due to the general air of caution and longer bank loan approval process after the new total debt servicing ratio (TDSR) framework took effect on June 29. The average prices of the units are between $980 and $1,050 per sq ft, depending on unit types and whether units face the sea. Absolute prices start from $540,000 for a 474 sq ft one-bedder. At 17 storeys high, the 463-unit condo development would have been able to

sell between 150 and 200 units in the first weekend prior to the new framework, according to OrangeTee research head Christine Li.
(Source: Business Times)

July developer sales expected to slow down following June surge

Developer sales increased by 23.8 percent month-on-month in June to 1,806 homes (excluding executive condominiums), thanks to the 737 units sold at the J Gateway condo in Jurong on a single day on June 28 as developers and buyers raced before the new Monetary Authority of Singapore (MAS) regulations took effect the following day.
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SINGAPORE PROPERTY WEEKLY Issue 113 According to Urban Redevelopment Authority's (URA) latest figures, developers have moved 10,061 units in the first six months, which translated to a monthly average of 1,677 units. As for ECs, which are a hybrid of private and public housing, developers' June 2012 sales stood at another 1,725 units. Despite the June surge, market watchers expect sales in July to slow down due to the new Total Debt Servicing Ratio framework by MAS, as players need time to adjust to the more rigorous framework for banks to approve property loans. Savills Singapore research head Alan Cheong said developers' private home sales for July could be as low as half the June figure. Colliers International director Chia Siew Chuin said that July sales could ease to 1,000 units before recovering in the following months. (Source: Business Times)
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Tender for Tampines Ave 10 plot draws strong demand, surprising analysts Tampines Ave 10 plot, the first private residential site tender to close since a new debt servicing framework for property loans was introduced, drew strong demand with ten bidders and surprised analysts who predicted greater caution. The highest bid was from MCC Land Singapore with $562.01 psf ppr, or $289.7 million in absolute terms. The second highest bid stood at $522.24 psf ppr, or $269.2 million from a partnership of UOL Venture Investments and Kheng Leong Company.

(Source: Business Times)

The Quinn to get July launch The Quinn, a freehold residential development along Bartley Road, will be launched at the end of July by TOP Global.
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SINGAPORE PROPERTY WEEKLY Issue 113 The development comprises 139 units over four five-storey blocks, with apartments ranging from one-bedroom units (starting from 484 sq ft), two- and three-bedroom units (646- 1,141 sq ft) to penthouses exceeding 2,000 sq ft. Prices are expected to start from $1,500 psf. Located close to the upcoming Bidadari Township, The Quinn is expected to benefit from the rental demand of the working population based at Paya Lebar iPark, the Central Business District and Seletar Aerospace Park. (Source: Business Times) Commercial No more bank-developer tie-ups The Monetary Authority of Singapore (MAS) has put out a new rule that would stop banks from offering preferential interest rates for property loans to clients buying designated
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properties. In other words, this rule would restrict a common practice where property developers and agents tie up with banks to sell property. With effect from June 29 onwards, all forms of tie-ups with property developers and agents are not allowed. MAS spokesman said that except for the granting of property loans, financial institutions should not offer any property-related services to customers in general, including property advertisements or tie-ups with property developers, regardless of the location (in or outside of Singapore) or the type of property (residential, commercial, industrial).

(Source: Business Times)

Shell firms cant circumvent new loan regime The Monetary Authority of Singapore (MAS) said that shell companies, or companies
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SINGAPORE PROPERTY WEEKLY Issue 113 set up by individuals to buy commercial and industrial properties, are to be included in the newly launched TDSR framework as well. Financial institution were advised by MAS to thoroughly assess the case in which individuals set up local or offshore shell companies but do not have substantive businesses with genuine commercial activities. Entities not subjected to TDSR framework include: existing companies trading in property and/or holding investment properties for rental income, and new entities set up by an established property group or fund if the FIs can establish the new entity's parentage. (Source: Business Times)

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SINGAPORE PROPERTY WEEKLY Issue 113

Non-Landed Residential Resale Property Transactions for the Week of Jul 3 Jul 9
Postal District 1 2 5 5 5 5 8 9 9 9 9 9 9 9 10 10 10 10 10 10 11 11 11 11 Area (sqft) 614 506 1,496 1,195 1,302 980 1,356 1,184 1,593 474 667 1,173 667 1,572 990 786 1,302 2,056 1,464 1,528 581 2,573 958 1,345 Transacted Price ($) 1,400,000 1,105,000 1,720,000 1,360,000 1,480,000 890,000 2,200,000 3,629,000 4,816,500 980,000 1,360,000 2,165,000 1,175,000 2,515,000 1,938,000 1,330,000 2,171,000 3,160,000 2,180,000 2,185,000 1,250,000 4,305,000 1,600,000 1,930,000 Price Tenure ($ psf) 2,282 99 2,184 99 1,150 FH 1,138 FH 1,136 FH 909 99 1,622 99 3,065 FH 3,023 FH 2,069 FH 2,038 FH 1,845 FH 1,761 FH 1,600 999 1,957 FH 1,693 FH 1,667 FH 1,537 FH 1,489 FH 1,430 FH 2,151 99 1,673 FH 1,670 99 1,434 FH Postal District 12 12 12 12 12 12 14 15 15 15 15 15 15 16 16 16 17 18 19 19 19 19 19 21 Area (sqft) 570 1,163 1,130 1,399 4,413 1,044 1,195 1,442 1,841 1,066 2,056 861 1,636 1,755 872 926 1,249 1,270 936 1,389 1,302 1,033 1,173 861 Transacted Price ($) 835,000 1,600,000 1,535,000 1,850,000 4,975,000 1,063,880 1,170,000 2,588,000 2,600,000 1,350,000 2,575,000 1,010,000 1,200,000 2,500,000 1,060,000 920,000 1,250,000 1,235,000 1,080,000 1,560,000 1,420,000 1,030,000 890,000 1,160,000 Price Tenure ($ psf) 1,464 FH 1,376 FH 1,358 FH 1,322 FH 1,127 FH 1,019 FH 979 99 1,794 FH 1,413 FH 1,267 FH 1,252 99 1,173 FH 733 99 1,425 99 1,216 FH 994 99 1,001 FH 972 99 1,153 FH 1,123 FH 1,090 99 997 FH 759 99 1,347 99

Project Name THE SAIL @ MARINA BAY LUMIERE THE PARC CONDOMINIUM THE PARC CONDOMINIUM LE HILL CONDOMINIUM VISTA PARK CITYLIGHTS HILLTOPS HILLTOPS PARC SOPHIA THE INSPIRA LUMA PARC SOPHIA ASPEN HEIGHTS PARVIS THE LEVELZ SOMMERVILLE PARK HOLT RESIDENCES THE LEGEND SHEARES VILLE SOLEIL @ SINARAN THE LINCOLN RESIDENCES AMARYLLIS VILLE AMANINDA

Project Name D'LOTUS TRELLIS TOWERS DE PARADISO THE ARTE BALESTIER TOWERS MOONSTONE RESIDENCES ASTORIA PARK AALTO CASA MEYFORT ST PATRICK'S LOFT COSTA RHU THE SUNNIDORA NEPTUNE COURT COSTA DEL SOL CHANGI COURT THE BAYSHORE FERRARIA PARK CONDOMINIUM OASIS @ ELIAS SANCTUARY @ 813 TANGERINE GROVE THE SPRINGBLOOM THE MORNING GLORY EVERGREEN PARK GARDENVISTA

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SINGAPORE PROPERTY WEEKLY Issue 113

Postal District 21 21 21 21 21 22 22 22 23 23 23 26

Project Name THE BLOSSOMVALE HIGHGATE PARC PALAIS SUNSET LODGE HUME PARK I THE CENTRIS THE LAKESHORE PARC VISTA HILLVIEW REGENCY PARKVIEW APARTMENTS PALM GARDENS THE CALROSE

Area (sqft) 1,367 1,227 1,238 1,087 1,582 1,066 1,109 1,055 1,195 1,119 1,216 969

Transacted Price ($) 1,780,000 1,380,000 1,350,000 1,130,000 1,460,000 1,400,000 1,380,000 990,000 1,135,000 895,000 935,000 1,180,000

Price Tenure ($ psf) 1,302 999 1,125 FH 1,091 FH 1,039 FH 923 FH 1,314 99 1,245 99 939 99 950 99 799 99 769 99 1,218 FH

NOTE: This data only covers non-landed residential resale property transactions with caveats lodged with the Singapore Land Authority. Typically, caveats are lodged at least 2-3 weeks after a purchaser signs an OTP, hence the lagged nature of the data.

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