Sunday, July 29, 2007

Home Buyer's Guide & The Buying/Selling Process

Source : Urban Redevelopment Authority (URA) [http://www.ura.gov.sg/lad/HBG/basicCheck.htm]

Buying a new apartment, flat or house may probably be your single largest investment. Hence, before you even visit a showflat or view any unit, it is important that you familiarise yourself with some existing Government policies which may affect you.

Fast Facts:
.If you own a HDB flat or Executive Condominium, you have to fulfill the minimum occupation period before you can purchase private residential properties

.If you are a Non-Singapore citizen, you have to obtain approval from the Controller of Residential Property before you may buy landed houses.

.You should consider your finances before committing to any property purchase, taking into consideration the limit on the use of CPF monies for property purchase and the loan amount you can obtain.

.You can access free property market information, such as prices of private residential properties transacted over the last 12 months, from URA website.

.Besides the price of the property, other fees such as stamp duty and property tax are payable.

.You may wish to consult a lawyer on your rights and obligations before signing any document.


Check Your Eligibility to Buy
Before you consider buying your dream home, check whether you are eligible to buy especially if you own a HDB flat and/or are a non-Singapore citizen (including Singapore Permanent Resident).

If you own a HDB flat, you may wish to check whether you have fulfilled the minimum occupation period required for your HDB flat before you can purchase private residential properties. For more information, visit the Housing Development Board of Singapore (HDB) website. [http://www.hdb.gov.sg]

If you are a non-Singapore citizen (including Singapore Permanent Residents), you have to obtain approval from the Controller of Residential Property, Singapore Land Authority, before you may buy landed houses. For more information, visit the Singapore Land Authority (SLA) website.[http://www.sla.gov.sg]


Considering Your Finances
You should consider your finances and decide on a budget that you would be able to commit towards your property purchase. You could use the "Housing Affordability Calculator" from CPF's website to estimate your housing loan based on your income and ability to service the loan.

If you decide to utilise your CPF monies, you should take note that there are limits on their use for property purchases. Information on the use of CPF monies and how proceeds of sale from your previous residential property will be handled is available from the Central Provident Fund Board (CPF) website. [http://www.cpf.gov.sg]

If you need to borrow from banks, you should familiarise yourself with the terms of the loan and mortgage as well as the variation in interest rates for the period of your loan. You may wish to discuss with a banker to determine the maximum loan amount that you may obtain, the interest rate and period of repayment for the loan. The list of local and foreign full banks operating in Singapore can be found in Monetary Authority of Singapore (MAS) website. [http://www.mas.gov.sg]

Your application for the use of CPF monies and/or loans from banks will take some time to be processed. Your lawyer will also need time to carry out certain checks regarding the property to be purchased. To ensure that you have enough funds to meet the payments required as well as a place to stay, you should plan carefully when you should sell your existing home and when to purchase a new home. For information on the process of sale of HDB flats, visit the Housing Development Board of Singapore (HDB) website. [http://www.hdb.gov.sg]


Property Market Information
URA provides free information on the property market, including:

• List of the launch and sale status of uncompleted private residential projects. The list is updated every month.

• Prices of private residential properties that were transacted with caveats lodged over the last 12 months.


Know the Fees Payable
You may want to find out more about the other fees payable when purchasing a residential property. Besides the following fees, you should also find out from the sales agent or your lawyer on any other fees which you may have to pay.

For information on stamp duty and property tax payable, visit the Inland Revenue Authority of Singapore (IRAS) website.[http://www.iras.gov.sg]

A valuation report on the value of the property to be purchased is required by banks and the CPF Board. For a list of valuers and the fees payable, visit the Singapore Institue of Surveyors and Valuers(SISV) website. [http://www.sisv.org.sg]


Consult a Lawyer
You may wish to consult a lawyer to understand better the process of buying a property and your rights and obligations before signing any document. In engaging a lawyer you should also clarify the scope of services to be provided as well as the fees payable. For information on lawyers and the legal profession in Singapore, visit the website of The Law Society of Singapore [http://www.lawsociety.org.sg]


The Buying/Selling Process:

1) Select an agent
Optional, but recommended. A professional agent will not only help you to find the right property, but also ensure you get the right price, ensure all small details are covered prior to purchase, guide you through the process and make recommendations on financing and legal representation.

2) Find your property and agree a price
When reaching a preliminary agreement to buy, ensure that all important points have been discussed and agreed, including any repairs or changes prior to purchase, what stays and what goes, any special requirements from both side and the anticipated schedule.

3) Sign an Option to Purchase
For Private Property - This is obtained from the seller through their lawyer or agent. At this point you are required to pay a non-refundable option fee (normally 1% of purchase price). The option period is usually 14 days.

For HDB Property - Since 15 April 2003, the HDB standard Option to Purchase has replaced the Sale & Purchase Agreement as the form of contract to be used in resale flat transactions. Buyers and sellers should not enter into any other forms of agreement or supplemental agreements.

4) Appoint a Lawyer
You now need to appoint a lawyer to make legal enquiries on the status of the seller, the title of the property and the terms of the sale.

5) Arranging Financing
Compare interest rates and special terms when choosing your finance scheme. You can apply for withdrawal of CPF savings by completing an application together with a valuation report prepared by a licensed valuer who is on the CPF panel of valuers.

6) Exercise the Option / HDB 1st Appointment
For Private Property - If all is well you now sign the sale contract, and pay 5% of the purchase price (less the option fee). You also need to pay stamp duty within 14 days of the contract.

For HDB Property - The buyer and seller must both attend the Sales Declaration & Registration appointment to seal the closing price. After this appointment, HDB will check eligibility of the transaction and arrange for a 1st Appointment – usually about 4 weeks after the Sales Declaration.

7) Legal Inspection & Completion
Your lawyer will carry out an investigation of title deeds and send requisitions to various government departments. The seller’s lawyer will also prepare the completion statement and send documents for stamping to effect completion.

8) Settle Payment and Handover / HDB 2nd Appointment
For Private Property - You now settle the outstanding balance of the purchase price. This might be 8 to 12 weeks after exercising the option. The seller’s lawyer will then handover the keys and title deed of conveyance, and you become the owner of your new home.

For HDB Property - Completion takes place at the 2nd Appointment, usually about a month after the 1st Appointment. The insurance and mortgage is arranged and stamp duty, legal fees and agent fees are paid. The sale is completed and arrangements are made for moving into your new home.

Leasehold Vs Freehold

Source : The New Paper, 10 Feb 2007

In boom times, Lease is more

Which would you rather buy - a leasehold property or freehold?

For many Singaporeans, it’s a no-brainer.

Why? Ownership of the freehold property lasts generations (unless it’s acquired by the authorities) compared to leasehold, where the fear is that after 99 years, you may lose your home.

But if the largest en-bloc sale on Tuesday is any indication - where CapitaLand paid a staggering $548 million for the leasehold Gillman Heights - it just goes to show that en-bloc possibilities are not limited to the freehold market.

Just last month, the leasehold Minton Rise at Hougang was also sold en-bloc for $209 million to the Kheng Leong group. With the market looking up, this leasehold or freehold dilemma will be on many home-buyers’ minds.

Consider this: The number of new homes sold hit a staggering 11,147 last year, far exceeding the sub-10,000 units sold during the last three peaks in 1996, 1999 and 2002, according to figures released by the Urban Redevelopment Authority last month.

For a home-buyer, the price difference between a freehold and leasehold unit in the same area could be a premium of as much as 40 per cent.

Here’s an example: Four years ago, we compared some properties in the East Coast area, such as the freehold Amber Park and the 99-year leasehold Mandarin Gardens.

Both units were three-bedroom apartments of about the same size.

Back then, Amber Park was about 15 years old, while Mandarin Gardens was about 21 years old. We polled 50 people then and asked: ‘If you have to live in one of the above developments, which would you choose?’

Without knowing the price and land leases, 42 out of 50 chose Mandarin Gardens - the main attraction being the condo’s huge grounds and facilities.

But when told that Mandarin Gardens is leasehold, 46 out of the same group of 50 chose Amber Park.

Today both properties have seen the same price increase of about 25 per cent. (See comparison above.)

But if you had bought the two properties to rent out, you’ll realise that Mandarin Gardens gives you more bang for your buck.

Currently, the monthly rental at Amber Park is about $3,500.

This means a yield of about 4 per cent a year ($3,500 x 12 months divided by the property value of $1.07m).

In comparison, the monthly rental at Mandarin Gardens is about $2,800.

But its rental yield of about 5 per cent a year is better than Amber Park ($2,800 x 12 months divided by the property value of $668,000).

ERA Singapore vice-president Eugene Lim explained:

‘The tenant doesn’t care if the property is leasehold or freehold. If the age, size, location and facilities of the two places are about the same, the rental should be similar too.’

During a boom, prices of both types of properties will appreciate. The reverse happens when the market dips, said Mr Colin Tan, Chesterton International’s head of research and consultancy. He said: ‘Some may say that freehold has better capital gains. But it’s inconclusive if one type of tenure is better than the other. In some areas, the freehold gains are better but in other areas, leasehold does better.’

Tenure aside, the location, the surroundings, and even a new MRT line does affect property prices.

In the past, it was true that a leasehold property’s value depreciated sharply after 60 years.

Then, you couldn’t use your CPF to pay for properties with less than 60 years on the lease.

This forced potential buyers to use only cash to pay for the unit if bought at the cut-off mark.
That affected the asking price drastically.

This policy was revised in 2005 for properties with less than 30 years on the lease, which is good news for leasehold property owners.

For leasehold properties, however, going en-bloc is not a given compared to freehold ones. This is because there’s still the issue of lease top-up which needs approval, property watchers said.
And for that to happen, the plot ratio must be hiked where there is potential for intensifying the use of the land.

For auditor James Tang, 37, property location is foremost on his mind.

His dream is to own a freehold property, both for the prestige factor and also so that the place will be ‘mine forever’, he said.

He said: ‘It’s a notion that we want to leave something for our children that can last forever. But knowing how upgrade-crazy Singaporeans are, it may make sense to just jump from a leasehold property to another.’

Macpherson Estate Set To Become A More Vibrant Town

Source : Channel NewsAsia, 29 July 2007

Macpherson is set to become a more vibrant town in the next five to ten years as it goes into the next phase of development and regain its status as a transportation hub, said MP Matthias Yao.

In its hey day, 13 bus routes had their terminals at Macpherson and on Sunday, over 2,000 residents at the Macpherson Day Carnival were told that the estate is lined up for bigger things.





Video Link - http://tinyurl.com/2gv27c (Channel NewsAsia Video News)

The upcoming MacPherson Circle Line station looks set to make a splash with residents when it is ready in 2010 as it promises to inject vibrancy into the area.

It will also serve as an interchange, intersecting with the Downtown MRT line which will ply through the city centre and Marina Bay.

With the development, linkways and underpasses will be built to connect the neighbourhood centres to the new station.

Mr Yao, who is also the mayor of South East CDC, said: "Because of the convenience of transport in the coming years, Macpherson will become very lively. More people will want to choose to live in Macpherson, and certainly, I see some of the property value going up.

"When the interchange is done, there will be commercial activities around it and that will also bring more dynamism to the existing small businesses within the estate."

And as more residents move in, it is important to promote harmonious living in the estate.

Senior Minister Goh Chok Tong and Marine Parade GRC MPs joined Macpherson residents in celebrating diversity at the carnival.

There are also plans to make life easier for the senior citizens as more than half of the population here in Macpherson are 55 years old and above.

These plans include providing more financial and social assistance to the elderly and upgrading the estate.

Over the next five years, they can look forward to more barrier-free access features around the estate and lifts on every floor, even for low-rise flats.

Three upgrading programmes are in the pipeline and residents from 15 blocks are expected to vote for the projects in September. - CNA/so

Home For Family Of Three Is Entire 11-Storey Condo

Source : The Straits Times, Sunday, July 29, 2007

They're leaving the penthouse and 3 other maisonettes empty. Who needs to rent them out when you're billionaire Peter Lim - and he won't cash in on his $100m Ardmore Park property By Lee Su Shyan














Billionaire Peter Lim (above) has no plans to sell his condo and move into a landed property because it feels more secure to live in an apartment. -- ST PHOTO: LIM WUI LIANG

EVEN for the ultra rich, condo living still means having to share facilities like pools and tennis courts with neighbours. Unless you're billionaire Peter Lim, that is.

Mr Lim, his wife Cherie and his 85-year-old mother have an entire 11-storey condo - and pool - at Ardmore Park to themselves. No noisy neighbours, no barking dogs, no learner trumpeters practising in the apartment next door.






















LOCATION AND SPACE are what keep billionaire Lim from selling Abelia, of which he has an 80 per cent share. -- ST PHOTO: MAY LIN LE GOFF

The family occupy an apartment close to 4,000 sq ft at the Abelia condo while the other three maisonettes and a 5,000 sq ft penthouse sit empty, although there is a security guard.

Not that Mr Lim needs the rent. He made his first fortune as a remisier and another bigger one with shrewd investments in palm oil.

And Abelia - Mr Lim owns 80 per cent and a pal the rest - is probably worth about $100 million given its primest of prime locations near Orchard Road.

But Mr Lim is resisting the temptation to sell up and cash in on the property boom as his mum does not want to move.

They like the location and the acres of space, including an underground carpark, which is handy given Mr Lim's pricey collection of 10 cars, Ferraris included.

'I have enough space to park them,' Mr Lim said in a recent interview.

'The road is also very wide with lots of entrances and exits. If I were to live at Orchard Turn, I would have to put up with the bad traffic. But here, there are many ways for me to avoid the congestion,' he added.

And while he could sell the Abelia and buy a handful of houses, the posh bungalow life in District 10 doesn't suit him.

'Maybe it comes from the days when I was a remisier and travelling a lot in Malaysia, every four days of the week.

'That has made me security conscious so I prefer to live in an apartment,' he said.

The bumper gain he is sitting on at the Abelia must also enhance the home sweet home feeling. He bought the building in 1994 when Malayan Credit sold some of its investment properties, paying less than $14 million.

That is looking like a bargain to end all bargains, what with the land and building now worth as much as $100 million, going by recent sale prices.

Last month, SC Global forked out $262 million for The Ardmore, just a few doors away at 6 Ardmore Park. The price for the plot of 42,565 sq ft worked out to $2,337 per sq ft (psf) of potential gross floor area, including development charges.

Abelia has an estimated 40,000 sq ft of gross floor area, which could mean a sale price of about $100 million given the $2,500 psf it could command in today's market, say some consultants.

Others sound a note of caution as the Abelia's land area is far smaller at 14,000 sq ft, although as Knight Frank's head of research and consultancy Nicholas Mak says: 'The whole stretch of Ardmore Park is valuable land, and the price it can fetch will depend on the size and the shape of the parcel.'

Whatever price it might command, it will be small beer compared to Mr Lim's stake of just under 5 per cent in palm oil giant Wilmar International, which is worth around $1 billion.

While Abelia is only 11 storeys, it dominates the area - at least for the next few months.

It is surrounded on three sides by the building site for Wheelock Properties' 36-storey Ardmore Park II. The site was occupied by Habitat Two and Ardmore View, which were sold en bloc last year.

But Mr Lim is not fretting about the noise and dust as modern piling methods have reduced much of the impact.

Anyway, he can always get away for the day in one of his flashy cars sitting in that spacious underground carpark.

He Owns The Whole Condo In Orchard Rd

Source : The Straits Times, July 28, 2007

EVEN for the ultra rich, condo living still means having to share facilities like pools and tennis courts with neighbours. Unless you're billionaire Peter Lim, that is.

Mr Lim, wife Cherie and his 85-year-old mother have an entire 11-storey condo and pool at Ardmore Park to themselves.

No noisy neighbours, no barking dogs, no learner trumpeters practising in the apartment next door.

The family occupy a flat close to 4,000 sq ft at the Abelia condo while the other three maisonettes and a 5,000 sq ft penthouse sit empty, although there is a security guard.

Not that Mr Lim needs the rent.

He made his first fortune as a remisier and another bigger one with shrewd investments in palm oil.

And Abelia - Mr Lim owns 80 per cent and a pal the rest - is probably worth about $100 million given its primest of prime locations near Orchard Road.














Mr Lim is resisting the temptation to sell up and cash in on the property boom as his mum does not want to move. -- ST PHOTO: LIM WUI LIANG

They like the location and the acres of space, including an underground carpark, which is handy given Mr Lim's pricey collection of 10 cars, Ferraris included.

And while he could sell the Abelia and buy a handful of houses, the posh bungalow life in District 10 doesn't suit him.

Rents Here Too High? Not So, Say Expats

Source : The Staits Times, Sunday, July 29, 2007

Though rents are rising, expats say housing here is more affordable than in many major cities




















MR CHARLES TIDSWELL, 34, managing director for South-east Asia at IT company Facilitate Digital, pays about $3,000 for his 1,100 sq ft apartment at The Legend in Bukit Timah Road. When he was in Hong Kong, he paid $4,500 for a 900 sq ft apartment. He moved here in 1998. 'You could say that Singapore's prices are possibly 10 years behind those of Hong Kong's,' said Mr Tidswell. -- ST PHOTO


SINGAPORE and Hong Kong are keen competitors in most things but when it comes to rent, there is only one winner.
Ask Mr Jason Longley, the regional manager of an insurance company. A year ago, he was paying $8,500 a month to rent a 900 sq ft apartment in Hong Kong's prime Peak area.

Now he rents a 1,400 sq ft flat at Leonie Hill off Grange Road for just $5,500.

Mr Longley, 35, said Singapore's cheaper rent was a key factor in his decision to relocate: 'I definitely saw rent as a huge expense in Hong Kong.'

It also helps put into perspective the growing complaints about rising rents.

Urban Redevelopment Authority figures out last Friday showed that residential rents rose 10.4 per cent in the April to June quarter and are up 31.2 per cent over the past 12 months.

But expats and agents told The Sunday Times that Singapore rents are still cheaper than in cities such as Hong Kong, Tokyo, London and New York.

A new survey by ECA International, a human resource consultancy, showed that rents here were 45 per cent less than the average price in Tokyo and 40 per cent less than in Hong Kong.

Singapore was the eighth most expensive place to rent a three-bedroom flat in Asia and 15th most expensive in the world - below Hong Kong, Tokyo, New York and London.




















Investment banker Timothy Rice, who moved here last August, can testify to that.

Mr Rice, 27, pays $1,400 for a 350 sq ft studio in Kelantan Lane, near Bugis Junction. He said such a flat in an equivalent London location would still cost about the same figure - but in pounds. That is about $4,300.


Mr Masamitsu Kawasumi, 44, chief bank representative of the Development Bank of Japan, arrived here last month and was struck by the rental gap between Tokyo and Singapore.

Tokyo's hip Roppongi area, with its many clubs and restaurants, has rents of about $13 per sq ft. Orchard Road's $6 psf seems like a bargain.

Mr Thomas Preben Hansen, 32, chief executive of a listed marine firm, has lived in Shanghai and London: 'Rents had become very cheap since 1997, and still have some catching up to do.'

He anticipated the rent squeeze and so bought a flat in Ewe Boon Road, off Bukit Timah Road, when he arrived in May.

A rental squeeze is exactly what Ms Isabelle Scali, 30, is bracing herself for. The public relations manager thinks Singapore is relatively more costly than London.

She pays $1,800 - nearly half of her salary - for a 1,200 sq ft flat at Sunshine Plaza off Prinsep Street.

In London, she said she spent just a third of her salary on a 700 sq ft studio flat in Balham, southwest London.

Ms Scali, who has signed a two-year lease, said rental costs will determine if she stays in Singapore.

Mr Rajesh Malkani, 43, who lived in Hong Kong for 13 years before moving here in 2005, said: 'I don't expect Singapore's prices to reach Hong Kong levels because there is still land here. But I do expect them to go up.'

Mr Malkani, the global head of sales and business development at Standard Chartered, rents a 4,000 sq ft bungalow in Sunset Place. He would not reveal his rent but said it would get only half the space in Discovery Bay, which he feels is a comparable site in Hong Kong.

Given the decade-long property slump here, Mr Simon Smith, a senior director at Savills Asia Pacific, thinks rents will keep rising for the next one to three years.

But Mr Rice is not complaining: 'Compared to Hong Kong, New York, London - Singapore is still cheap,' he said.