《联合早报》Feb 05, 2008
全岛58个组屋地段的590座组屋获选在新一批翻新计划下受惠，有关翻新计划包括家居改进计划、邻区更新计划和电梯翻新计划。
建屋局昨天发表文告说，由于国人对新推出的家居改进计划（Home Improvement Programme，简称HIP）反应热烈，受惠市镇将从原本宣布的两个增加至四个。
据本报了解，除了之前公布的淡滨尼和义顺市镇外，马林百列市镇理事会和宏茂桥—杨厝港市镇理事会管辖的组屋区，也将有地段获选展开家居改进计划。
获选展开邻区更新计划（Neighbourhood Renewal Programme，简称NRP）的则有8个邻里，而52个电梯翻新计划（Lift Upgrading Programme)也会在不同邻里展开。一些地段会同时展开两项翻新工程，以减低对居民造成的不便。
李显龙总理在去年的国庆群众大会上宣布政府将推出家居改进计划和邻区更新计划，这些新计划让居民享有更大自主权，可决定需要什么屋内装修或社区设施。
其中两个受惠地点
建屋局说，新一批翻新计划的具体地点及详情，将由有关地段所属选区的议员宣布。本报打听到的其中两个受惠地点，是后港6道第520座至533座组屋，拉丁马士区的直落布兰雅大道第27座至43座组屋。这两个地点预计将在邻区更新计划和电梯翻新计划下受惠。
丹戎巴葛集选区（拉丁马士区）议员陈振泉受访时说，获准翻新的拉丁马士组屋都是在1975年兴建，许多居民都是第一代住户，从年纪轻轻住到年事已高，自然很希望居住环境可以获得改善。
阿裕尼集选区议员潘惜玉说，邻区更新计划将能改善居民的居住环境，为旧组屋区注入新活力。她说，建屋局也已要求市镇理事会提名，看哪些市镇适合进行下一轮的家居改进计划。
另外，6个原本获选展开主要翻新计划（Main Upgrading Programme，简称MUP）的地段，也获准以新的翻新计划替代。建屋局说，这些邻里都还未进行投票，当局是收到它们所属选区的基层组织顾问的申请后，批准让这30座组屋展开新的翻新计划。
Tuesday, February 5, 2008
Local SMEs Cautiously Positive About Economic Outlook
Source : Channel NewsAsia, 04 February 2008
Small and medium enterprises (SMEs) remain positive about Singapore's economic outlook this year.
But sentiment has turned somewhat cautious, according to the latest survey by banking giant HSBC on Small Business Confidence in Asia Pacific.
Compared to 2007, SMEs will be taking on a more conservative approach this year as the economy is expected to moderate amid a likely slowdown in the US.
HSBC is forecasting a 6 percent GDP growth for Singapore's economy in 2008, down from 7.5 percent last year.
Robert Prior-Wandesforde, Senior Asian Economist, HSBC, said: "Inflation in Singapore is probably the main domestic risk and we're going to see it rise further before it starts to fall in the second half of this year. I think it may well go up to 6 percent or in fact just above 6 percent. That will provide some constraints on real income, but inflation is not running as quickly as overall wage growth. There are real wage gains happening in the economy at the moment."
Wage growth in Singapore at the moment is running at 7 percent or so, while inflation is around 4 percent.
According to the survey, 52 percent of the respondents from Singapore expected economic growth to remain the same as 2007, while 55 percent said their capital expenditure would remain the same.
But those who plan to raise their capital expenditure fell to 35 percent from 44 percent in the previous survey.
More than seven in ten Singapore companies said they would keep their current headcounts, and a quarter – down from 36 percent – said they were looking at increasing staff strength.
Those who are looking to reduce headcount also went down, from 6 percent in the last survey to 2 percent.
SMEs are generally positive about the trade outlook with the international community, especially with China and the Asia Pacific economies.
A total of 46 percent of respondents from Singapore expected trade volumes within the rest of Asia to increase over the next six months.
HSBC said Singapore SMEs have much to gain from venturing overseas.
Tan Siew Meng, Head of Commercial Banking, HSBC, said: "From HSBC's perspective, we continue to support the SMEs in terms of their regionalisation and internationalisation objectives. You can see from the survey results that Vietnam and India, for example, are markets that are still very high in terms of confidence level and you know our SMEs in Singapore can take advantage of the growth expectations in those countries to expand their scope."
From the survey, expansion seems to be on the cards for many SMEs. 45 percent of the respondents with cross-border activities planned to increase their investments.
The HSBC survey was conducted in the fourth quarter of last year and it covered 2,700 SMEs in Singapore, Malaysia, Hong Kong, China, Taiwan, India, Vietnam, South Korea and Indonesia. - CNA/so
Small and medium enterprises (SMEs) remain positive about Singapore's economic outlook this year.
But sentiment has turned somewhat cautious, according to the latest survey by banking giant HSBC on Small Business Confidence in Asia Pacific. Compared to 2007, SMEs will be taking on a more conservative approach this year as the economy is expected to moderate amid a likely slowdown in the US.
HSBC is forecasting a 6 percent GDP growth for Singapore's economy in 2008, down from 7.5 percent last year.
Robert Prior-Wandesforde, Senior Asian Economist, HSBC, said: "Inflation in Singapore is probably the main domestic risk and we're going to see it rise further before it starts to fall in the second half of this year. I think it may well go up to 6 percent or in fact just above 6 percent. That will provide some constraints on real income, but inflation is not running as quickly as overall wage growth. There are real wage gains happening in the economy at the moment."
Wage growth in Singapore at the moment is running at 7 percent or so, while inflation is around 4 percent.
According to the survey, 52 percent of the respondents from Singapore expected economic growth to remain the same as 2007, while 55 percent said their capital expenditure would remain the same.
But those who plan to raise their capital expenditure fell to 35 percent from 44 percent in the previous survey.
More than seven in ten Singapore companies said they would keep their current headcounts, and a quarter – down from 36 percent – said they were looking at increasing staff strength.
Those who are looking to reduce headcount also went down, from 6 percent in the last survey to 2 percent.
SMEs are generally positive about the trade outlook with the international community, especially with China and the Asia Pacific economies.
A total of 46 percent of respondents from Singapore expected trade volumes within the rest of Asia to increase over the next six months.
HSBC said Singapore SMEs have much to gain from venturing overseas.
Tan Siew Meng, Head of Commercial Banking, HSBC, said: "From HSBC's perspective, we continue to support the SMEs in terms of their regionalisation and internationalisation objectives. You can see from the survey results that Vietnam and India, for example, are markets that are still very high in terms of confidence level and you know our SMEs in Singapore can take advantage of the growth expectations in those countries to expand their scope."
From the survey, expansion seems to be on the cards for many SMEs. 45 percent of the respondents with cross-border activities planned to increase their investments.
The HSBC survey was conducted in the fourth quarter of last year and it covered 2,700 SMEs in Singapore, Malaysia, Hong Kong, China, Taiwan, India, Vietnam, South Korea and Indonesia. - CNA/so
590 Blocks In 58 Sites Selected For New HDB Upgrading Programmes
Source : Channel NewsAsia, 04 February 2008
A total of 590 blocks in 58 sites have been selected for the next batch of HDB upgrading programmes.
The exact list has not been disclosed but HDB said these blocks would benefit from programmes such as the Home Improvement Programme (HIP), Neighbourhood Renewal Programme (NRP) and the Lift Upgrading Programme (LUP).
HDB said the number of HIP projects has been increased from two to four due to strong public support. Eight NRP and 52 LUP projects will also be offered.
Some areas will benefit from more than one programme.
HDB has also agreed to requests from some MPs for six of the Main Upgrading Programme (MUP) sites selected in previous years to switch to the new programmes as they have not undergone polling.
Residents from about 30 blocks in these sites will be able to enjoy one or a combination of the new programmes.
Details of the selected sites will be announced soon. - CNA/so
A total of 590 blocks in 58 sites have been selected for the next batch of HDB upgrading programmes.
The exact list has not been disclosed but HDB said these blocks would benefit from programmes such as the Home Improvement Programme (HIP), Neighbourhood Renewal Programme (NRP) and the Lift Upgrading Programme (LUP). HDB said the number of HIP projects has been increased from two to four due to strong public support. Eight NRP and 52 LUP projects will also be offered.
Some areas will benefit from more than one programme.
HDB has also agreed to requests from some MPs for six of the Main Upgrading Programme (MUP) sites selected in previous years to switch to the new programmes as they have not undergone polling.
Residents from about 30 blocks in these sites will be able to enjoy one or a combination of the new programmes.
Details of the selected sites will be announced soon. - CNA/so
S'pore Resident Population Stood At Nearly 3.6m As Of June 2007
Source : Channel NewsAsia, 04 February 2008
The Singapore resident population - comprising citizens and permanent residents - hit some 3.58 million (3,583,100) by end of June last year, compared to 3.53 million (3,525,900) at the end of June 2006.
But the Department of Statistics says the latest figures showed that Singapore's total population as at end of June this year was 4.59 million (4,588,600).
This includes the non-resident population, which increased to slightly over one million by end-June 2007 (1,005,500) compared to 875,500 in the previous year. - CNA/ir
The Singapore resident population - comprising citizens and permanent residents - hit some 3.58 million (3,583,100) by end of June last year, compared to 3.53 million (3,525,900) at the end of June 2006. But the Department of Statistics says the latest figures showed that Singapore's total population as at end of June this year was 4.59 million (4,588,600).
This includes the non-resident population, which increased to slightly over one million by end-June 2007 (1,005,500) compared to 875,500 in the previous year. - CNA/ir
Roads Leading To Sentosa And Harbourfront To Be Upgraded
Source : Channel NewsAsia, 04 February 2008
Roads leading to Sentosa and the area around Harbourfront will be upgraded this year.
The Land Transport Authority (LTA) said this is to prepare for an expected increase in traffic when the integrated resort at Sentosa – Resorts World at Sentosa – is completed in 2010.
When fully upgraded in two years' time, the roads can accommodate 30 percent more traffic.
According to LTA, during peak period, the junction of Sentosa Gateway sees about 6,000 passenger car unit (pcu) per hour. So this is expected to increase to between 8,000 and 9,000 pcu per hour in future.
Related Video Link - http://tinyurl.com/2y56kk
LTA said the roads affected include the stretch of Telok Blangah Road and Kampong Bahru Road where a single lane will be added in both directions.
Extra lanes will also be added for parts of Sentosa Gateway. For example, the road leading to Sentosa will have two lanes to facilitate vehicles turning left from Telok Blangah Road.
To further ease traffic flow, an existing central up-ramp which links Telok Blangah Road to the city-bound West Coast Highway, will be converted to a down-ramp.
A new up-ramp will be built to link Telok Blangah Road to the city-bound West Coast Highway viaduct.
Once the ramps are completed, it is expected to divert about 20 percent of traffic from this area, saving motorists at least 10 minutes of travelling time.
Paul Fok, Group Director of Land Transport Authority, said: "If we don't do anything to the traffic in the area, you'll probably need to wait at the junction for the lights to turn from red to green three times or even more before you can cross the junctions. With the improvements, we'd expect you to clear the junctions with one or two cycles."
LTA said tender for improvement works will be called soon and the project is expected to start in June.
The authority is also trying out a Parking Guidance System which is an electronic system that advises motorists which parking lots are available, even before they approach the Harbourfront-Sentosa area.
LTA added that this is to further ease traffic congestion caused by drivers who clog up the areas when they cannot find a parking spot.
Signs will be put up at strategic roads to give motorists ample time to decide where to park before they reach the area. - CNA/so
Roads leading to Sentosa and the area around Harbourfront will be upgraded this year.
The Land Transport Authority (LTA) said this is to prepare for an expected increase in traffic when the integrated resort at Sentosa – Resorts World at Sentosa – is completed in 2010. When fully upgraded in two years' time, the roads can accommodate 30 percent more traffic.
According to LTA, during peak period, the junction of Sentosa Gateway sees about 6,000 passenger car unit (pcu) per hour. So this is expected to increase to between 8,000 and 9,000 pcu per hour in future.
Related Video Link - http://tinyurl.com/2y56kk
LTA said the roads affected include the stretch of Telok Blangah Road and Kampong Bahru Road where a single lane will be added in both directions.
Extra lanes will also be added for parts of Sentosa Gateway. For example, the road leading to Sentosa will have two lanes to facilitate vehicles turning left from Telok Blangah Road.
To further ease traffic flow, an existing central up-ramp which links Telok Blangah Road to the city-bound West Coast Highway, will be converted to a down-ramp.
A new up-ramp will be built to link Telok Blangah Road to the city-bound West Coast Highway viaduct.
Once the ramps are completed, it is expected to divert about 20 percent of traffic from this area, saving motorists at least 10 minutes of travelling time.
Paul Fok, Group Director of Land Transport Authority, said: "If we don't do anything to the traffic in the area, you'll probably need to wait at the junction for the lights to turn from red to green three times or even more before you can cross the junctions. With the improvements, we'd expect you to clear the junctions with one or two cycles."
LTA said tender for improvement works will be called soon and the project is expected to start in June.
The authority is also trying out a Parking Guidance System which is an electronic system that advises motorists which parking lots are available, even before they approach the Harbourfront-Sentosa area.
LTA added that this is to further ease traffic congestion caused by drivers who clog up the areas when they cannot find a parking spot.
Signs will be put up at strategic roads to give motorists ample time to decide where to park before they reach the area. - CNA/so
National Annuity Plan To Take Off As Early As 2013
Source : The Business Times, February 4, 2008
The new National Lifelong Income scheme - the annuity plan for those who live beyond the age of 85 - will be rolled out as soon as 2013, with the government having 'done its sums' and found the proposed plan a 'workable' one.
The new scheme is also set to be a 'win-win' one for Singaporeans - with most set to get the same Central Provident Fund (CPF) payout they are currently entitled to receive between the age of 65 and 85 even when they are past 85.
Manpower Minister Ng Eng Hen announced this to residents living in the Keat Hong division during his visit to the area yesterday.
His announcement comes just after news last Thursday that the National Longevity Insurance Committee, headed by Lim Pin, had come up with proposals for an annuity scheme that would address the concerns of Singaporeans.
After listening to the views of more than 600 people across the social spectrum, Prof Lim's committee suggested the scheme should provide a basic and steady income for life; allow refund of the capital sum on early death; and start at age 80 instead of 85, but allow for options on the starting payout age.
Yesterday, Dr Ng elaborated on those recommendations on the scheme, with the full details to be announced on Feb 12.
The scheme will affect all those now aged 50 and below. 'I am (part of) the first group that will be affected by this,' the 49-year-old minister pointed out.
Dr Ng said that, under the current CPF scheme, this group of Singaporeans - who have half the minimum sum in cash, about $67,000, in their active CPF accounts - will get to draw out an average of $600 a month from the time they are 65 up until they reach 85.
Under the new Lifelong Income scheme, some 60 per cent of these Singaporeans will still get to draw out at least $600 each month when they turn 65 - but what's different is that they will be able to do so until they die, whatever the age.
The sustained payout over a longer period of time, Dr Ng explained, was due to the extra one percentage point in interest being paid out on CPF accounts.
The exact amount each Singaporean will get depends on how much is in his or her CPF accounts.
'The whole point of this is that we want people to have income for as long as they live,' said Dr Ng. 'It will help us to face our future with a lot more peace of mind.'
And he believes that many Singaporeans will need this payout, as studies have shown that more than half of those still alive today at the age of 65 will live until they are 85. And there will be some 900,000 Singaporeans above the age of 65 by the year 2030.
Dr Ng called the new scheme a bao chiak scheme, as Singaporeans would still get the same amount they are receiving now, but over an extended period of time.
And their families would be able to get back all that's left in their CPF accounts, should the recipient die early.
Options, such as for an earlier payout, would also be given to Singaporeans. As these options can be quite complicated, Dr Ng said, it's something the CPF Board would have to look into before educating individuals on the options.
Dr Ng also referred to the committee's recommendation that the CPF Board run this new scheme.
'This is a major undertaking. It will have to assure successive generations of Singaporeans who enter this scheme that they can get an income for life, for as long as they live. There are implementation and financial issues,' he said. He explained that the government would respond to the committee's recommendations when the detailed proposals are announced.
Still, Dr Ng says: 'My sense is the public will accept this scheme. From what I've heard, residents think it's a good scheme.'
The new National Lifelong Income scheme - the annuity plan for those who live beyond the age of 85 - will be rolled out as soon as 2013, with the government having 'done its sums' and found the proposed plan a 'workable' one.
The new scheme is also set to be a 'win-win' one for Singaporeans - with most set to get the same Central Provident Fund (CPF) payout they are currently entitled to receive between the age of 65 and 85 even when they are past 85.
Manpower Minister Ng Eng Hen announced this to residents living in the Keat Hong division during his visit to the area yesterday.
His announcement comes just after news last Thursday that the National Longevity Insurance Committee, headed by Lim Pin, had come up with proposals for an annuity scheme that would address the concerns of Singaporeans.
After listening to the views of more than 600 people across the social spectrum, Prof Lim's committee suggested the scheme should provide a basic and steady income for life; allow refund of the capital sum on early death; and start at age 80 instead of 85, but allow for options on the starting payout age.
Yesterday, Dr Ng elaborated on those recommendations on the scheme, with the full details to be announced on Feb 12.
The scheme will affect all those now aged 50 and below. 'I am (part of) the first group that will be affected by this,' the 49-year-old minister pointed out.
Dr Ng said that, under the current CPF scheme, this group of Singaporeans - who have half the minimum sum in cash, about $67,000, in their active CPF accounts - will get to draw out an average of $600 a month from the time they are 65 up until they reach 85.
Under the new Lifelong Income scheme, some 60 per cent of these Singaporeans will still get to draw out at least $600 each month when they turn 65 - but what's different is that they will be able to do so until they die, whatever the age.
The sustained payout over a longer period of time, Dr Ng explained, was due to the extra one percentage point in interest being paid out on CPF accounts.
The exact amount each Singaporean will get depends on how much is in his or her CPF accounts.
'The whole point of this is that we want people to have income for as long as they live,' said Dr Ng. 'It will help us to face our future with a lot more peace of mind.'
And he believes that many Singaporeans will need this payout, as studies have shown that more than half of those still alive today at the age of 65 will live until they are 85. And there will be some 900,000 Singaporeans above the age of 65 by the year 2030.
Dr Ng called the new scheme a bao chiak scheme, as Singaporeans would still get the same amount they are receiving now, but over an extended period of time.
And their families would be able to get back all that's left in their CPF accounts, should the recipient die early.
Options, such as for an earlier payout, would also be given to Singaporeans. As these options can be quite complicated, Dr Ng said, it's something the CPF Board would have to look into before educating individuals on the options.
Dr Ng also referred to the committee's recommendation that the CPF Board run this new scheme.
'This is a major undertaking. It will have to assure successive generations of Singaporeans who enter this scheme that they can get an income for life, for as long as they live. There are implementation and financial issues,' he said. He explained that the government would respond to the committee's recommendations when the detailed proposals are announced.
Still, Dr Ng says: 'My sense is the public will accept this scheme. From what I've heard, residents think it's a good scheme.'
Better Traffic Access For Sentosa, VivoCity And HarbourFront
Source : The Straits Times, Feb 5, 2008
ROAD IMPROVEMENTS
Volume likely to rise due to IR, new condos; works to start in June
By Maria Almenoar
THE roads leading to Sentosa, VivoCity and HarbourFront will be widened to cater to an anticipated increase in traffic into the area.
With one of Singapore's two integrated resorts opening on Sentosa and new condominiums to be built in the area by 2010, traffic is likely to go up by 30 per cent, said the Land Transport Authority (LTA) yesterday.
The Sentosa Gateway junction at Telok Blangah Road now sees about 6,000 cars during the evening peak period.
By 2010, the number will likely be between 8,000 and 9,000.
LTA director of transport planning Lina Lim told reporters yesterday: 'Without the improvement works, I think we would expect very long queues and not being able to clear junctions...'
The road widening works, expected to begin in June and be completed in 11/2 years, will span a 2km stretch from the junction of Keppel and Kampong Bahru roads to the junction of Telok Blangah and Henderson roads.
Related Video Link - http://tinyurl.com/2a3m8u
# An extra lane will be added to both sides of Telok Blangah Road, to give each side four lanes;
# Another lane will be kept specially for cars turning left into Sentosa Gateway from west-bound Telok Blangah Road, to make two left-turn lanes;
# Another lane will be added for vehicles turning right into Sentosa Gateway from east-bound Telok Blangah Road, making three lanes there;
# Adding an extra left-turn lane for vehicles going from Sentosa Gateway to Telok Blangah Road, to make three lanes there.
Other changes: Kampong Bahru Road will be widened, and improvements will be made to the Henderson Road/Telok Blangah Road junction and the HarbourFront Walk/Telok Blangah Road junction.
The viaduct which takes cars overhead, in front of VivoCity mall, will have an extra exit built from it.
An exit will be created near Morse Road, just before Henderson Road, which will enable motorists to bypass the HarbourFront area and at least four traffic lights.
Miss Hwang E-wan, a 25-year-old investment banking analyst who lives along Wishart Road off Telok Blangah Road, is glad for this.
To get home, she usually goes through the jam outside VivoCity.
'The alternative is to use the Alexandra Road exit and then make a U-turn back to my house. This will help me escape all that.'
A VivoCity spokesman said that traffic in the area was generally fine on weekdays but can build up on Fridays, weekends and public holidays.
Sentosa said its plans to increase the number of arrival lanes and to move its admission booths inland would complement LTA's plans.
An electronic parking guidance system will also be introduced in the HarbourFront area.
Large signboards will alert motorists where carpark lots are available, which will cut down congestion by reducing the number of cars circling the area looking for lots.
ROAD IMPROVEMENTS
Volume likely to rise due to IR, new condos; works to start in June
By Maria Almenoar
THE roads leading to Sentosa, VivoCity and HarbourFront will be widened to cater to an anticipated increase in traffic into the area.
With one of Singapore's two integrated resorts opening on Sentosa and new condominiums to be built in the area by 2010, traffic is likely to go up by 30 per cent, said the Land Transport Authority (LTA) yesterday.
The Sentosa Gateway junction at Telok Blangah Road now sees about 6,000 cars during the evening peak period.
By 2010, the number will likely be between 8,000 and 9,000.
LTA director of transport planning Lina Lim told reporters yesterday: 'Without the improvement works, I think we would expect very long queues and not being able to clear junctions...'
The road widening works, expected to begin in June and be completed in 11/2 years, will span a 2km stretch from the junction of Keppel and Kampong Bahru roads to the junction of Telok Blangah and Henderson roads.
Related Video Link - http://tinyurl.com/2a3m8u# An extra lane will be added to both sides of Telok Blangah Road, to give each side four lanes;
# Another lane will be kept specially for cars turning left into Sentosa Gateway from west-bound Telok Blangah Road, to make two left-turn lanes;
# Another lane will be added for vehicles turning right into Sentosa Gateway from east-bound Telok Blangah Road, making three lanes there;
# Adding an extra left-turn lane for vehicles going from Sentosa Gateway to Telok Blangah Road, to make three lanes there.
Other changes: Kampong Bahru Road will be widened, and improvements will be made to the Henderson Road/Telok Blangah Road junction and the HarbourFront Walk/Telok Blangah Road junction.
The viaduct which takes cars overhead, in front of VivoCity mall, will have an extra exit built from it.
An exit will be created near Morse Road, just before Henderson Road, which will enable motorists to bypass the HarbourFront area and at least four traffic lights.
Miss Hwang E-wan, a 25-year-old investment banking analyst who lives along Wishart Road off Telok Blangah Road, is glad for this.
To get home, she usually goes through the jam outside VivoCity.
'The alternative is to use the Alexandra Road exit and then make a U-turn back to my house. This will help me escape all that.'
A VivoCity spokesman said that traffic in the area was generally fine on weekdays but can build up on Fridays, weekends and public holidays.
Sentosa said its plans to increase the number of arrival lanes and to move its admission booths inland would complement LTA's plans.
An electronic parking guidance system will also be introduced in the HarbourFront area.
Large signboards will alert motorists where carpark lots are available, which will cut down congestion by reducing the number of cars circling the area looking for lots.
Growth In S-E Asia Property Market Sustainable: DTZ
Source : The Business Times, February 5, 2008
THE property markets of South-east Asia are expected to sustain the buoyant growth seen in 2007, says DTZ Debenham Tie Leung.
DTZ said that residential markets in the region are expected to continue to grow, 'driven by steady economic expansion, increasing affluence and increasingly attractive projects as developers strive to refine concepts'.
In Vietnam, DTZ noted that demand for residential properties, which was already growing fast, was bolstered by the recent relaxation in rules for housing ownership, allowing foreign land ownership terms to increase from 50 to 70 years. DTZ said this also encouraged foreign developers to build residential properties there.
In Malaysia, DTZ said take-up was encouraging for high-end condominiums in Kuala Lumpur, with a complete sell-out for several luxury projects. This was supported by the relaxation of rules for foreigners to buy residential properties and the waiver of real property gains tax last April. While monthly average gross rents remained unchanged at RM4 (S$1.25) per square foot, average capital values increased 3 per cent year-on-year to an average RM500 (US$152) psf.
The residential market in Thailand is also expected to recover, as the political situation improves and developers are encouraged to launch projects which have been withheld.
In the office sector, DTZ says demand for office space in Vietnam is expected to continue to be underpinned by limited potential supply. It said that in Vietnam, most potential supply comprises non-prime office buildings, 'which will lead to greater competition for prime office space'. Occupancy remains high, at above 95 per cent, while Grade A rents average US$3.70 psf per month in Hanoi and US$4.37 psf per month in Ho Chi Minh City.
The office market in Kuala Lumpur was also active, with increasing demand by the services, oil and gas, information technology and financial sectors. Together with limited new supply, prime office rents rose 7.8 per cent year-on-year to RM62.65 (US$18.16) psm.
Jakarta also saw office occupancy rates of over 90 per cent. Rents did, however, remain at about US$0.76 psf per month amid fluctuations in exchange rates.
The Bangkok office market was the only one that was subdued, with a negative net absorption for H1 2007. DTZ said this was due to a less favourable operating environment which affected investors' confidence.
THE property markets of South-east Asia are expected to sustain the buoyant growth seen in 2007, says DTZ Debenham Tie Leung.
DTZ said that residential markets in the region are expected to continue to grow, 'driven by steady economic expansion, increasing affluence and increasingly attractive projects as developers strive to refine concepts'.
In Vietnam, DTZ noted that demand for residential properties, which was already growing fast, was bolstered by the recent relaxation in rules for housing ownership, allowing foreign land ownership terms to increase from 50 to 70 years. DTZ said this also encouraged foreign developers to build residential properties there.
In Malaysia, DTZ said take-up was encouraging for high-end condominiums in Kuala Lumpur, with a complete sell-out for several luxury projects. This was supported by the relaxation of rules for foreigners to buy residential properties and the waiver of real property gains tax last April. While monthly average gross rents remained unchanged at RM4 (S$1.25) per square foot, average capital values increased 3 per cent year-on-year to an average RM500 (US$152) psf.
The residential market in Thailand is also expected to recover, as the political situation improves and developers are encouraged to launch projects which have been withheld.
In the office sector, DTZ says demand for office space in Vietnam is expected to continue to be underpinned by limited potential supply. It said that in Vietnam, most potential supply comprises non-prime office buildings, 'which will lead to greater competition for prime office space'. Occupancy remains high, at above 95 per cent, while Grade A rents average US$3.70 psf per month in Hanoi and US$4.37 psf per month in Ho Chi Minh City.
The office market in Kuala Lumpur was also active, with increasing demand by the services, oil and gas, information technology and financial sectors. Together with limited new supply, prime office rents rose 7.8 per cent year-on-year to RM62.65 (US$18.16) psm.
Jakarta also saw office occupancy rates of over 90 per cent. Rents did, however, remain at about US$0.76 psf per month amid fluctuations in exchange rates.
The Bangkok office market was the only one that was subdued, with a negative net absorption for H1 2007. DTZ said this was due to a less favourable operating environment which affected investors' confidence.
Prime Properties In For 5% Fall In '08: UBS
Source : The Business Times, February 5, 2008
Bank expects modest 0-5% growth in mass and mid-tier segments
ANALYSTS from Swiss bank UBS believe Singapore's property market will 'remain intact', but they are nonetheless projecting a drop of 5 per cent in prime property prices for the year.
In the more affordable mass and mid-tier segments, where prices increased at a slower pace, UBS expects a modest growth of between 0-5 per cent in prices this year.
In its report on the Singapore property market, UBS says that in light of the uncertainty over the global economic outlook, buyers are likely to defer purchases of new property for at least six months. UBS said that demand 'is highly dependent on the market's outlook for the next three or four years, when the projects are completed'.
It added that with supply of new homes on the rise, there could be pressure on developers to reduce launch prices to 'stimulate demand' - and some developers may start cutting prices as early as the second quarter of this year.
While the larger developers are expected to have more holding power, smaller ones could feel the strain of holding costs sooner. UBS estimates that of the units to be launched between this year and 2010, around 9 per cent are held by small, unlisted developers. Still, it said that there is little evidence to suggest that the market will be affected if small developers 'capitulate and cut prices aggressively when holding costs build up'.
In its report on the current property market conditions, UBS made comparisons with the previous property slump of 1998. 'Markets appear to be pricing a 70 per cent fall in Singapore residential prices, similar to 1998,' it noted.
But UBS said: 'We think the residential market in 2008 will not replicate the 1998 scenario where launch prices fell by 50 per cent in a year, and stock prices fell by 75 per cent.'
It added that expected GDP growth of 3.5 per cent should keep population inflow positive, which combined with negative real interest rates and low unemployment should underpin resale prices.
'Even if job growth were to halve in 2008 to 90,000-100,000, this could still mean housing demand for at least around 15,000-18,000 units, assuming half the newly- weds (23,000 per annum) want to move out, and around 6,000 new households - of new permanent residents and expatriates - relocate to Singapore,' UBS added. It pointed out that the figure is much higher than the expected number of home completions - 8,700 in 2008 and 16,000 in 2009.
As such UBS believes that current share prices for listed property developers have been 'over-corrected'.
'Allgreen's price ($1.17 per share currently) attributes no value to its residential (portfolio), while City Development's price ($12 per share currently) implies a 70 per cent writedown in unsold land,' said UBS.
UBS said that it has adjusted the revalued net asset value and earnings per share for Allgreen, City Developments, CapitaLand and Keppel Land, and given current price levels 'we have retained our Buy ratings on all these developers'.
Bank expects modest 0-5% growth in mass and mid-tier segments
ANALYSTS from Swiss bank UBS believe Singapore's property market will 'remain intact', but they are nonetheless projecting a drop of 5 per cent in prime property prices for the year.
In the more affordable mass and mid-tier segments, where prices increased at a slower pace, UBS expects a modest growth of between 0-5 per cent in prices this year.
In its report on the Singapore property market, UBS says that in light of the uncertainty over the global economic outlook, buyers are likely to defer purchases of new property for at least six months. UBS said that demand 'is highly dependent on the market's outlook for the next three or four years, when the projects are completed'.
It added that with supply of new homes on the rise, there could be pressure on developers to reduce launch prices to 'stimulate demand' - and some developers may start cutting prices as early as the second quarter of this year.
While the larger developers are expected to have more holding power, smaller ones could feel the strain of holding costs sooner. UBS estimates that of the units to be launched between this year and 2010, around 9 per cent are held by small, unlisted developers. Still, it said that there is little evidence to suggest that the market will be affected if small developers 'capitulate and cut prices aggressively when holding costs build up'.
In its report on the current property market conditions, UBS made comparisons with the previous property slump of 1998. 'Markets appear to be pricing a 70 per cent fall in Singapore residential prices, similar to 1998,' it noted.
But UBS said: 'We think the residential market in 2008 will not replicate the 1998 scenario where launch prices fell by 50 per cent in a year, and stock prices fell by 75 per cent.'
It added that expected GDP growth of 3.5 per cent should keep population inflow positive, which combined with negative real interest rates and low unemployment should underpin resale prices.
'Even if job growth were to halve in 2008 to 90,000-100,000, this could still mean housing demand for at least around 15,000-18,000 units, assuming half the newly- weds (23,000 per annum) want to move out, and around 6,000 new households - of new permanent residents and expatriates - relocate to Singapore,' UBS added. It pointed out that the figure is much higher than the expected number of home completions - 8,700 in 2008 and 16,000 in 2009.
As such UBS believes that current share prices for listed property developers have been 'over-corrected'.
'Allgreen's price ($1.17 per share currently) attributes no value to its residential (portfolio), while City Development's price ($12 per share currently) implies a 70 per cent writedown in unsold land,' said UBS.
UBS said that it has adjusted the revalued net asset value and earnings per share for Allgreen, City Developments, CapitaLand and Keppel Land, and given current price levels 'we have retained our Buy ratings on all these developers'.
Let Public Have First Bite Of Property Before Directors
Source : The Business Times, February 5, 2008
IT was reported recently that a listed company had sold a property it had developed to the relatives of a director.
What was unusual this time was that the relatives were walk-in customers during a public sale which was held after the sales preview for invited guests.
The sale was also on the same terms as those offered to members of the public.
I feel that this approach to transacting properties with directors and their related parties represent a standard of corporate governance for other listed companies to follow.
I am sure that shareholders have no qualms about directors buying properties that were left unsold after having been launched to members of the public or even if directors purchased them during the public launch.
However, if directors were given preference to units during the pre-launch, as is often the case, these transactions should be disclosed by the company in a clear and transparent manner.
At the outset, companies should state if these property sales, or the profits from any subsequent resale by the directors, are meant to be part of their remuneration.
If they are, then the amount should be determined and, if necessary, approved at annual general meetings.
Also, if the directors were related to the major shareholder, then minority shareholders should get a chance to vote on it.
If the company's view is that the sale was not part of their remuneration, then there should be a test of valuation or a governance guideline to be followed to ensure that revenues were maximised in the sales to directors.
The reason being, even when properties are sold at list prices without discounts, it is not clear to shareholders that the properties were sold at the best possible price.
If directors were responsible for setting prices and would also likely to have had the first pick of the best units, it is difficult for shareholders to be certain if the launch price was correctly priced to begin with.
The only way to be confident that a company got the best price for the property is if the properties were first open to third parties for purchase or bidding.
Therefore, the guideline for sales to company directors should be that the directors make purchases after the public launch, or at the very least, during the launch.
This will clear doubts on whether the transactions involving directors were in the interest of shareholders.
Ang Hao Yao
IT was reported recently that a listed company had sold a property it had developed to the relatives of a director.
What was unusual this time was that the relatives were walk-in customers during a public sale which was held after the sales preview for invited guests.
The sale was also on the same terms as those offered to members of the public.
I feel that this approach to transacting properties with directors and their related parties represent a standard of corporate governance for other listed companies to follow.
I am sure that shareholders have no qualms about directors buying properties that were left unsold after having been launched to members of the public or even if directors purchased them during the public launch.
However, if directors were given preference to units during the pre-launch, as is often the case, these transactions should be disclosed by the company in a clear and transparent manner.
At the outset, companies should state if these property sales, or the profits from any subsequent resale by the directors, are meant to be part of their remuneration.
If they are, then the amount should be determined and, if necessary, approved at annual general meetings.
Also, if the directors were related to the major shareholder, then minority shareholders should get a chance to vote on it.
If the company's view is that the sale was not part of their remuneration, then there should be a test of valuation or a governance guideline to be followed to ensure that revenues were maximised in the sales to directors.
The reason being, even when properties are sold at list prices without discounts, it is not clear to shareholders that the properties were sold at the best possible price.
If directors were responsible for setting prices and would also likely to have had the first pick of the best units, it is difficult for shareholders to be certain if the launch price was correctly priced to begin with.
The only way to be confident that a company got the best price for the property is if the properties were first open to third parties for purchase or bidding.
Therefore, the guideline for sales to company directors should be that the directors make purchases after the public launch, or at the very least, during the launch.
This will clear doubts on whether the transactions involving directors were in the interest of shareholders.
Ang Hao Yao
S'pore Population Hits 4.6 Million
Source : The Business Times, February 5, 2008
Number of foreigners increasing faster than citizens, PRs
SINGAPORE'S economic planners think the country can hold 6.5 million people, a size they feel will be ideal to keep the economy humming.
Minister Mentor Lee Kuan Yew, however, feels the optimum population size for tiny Singapore might be smaller, between 5 and 5.5 million.
The latest numbers released yesterday by the Singapore Department of Statistics - after some refinements that exclude persons who were away for at least 12 months continuously, in line with United Nations guidelines - show that Singapore is just less than one million people away from hitting that figure recently suggested by Mr Lee.
Singapore's total population has swelled to 4.6 million - and that was seven months ago.
The drive to attract foreign talent to make up the local shortage is apparently bearing fruit. The number of foreigners who work and live here has crossed the one-million mark.
In the past five years, the figure grew three times as fast as the number of Singaporeans and permanent residents.
The result: foreigners made up 22 per cent of Singapore's total population as at June 2007, up from 18 per cent in 2003. From 2006 to 2007, the number of foreigners jumped nearly 15 per cent to 1,005,500.
Locals and permanent residents rose by less than 2 per cent to 3,583,100.
Number of foreigners increasing faster than citizens, PRs
SINGAPORE'S economic planners think the country can hold 6.5 million people, a size they feel will be ideal to keep the economy humming.
Minister Mentor Lee Kuan Yew, however, feels the optimum population size for tiny Singapore might be smaller, between 5 and 5.5 million.
The latest numbers released yesterday by the Singapore Department of Statistics - after some refinements that exclude persons who were away for at least 12 months continuously, in line with United Nations guidelines - show that Singapore is just less than one million people away from hitting that figure recently suggested by Mr Lee.
Singapore's total population has swelled to 4.6 million - and that was seven months ago.
The drive to attract foreign talent to make up the local shortage is apparently bearing fruit. The number of foreigners who work and live here has crossed the one-million mark.
In the past five years, the figure grew three times as fast as the number of Singaporeans and permanent residents.
The result: foreigners made up 22 per cent of Singapore's total population as at June 2007, up from 18 per cent in 2003. From 2006 to 2007, the number of foreigners jumped nearly 15 per cent to 1,005,500.
Locals and permanent residents rose by less than 2 per cent to 3,583,100.
Aussie Property Still Looking Up?
Source : The Business Times, February 5, 2008
THE US sub-prime mortgage problem may have put a dampener on property stocks worldwide, including Singapore. But there appears to be at least one bright spot on the planet, if ANZ Bank is to be believed.
Said the bank in a recent report on its outlook for the Australian property market: 'Property returns have accelerated, underpinned by buoyant economic growth and tightening market fundamentals. Despite a meltdown in US sub-prime mortgages and a crisis in global credit markets, the economic outlook remains supportive.'
While it warns that rising interest rates and a 'marked jump in risk aversion' have raised the risks facing the property sector, it still thinks that by 2010 there will be a serious housing shortage.
'A dramatic tightening of the housing market will force already soaring house prices and rents sharply higher. By 2010, we project a record housing shortage of nearly 200,000 homes which risks becoming an intractable imbalance as renters and first-home buyers become collateral damage in the Reserve Bank's ongoing war on inflation,' it said.
It also noted that in risk-adjusted terms, residential property has delivered 'vastly superior' returns in comparison to all other broad asset classes.
These will be sweet words to Singapore-linked Australian developers like AV Jennings, which is 42 per cent owned by SC Global, and Australand Property Group, the Australian property arm of local property giant CapitaLand. Others who will be heartened by such talk include smaller players like shipping tycoon CK Ow's Stamford Land and Chua Thian Poh's Ho Bee Investments, which is now trying to make inroads Down Under.
The ANZ report also pointed out that total returns over the year to last September were 20 per cent in offices, 15.5 per cent in retail, 13 per cent in industrial and 14.3 per cent in residential property.
'Yields have continued to firm and tightening availability is forcing both rents and capital values higher. Solid investment returns have underpinned a rebound in construction activity which has jumped to record levels, bolstered by a remarkable 24 per cent increase in engineering construction, a 7.8 per cent lift in non-residential building and a surprise 4.8 per cent rise in residential activity,' said its analyst Paul Braddick.
He thinks that the property sector will be underpinned by Australia's buoyant economy, which in turn now depends more on Asia's growth than America's. 'Asian growth has effectively decoupled from the US and the outlook for China in particular remains very strong,' Mr Braddick says.
While some households are being adversely impacted by rising interest rates, Mr Braddick claims that rising debt servicing costs have been more than offset by solid income gains.
He said houses were no different from bananas in that when there is a shortage, prices are likely to rise. 'However, unlike bananas, the necessary rebound in housing supply will be far more difficult to achieve and house prices are therefore unlikely to fall.'
According to ANZ, the tightness is being felt in all sectors of the property market and across the country.
Despite some recent developments, including a contract to build 600 homes in Auckland worth some NZ$300 million (S$337 million), AV Jennings shares have been near a 52-week low at around A$0.90 apiece. Australand's shares have been thinly traded and languish at around A$2.30. Perhaps the ANZ report should bring some cheer to their shareholders.
THE US sub-prime mortgage problem may have put a dampener on property stocks worldwide, including Singapore. But there appears to be at least one bright spot on the planet, if ANZ Bank is to be believed.
Said the bank in a recent report on its outlook for the Australian property market: 'Property returns have accelerated, underpinned by buoyant economic growth and tightening market fundamentals. Despite a meltdown in US sub-prime mortgages and a crisis in global credit markets, the economic outlook remains supportive.'
While it warns that rising interest rates and a 'marked jump in risk aversion' have raised the risks facing the property sector, it still thinks that by 2010 there will be a serious housing shortage.
'A dramatic tightening of the housing market will force already soaring house prices and rents sharply higher. By 2010, we project a record housing shortage of nearly 200,000 homes which risks becoming an intractable imbalance as renters and first-home buyers become collateral damage in the Reserve Bank's ongoing war on inflation,' it said.
It also noted that in risk-adjusted terms, residential property has delivered 'vastly superior' returns in comparison to all other broad asset classes.
These will be sweet words to Singapore-linked Australian developers like AV Jennings, which is 42 per cent owned by SC Global, and Australand Property Group, the Australian property arm of local property giant CapitaLand. Others who will be heartened by such talk include smaller players like shipping tycoon CK Ow's Stamford Land and Chua Thian Poh's Ho Bee Investments, which is now trying to make inroads Down Under.
The ANZ report also pointed out that total returns over the year to last September were 20 per cent in offices, 15.5 per cent in retail, 13 per cent in industrial and 14.3 per cent in residential property.
'Yields have continued to firm and tightening availability is forcing both rents and capital values higher. Solid investment returns have underpinned a rebound in construction activity which has jumped to record levels, bolstered by a remarkable 24 per cent increase in engineering construction, a 7.8 per cent lift in non-residential building and a surprise 4.8 per cent rise in residential activity,' said its analyst Paul Braddick.
He thinks that the property sector will be underpinned by Australia's buoyant economy, which in turn now depends more on Asia's growth than America's. 'Asian growth has effectively decoupled from the US and the outlook for China in particular remains very strong,' Mr Braddick says.
While some households are being adversely impacted by rising interest rates, Mr Braddick claims that rising debt servicing costs have been more than offset by solid income gains.
He said houses were no different from bananas in that when there is a shortage, prices are likely to rise. 'However, unlike bananas, the necessary rebound in housing supply will be far more difficult to achieve and house prices are therefore unlikely to fall.'
According to ANZ, the tightness is being felt in all sectors of the property market and across the country.
Despite some recent developments, including a contract to build 600 homes in Auckland worth some NZ$300 million (S$337 million), AV Jennings shares have been near a 52-week low at around A$0.90 apiece. Australand's shares have been thinly traded and languish at around A$2.30. Perhaps the ANZ report should bring some cheer to their shareholders.
Markets Will Recover After 3-6 Mths Of Mild Recession: S&P Analyst
Source : The Business Times, February 5, 2008
He warns of one more major market collapse between now and rosier H2
THE sub-prime crisis will cause a mild US recession, but financial markets will recover in three to six months after most of the bad news is flushed out or priced in, says a leading US analyst.
Stephen Biggar, New York-based director for US equity research at S&P Equity Research, was one of the first to predict the sub-prime crisis and subsequent market meltdown that began in late July last year.
He sees many similarities between the current sub-prime fallout and the 1990-91 Savings and Loan (S&L) crisis.
'The ingredients are the same: banks in trouble, credit crunch, junk bonds, worthless debt,' he said. 'But as is the case now, the Federal Reserve stepped in aggressively. The US went into a mild recession, but it was a three- to five-month event for the market.'
Mr Biggar reckons this US recession started in December 2007, but noted that the Fed has moved fast, cutting its key interest rate three times in as many months - the most aggressive cuts in 25 years.
The latest 50 basis points cut last week brought the key discount rate down to 3 per cent.
'The Fed has been on the curve, if not ahead of it,' Mr Biggar said. 'Meanwhile, the impact of Washington's US$145 billion fiscal stimulus package should kick in by May. And we should also see US corporate earnings improving during the second half, especially for exports.'
He says with half of the total earnings of S&P 500 companies coming from offshore, the weak US dollar environment will be a boost for them.
But while painting a sanguine picture for the second half of this year, Mr Biggar warns of one more major market collapse between now and then.
'We haven't seen a capitulation selling yet which will totally flush out the system and set it on course for the next recovery,' he said. 'But this will happen in the next couple of months as banks will demonstrate their ultimate exposure (to the sub-prime collateralised debt obligations).'
This will pull the S&P500 down to retest 1,310, he said. If this does not hold, the index will hit a trough at 1,170 points. And that will be the buy signal for value investors.
'The shock value of bailouts will rattle many, but markets have a way of getting immune to this kind of news,' he said. 'Ultimately, the market will price in the risks.'
Mr Biggar is not a proponent of the theory that Asian markets and economies have decoupled from the US.
'We have already seen how the US market's pull-back has caused the collapse across this region,' he said. 'And the sub-prime losses are not just losses in the US. The exposure is global.'
Mr Biggar told BT in June last year that several US lenders were on the verge of declaring huge sub-prime losses, and that these would trigger a meltdown on Wall Street and elsewhere.
'All it would take is a failure of one large US bank,' Mr Biggar said then. 'In the US sub-prime segment, which accounts for 20 per cent of total lending, delinquencies and foreclosures have been building up. But the troubles have been largely hidden away.'
Those words proved prescient. Just a month later, Countrywide Financial Corp - America's largest mortgage lender - reported a sharp rise in delinquencies. This was followed by American Home Mortgage's loan delinquencies, after which two of Bear Stearns' hedge funds hit the sub-prime skids.
Fast-forward, and Mr Biggar has this prediction:
'If the parallels to the 1990-91 S&L crisis and what we have now are anything to go by, we should pull out of this in about three to four months.'
Many here would recall that after the recovery from the 1991 crisis, Asian markets headed into their biggest 'super-bull' run ever in 1993.
And many must also be praying Mr Biggar is spot on - again.
He warns of one more major market collapse between now and rosier H2
THE sub-prime crisis will cause a mild US recession, but financial markets will recover in three to six months after most of the bad news is flushed out or priced in, says a leading US analyst.
Stephen Biggar, New York-based director for US equity research at S&P Equity Research, was one of the first to predict the sub-prime crisis and subsequent market meltdown that began in late July last year.
He sees many similarities between the current sub-prime fallout and the 1990-91 Savings and Loan (S&L) crisis.
'The ingredients are the same: banks in trouble, credit crunch, junk bonds, worthless debt,' he said. 'But as is the case now, the Federal Reserve stepped in aggressively. The US went into a mild recession, but it was a three- to five-month event for the market.'
Mr Biggar reckons this US recession started in December 2007, but noted that the Fed has moved fast, cutting its key interest rate three times in as many months - the most aggressive cuts in 25 years.
The latest 50 basis points cut last week brought the key discount rate down to 3 per cent.
'The Fed has been on the curve, if not ahead of it,' Mr Biggar said. 'Meanwhile, the impact of Washington's US$145 billion fiscal stimulus package should kick in by May. And we should also see US corporate earnings improving during the second half, especially for exports.'
He says with half of the total earnings of S&P 500 companies coming from offshore, the weak US dollar environment will be a boost for them.
But while painting a sanguine picture for the second half of this year, Mr Biggar warns of one more major market collapse between now and then.
'We haven't seen a capitulation selling yet which will totally flush out the system and set it on course for the next recovery,' he said. 'But this will happen in the next couple of months as banks will demonstrate their ultimate exposure (to the sub-prime collateralised debt obligations).'
This will pull the S&P500 down to retest 1,310, he said. If this does not hold, the index will hit a trough at 1,170 points. And that will be the buy signal for value investors.
'The shock value of bailouts will rattle many, but markets have a way of getting immune to this kind of news,' he said. 'Ultimately, the market will price in the risks.'
Mr Biggar is not a proponent of the theory that Asian markets and economies have decoupled from the US.
'We have already seen how the US market's pull-back has caused the collapse across this region,' he said. 'And the sub-prime losses are not just losses in the US. The exposure is global.'
Mr Biggar told BT in June last year that several US lenders were on the verge of declaring huge sub-prime losses, and that these would trigger a meltdown on Wall Street and elsewhere.
'All it would take is a failure of one large US bank,' Mr Biggar said then. 'In the US sub-prime segment, which accounts for 20 per cent of total lending, delinquencies and foreclosures have been building up. But the troubles have been largely hidden away.'
Those words proved prescient. Just a month later, Countrywide Financial Corp - America's largest mortgage lender - reported a sharp rise in delinquencies. This was followed by American Home Mortgage's loan delinquencies, after which two of Bear Stearns' hedge funds hit the sub-prime skids.
Fast-forward, and Mr Biggar has this prediction:
'If the parallels to the 1990-91 S&L crisis and what we have now are anything to go by, we should pull out of this in about three to four months.'
Many here would recall that after the recovery from the 1991 crisis, Asian markets headed into their biggest 'super-bull' run ever in 1993.
And many must also be praying Mr Biggar is spot on - again.
Subsales May Spike Again As Projects Near Completion
Source : The Business Times, February 5, 2008
Prices could soften if 'specuvestors' are forced to offload properties
Speculative activity took a breather in Q4 last year as the number of subsales as well as their share of total private home deals were down sharply from the preceding two quarters of 2007. However, many in the industry are wondering whether subsales will again spike closer to the physical completion dates for some high-profile projects sold substantially on deferred payment (DP) schemes.
Among the projects that will be keenly watched are The Sail @ Marina Bay, The Coast (at Sentosa Cove), The Grange, and The Suites at Central in the Devonshire Road area, all of which were sold amidst much hype. The first two projects are scheduled to receive Temporary Occupation Permit (TOP) next year and the latter two, this year.
The coming wave of subsales - if there's one - may not be so much a reflection of speculative froth in the market but rather of buyers seeking to offload their units before the DP expires.
Those who bought their properties on DP schemes would typically have paid 10 or 20 per cent of their purchase price to the developer with the next payment (of 75 per cent or 65 per cent, respectively) deferred till the project receives TOP. By TOP, the developer would collect 85 per cent of the sale price.
Such buyers can shop for a bank loan until closer to the project's TOP date.
However, buyers who picked up multiple units in some of these developments on DP schemes and are still sitting on them may not be able to secure sufficient housing loans to foot the bills when the projects obtain TOP.
Banks may turn cautious over advancing loans for multiple property purchases. Some, for example, may only be prepared to lend up to 70 per cent - based on their credit assessment and servicing ability of the borrower - instead of 80-90 per cent, of the purchase price of the property or its current value, whichever is lower.
These 'specuvestors' may find that it makes more sense to sell their units in the subsale market before they receive a big bill from developers.
Such subsales, while apparently 'forced' by the difficulty of finding enough housing loans, could still yield handsome gains for such investors - given the huge rise in upmarket home prices.
However, if a sizeable number of such properties come on the subsale market, some sellers may be willing to accept below-market values. This will clip developers' pricing power when they sell new projects in nearby locations.
Already, BT understands that some individual investors, anticipating 'dumping' from speculators, are teaming up to snap up some of these units at below-market prices.
Jones Lang LaSalle's head of research (South-east Asia) Chua Yang Liang reckoned that some buyers who purchased units on DP during the initial launches may begin to review their options around five to six months ahead of TOP. 'Supply of such properties in the subsale market could potentially increase from the latter half of this year, which could potentially see prices easing,' Dr Chua said.
Of course, it may be a different story altogether if sentiment in the high-end market picks up again.
A lot will also depend on the holding power of those who still have units they've bought from developers. Some may not face problems getting housing loans, because they have the ability to service them. Such buyers may just go ahead and pay that big instalment when the project receives TOP.
Another factor that will bear on the extent of 'forced' subsales is the profile of buyers in each project - the mix of those who bought units with a view to living in them, and those who purchased with an eye on flipping before the project's completion.
A seasoned property agent told BT that a condo in the East Coast area receiving TOP soon recently saw several buyers offering their units at prices considerably below what was being achieved just a few weeks ago - before the stock market plunge.
Then there's another theory. While we may see a flurry of subsales for projects sold in the past on DP, it will be a different story going ahead.
With no new projects approved by the authorities for DP schemes since DP was scrapped in late October 2007, new launches going ahead will attract fewer potential speculators. This is because those who buy into projects without DP schemes know they will have to make regular progress payments to the developer and in all likelihood have to obtain housing loans.
'You'll see more genuine buyers in the market,' as ERA Realty Network divisional director Andrew Soh said. 'Developers may still be able to maintain current prices, or even achieve higher prices. But instead of weeks, it may take them months, or even years, to sell out projects.'
'As new project launches attract fewer speculators, I may have to sell physical homes and not just paper (options),' he quipped.
Prices could soften if 'specuvestors' are forced to offload properties
Speculative activity took a breather in Q4 last year as the number of subsales as well as their share of total private home deals were down sharply from the preceding two quarters of 2007. However, many in the industry are wondering whether subsales will again spike closer to the physical completion dates for some high-profile projects sold substantially on deferred payment (DP) schemes.
Among the projects that will be keenly watched are The Sail @ Marina Bay, The Coast (at Sentosa Cove), The Grange, and The Suites at Central in the Devonshire Road area, all of which were sold amidst much hype. The first two projects are scheduled to receive Temporary Occupation Permit (TOP) next year and the latter two, this year.
The coming wave of subsales - if there's one - may not be so much a reflection of speculative froth in the market but rather of buyers seeking to offload their units before the DP expires.
Those who bought their properties on DP schemes would typically have paid 10 or 20 per cent of their purchase price to the developer with the next payment (of 75 per cent or 65 per cent, respectively) deferred till the project receives TOP. By TOP, the developer would collect 85 per cent of the sale price.
Such buyers can shop for a bank loan until closer to the project's TOP date.
However, buyers who picked up multiple units in some of these developments on DP schemes and are still sitting on them may not be able to secure sufficient housing loans to foot the bills when the projects obtain TOP.
Banks may turn cautious over advancing loans for multiple property purchases. Some, for example, may only be prepared to lend up to 70 per cent - based on their credit assessment and servicing ability of the borrower - instead of 80-90 per cent, of the purchase price of the property or its current value, whichever is lower.
These 'specuvestors' may find that it makes more sense to sell their units in the subsale market before they receive a big bill from developers.
Such subsales, while apparently 'forced' by the difficulty of finding enough housing loans, could still yield handsome gains for such investors - given the huge rise in upmarket home prices.
However, if a sizeable number of such properties come on the subsale market, some sellers may be willing to accept below-market values. This will clip developers' pricing power when they sell new projects in nearby locations.
Already, BT understands that some individual investors, anticipating 'dumping' from speculators, are teaming up to snap up some of these units at below-market prices.
Jones Lang LaSalle's head of research (South-east Asia) Chua Yang Liang reckoned that some buyers who purchased units on DP during the initial launches may begin to review their options around five to six months ahead of TOP. 'Supply of such properties in the subsale market could potentially increase from the latter half of this year, which could potentially see prices easing,' Dr Chua said.
Of course, it may be a different story altogether if sentiment in the high-end market picks up again.
A lot will also depend on the holding power of those who still have units they've bought from developers. Some may not face problems getting housing loans, because they have the ability to service them. Such buyers may just go ahead and pay that big instalment when the project receives TOP.
Another factor that will bear on the extent of 'forced' subsales is the profile of buyers in each project - the mix of those who bought units with a view to living in them, and those who purchased with an eye on flipping before the project's completion.
A seasoned property agent told BT that a condo in the East Coast area receiving TOP soon recently saw several buyers offering their units at prices considerably below what was being achieved just a few weeks ago - before the stock market plunge.
Then there's another theory. While we may see a flurry of subsales for projects sold in the past on DP, it will be a different story going ahead.
With no new projects approved by the authorities for DP schemes since DP was scrapped in late October 2007, new launches going ahead will attract fewer potential speculators. This is because those who buy into projects without DP schemes know they will have to make regular progress payments to the developer and in all likelihood have to obtain housing loans.
'You'll see more genuine buyers in the market,' as ERA Realty Network divisional director Andrew Soh said. 'Developers may still be able to maintain current prices, or even achieve higher prices. But instead of weeks, it may take them months, or even years, to sell out projects.'
'As new project launches attract fewer speculators, I may have to sell physical homes and not just paper (options),' he quipped.
590 HDB Blocks To Be Upgraded Islandwide
Source : The Straits Times, Feb 4, 2008
Larger developers can still hold out, but some may be more open to slightly lower offers
ABOUT 590 blocks in 58 Housing Board sites islandwide have been picked for the next batch of improvement works by the Housing Board under its new upgrading schemes.
This includes the Home Improvement Programme (HIP) and Neighbourhood Renewal Programme (NRP).
The HDB, which said earlier that HIP would be first conducted in two precincts in Yishun and Tampines, announced on Monday that it will double that number to four in view of strong public support. -- ST PHOTO: LAU FOOK KONG
The HIP focuses on essential improvements within a flat, like repairing spalling concrete, and also gives residents the choice of opting out of certain items to reduce their bill. This replaces the more extensive Main Upgrading Programme, which conducts work both inside and outside the flat and costs more to do.
Under NRP, several adjoining estates are spruced up together, with the cost fully borne by the Government.
The HDB, which said earlier that HIP would be first conducted in two precincts in Yishun and Tampines, announced on Monday that it will double that number to four in view of strong public support.
Meanwhile, eight estates have been selected for NRP and 52 for lift upgrading - where lifts are improved to give residents access on every level. Some estates will have more than one type of upgrading work done concurrently to reduce the inconvenience caused.
Six precincts previously picked for the main upgrading programme under the old regime will also be switching to the new programmes. This is possible because residents in these precincts have not yet voted on their upgrading plan.
Details of the specific locations of these precincts will be released by the respestive MPs later. Work on this batch is expected to be completed within five years' time.
The HDB decided to go ahead with the major upgrading works following strong support from the residents after they were announced by Prime Minister Lee Hsien Loong at the National Day Rally last August.
In surveys conducted by HDB, 98 per cent of respondents expressed support for the HIP while 92 per cent indicated their willingness to participate in town hall meetings and provide inputs for NRP projects in their precincts.
The amendments to the Housing and Development Act that enable the HIP to be carried out were passed by Parliament on Jan 21.
In view of strong public support, the number of HIP projects has been increased from the earlier two to four, said the HDB in a statement on Monday.
'Some of the sites will be offered more than one programme to cater to specific local needs, minimise inconvenience to the residents and complete the LUP by 2014,' said the HDB.
Commenting on the upgrading works, Minister of State for National Development, Ms Grace Fu, said: 'We have listened to the feedback that residents gave us at the Forum on HDB Heartware and incorporated them into the new programmes. I am heartened by the strong support for the HIP and NRP. We are pleased to be able to bring the new programmes to more residents. In addition, the Government remains on track to complete the LUP for all eligible blocks by 2014.'
Factbox on HDB upgrading programmes
Home Improvement Programme (HIP)
The HIP will introduce useful flat improvements and items that are necessary for public health, safety or technical reasons, while addressing common maintenance problems in ageing flats, such as spalling concrete and ceiling leaks. About 300,000 flats, built in 1986 or before that have not undergone the MUP, will be eligible for the HIP.
The programme comprises two components - Optional Improvements and Essential Improvements. Optional Improvements are items that residents are likely to value, such as toilet upgrading and replacement of entrance door and refuse chute hopper.
Residents will be allowed to opt out of Optional Improvements with a corresponding reduction in co-payment. (In the case of toilet upgrading, the toilet must pass the water test for leaks if the lessee wishes to opt out of the item, to prevent ceiling leaks for the unit below.)
Essential Improvements are those that are deemed necessary for public health, safety or technical reasons, such as the repair of spalling concrete and replacement of waste pipes and pipe sockets ('bamboo pole holders'). These items will be fully funded by the Government if the HIP is polled successfully.
Neighbourhood Renewal Programme (NRP)
The NRP focuses on precinct- and block-level improvements and will be carried out on a larger scale, across two or more contiguous precincts.
This will ensure that facilities provided in adjoining precincts complement rather than duplicate one another, and allow pooling of resources to provide items that are otherwise too costly to build.
Under the NRP, residents will be invited to more actively provide feedback and views on the facilities to be built. About 200,000 flats, built in 1989 or before that have not undergone the MUP, Interim Upgrading Programme (IUP) or IUP Plus, will be eligible for the NRP.
Lift Upgrading Programme (LUP)
HDB is committed to completing the Lift Upgrading Programme (LUP) by 2014, for all eligible HDB blocks that do not have lifts stopping on every floor. Since LUP was introduced in 2001, around 3,600 HDB blocks, or about 70 per cent of the total number of eligible bocks, have been offered lift upgrading. The remaining eligible blocks will be offered LUP within the next few years and will be completed by 2014.
Larger developers can still hold out, but some may be more open to slightly lower offers
ABOUT 590 blocks in 58 Housing Board sites islandwide have been picked for the next batch of improvement works by the Housing Board under its new upgrading schemes.
This includes the Home Improvement Programme (HIP) and Neighbourhood Renewal Programme (NRP).
The HDB, which said earlier that HIP would be first conducted in two precincts in Yishun and Tampines, announced on Monday that it will double that number to four in view of strong public support. -- ST PHOTO: LAU FOOK KONGThe HIP focuses on essential improvements within a flat, like repairing spalling concrete, and also gives residents the choice of opting out of certain items to reduce their bill. This replaces the more extensive Main Upgrading Programme, which conducts work both inside and outside the flat and costs more to do.
Under NRP, several adjoining estates are spruced up together, with the cost fully borne by the Government.
The HDB, which said earlier that HIP would be first conducted in two precincts in Yishun and Tampines, announced on Monday that it will double that number to four in view of strong public support.
Meanwhile, eight estates have been selected for NRP and 52 for lift upgrading - where lifts are improved to give residents access on every level. Some estates will have more than one type of upgrading work done concurrently to reduce the inconvenience caused.
Six precincts previously picked for the main upgrading programme under the old regime will also be switching to the new programmes. This is possible because residents in these precincts have not yet voted on their upgrading plan.
Details of the specific locations of these precincts will be released by the respestive MPs later. Work on this batch is expected to be completed within five years' time.
The HDB decided to go ahead with the major upgrading works following strong support from the residents after they were announced by Prime Minister Lee Hsien Loong at the National Day Rally last August.
In surveys conducted by HDB, 98 per cent of respondents expressed support for the HIP while 92 per cent indicated their willingness to participate in town hall meetings and provide inputs for NRP projects in their precincts.
The amendments to the Housing and Development Act that enable the HIP to be carried out were passed by Parliament on Jan 21.
In view of strong public support, the number of HIP projects has been increased from the earlier two to four, said the HDB in a statement on Monday.
'Some of the sites will be offered more than one programme to cater to specific local needs, minimise inconvenience to the residents and complete the LUP by 2014,' said the HDB.
Commenting on the upgrading works, Minister of State for National Development, Ms Grace Fu, said: 'We have listened to the feedback that residents gave us at the Forum on HDB Heartware and incorporated them into the new programmes. I am heartened by the strong support for the HIP and NRP. We are pleased to be able to bring the new programmes to more residents. In addition, the Government remains on track to complete the LUP for all eligible blocks by 2014.'
Factbox on HDB upgrading programmes
Home Improvement Programme (HIP)
The HIP will introduce useful flat improvements and items that are necessary for public health, safety or technical reasons, while addressing common maintenance problems in ageing flats, such as spalling concrete and ceiling leaks. About 300,000 flats, built in 1986 or before that have not undergone the MUP, will be eligible for the HIP.
The programme comprises two components - Optional Improvements and Essential Improvements. Optional Improvements are items that residents are likely to value, such as toilet upgrading and replacement of entrance door and refuse chute hopper.
Residents will be allowed to opt out of Optional Improvements with a corresponding reduction in co-payment. (In the case of toilet upgrading, the toilet must pass the water test for leaks if the lessee wishes to opt out of the item, to prevent ceiling leaks for the unit below.)
Essential Improvements are those that are deemed necessary for public health, safety or technical reasons, such as the repair of spalling concrete and replacement of waste pipes and pipe sockets ('bamboo pole holders'). These items will be fully funded by the Government if the HIP is polled successfully.
Neighbourhood Renewal Programme (NRP)
The NRP focuses on precinct- and block-level improvements and will be carried out on a larger scale, across two or more contiguous precincts.
This will ensure that facilities provided in adjoining precincts complement rather than duplicate one another, and allow pooling of resources to provide items that are otherwise too costly to build.
Under the NRP, residents will be invited to more actively provide feedback and views on the facilities to be built. About 200,000 flats, built in 1989 or before that have not undergone the MUP, Interim Upgrading Programme (IUP) or IUP Plus, will be eligible for the NRP.
Lift Upgrading Programme (LUP)
HDB is committed to completing the Lift Upgrading Programme (LUP) by 2014, for all eligible HDB blocks that do not have lifts stopping on every floor. Since LUP was introduced in 2001, around 3,600 HDB blocks, or about 70 per cent of the total number of eligible bocks, have been offered lift upgrading. The remaining eligible blocks will be offered LUP within the next few years and will be completed by 2014.
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