Source : The Business Times, August 21, 2009
KEPPEL Corporation and Keppel Land are releasing a new batch of 30 units at their Reflections at Keppel Bay condo today at an average price of $1,950 per square foot (psf), assuming buyers will take the deferred payment scheme (DPS).
Buyers who opt for the normal progressive payment scheme pay 3 per cent less. Sizes of units range from 900 sq ft to 1,600 sq ft. The 99-year development is still under construction.
Reflections at Keppel Bay comprises a total of 1,129 units, of which 638 were sold as at end-July, according to Urban Redevelopment Authority data released this week. In July alone, five units were sold at prices ranging from $1,641 psf to $2,195 psf.
Keppel is also riding on the current uptick in home buying to release for sale units at the completed Caribbean Residences nearby at an average price of $1,300-1,400 psf.
Caribbean Residences comprises a total of 168 apartments at the completed 99-year-leasehold Caribbean at Keppel Bay condo that the group had leased out as corporate residences earlier. The majority of the apartments are leased with tenancies ranging from six months to two years, and these units will be sold with the existing tenancies.
Most of the apartments at Caribbean Residences are located in two blocks which are eight and nine storeys high. So far, about 30 of the 168 units are said to have been sold in the past few weeks and the group is riding on the buyer interest to release more apartments.
'However, not all the remaining units at Caribbean Residences are being put on the market at the same time,' a Keppel spokeswoman said. The 30 units sold recently were mostly two-bedders.
Keppel is developing the two projects on the former Keppel Harbour site.
Property consultants say developers are working hard to release more projects, to take advantage of the pick-up in home-buying sentiment.
Next week, NTUC Choice Homes will preview its 39-storey Trevista condo in Toa Payoh. The 99-year-leasehold project will have a total of 590 units.
Singapore Land is also expected to begin selling next week Trizon, a freehold condo on the former Himiko Court site in the Mount Sinai area.
The 24-storey development comprises a total of 289 units.
SingLand bought Himiko Court in May 2007 for $336 million, or $821 psf of potential gross floor area, inclusive of an estimated $1.07 million development charge. Market watchers reckon Trizon may be priced about $1,400 psf on average.
Saturday, August 22, 2009
2nd Most Expensive City
Source : The Straits Times, Aug 21, 2009
Hong Kong No. 3 as rent was excluded; S'pore moves up to 24th globally
SINGAPORE is the No.2 most expensive Asian city to live in, with only famously pricey Tokyo ahead in the rankings, according to a study by Swiss bank UBS.
In another survey released last month, Singapore jumped three spots to become the 10th most expensive city in the world for expatriates. -- ST PHOTO: ALPHONSUS CHERN
UBS assessed the purchasing power of residents in 73 cities and compared prices of a standardised basket of 122 goods and services, excluding rents.
The Asian top three were no surprise although Hong Kong usually emerges as more expensive in such surveys; but not this time as UBS discounted rent. Rent is traditionally higher in Hong Kong and would have been enough to send the city into second spot in Asia.
On the global league table, Tokyo was the fifth most expensive city while Singapore was 24th - up from the 32nd spot in 2006, the last time UBS conducted a similar study. Kuala Lumpur, Manila, New Delhi and Mumbai propped up the table as cities with the lowest prices.
Cities like Oslo, Zurich, Copenhagen, Geneva and traditional wallet-buster New York came in tops as the world's most expensive cities.
Employees in Tokyo earn the highest wages in Asia, making almost double the amount their counterparts earn here. Workers in Manila, Jakarta and Mumbai earn the lowest wages.
However, Asia remains home to some of the world's priciest cities and nowhere is the spread between most expensive and cheapest more pronounced, said UBS.
The study also found that people worked an average of 1,902 hours a year in the cities surveyed. Workers in Asian and Middle Eastern cities slogged for the longest hours, averaging 2,119 and 2,063 hours each year respectively.
The lucky people in the French cities of Lyon and Paris spend the least amount of time at work a year: just 1,582 and 1,594 hours respectively.
In another survey released last month, Singapore jumped three spots to become the 10th most expensive city in the world for expatriates. However, that survey - conducted by Mercer, which also studied items such as food, housing, transport and entertainment costs - suggested that Singapore had not become more expensive; instead, other cities had become cheaper places to live in.
Read the full story in Friday's edition of The Straits Times
Hong Kong No. 3 as rent was excluded; S'pore moves up to 24th globally
SINGAPORE is the No.2 most expensive Asian city to live in, with only famously pricey Tokyo ahead in the rankings, according to a study by Swiss bank UBS.
In another survey released last month, Singapore jumped three spots to become the 10th most expensive city in the world for expatriates. -- ST PHOTO: ALPHONSUS CHERNUBS assessed the purchasing power of residents in 73 cities and compared prices of a standardised basket of 122 goods and services, excluding rents.
The Asian top three were no surprise although Hong Kong usually emerges as more expensive in such surveys; but not this time as UBS discounted rent. Rent is traditionally higher in Hong Kong and would have been enough to send the city into second spot in Asia.
On the global league table, Tokyo was the fifth most expensive city while Singapore was 24th - up from the 32nd spot in 2006, the last time UBS conducted a similar study. Kuala Lumpur, Manila, New Delhi and Mumbai propped up the table as cities with the lowest prices.
Cities like Oslo, Zurich, Copenhagen, Geneva and traditional wallet-buster New York came in tops as the world's most expensive cities.Employees in Tokyo earn the highest wages in Asia, making almost double the amount their counterparts earn here. Workers in Manila, Jakarta and Mumbai earn the lowest wages.
However, Asia remains home to some of the world's priciest cities and nowhere is the spread between most expensive and cheapest more pronounced, said UBS.
The study also found that people worked an average of 1,902 hours a year in the cities surveyed. Workers in Asian and Middle Eastern cities slogged for the longest hours, averaging 2,119 and 2,063 hours each year respectively.
The lucky people in the French cities of Lyon and Paris spend the least amount of time at work a year: just 1,582 and 1,594 hours respectively.
In another survey released last month, Singapore jumped three spots to become the 10th most expensive city in the world for expatriates. However, that survey - conducted by Mercer, which also studied items such as food, housing, transport and entertainment costs - suggested that Singapore had not become more expensive; instead, other cities had become cheaper places to live in.
Read the full story in Friday's edition of The Straits Times
No Property Tax Change
Source : The Straits Times, Aug 22, 2009
Govt accepts feedback and leaves current framework alone
THE Government has decided to back away from changes it had proposed to tax laws dealing with gains made from property sales. The public consultation process for the proposal attracted 64 responses with 60 opposing the change.
Under the proposal, an individual who sells a property would not be taxed on the profit if he had not sold any other property in the preceding four years. -- PHOTO: BUSINESS TIMES
The Finance Ministry (MOF) said on Friday that 'on balance, it [is] best to retain the current framework of income tax treatment for individuals who sell their properties'. It said that it had received 'salient public feedback' and saw merit in the points raised.
Dr Steven Choo, chief executive of the Real Estate Developers' Association of Singapore (Redas), welcomed Friday's move, adding that he appreciated the Government's 'consultative approach and understanding of the industry's concern on the matter'.
Under the proposal, an individual who sells a property would not be taxed on the profit if he had not sold any other property in the preceding four years.
The measure sparked considerable unease and a two-day slump in property shares when news of it broke last month. Investors initially viewed it as a back-door attempt to impose a capital gains tax or a pre-emptive strike against property speculators.
The ministry's subsequent clarifications and reassurances about the proposals calmed much of those concerns but public feedback was mostly not in support of the move. In a statement on Friday, MOF said there was feedback that the proposed change 'could bias purchase decisions towards investing in one bigger property, rather than numerous smaller properties'.
Respondents also noted that there were many other factors that should allow property sellers to escape tax on a gain other than considering the frequency of their sales.
These include owners who might have held a property for a long time before selling it together with another property within the same four-year period. The circumstances that led to the sale could also be significant.
'To cater to all such factors would not be straightforward, and would make the income tax treatment for property disposals complex,' said MOF.
Singapore has no capital gains tax but the Inland Revenue Authority of Singapore assesses a small number of individuals - those who regularly transact in property - each year. It uses yardsticks like the circumstances that led to the sale to determine if the profits should be taxed at the appropriate income tax rate.
Read the full story in Saturday's edition of The Straits Times
Govt accepts feedback and leaves current framework alone
THE Government has decided to back away from changes it had proposed to tax laws dealing with gains made from property sales. The public consultation process for the proposal attracted 64 responses with 60 opposing the change.
Under the proposal, an individual who sells a property would not be taxed on the profit if he had not sold any other property in the preceding four years. -- PHOTO: BUSINESS TIMESThe Finance Ministry (MOF) said on Friday that 'on balance, it [is] best to retain the current framework of income tax treatment for individuals who sell their properties'. It said that it had received 'salient public feedback' and saw merit in the points raised.
Dr Steven Choo, chief executive of the Real Estate Developers' Association of Singapore (Redas), welcomed Friday's move, adding that he appreciated the Government's 'consultative approach and understanding of the industry's concern on the matter'.
Under the proposal, an individual who sells a property would not be taxed on the profit if he had not sold any other property in the preceding four years.
The measure sparked considerable unease and a two-day slump in property shares when news of it broke last month. Investors initially viewed it as a back-door attempt to impose a capital gains tax or a pre-emptive strike against property speculators.
The ministry's subsequent clarifications and reassurances about the proposals calmed much of those concerns but public feedback was mostly not in support of the move. In a statement on Friday, MOF said there was feedback that the proposed change 'could bias purchase decisions towards investing in one bigger property, rather than numerous smaller properties'.
Respondents also noted that there were many other factors that should allow property sellers to escape tax on a gain other than considering the frequency of their sales.
These include owners who might have held a property for a long time before selling it together with another property within the same four-year period. The circumstances that led to the sale could also be significant.
'To cater to all such factors would not be straightforward, and would make the income tax treatment for property disposals complex,' said MOF.
Singapore has no capital gains tax but the Inland Revenue Authority of Singapore assesses a small number of individuals - those who regularly transact in property - each year. It uses yardsticks like the circumstances that led to the sale to determine if the profits should be taxed at the appropriate income tax rate.
Read the full story in Saturday's edition of The Straits Times
No Change To Tax Rules
Source : The Straits Times, Aug 21, 2009
THE Government has decided not to press ahead with a proposed change to the income tax laws to make it clearer to property sellers when they will be taxed on their profits.
Under the proposal, an individual who sells a property would be certain that profit from the sale would not be subject to tax if he had not sold any other property in the preceding four years. --PHOTO: BT
This came after 60 of the 64 comments received on the proposed change gave it the thumbs down.
Under the proposal, an individual who sells a property would be certain that profit from the sale would not be subject to tax if he had not sold any other property in the preceding four years.
But instead of reacting positively after The Straits Times highlighted the proposed change last month, investors viewed it as a back-door attempt to impose a capital gains tax or a pre-emptive strike against property speculators.
This prompted the Finance Ministry to clarify that the proposed change involved no tightening of the current income tax treatment for individuals who sell their properties. It had also noted that over the years, only a small number of individuals - those who regularly buy and sell properties - had been taxed on their gains from such transactions.
In a statement on Friday, the Finance Ministry noted that it had received salient feedback which led to its decision not to press ahead with the proposed change. It had also considered alternatives to give certainties of non-taxation to individuals who sell their properties but noted that these brought 'drawbacks and complexities of their own'.
One respondent, for example, had noted that the proposed tax change 'could bias property purchase decisions towards investing in one bigger property rather than numerous smaller properties. This is because certainty of non-taxation would be provided for disposal of one property within any four years, regardless of the property's value'.
Other respondents said there were many other possible factors which should be take into consideration. These factors include property being held for a very long period but ended up being sold together another property within the same four-year period..
This might lead to 'inadvertent uncertainty' for individuals who sell more than one property within any four years, even though there is no change to the current income tax treatment for such cases.
THE Government has decided not to press ahead with a proposed change to the income tax laws to make it clearer to property sellers when they will be taxed on their profits.
Under the proposal, an individual who sells a property would be certain that profit from the sale would not be subject to tax if he had not sold any other property in the preceding four years. --PHOTO: BTThis came after 60 of the 64 comments received on the proposed change gave it the thumbs down.
Under the proposal, an individual who sells a property would be certain that profit from the sale would not be subject to tax if he had not sold any other property in the preceding four years.
But instead of reacting positively after The Straits Times highlighted the proposed change last month, investors viewed it as a back-door attempt to impose a capital gains tax or a pre-emptive strike against property speculators.
This prompted the Finance Ministry to clarify that the proposed change involved no tightening of the current income tax treatment for individuals who sell their properties. It had also noted that over the years, only a small number of individuals - those who regularly buy and sell properties - had been taxed on their gains from such transactions.
In a statement on Friday, the Finance Ministry noted that it had received salient feedback which led to its decision not to press ahead with the proposed change. It had also considered alternatives to give certainties of non-taxation to individuals who sell their properties but noted that these brought 'drawbacks and complexities of their own'.
One respondent, for example, had noted that the proposed tax change 'could bias property purchase decisions towards investing in one bigger property rather than numerous smaller properties. This is because certainty of non-taxation would be provided for disposal of one property within any four years, regardless of the property's value'.
Other respondents said there were many other possible factors which should be take into consideration. These factors include property being held for a very long period but ended up being sold together another property within the same four-year period..
This might lead to 'inadvertent uncertainty' for individuals who sell more than one property within any four years, even though there is no change to the current income tax treatment for such cases.
New Condo To Get Walkway To MRT Station
Source : The Straits Times, August 21 2009
Beach Road private housing project could set new property trend
HOW'S this for a condominium's selling point: Near MRT station. Complete with all-weather walkway.
The new Concourse Skyline in Beach Road could be the first private housing project to have an overhead bridge linking it to Singapore's mass transit system.
Part of the covered overhead bridge that will link Concourse Skyline in Beach Road to Nicoll Highway MRT station. -- PHOTO: LIM SIN THAI
Other condo projects are likely to follow, in what could be an emerging trend.
Once it is completed, residents of the 99-year lease Concourse Skyline, being built on a demolished wing of the Concourse complex, will need to walk only about 200m to the Circle Line's rebuilt (and relocated) Nicoll Highway station due to open next year.
The 360-unit condo, developed by listed property group Hong Fok at an estimated $200 million, is expected to be ready by 2013.
Concourse Skyline's unique addition arose from rather unusual circumstances. The original Nicoll Highway station, which was much nearer to the Concourse, would have had an underground link to the former Concourse wing. But when the uncompleted station collapsed, killing four workers in a 2004 construction accident, plans for the underground link were scrapped.
A dispute then ensued between the Land Transport Authority and Hong Fok. Neither party would comment on this, but The Straits Times understands it partly involved the condo developer wanting direct access to the new station. The issue was settled last year, resulting in the overhead residential link.
Why not an underground connection?
'The new Concourse development is no longer a commercial space, and the new MRT station is much farther away,' explained Hong Fok director S.E. Cheong.
The project will be carried out in three stages, the first being the overhead bridge spanning Nicoll Highway. It was completed recently.
Construction of the second stage that links the overhead bridge to the MRT station, complete with lifts and escalators, is under way.
Once the Concourse Skyway nears completion, the final segment joining the condo to the bridge will be built by Hong Fok. Access to this segment will be through a secured doorway, passable only to residents.
Hong Fok had already included the linkway in publicity materials for the condo. The project was launched last year just as the impact of the world financial crisis hit Singapore. Units were then priced at between $1,500 and $1,800 per sq ft. Mr Cheong said yesterday 140 units have been sold.
City Developments' massive $2.5 billion South Beach project - also in Beach Road and targeted to be up by 2016 - will also have mass transit links. A spokesman said the 3.5ha commercial-and-residential project will have underground links to both Circle Line and Downtown Line stations, as well as to CityLink Mall that connects to the City Hall station and Raffles City Shopping Centre.
Beach Road private housing project could set new property trend
HOW'S this for a condominium's selling point: Near MRT station. Complete with all-weather walkway.
The new Concourse Skyline in Beach Road could be the first private housing project to have an overhead bridge linking it to Singapore's mass transit system.
Part of the covered overhead bridge that will link Concourse Skyline in Beach Road to Nicoll Highway MRT station. -- PHOTO: LIM SIN THAIOther condo projects are likely to follow, in what could be an emerging trend.
Once it is completed, residents of the 99-year lease Concourse Skyline, being built on a demolished wing of the Concourse complex, will need to walk only about 200m to the Circle Line's rebuilt (and relocated) Nicoll Highway station due to open next year.
The 360-unit condo, developed by listed property group Hong Fok at an estimated $200 million, is expected to be ready by 2013.
Concourse Skyline's unique addition arose from rather unusual circumstances. The original Nicoll Highway station, which was much nearer to the Concourse, would have had an underground link to the former Concourse wing. But when the uncompleted station collapsed, killing four workers in a 2004 construction accident, plans for the underground link were scrapped.A dispute then ensued between the Land Transport Authority and Hong Fok. Neither party would comment on this, but The Straits Times understands it partly involved the condo developer wanting direct access to the new station. The issue was settled last year, resulting in the overhead residential link.
Why not an underground connection?
'The new Concourse development is no longer a commercial space, and the new MRT station is much farther away,' explained Hong Fok director S.E. Cheong.
The project will be carried out in three stages, the first being the overhead bridge spanning Nicoll Highway. It was completed recently.
Construction of the second stage that links the overhead bridge to the MRT station, complete with lifts and escalators, is under way.
Once the Concourse Skyway nears completion, the final segment joining the condo to the bridge will be built by Hong Fok. Access to this segment will be through a secured doorway, passable only to residents.
Hong Fok had already included the linkway in publicity materials for the condo. The project was launched last year just as the impact of the world financial crisis hit Singapore. Units were then priced at between $1,500 and $1,800 per sq ft. Mr Cheong said yesterday 140 units have been sold.
City Developments' massive $2.5 billion South Beach project - also in Beach Road and targeted to be up by 2016 - will also have mass transit links. A spokesman said the 3.5ha commercial-and-residential project will have underground links to both Circle Line and Downtown Line stations, as well as to CityLink Mall that connects to the City Hall station and Raffles City Shopping Centre.
Ex-Parkway Boss In $48m Hilltops Deal
Source : The Business Times, August 22, 2009
Group led by Tony Tan pays about $2,560 per square foot in sub-sale market for 18 apartments in Cairnhill project
A GROUP led by former Parkway Holdings boss Tony Tan is understood to have picked up 18 apartments in the sub-sale market at Hilltops condo at Cairnhill Circle for a total of $48.2 million or an average price of about $2,560 per square foot (psf).
UPMARKET - The 241-unit development is expected to be completed next year
BT could not ascertain the loss suffered by the seller, who is believed to be a Hong Kong investor that bought the units in late 2007.
But according to back-of-the-envelope calculations by some analysts, the loss is estimated at 30-35 per cent.
The freehold project reportedly achieved an average price of just over $3,900 psf for the first 28 units, according to a news report in late 2007.
Government statistics show the project's developer, SC Global subsidiary Taraville, sold 24 units in October 2007 at a median price of $3,711 psf.
According to the latest Urban Redevelopment Authority (URA) statistics at the end of last month, 31 units in the project had been sold by the developer.
This is the same number of units that SC Global had released in the 241-unit condo by the same date. The project, comprising two 20-storey towers and a 14-storey block, is expected to be completed next year.
Savills is understood to have brokered the latest sub-sale deal involving the 18 units, which comprise mostly two and three-bedders.
The apartments were bought by companies whose shareholders include Mr Tan and Hasetrale Holdings, which is controlled by Mr Tan, his uncle Tan Chin Nam and a string of other Malaysians.
Hasetrale is also a shareholder in Napier Properties, developer of the 8 Napier condo on the former Eng Lok Mansion site.
Despite the loss suffered by the Hong Kong party in the sub-sale of 18 Hilltops apartments, market watchers described the $2,560 psf average price as attractive for the seller.
Keppel Land is understood to have sold a handful of units at The Promont nearby at prices ranging from just below $1,900 psf to $2,060 psf recently. The Promont is a 17-storey apartment development with just 15 apartments.
Earlier this month, BT reported that a property fund had bought the remaining 21 units at Sui Generis condo in Balmoral Crescent for $65 million or about $1,260 psf on average from the freehold project's developers.
However, the price is understood to have been agreed much earlier in the year, when sentiment was still weak.
The latest URA statistics on developers' home sales show an improvement in sales of high-end projects in July.
City Developments sold 79 units at Volari in Balmoral Road at a median price of $2,059 psf.
Four units each were sold at Nassim Park Residences ($3,273 psf median price) and The Orchard Residences ($2,815 psf median price).
Ho Bee found buyers for nine units at The Orange Grove at a median price of $2,334 psf.
Group led by Tony Tan pays about $2,560 per square foot in sub-sale market for 18 apartments in Cairnhill project
A GROUP led by former Parkway Holdings boss Tony Tan is understood to have picked up 18 apartments in the sub-sale market at Hilltops condo at Cairnhill Circle for a total of $48.2 million or an average price of about $2,560 per square foot (psf).
UPMARKET - The 241-unit development is expected to be completed next yearBT could not ascertain the loss suffered by the seller, who is believed to be a Hong Kong investor that bought the units in late 2007.
But according to back-of-the-envelope calculations by some analysts, the loss is estimated at 30-35 per cent.
The freehold project reportedly achieved an average price of just over $3,900 psf for the first 28 units, according to a news report in late 2007.
Government statistics show the project's developer, SC Global subsidiary Taraville, sold 24 units in October 2007 at a median price of $3,711 psf.
According to the latest Urban Redevelopment Authority (URA) statistics at the end of last month, 31 units in the project had been sold by the developer.
This is the same number of units that SC Global had released in the 241-unit condo by the same date. The project, comprising two 20-storey towers and a 14-storey block, is expected to be completed next year.
Savills is understood to have brokered the latest sub-sale deal involving the 18 units, which comprise mostly two and three-bedders.
The apartments were bought by companies whose shareholders include Mr Tan and Hasetrale Holdings, which is controlled by Mr Tan, his uncle Tan Chin Nam and a string of other Malaysians.
Hasetrale is also a shareholder in Napier Properties, developer of the 8 Napier condo on the former Eng Lok Mansion site.
Despite the loss suffered by the Hong Kong party in the sub-sale of 18 Hilltops apartments, market watchers described the $2,560 psf average price as attractive for the seller.
Keppel Land is understood to have sold a handful of units at The Promont nearby at prices ranging from just below $1,900 psf to $2,060 psf recently. The Promont is a 17-storey apartment development with just 15 apartments.
Earlier this month, BT reported that a property fund had bought the remaining 21 units at Sui Generis condo in Balmoral Crescent for $65 million or about $1,260 psf on average from the freehold project's developers.
However, the price is understood to have been agreed much earlier in the year, when sentiment was still weak.
The latest URA statistics on developers' home sales show an improvement in sales of high-end projects in July.
City Developments sold 79 units at Volari in Balmoral Road at a median price of $2,059 psf.
Four units each were sold at Nassim Park Residences ($3,273 psf median price) and The Orchard Residences ($2,815 psf median price).
Ho Bee found buyers for nine units at The Orange Grove at a median price of $2,334 psf.
Sales Of Existing Homes Up In US
Source : The Business Times, August 22, 2009
Latest US Data
(Washington)SALES of existing US homes jumped more than forecast in July to the highest level in almost two years, signalling that the housing crisis that crippled the world's largest economy is easing.
HOME AND DRY - The jump of existing US homes sales to the highest level in almost two years signals that the housing crisis is easing
Purchases climbed 7.2 per cent to a 5.24 million annual rate, the most since August 2007, the National Association of Realtors (NAR) said yesterday. The gain was the biggest since records began in 1999. The median price fell 15 per cent.
'More and more buyers are becoming convinced that there is not a lot of downside left in the housing market,' said Ellen Zentner, a senior economist at Bank of Tokyo-Mitsubishi UFJ in New York. 'We can count on housing no longer being a drag.'
Stocks jumped and Treasury securities dropped after the report added to evidence that the housing market was turning.
Economists had forecast that existing home sales would rise to a five million annual rate, according to a Bloomberg News survey. June's pace was unrevised at 4.89 million.
Sales had reached a 4.49 million pace in January, their lowest level since comparable records began in 1999.
Purchases of existing homes increased 5 per cent compared with a year earlier. The median price dropped to US$178,400 from US$210,100 in July 2008.
The number of previously owned unsold homes on the market jumped 7.3 per cent to 4.09 million in July, a 'notable' increase, according to Lawrence Yun, NAR's chief economist. At the current sales pace, it would take 9.4 months to sell those houses, the same as in June.
A seven months' supply is usually consistent with stabilisation in prices, Mr Yun said last month.
The share of homes sold as foreclosures or otherwise distressed properties held to 31 per cent in July, he said.
Yesterday's report showed that sales of existing single- family homes increased 6.5 per cent to an annual rate of 4.61 million. Sales of condominiums and cooperatives climbed 13 per cent to a 630,000 rate.
Purchases increased in three of four regions, led by a 13 per cent jump in the north-east.
Obama administration efforts to revive housing include an US$8,000 federal tax credit for first-time buyers who complete the transaction before Dec 1. The first-time buyers accounted for about 30 per cent of sales last month and the government's credit is having a 'significant impact' on sales, the NAR's Mr Yun said. -- Bloomberg
Latest US Data
(Washington)SALES of existing US homes jumped more than forecast in July to the highest level in almost two years, signalling that the housing crisis that crippled the world's largest economy is easing.
HOME AND DRY - The jump of existing US homes sales to the highest level in almost two years signals that the housing crisis is easingPurchases climbed 7.2 per cent to a 5.24 million annual rate, the most since August 2007, the National Association of Realtors (NAR) said yesterday. The gain was the biggest since records began in 1999. The median price fell 15 per cent.
'More and more buyers are becoming convinced that there is not a lot of downside left in the housing market,' said Ellen Zentner, a senior economist at Bank of Tokyo-Mitsubishi UFJ in New York. 'We can count on housing no longer being a drag.'
Stocks jumped and Treasury securities dropped after the report added to evidence that the housing market was turning.
Economists had forecast that existing home sales would rise to a five million annual rate, according to a Bloomberg News survey. June's pace was unrevised at 4.89 million.
Sales had reached a 4.49 million pace in January, their lowest level since comparable records began in 1999.
Purchases of existing homes increased 5 per cent compared with a year earlier. The median price dropped to US$178,400 from US$210,100 in July 2008.
The number of previously owned unsold homes on the market jumped 7.3 per cent to 4.09 million in July, a 'notable' increase, according to Lawrence Yun, NAR's chief economist. At the current sales pace, it would take 9.4 months to sell those houses, the same as in June.
A seven months' supply is usually consistent with stabilisation in prices, Mr Yun said last month.
The share of homes sold as foreclosures or otherwise distressed properties held to 31 per cent in July, he said.
Yesterday's report showed that sales of existing single- family homes increased 6.5 per cent to an annual rate of 4.61 million. Sales of condominiums and cooperatives climbed 13 per cent to a 630,000 rate.
Purchases increased in three of four regions, led by a 13 per cent jump in the north-east.
Obama administration efforts to revive housing include an US$8,000 federal tax credit for first-time buyers who complete the transaction before Dec 1. The first-time buyers accounted for about 30 per cent of sales last month and the government's credit is having a 'significant impact' on sales, the NAR's Mr Yun said. -- Bloomberg
No Change To Property Sales Tax Framework
Source : The Business Times, August 22, 2009
MOF drops proposed change aimed at giving certainty after public consultation exercise
THE government has decided not to change the current income tax framework with regard to individuals who sell their properties, a move that was welcomed by industry players including the Real Estate Developers' Association of Singapore (Redas).
Under a proposal put up for public consultation, the Ministry of Finance (MOF) had suggested that individuals who sold their properties would be certain that the gains they made would not be subject to income tax if they had not sold any other properties in the preceding four years.
But this was seen by the market as an anti-speculation measure, as it means that those who sell more than one property within four years will not be exempt.
'We remain believers of the idea that the government may be sending out a signal through this proposal to cool property transactions, especially in the high-end,' said CIMB analyst Donald Chua in a note last month.
Keen to quell rumours about an anti-speculation drive, MOF then clarified that the proposal is unlikely to lead to more individuals being taxed. Rather, it offers greater clarity on whether gains will be taxed as it proposes a condition that would guarantee no tax: an individual who sells a property on or after Jan 1, 2010 will not be taxed on the gains if he has not sold any other property in the previous four years.
Currently, property sellers do not pay tax on gains unless the Inland Revenue Authority of Singapore (IRAS) sees them as traders and treats the gains as income. IRAS makes its decision on a case-by-case basis, considering factors such as why the properties were sold, how long the sellers owned them and how frequently the sellers transacted properties in the past.
MOF decided not to implement the change following the recent public consultation exercise.
The proposal was put up for feedback under the Income Tax Act public consultation exercise from June 22 to July 14. A total of 64 comments were received on the proposed relaxation of income tax treatment for individuals who sell their properties, and of these, 60 comments were not in support of the proposed change.
Among other things, feedback said that the proposed change could bias property purchase decisions towards investing in one bigger property, rather than numerous smaller properties. This is because certainty of non-taxation would be provided for disposal of one property within any four years, regardless of the property's value.
Concern was also raised that the proposed change could create inadvertent uncertainty for individuals who sell more than one property within any four years - even though there was no change to the current income tax treatment for such cases.
'The Ministry of Finance sees merits in these points raised in the public feedback to the proposed change,' MOF said in a statement. It has therefore decided that it is, on balance, best to retain the current framework of income tax treatment for individuals who sell their properties.
Industry players welcomed MOF's decision.
'We welcome the Ministry of Finance's decision not to change the current income tax framework for individuals who sell their properties,' said a Redas spokeswoman. 'Redas appreciates the government's consultative approach and understanding of the industry's concern on the matter.'
'We welcome the positive news that the Ministry of Finance has listened to public feedback,' said Owi Kek Hean, head of tax services at KPMG in Singapore. 'The decision not to change the current income tax framework for individuals who sell their properties clearly demonstrates how the government takes differing views on-board in its formulation and changes proposed to Singapore tax policy.'
MOF also said that it has accepted for implementation 85 out of the 113 suggestions received on the draft Income Tax (Amendment) Bill 2009. The draft contains proposed legislation to put into effect the income tax changes announced in Budget 2009, as well as other changes arising from the periodic review of the income tax system.
MOF drops proposed change aimed at giving certainty after public consultation exercise
THE government has decided not to change the current income tax framework with regard to individuals who sell their properties, a move that was welcomed by industry players including the Real Estate Developers' Association of Singapore (Redas).
Under a proposal put up for public consultation, the Ministry of Finance (MOF) had suggested that individuals who sold their properties would be certain that the gains they made would not be subject to income tax if they had not sold any other properties in the preceding four years.
But this was seen by the market as an anti-speculation measure, as it means that those who sell more than one property within four years will not be exempt.
'We remain believers of the idea that the government may be sending out a signal through this proposal to cool property transactions, especially in the high-end,' said CIMB analyst Donald Chua in a note last month.
Keen to quell rumours about an anti-speculation drive, MOF then clarified that the proposal is unlikely to lead to more individuals being taxed. Rather, it offers greater clarity on whether gains will be taxed as it proposes a condition that would guarantee no tax: an individual who sells a property on or after Jan 1, 2010 will not be taxed on the gains if he has not sold any other property in the previous four years.
Currently, property sellers do not pay tax on gains unless the Inland Revenue Authority of Singapore (IRAS) sees them as traders and treats the gains as income. IRAS makes its decision on a case-by-case basis, considering factors such as why the properties were sold, how long the sellers owned them and how frequently the sellers transacted properties in the past.
MOF decided not to implement the change following the recent public consultation exercise.
The proposal was put up for feedback under the Income Tax Act public consultation exercise from June 22 to July 14. A total of 64 comments were received on the proposed relaxation of income tax treatment for individuals who sell their properties, and of these, 60 comments were not in support of the proposed change.
Among other things, feedback said that the proposed change could bias property purchase decisions towards investing in one bigger property, rather than numerous smaller properties. This is because certainty of non-taxation would be provided for disposal of one property within any four years, regardless of the property's value.
Concern was also raised that the proposed change could create inadvertent uncertainty for individuals who sell more than one property within any four years - even though there was no change to the current income tax treatment for such cases.
'The Ministry of Finance sees merits in these points raised in the public feedback to the proposed change,' MOF said in a statement. It has therefore decided that it is, on balance, best to retain the current framework of income tax treatment for individuals who sell their properties.
Industry players welcomed MOF's decision.
'We welcome the Ministry of Finance's decision not to change the current income tax framework for individuals who sell their properties,' said a Redas spokeswoman. 'Redas appreciates the government's consultative approach and understanding of the industry's concern on the matter.'
'We welcome the positive news that the Ministry of Finance has listened to public feedback,' said Owi Kek Hean, head of tax services at KPMG in Singapore. 'The decision not to change the current income tax framework for individuals who sell their properties clearly demonstrates how the government takes differing views on-board in its formulation and changes proposed to Singapore tax policy.'
MOF also said that it has accepted for implementation 85 out of the 113 suggestions received on the draft Income Tax (Amendment) Bill 2009. The draft contains proposed legislation to put into effect the income tax changes announced in Budget 2009, as well as other changes arising from the periodic review of the income tax system.
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