Wednesday, September 3, 2008

Brown Unveils Housing Market Support Plan

Source : The Business Times, September 3, 2008

Package to help families with mortgages avoid losing homes

(LONDON) British Prime Minister Gordon Brown yesterday unveiled plans to boost the country's slumping housing market as he launched a fightback after nearly a year trailing in the opinion polls.

Political fightback: Mr Brown (second from left), with Mr Darling, Ms Blears and Chief Secretary to the Treasury Yvette Cooper meeting at Downing Street to discuss the housing situation yesterday

With consumer confidence crumbling in the face of the credit crunch and rocketing energy bills, his ruling Labour Party is some 20 points behind the opposition Conservatives and on that showing would easily lose the next general election. House prices in Britain are falling and home repossession orders in England and Wales have risen to their highest level since the housing market crash of the early 1990s.

The government said the housing package would help vulnerable families struggling with mortgage payments avoid losing their homes and bring forward funding for new social housing from existing budgets. The government and property developers also plan to offer five-year interest-free loans for some first-time buyers - both to help people move into affordable homes and support the house building industry.

Communities Secretary Hazel Blears said the package was aimed at 'people who just need that little bit of extra help to keep them afloat'. 'I think it's the responsibility of government ... to do what we can to help the decent people who want to stay in their homes,' she told GMTV television. A government source said those measures would cost about £pounds;1 billion (S$2.6 billion).

Mr Brown's political fightback comes after a summer which kicked off with speculation he could soon be ousted as Labour leader and ended with data showing the British economy failed to expand in the second quarter of 2008. That was the first quarter the economy has not grown since a recession in the early 1990s, ending Mr Brown's ability to boast of uninterrupted growth since Labour took office in 1997.

Data on Monday showed that the number of new home loans approved in July fell for the 12th consecutive month and the government may consider tinkering with an unpopular tax on home purchases, known as stamp duty. The government may offer home buyers the option of paying the tax at a later date or perhaps cut the rate of stamp duty for homes of a certain value, or for first-time buyers.

Mr Brown also plans later this week or next to look at ways to help households cope with the rising cost of fuel bills, perhaps by asking utility firms to pay money into a voluntary fund that could be used to make poor households more energy efficient. Ms Blears refused to be drawn on whether the government planned changes to stamp duty, saying it was a question for finance minister Alistair Darling. 'We've got our work cut out. The coming 12 months will be the most difficult 12 months the Labour Party has had in a generation,' Mr Darling said on Saturday. -- Reuters

Chip Eng Seng Wins Third HDB Job This Year

Source : The Business Times, September 3, 2008

Company's order book hits $843m with latest contract worth $156m

CONSTRUCTION and property group Chip Eng Seng has won a $156 million design and build contract for Housing and Development Board (HDB) flats at Punggol West - its third HDB contract this year.

The latest win, through wholly owned Chip Eng Seng Contractors (1988), takes its order book to $843 million, from $687 million at end-June.

In a statement yesterday, Chip Eng Seng said the contract involves the design and construction of residential buildings with parking and community facilities. It said preparation and design work and obtaining approvals will take seven months from this month.

Construction phase is expected to take 30 months.

Chip Eng Seng executive chairman Lim Tiam Seng said: 'With the enlarged order book, we will be kept busy through to 2011.'

Chip Eng Seng won $123.5 million and $188 million HDB contracts in June and January respectively this year. The $123.5 million contract is for building five 25-storey blocks of flats with a total of 698 units in Sengkang.

The $188 million contract is for building 1,394 HDB flats in Queenstown. Chip Eng Seng is currently undertaking two other HDB projects - one at Sembawang and the other called Pinnacle@Duxton.

Chip Eng Seng Contractors (1988) is registered with the Building and Construction Authority of Singapore as an A1 general builder - the highest classification, which allows it to tender for public sector projects of unlimited value.

The group's development arm CEL Development has projects in Singapore and Vietnam.

CapitaLand Sees $163m Gain After Capital Tower Beijing Sale

Source : The Business Times, September 3, 2008

CapitaLand on Wednesday said it has entered into a share purchase deed for the sale of its indirect wholly-owned subsidiary Hua Lei Holdings Pte Ltd which indirectly owns all of the office property Capital Tower Beijing for US$352 million.

Capital Tower Beijing, located in the central business district of Beijing, comprises two 35-storey office towers. The building is currently home to several multinational companies

The sale purchase comprises the consolidated net asset value of CapitaLand's indirect wholly-owned subsidiaries which own the property, taking into account the assignment of shareholder's loan of about US$166 million and valuing Capital Tower Beijing at US$488 million.

CapitaLand will obtain a net cash flow of about $498 million (US$348 million) and is expected to recognise a gain of $163 million.

Merrill Lynch Singapore Property Analysis 26 Aug 2008

Chip Eng Seng Unit Bags HDB's $156m Punggol Deal

Source : The Straits Times, Sep 3, 2008

CHIP Eng Seng, a mainboard-listed construction firm, has clinched a $156 million design-and- build contract from the HDB.

The latest HDB contract is for designing and building residential buildings with carpark and community facilities in Punggol West. -- ST FILE PHOTO

In a statement to the Singapore Exchange, the company said its unit Chip Eng Seng Contractors (1988) had won the award to design and build residential buildings with carpark and community facilities in Punggol West.

The preparation and design work will take seven months and is expected to commence this month, said the firm.

Upon approval, construction will take 30 months, it added.

This latest award brings the firm's order book to $843 million from $687 million as at the end of June this year.

Executive chairman Lim Tiam Seng said the firm will 'be kept busy through to 2011' with the enlarged order book.

This is the group's third HDB contract for the year, following $123.5 million and $188 million deals awarded in June and January this year respectively.

It is also undertaking two other HDB projects, one in Sembawang. The other is Pinnacle @ Duxton, Singapore's tallest public housing project which will feature seven 50-storey blocks with communal and commercial facilities when completed.

The firm's shares rose 1.5 cents to 26.5 cents yesterday with 437,000 shares changing hands. Its market capitalisation is about $177 million.

Since the start of the year, Chip Eng Seng shares have lost about 57 per cent of their value, in line with the weak property sector.

Asians Want To Bet More On Property

Source : The Business Times, September 3, 2008

Barclays Wealth survey says more individuals in Asian and emerging markets would like to up property allocation

MASS affluent and high net worth individuals in Singapore would like to invest more into property, a survey by Barclays Wealth has found. But those surveyed also indicate that in a time of increased economic volatility they would like to raise their allocations into cash, and take on more risk.

That may not be as contradictory as it sounds, says Didier von Daeniken, Barclays Wealth Asia-Pacific chief executive. 'There might not necessarily be a long term change in people's willingness to bear risk, although there is clearly a temporary reduction in risk-taking due to less optimistic investment prospects.'

Barclays has just published the latest in its series of 'Wealth Insights' publications, this time looking into behavioural finance aspects of clients' attitudes. The survey has found that on property, more individuals in the Asian and emerging markets say they would like to invest more, compared to those in the UK, Germany and Spain.

The survey, done together with the Economic Intelligence, was conducted between March and April this year. Sentiment here on property, however, has dampened markedly this year, alongside a bleaker economic outlook. Roughly 2,300 investors were polled, with investable assets of between £pounds;500,000 and over £pounds;30 million.

On property, 57 per cent of those in China indicated they want to raise allocations, compared to 48 per cent of clients in India and 45 per cent of Singaporeans.

Greg Davies, Barclays Wealth head of behavioural finance, says a drop in property prices may not dampen desire by very much. 'Our economic research people tend to feel that perhaps the lower availability and depth of (alternatives) is one reason for the property focus in Asia.'

On volatility, he says: 'Data seems to suggest that Asian investors treat volatility more opportunistically, rather than cautiously.' This may be partly because investors see the current downturn as a 'dip' in an upward trend for Asia and the emerging markets.

'In these markets up to last October, the recent trend has been very strongly positive, and individuals are very strongly influenced by trends. In mature markets, data extends much further back and they see this as a cyclical dowturn rather than a dip in an uptrend.'

Another factor that may favour risk taking is that many in Asia are entrepreneurial, first or second generation wealth owners. 'Even with the recent and fairly strong drop in Asian markets, many people are so much wealthier than they have been in recent memory...This inclines people towards a more opportunistic way of thinking.'

Age appears to play a part in the desire to allocate to cash. Younger respondents under 50 are more likely to move to cash in a market upheaval, than those over 50. Younger respondents were also more likely to trade more frequently. This is likely to reflect the fact that older investors have more experience of previous cycles and may be less nervous in the face of volatility.

In terms of monitoring their portfolios, 71 per cent of the individuals monitor their overall portfolio at least monthly, and 41 per cent monitor either weekly or daily. In the study, Mr Davies says that the frequency of monitoring a portfolio is linked to an investor's level of composure. Those with lower levels of composure are likely to watch their investments more closely.

Those who monitor more tend to focus on relative benchmarks rather than absolute ones. Individuals' perception of their own skills, and the extent to which they think their skills contribute to success instead of luck, also play a part. Wealthy investors who attribute success to their skills are more likely to monitor and take risks.

The study also looked into clients' sources of advice. It found that those with assets greater than £pounds;30 million are more likely to seek advice from a business adviser. Those with between £pounds;500,000 and £pounds;1 million in assets, however, look to the media. This suggests that as individuals gain wealth, they are more likely to rely on professional advice.

In terms of gender differences, women tend to be more likely to turn to family and friends, and men seem more likely to turn to the media. This is partly borne out in the Singapore portion of the survey, which found that 47 per cent of women cite family and friends as information sources. Among men, 38 per cent cite their peer group.

In addition, more than 70 per cent of men in Singapore believe that increasing the value of their portfolios is the most important outcome in wealth creation and protection. The majority of women (65 per cent), on the other hand, see regular income as the most desirable outcome.

Globally men displayed higher levels of confidence than women on a broad range of issues, including domestic equities, tax, bonds and private equities. While the Barclays survey did not look into performance, academic studies have found that women's portfolios tend to do better, as they are less likely to trade.

Mr Davies says Barclays is in the process of fine-tuning a risk profiler for Asian clients. 'We believe that most assessments that banks use is not good, not behaviourally or statistically robust, and ask the wrong questions. We'd like to make a distinction between long-run and short-run financial objectives. We need to understand clients' composure level, the degree to which they are comfortable with taking risk in the financial market context.'

Retail Body Chief Calls For Lower Rents As Sales Droop

Source : The Business Times, September 3, 2008

Jannie Tay suggests talks with landlords to tackle issue

HIGH rental levels are the biggest challenge faced by retailers in Singapore today and the problem is compounded by inflation, weakening global economies as well as lower than anticipated spending by overseas visitors.

Mrs Tay: Yearly rent increases in shop leases are not representative of the real economic environment

Jannie Tay, president of the Singapore Retailers Association, stressed the need for a drop in retail rents, in light of weaker sales. For June, some sectors in the retail industry saw sales fall 10-20 per cent.

'Landlords factor in what they claim will be rent increases year on year in the shop leases we sign but such increases are not representative of the real economic environment,' Mrs Tay emphasised, adding that evidence is beginning to suggest that the retail economy is unable to sustain such hikes.

'We must continue to meet the challenges of high operational costs, stiffer competition, a limited consumer base and more demanding and price conscious consumers.'

Mrs Tay cited organising a dialogue session with landlords as one plausible means of tackling the issue.

Senior Minister of State for Trade and Industry S Iswaran highlighted that local retailers for their part needed to adapt operations to capitalise on new opportunities such as the upcoming Formula One race, as well as to strive for the highest standards in service excellence.

He was speaking at the Singapore Retail Industry Conference 2008 yesterday, which was also co-organised by Spring Singapore and The Retail Academy of Singapore.

And, while retail sales for the first half of the year grew 8 per cent year on year, Mr Iswaran noted that the 'global economic slowdown has begun to have an impact on Singapore's retail scene'.

Charles Wong, founder of local shoe retailer Charles and Keith, said that while the slowdown would have some impact, the brand still had its overseas stores to fall back on.

Out of its 130 stores worldwide, only 26 are located in Singapore. However, local stores account for about 50 per cent of revenue.

A study conducted by Media Research Consultants also showed that Singaporeans were increasingly spending on shopping overseas.

Respondents highlighted customer service as one key area for improvement here, as well as a need for greater diversity of stores.

Auction Property Sales Hit Record High Of S$22.7m In August

Source : Channel NewsAsia, 02 September 2008

Auction sales of properties in Singapore hit a record high in August at S$22.7 million, 37 per cent higher compared to a year ago.

The increase was mainly due to the sale of four residential infill land sites by the Singapore Land Authority (SLA), despite taboos associated with property purchase during the Hungry Ghost month.

The report by Collier's International said this confirms that investors are ready to buy property as long as the price and location are right.

Last month, buyers focused on commercial and industrial properties as they are seen to offer better yields than residential units.

A total of S$5.4 million worth of commercial and industrial properties were sold under the hammer versus S$3.5 million of residential properties.

A total of 66 properties were put up for auction sale last month, and 12 of them were successfully sold.

On a monthly basis, auction sales in August posted the highest value so far this year. The next highest sales value was in June at S$11.35 million. - CNA/so

Property Buyers Defy Hungry Ghost Taboo At Auction Market

Source : The Business Times, September 3, 2008

August sales of $22.75m beat June's $11.35m, the next highest this year

TYPICALLY a taboo time for property purchases, this year's Hungry Ghost Festival bucked the trend and worked up an appetite among buyers in the auction market.

The festival fell in August, which registered the highest sale value for auctions so far this year. According to Colliers International, 12 properties and sites out of 66 put up for auction were sold, fetching $22.75 million.

This surpassed the next-highest auction sale value of $11.35 million in June this year and the $9.56 million recorded during the Hungry Ghost Festival last year.

It 'confirms that buyers will defy traditional taboos and will commit to a purchase so long as the price and location - among other factors - are right,' said Colliers deputy managing director (agency and business services) and auctioneer Grace Ng.

Of the auction sale value of $22.75 million in August, 61 per cent or $13.81 million came from the sale of four residential in-fill sites at a Singapore Land Authority (SLA) auction.

If the subdued mood at the SLA auction was anything to go by however, the market has quietened from a year ago and figures indicate the same.

From January to August this year, properties sold at auctions totalled $70.79 million. Amid buoyant sentiment in the same period last year, total sale value was more than four times higher at $329.18 million.

The sluggish stock market, negative reports from the US and more conservative bank lending dragged property market activity down in the earlier part of the year, said Knight Frank executive director (auctions) Mary Sai.

Sales are taking longer to materialise in the auction market. 'We have more willing sellers with realistic pricing, but buyers are bottom-fishing,' Ms Sai said. In particular, residential property sales in the auction market have been slow, said DTZ senior director Shaun Poh.

'Some potential buyers may be waiting for more re-possessed property to come along,' he said. 'This may happen beginning next year as new developments receive their Temporary Occupation Permits and speculators from the earlier market boom lose their ability to pay the bulk of the purchase price.'

According to Colliers, commercial and industrial properties sold at auctions during the Hungry Ghost Festival this year fetched $5.42 million, exceeding the $3.52 million from residential properties.

'During market downturns, investors tend to shift their focus to non-residential properties,' said Colliers's Ms Ng. 'Commercial and industrial properties generally offer better yields than residential properties, and the limited supply has made this asset class more resilient to unattractive market conditions.'

S'pore Growth Outlook Cut

Source : The Straits Times, Sep 3, 2008

THE Monetary Authority of Singapore said on Wednesday a survey showed economists expected the city-state to grow 4.2 per cent in 2008, down from the 5.5 per cent predicted in an earlier poll.

Economists had trimmed the growth outlook to 5.5 per cent from 5.6 per cent in the previous survey released in June. -- ST PHOTO: ALAN LIM

The lower growth prediction comes amid signs of an economic slowdown after a tumble in key exports over the last few months, particularly to US and other industrialised economies.

Economists had trimmed the growth outlook to 5.5 per cent from 5.6 per cent in the previous survey released in June.

The poll showed that economists expected the manufacturing sector, a key pillar of the economy, to grow a mere 1.0 per cent this year compared with the previous forecast of 5.5 per cent.

The government in August lowered its 2008 growth targets to 4.0-5.0 per cent from 4.0-6.0 per cent, citing weakness in the global economy as the main reason behind the downgrade.

The central bank sent out the survey to 24 economists in the private sector in August and 20 responded. -- AFP


Source :《联合早报》September 3, 2008














Source :《联合早报》September 3, 2008








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