Thursday, February 26, 2009

Do Your Homework

Source : TODAY, Thursday, February 26, 2009

Some mortgage rates are rising; shop around before making a choice

As global interest rates fall, you would expect more homeowners to be tempted into taking up mortgages pegged to the Singapore Interbank Offered Rate (Sibor) or Swap Offer Rate (SOR).

After all, the three-month Sibor rate is currently around 0.68 per cent — just shy of its all-time low of 0.63 per cent.

However, instead of resulting in lower mortgage rates, interest payments on these pegged loans have surprisingly started to rise.

Rather than passing on savings from cheaper inter-bank lending, most financial institutions are now charging higher premiums above Sibor and SOR to reflect higher default risk, given that the economy has turned.

Banks have turned increasingly cautious over lending.

Last July, someone taking out a mortgage with DBS Bank would have paid a rate of Sibor plus 1.25 percentage points for an80 per cent loan.

Today, DBS’ mortgage rates start at Sibor plus 1.75 percentage points, with no lock-in period.

That means the total interest rate paid would now be 2.43 per cent, up from 2.25 per cent last July.

Similarly, spreads over SOR have widened.

Tellingly, some financial planners Today spoke to suggested that home-buyers should consider fixed-rate loans instead.

“Personally, I would lock in for as far as possible,” said Mr Sani Hamid, Financial Alliance’s director of wealth management.

That is because Sibor rates — while now low — rose to as high as 3.1875 per cent in 2005.

At DBS, Sibor fixed rate mortgages start at 3.25 per cent for a one year lock-in period on an80 per cent loan.

In contrast, fixed rate mortgages charge interest rates at a stable interest rate that is fixed and guaranteed in the first few years. This means that the monthly instalment amount is fixed for this period.

This brings about stability and certainty about how much you will be expected to pay in the long-run.

Another tip: Shop around for — and even ask — for the best rates possible in the competitive markets, note financial planners. You may just get a rate that is better than those published.

First Citadines Serviced Apartments Hit 70% Occupancy

Source : The Straits Times, Feb 26, 2009

THE first Citadines serviced apartment complex opened here by the Ascott company is already doing brisk business.

The firm said the 154-unit block in Wilkie Road - called Citadines Singapore Mount Sophia - is about 70 per cent occupied a month after its Jan 9 opening.

Ascott, which is wholly owned by CapitaLand, now has seven serviced apartment complexes here under its Ascott, Somerset and Citadines brands as well as two unbranded developments.

Occupancy at most of its properties is now hovering around 80 per cent, compared with more than 90 per cent at its five Somerset properties last May.

Clients at Citadines Singapore Mount Sophia include corporate guests and academics from the nearby Singapore Management University.

The development is part of the 12-storey Wilkie Edge, a CapitaCommercial Trust's development comprising offices, retail space and eateries.

The building was 70 per cent leased, according to the trust last month.

Ascott will open the first Citadines serviced apartments in Tokyo on Sunday. The 160-unit Citadines Tokyo Shinjuku is jointly owned by Ascott and Mitsubishi Estate. It will be the 11th Citadines property in Asia.

There is a minimum stay of seven nights at the Citadines development here, as with most serviced apartments in Singapore. The 146-unit Ascott Raffles Place, which had its soft opening last July, has a hotel licence allowing it to offer daily stays.

Ascott, which brought the Citadines brand to Asia in 2006, aims to open 11 more Citadines properties in the region by 2011, said Mr Gerald Lee, the chief executive of its hospitality management arm Ascott Hospitality.

Orchard Rd Sparkles After $40m Facelift

Source : The Straits Times, Feb 26, 2009

Makeover to be completed this weekend; fashion show in May to celebrate

FINAL touches to the $40 million Orchard Road makeover are expected to be completed this weekend, after a 10-month-long project to rejuvenate Singapore's main shopping strip.

One road lane has been sacrificed to create a wider pavement in front of Ion Orchard, Wisma Atria and Ngee Ann City. The extra space has been given to 25 'urban green rooms', containing benches, planter boxes and large decorative glass screens that light up at night. -- ST PHOTO: JOYCE FANG

Workers were seen yesterday scurrying around, erecting flower totems - large pillars decorated with fresh flowers - on the pavement from Forum The Shopping Mall to Liat Towers.

By this weekend, old lamp posts and electrical boxes will be stripped out.

New benches, lamp posts, recycling bins, planter boxes and other improvements are already in place along nearly 2km of Orchard Road, between Tanglin Mall and Concorde Hotel Singapore.

The walkways have been repaved, and one road lane has been sacrificed to create a wider pavement in front of Ion Orchard, Wisma Atria and Ngee Ann City.

The extra space has been given to 25 'urban green rooms', containing benches, planter boxes and large decorative glass screens that light up at night.

This is the first time Orchard Road has been extensively improved, with the aim of elevating it to the level of famous shopping streets like Paris' Champs-Elysees.

But the project had a rocky start. An initial ambitious idea by the Singapore Tourism Board, which paid for the works, to construct a glass canopy running down the stretch was promptly shot down by mall owners, who said it would require too much maintenance.

Works were then delayed by nearly two months at the start because of stalled talks with businesses, which were concerned about how the closure of one lane would affect them. Some shops and restaurants actually saw their takings drop when hoardings went up outside Wisma Atria and Ngee Ann City and the drilling began.

But with all that in the past, and to celebrate the facelift, the Orchard Road Business Association is now planning events, including a fashion show and shopping promotions, all set to begin in early May.

One idea is to hold the fashion show on what would be Singapore's longest catwalk - a specially constructed outdoor platform on the pavement stretching from Wisma Atria to Ngee Ann City.

Retailers, restaurants and cafes are also expected to take part in promotions and lucky draws to lure shoppers and diners to the area.

Hiap Hoe Launches The Beverly

Source : TODAY, Thursday, February 26, 2009

Niche residential property developer Hiap Hoe Group is to launch its latest residential development this Saturday with a starting selling price of $648 per square foot.

The Beverly is a low density development comprising 118 apartments and double-storey penthouses, with the larger units each outfitted with a private roof garden and pool.

Mr Teo Ho Beng, Hiap Hoe’s managing director, said: “We have designed The Beverly for those looking for affordable, high quality residential developments in a good location.”

The project is targeted for completion in 2013. Its show flat is in Toh Tuck Road.

Property Transactions With Contract Dates Between Feb 1st - 13th, 2009

China Property Recovery Not Expected Till H2

Source : The Business Times, February 26, 2009

Prices need to fall further before buyers are attracted, says Goldman Sachs

(SHANGHAI) China's real estate developers do not expect the property market to recover until at least the second half of this year, as prices need to fall further before attracting more buyers, according to Goldman Sachs Group Inc.

'A sustainable property market is out of sight,' Goldman Sachs analysts Thomas Deng and Kinger Lau write in a report, which was based on observations from company visits in southern China and published yesterday.

Home prices in China fell 0.9 per cent in January, the second consecutive monthly decline and the longest losing streak since the government started issuing the data in August 2005. Property prices more than quadrupled in the five years through 2007 as urban incomes rose.

Goldman Sachs said that a recent increase in property transactions is not evidence of the market bottoming out. The analysts visited China Vanke Co, the nation's largest publicly traded developer, Shenzhen Investment Ltd and Gemdale Corp.

Sale volumes in the southern city of Shenzhen, bordering Hong Kong, more than doubled to 787,800 square metres in December from 358,300 sq m in November and 338,000 sq m in October, according to a report by property agency DTZ earlier this month. House prices in the city dropped 16 per cent in January from a year earlier. -- Bloomberg

More Mass Market Projects To Launch

Source : The Business Times, February 26, 2009

Developers are planning to launch more mass market projects this weekend to take advantage of a recent surge in buying interest.

Hiap Hoe Group, a niche developer, will officially launch its 118-unit The Beverly, located at Toh Tuck Road, this Saturday. The starting selling price is $648 per square foot (psf), which Hiap Hoe says is an 'attractive starting selling price'.

'We have designed The Beverly for those looking for affordable, high-quality residential developments in a good location,' said Teo Ho Beng, the company's managing director.

The Beverly's two, three and four-bedroom apartments range from 1,120 sq ft to 4,187 sq ft, while its double-storey penthouses range from 2,099 sq ft to 3,757 sq ft and are each outfitted with a private roof garden and pool.

On the other side of the island at Pasir Ris, Sustained Land Pte Ltd will also officially launch Coastal Breeze Residences come this weekend. Two and three-bedroom units at the 63-unit development will sell for $610-$660 psf.

Sustained Land has sold 13 units in Coastal Breeze Residences since the start of 2008 in a soft launch. The units, which were mostly prime apartments on higher floors, went at an average price of $690 psf.

The remaining units are mostly three-bedders between 1159 sq ft and 1356 sq ft in size and there are also duplex penthouses. In terms of absolute value, for example, the price for a three-room 1159 sq ft unit starts at $712,000.

Meanwhile, the UOL Group is expected to launch its 646-unit Double Bay Residences in Simei sometime next week. Market talk has it that the project could be launched at $650-680 psf.

The three projects are coming hot on the heels of two successful launches earlier this month. Units at Frasers Centrepoint's Caspian condominium near Jurong Lake and Alexis @ Alexandra, a project by joint venture partners Yi Kai Group and Fission Group, sold quickly upon the projects' launches.

One market insider said that developers are taking pricing cues from each other, and making sure their newly launched projects are priced to sell. 'There is a sense that people will only be willing to buy projects in the $600-plus psf range, and also only units that don't cost too much in total. People don't really want to pay more than $600,000 or $700,000-plus in these times,' he said.

Developers are also throwing in more upmarket features into their mass market offerings to entice buyers. Each of The Beverly's 118 apartments is served by private lifts that open into the lobby of its interior. UOL's Double Bay Residences will also offer extras such as full-length windows in the kitchen, the company has said.