Source : The Straits Times, July 30, 2009
NEW YORK: Home prices in major cities in the United States registered the first monthly gain in nearly three years, the latest sign that the housing market may have finally turned the corner.
The widely watched Case-Shiller home price index for May posted an increase of 0.5per cent, the first monthly rise since 2006, instead of a forecast 0.5per cent decline, though prices have tumbled more than 32per cent from their peak in the second quarter of 2006.
'This is much more important than an up day on the stock market. It may mean we have changed direction,' Yale University economist Robert Shiller, one of the developers of the index, told Reuters Television.
After seasonal adjustment, prices showed a 0.2per cent decline, but this was still an improvement in the recent trend, economists said.
It is 'a pretty significant indicator that we might be at or near a bottom', the other developer of the index, economist Karl Case, said in an interview.
After a plunge lasting three years, houses have finally become cheap enough to lure buyers. That, in turn, is stabilising prices, generating hope of a property market recovery.
Other recent signs of a turnaround were seen in new home sales data for last month which jumped 11per cent, the biggest monthly gain in eight years, the US Commerce Department said on Monday.
Existing home sales rose for the third straight month last month, the National Association of Realtors said last week, feeding optimism about the beleaguered housing sector.
Still, caution is warranted as long as the US unemployment rate and mortgage foreclosures keep rising, said professors Case and Shiller.
The index tracks home prices in 20 metropolitan areas. The nationwide index of house prices was still down 17per cent in May from the same month last year. But the rapid deterioration in prices has slowed since January.
However, home prices are still falling in many areas, with high unemployment and looming foreclosures likely to weigh down real estate for the foreseeable future. -REUTERS, LOS ANGELES TIMES
Friday, July 31, 2009
Mah Sounds Warning On Property Buzz
Source : The Straits Times, July 30, 2009
Government will take action if excessive speculation develops
THE Government will take 'whatever action necessary' to prevent excessive speculation in the property market, said National Development Minister Mah Bow Tan yesterday.
Mr Mah's note of caution comes amid a buying frenzy that has gripped the real estate sector in recent months.
He told the media on the sidelines of an industry event: 'I wouldn't say there is excessive speculation at the moment, but there is some element of speculation involved.
'Some of the practices and habits that you saw in the last property boom are beginning to come back, so I think we'll have to be careful.'
He also warned about a property bubble forming. 'Obviously it is not in our interest for such a bubble to form, because when it does, and bursts, which it inevitably must, then I think a lot of people will get hurt,' said the minister, adding that all parties concerned must ensure that such a bubble does not materialise.
'A little bit of speculation is inevitable in every market, but when it becomes excessive, then it is something that we should try to avoid.'
There are certainly signs of a red-hot market, including queues forming days before the launch of a new project.
Suburban condo Optima, next to the Tanah Merah MRT, drew lines snaking outside the showflat on Monday, though the unit does not open until tomorrow.
Real estate agents were also in the queues with blank cheques from clients.
Buyers at Ang Mo Kio were equally keen to put their money down at the 329-unit Centro Residences, reportedly paying $1,150 per sq ft, a price level typically seen in central districts.
Mr Mah said the Government was monitoring the market but added that it was uncertain if the activity is due to pent-up demand or generated by buyers responding to lower prices or low interest rates.
'It is in all our interest that the market is a healthy, sustainable one,' he said.
Property veteran Nicholas Mak, former head of research at Knight Frank, agreed that the key is sustainability of demand: 'Although now it seems it's a bit too much and too fast, with buying volume growing at an unsustainable rate.'
Speculation is on the rise, with the number of subsales in the second quarter at 940 compared with 412 in the first quarter of this year, he noted.
Mr Mah yesterday called on buyers to do their homework: Research prices, study information on upcoming supply and check data from the Urban Redevelopment Authority's website. 'Don't commit right up to the hilt...think about what if interest rates rise in the future, would you still be able to afford it?' he said.
He emphasised that there was plenty of supply in the pipeline: Of 62,350 uncompleted units of private homes, about 38,482 units remain.
The minister also announced that the confirmed list of sites in the Government's land sales programme could be reinstated if supply is needed.
The Real Estate Developers Association of Singapore backed up Mr Mah's comments that a bubble should not form.
It pointed out last night that not all the property launches have been snapped up. Only a select few have been highly successful for various reasons. This could also be a result of pent-up demand.
Government will take action if excessive speculation develops
THE Government will take 'whatever action necessary' to prevent excessive speculation in the property market, said National Development Minister Mah Bow Tan yesterday.
Mr Mah's note of caution comes amid a buying frenzy that has gripped the real estate sector in recent months.
He told the media on the sidelines of an industry event: 'I wouldn't say there is excessive speculation at the moment, but there is some element of speculation involved.
'Some of the practices and habits that you saw in the last property boom are beginning to come back, so I think we'll have to be careful.'
He also warned about a property bubble forming. 'Obviously it is not in our interest for such a bubble to form, because when it does, and bursts, which it inevitably must, then I think a lot of people will get hurt,' said the minister, adding that all parties concerned must ensure that such a bubble does not materialise.
'A little bit of speculation is inevitable in every market, but when it becomes excessive, then it is something that we should try to avoid.'
There are certainly signs of a red-hot market, including queues forming days before the launch of a new project.
Suburban condo Optima, next to the Tanah Merah MRT, drew lines snaking outside the showflat on Monday, though the unit does not open until tomorrow.
Real estate agents were also in the queues with blank cheques from clients.
Buyers at Ang Mo Kio were equally keen to put their money down at the 329-unit Centro Residences, reportedly paying $1,150 per sq ft, a price level typically seen in central districts.
Mr Mah said the Government was monitoring the market but added that it was uncertain if the activity is due to pent-up demand or generated by buyers responding to lower prices or low interest rates.
'It is in all our interest that the market is a healthy, sustainable one,' he said.
Property veteran Nicholas Mak, former head of research at Knight Frank, agreed that the key is sustainability of demand: 'Although now it seems it's a bit too much and too fast, with buying volume growing at an unsustainable rate.'
Speculation is on the rise, with the number of subsales in the second quarter at 940 compared with 412 in the first quarter of this year, he noted.
Mr Mah yesterday called on buyers to do their homework: Research prices, study information on upcoming supply and check data from the Urban Redevelopment Authority's website. 'Don't commit right up to the hilt...think about what if interest rates rise in the future, would you still be able to afford it?' he said.
He emphasised that there was plenty of supply in the pipeline: Of 62,350 uncompleted units of private homes, about 38,482 units remain.
The minister also announced that the confirmed list of sites in the Government's land sales programme could be reinstated if supply is needed.
The Real Estate Developers Association of Singapore backed up Mr Mah's comments that a bubble should not form.
It pointed out last night that not all the property launches have been snapped up. Only a select few have been highly successful for various reasons. This could also be a result of pent-up demand.
Speculation Creeping Back Into Market: Mah
Source : The Business Times, July 30, 2009
Govt will act if housing market overheats; supply pipeline is strong
Speculation is trickling back into the property market and the government is watching the situation closely, National Development Minister Mah Bow Tan said yesterday.
The authorities will take action should the market overheat but home seekers should also be careful about making purchases, he underlined.
'I wouldn't say that there is excessive speculation at the moment but there is some element of speculation involved,' Mr Mah told the press after the topping-out ceremony for Tower One at Marina Bay Financial Centre (MBFC).
'Some of the practices and habits that you saw in the last property boom are beginning to come back.'
Queues have started forming outside some showflats and property agents are reportedly armed with blank cheques from clients.
Median prices have also gone up at some launches - by up to 7 per cent a month in a handful of cases. This has stemmed the fall in private home prices, with the Urban Redevelopment Authority's (URA) price index sliding 4.7 per cent in Q2 from a quarter ago - much less than the 14.1 per cent tumble it took in Q1.
The question, though, is why a buying wave is forming when economic waters remain tepid. The slowdown has moderated but a contraction is still on Singapore's books, Mr Mah said.
The official forecast now points to the economy shrinking 4-6 per cent this year.
It is therefore unclear if the buying momentum is sustainable, he said. 'I'm not so sure whether the demand is due to pent-up demand, or whether it is due to buyers responding to lower prices by developers or even to the current low interest rates.'
While it is premature to call it the start of a property bubble, the government is monitoring the market closely and will take 'whatever action is necessary', Mr Mah said.
He also urged home seekers to research the property market thoroughly and seek affordable units.
'Don't panic - because there is a lot of supply in the market.'
According to URA, there were 62,350 uncompleted private homes from projects in the pipeline at the end of Q2. Of these, 38,482 units were still unsold.
The government can also inject supply through the Government Land Sales (GLS) programme, Mr Mah said. It is considering whether it should reintroduce the confirmed list (suspended last October) for the first half of 2010.
Responding to Mr Mah's comments, the Real Estate Developers Association of Singapore (Redas) said that developers share a 'common desire to see a steady growth, for greater stability and sustainability in the property market'.
It also highlighted that not all property launches have been snapped up.
'Only a selected few launches have been highly successful for various reasons. This could also be a result of pent-up demand.'
Industry watchers saw Mr Mah's message as a signal against excess exuberance in the market. The move could have contributed to a fall among major property counters yesterday: City Developments lost 10 cents to close at $9.94, while CapitaLand shed six cents to $4.00.
Colliers International's research and advisory director Tay Huey Ying felt that there is 'genuine concern' about the sustainability of current demand. Some buying has been driven by accumulated wealth from the boom years and when the funds dry up, it will take strong economic fundamentals to generate new demand, she said.
But she also believes that the government will 'tread cautiously' when it comes to tempering market sentiment, because the pick-up has only begun and is fragile.
Developer sales of private homes started to recover in February - interest first poured into mass-market projects and gradually filtered into mid- and high-end ones.
Over the last month, for example, KOP Group sold 11 units at its luxury site The Hamilton Scotts, at prices ranging from $2,500 to $3,000 psf.
Across liquidity-flush Asia, several economists have flagged the risk of property bubbles forming. However, many do not believe that policymakers will aggressively tighten measures when economic recovery remains nascent.
Govt will act if housing market overheats; supply pipeline is strong
Speculation is trickling back into the property market and the government is watching the situation closely, National Development Minister Mah Bow Tan said yesterday.
The authorities will take action should the market overheat but home seekers should also be careful about making purchases, he underlined.
'I wouldn't say that there is excessive speculation at the moment but there is some element of speculation involved,' Mr Mah told the press after the topping-out ceremony for Tower One at Marina Bay Financial Centre (MBFC).
'Some of the practices and habits that you saw in the last property boom are beginning to come back.'
Queues have started forming outside some showflats and property agents are reportedly armed with blank cheques from clients.
Median prices have also gone up at some launches - by up to 7 per cent a month in a handful of cases. This has stemmed the fall in private home prices, with the Urban Redevelopment Authority's (URA) price index sliding 4.7 per cent in Q2 from a quarter ago - much less than the 14.1 per cent tumble it took in Q1.
The question, though, is why a buying wave is forming when economic waters remain tepid. The slowdown has moderated but a contraction is still on Singapore's books, Mr Mah said.
The official forecast now points to the economy shrinking 4-6 per cent this year.
It is therefore unclear if the buying momentum is sustainable, he said. 'I'm not so sure whether the demand is due to pent-up demand, or whether it is due to buyers responding to lower prices by developers or even to the current low interest rates.'
While it is premature to call it the start of a property bubble, the government is monitoring the market closely and will take 'whatever action is necessary', Mr Mah said.
He also urged home seekers to research the property market thoroughly and seek affordable units.
'Don't panic - because there is a lot of supply in the market.'
According to URA, there were 62,350 uncompleted private homes from projects in the pipeline at the end of Q2. Of these, 38,482 units were still unsold.
The government can also inject supply through the Government Land Sales (GLS) programme, Mr Mah said. It is considering whether it should reintroduce the confirmed list (suspended last October) for the first half of 2010.
Responding to Mr Mah's comments, the Real Estate Developers Association of Singapore (Redas) said that developers share a 'common desire to see a steady growth, for greater stability and sustainability in the property market'.
It also highlighted that not all property launches have been snapped up.
'Only a selected few launches have been highly successful for various reasons. This could also be a result of pent-up demand.'
Industry watchers saw Mr Mah's message as a signal against excess exuberance in the market. The move could have contributed to a fall among major property counters yesterday: City Developments lost 10 cents to close at $9.94, while CapitaLand shed six cents to $4.00.
Colliers International's research and advisory director Tay Huey Ying felt that there is 'genuine concern' about the sustainability of current demand. Some buying has been driven by accumulated wealth from the boom years and when the funds dry up, it will take strong economic fundamentals to generate new demand, she said.
But she also believes that the government will 'tread cautiously' when it comes to tempering market sentiment, because the pick-up has only begun and is fragile.
Developer sales of private homes started to recover in February - interest first poured into mass-market projects and gradually filtered into mid- and high-end ones.
Over the last month, for example, KOP Group sold 11 units at its luxury site The Hamilton Scotts, at prices ranging from $2,500 to $3,000 psf.
Across liquidity-flush Asia, several economists have flagged the risk of property bubbles forming. However, many do not believe that policymakers will aggressively tighten measures when economic recovery remains nascent.
Slide In US Housing Prices Slowing Down
Source : The Business Times, July 30, 2009
May's housing index the 4th consecutive month that price declines slowed
(NEW YORK) After a plunge lasting three years, houses have finally become cheap enough to lure buyers. That, in turn, is stabilising prices, generating hope that the real estate market is beginning to recover.
Hopes lifted: Some quarters believe the housing market has reached its bottom and the worst is over
Eight cities, including Chicago, Cleveland, Denver and San Francisco showed price increases in May, up from four in April and one in March, according to data released Tuesday. Two other cities, Charlotte, North Carolina, and New York, were flat.
For the first time since early 2007, a composite index of 20 major cities was virtually flat, instead of down.
'We've found the bottom,' said Mark Fleming, chief economist for First American CoreLogic, a data firm.
The release of the surprisingly strong Case-Shiller Price Index, compiled by Standard & Poor's, followed earlier reports that sales of existing homes rose last month for the third consecutive time, while beleaguered homebuilders saw sales of new homes jump in June by the largest amount in eight years.
All of these improvements are tentative, and come after a relentless decline that knocked more than half the value off houses in the worst-hit cities.
Some sceptics believe the market is merely pausing before it resumes falling. Even the most enthusiastic analysts acknowledge that rising unemployment, another leap in foreclosures, or a significant rise in interest rates could snuff out progress.
Still, hope is growing in some quarters that the worst has passed.
'Recession is over, economy is recovering - let's look forward and stop the backward-looking focus,' John E Silvia, the Wells Fargo chief economist, wrote on Tuesday in a research note.
Kirit Shah decided to look forward a few weeks ago. A retired forensic chemist for the New York Police Department, he closed on a house in Royal Palm Beach, Florida.
Mr Shah was not dissuaded when the salesman at K Hovanian Homes told him the five-bedroom place had been empty since it was finished three years ago. 'It was waiting for me,' said Mr Shah, 64. 'I'm on a lakefront. I never dreamed I would be on a lakefront. I'm within walking distance of a swimming pool.' But the thing he likes best is this: He paid US$260,000 for the five-bedroom house, half of what that model was fetching during the boom.
'An excellent deal,' he said. 'Plus I got a good rate on my mortgage, under 5 per cent.'
Turning markets are full of uncertainty. If Mr Shah was one reason why new home sales were up 11 per cent in June from May, it is unclear just how many others like him are out there.
Brad Hunter, chief economist for Metrostudy, a research firm, said the new home numbers appeared to illustrate less a return of buyers like Mr Shah and more a resurgence of investors and speculators.
Metrostudy's own data showed that the number of buyers during the second quarter who actually moved into their new house declined 2.6 per cent.
'Investors are turning right around and putting the houses on the market for sale or for rent,' Mr Hunter said. 'What appears to have been an absorption of excess inventory can be just a changing of ownership of that inventory.'
The good news in the Case-Shiller index, the most widely watched source of price information about the housing market, is equally provisionary. Tracking only large urban areas, the monthly index does not represent the country as a whole.
The Case-Shiller figures released on Tuesday showed that May prices were down 17.1 compared with May of the previous year. As bad as that may sound, it was the fourth consecutive month that price declines slowed - a step in the right direction, but perhaps not cause for widespread celebration.
More attention was focused on the news that, when May was compared with April, the price index covering 20 major cities showed a half-per cent gain. It was the first month-over-month increase in the 20-city index in 34 months.
'It is very possible that years from now we will say that April 2009 was the trough in home prices,' said Maureen Maitland, vice-president for index services at Standard & Poor's.
When the numbers were adjusted for seasonal factors, however, the usual way housing figures are presented, the slight gain disappeared and the 20-city index was essentially flat. Half of the cities showed continued declines.
One reason the market is perking up in some places, real estate agents say, is because of the encouragement offered by such measures as the first time buyer's tax credit of US$8,000.
All the more reason, said the National Association of Realtors, to not only extend the credit but expand it. The association is lobbying for the current credit, which expires in December, to be replaced with a US$15,000 credit for all buyers.
'This is a relatively low-cost way to keep the housing market moving forward,' said Paul Bishop, the association's managing director of research.
Another reason for the market's resurgence is the prevalence of foreclosures, which make up about a third of all existing home sales.
In some troubled regions, agents say they cannot remember the last transaction that did not involve a bank disposing of a property.
These communities are not yet showing any improvement in prices.
Las Vegas was the worst-performing city in the May Case-Shiller index, falling 2.6 per cent. Prices have fallen there by a third in the last year.
'The mom and pop that work at the Hilton can now afford a home here again,' said Justin Pechonis, a Las Vegas real estate agent.
'Las Vegas is a great place to buy now.' But not from him. Sickened by seeing so many clients foreclosed, he is getting out of the business. He now drives a taxi.
The Obama administration has been seeking to stabilise the market in part by slowing the pace of foreclosures. Representatives from 25 leading mortgage servicers met administration officials on Tuesday and promised to pick up the pace of loan modifications. If that does not happen and there is another flood of foreclosures, Las Vegas may become the rule rather than the exception.
Andrew LePage, who analyses California and other markets for DataQuick, a research firm, said such a scenario is possible. 'The dark clouds are still there,' he said.
All this uncertainty breeds a hesitancy that seems to show up in nearly every sale, especially at the higher end of the market. When Margot and Pascal Lalonde decided in April to sell their two-bedroom condominium in the North End of Boston, they methodically quizzed six experienced agents about a good price.
List it for under US$500,000 unless you want to be here for months, said one agent. Two others said they should demand US$675,000. The other three were in between.
After 80 days on the market and two small price reductions, the condo is now under contract for US$550,000. The buyers examined the apartment six times. The Lalondes, who are moving to Short Hills, New Jersey, expect to be no less careful when they buy their new place. -- NYT
May's housing index the 4th consecutive month that price declines slowed
(NEW YORK) After a plunge lasting three years, houses have finally become cheap enough to lure buyers. That, in turn, is stabilising prices, generating hope that the real estate market is beginning to recover.
Hopes lifted: Some quarters believe the housing market has reached its bottom and the worst is overEight cities, including Chicago, Cleveland, Denver and San Francisco showed price increases in May, up from four in April and one in March, according to data released Tuesday. Two other cities, Charlotte, North Carolina, and New York, were flat.
For the first time since early 2007, a composite index of 20 major cities was virtually flat, instead of down.
'We've found the bottom,' said Mark Fleming, chief economist for First American CoreLogic, a data firm.
The release of the surprisingly strong Case-Shiller Price Index, compiled by Standard & Poor's, followed earlier reports that sales of existing homes rose last month for the third consecutive time, while beleaguered homebuilders saw sales of new homes jump in June by the largest amount in eight years.
All of these improvements are tentative, and come after a relentless decline that knocked more than half the value off houses in the worst-hit cities.
Some sceptics believe the market is merely pausing before it resumes falling. Even the most enthusiastic analysts acknowledge that rising unemployment, another leap in foreclosures, or a significant rise in interest rates could snuff out progress.
Still, hope is growing in some quarters that the worst has passed.
'Recession is over, economy is recovering - let's look forward and stop the backward-looking focus,' John E Silvia, the Wells Fargo chief economist, wrote on Tuesday in a research note.
Kirit Shah decided to look forward a few weeks ago. A retired forensic chemist for the New York Police Department, he closed on a house in Royal Palm Beach, Florida.
Mr Shah was not dissuaded when the salesman at K Hovanian Homes told him the five-bedroom place had been empty since it was finished three years ago. 'It was waiting for me,' said Mr Shah, 64. 'I'm on a lakefront. I never dreamed I would be on a lakefront. I'm within walking distance of a swimming pool.' But the thing he likes best is this: He paid US$260,000 for the five-bedroom house, half of what that model was fetching during the boom.
'An excellent deal,' he said. 'Plus I got a good rate on my mortgage, under 5 per cent.'
Turning markets are full of uncertainty. If Mr Shah was one reason why new home sales were up 11 per cent in June from May, it is unclear just how many others like him are out there.
Brad Hunter, chief economist for Metrostudy, a research firm, said the new home numbers appeared to illustrate less a return of buyers like Mr Shah and more a resurgence of investors and speculators.
Metrostudy's own data showed that the number of buyers during the second quarter who actually moved into their new house declined 2.6 per cent.
'Investors are turning right around and putting the houses on the market for sale or for rent,' Mr Hunter said. 'What appears to have been an absorption of excess inventory can be just a changing of ownership of that inventory.'
The good news in the Case-Shiller index, the most widely watched source of price information about the housing market, is equally provisionary. Tracking only large urban areas, the monthly index does not represent the country as a whole.
The Case-Shiller figures released on Tuesday showed that May prices were down 17.1 compared with May of the previous year. As bad as that may sound, it was the fourth consecutive month that price declines slowed - a step in the right direction, but perhaps not cause for widespread celebration.
More attention was focused on the news that, when May was compared with April, the price index covering 20 major cities showed a half-per cent gain. It was the first month-over-month increase in the 20-city index in 34 months.
'It is very possible that years from now we will say that April 2009 was the trough in home prices,' said Maureen Maitland, vice-president for index services at Standard & Poor's.
When the numbers were adjusted for seasonal factors, however, the usual way housing figures are presented, the slight gain disappeared and the 20-city index was essentially flat. Half of the cities showed continued declines.
One reason the market is perking up in some places, real estate agents say, is because of the encouragement offered by such measures as the first time buyer's tax credit of US$8,000.
All the more reason, said the National Association of Realtors, to not only extend the credit but expand it. The association is lobbying for the current credit, which expires in December, to be replaced with a US$15,000 credit for all buyers.
'This is a relatively low-cost way to keep the housing market moving forward,' said Paul Bishop, the association's managing director of research.
Another reason for the market's resurgence is the prevalence of foreclosures, which make up about a third of all existing home sales.
In some troubled regions, agents say they cannot remember the last transaction that did not involve a bank disposing of a property.
These communities are not yet showing any improvement in prices.
Las Vegas was the worst-performing city in the May Case-Shiller index, falling 2.6 per cent. Prices have fallen there by a third in the last year.
'The mom and pop that work at the Hilton can now afford a home here again,' said Justin Pechonis, a Las Vegas real estate agent.
'Las Vegas is a great place to buy now.' But not from him. Sickened by seeing so many clients foreclosed, he is getting out of the business. He now drives a taxi.
The Obama administration has been seeking to stabilise the market in part by slowing the pace of foreclosures. Representatives from 25 leading mortgage servicers met administration officials on Tuesday and promised to pick up the pace of loan modifications. If that does not happen and there is another flood of foreclosures, Las Vegas may become the rule rather than the exception.
Andrew LePage, who analyses California and other markets for DataQuick, a research firm, said such a scenario is possible. 'The dark clouds are still there,' he said.
All this uncertainty breeds a hesitancy that seems to show up in nearly every sale, especially at the higher end of the market. When Margot and Pascal Lalonde decided in April to sell their two-bedroom condominium in the North End of Boston, they methodically quizzed six experienced agents about a good price.
List it for under US$500,000 unless you want to be here for months, said one agent. Two others said they should demand US$675,000. The other three were in between.
After 80 days on the market and two small price reductions, the condo is now under contract for US$550,000. The buyers examined the apartment six times. The Lalondes, who are moving to Short Hills, New Jersey, expect to be no less careful when they buy their new place. -- NYT
Quintain Sees UK Property Market Revival Signs
Source : The Business Times, July 30, 2009
Uncertain rental prospects for vacant properties still a concern, however
(LONDON) UK developer Quintain Estates and Development says Britain's fractured commercial real estate market is showing signs of revival although uncertain letting prospects for vacant properties remain a concern.
The urban regeneration specialist, which is redeveloping almost 120 hectares of land in London's Wembley and Greenwich Peninsula districts, said yesterday that prices were stabilising in some parts of the market but the company did not rule out further reductions in values, especially for lower-quality assets.
Despite challenging economic conditions, Quintain said its ability to collect rents remained strong, with 99.5 per cent of rents due gathered at the last payment date.
While bad debts almost doubled in the period to £580,000 (S$1.38 million) following the administration of furniture retailer MFI, vacancy rates were unchanged since March 31.
Last month, Quintain said the net asset value of its properties plunged 40 per cent to 348 pence per share in the year to end-March 2009.
Shares in the firm have rallied 82 per cent since the start of the year as worries of cashflow pressures and poor access to debt funding subside.
But the stock, which closed at 67 pence on Tuesday, is still 60 per cent below its level of July 2008.
Quintain said it made cost savings of £11 million since April, bringing the total sum of savings to £108.5 million since April 2008.
The company has also renegotiated terms of key borrowing facilities with Barclays, extending repayment dates on some short-term loans to April 2013 from April 2010.
The company's maximum gearing ratio has increased to 150 per cent and net debts stood at £547 million on June 30. -- Reuters
Uncertain rental prospects for vacant properties still a concern, however
(LONDON) UK developer Quintain Estates and Development says Britain's fractured commercial real estate market is showing signs of revival although uncertain letting prospects for vacant properties remain a concern.
The urban regeneration specialist, which is redeveloping almost 120 hectares of land in London's Wembley and Greenwich Peninsula districts, said yesterday that prices were stabilising in some parts of the market but the company did not rule out further reductions in values, especially for lower-quality assets.
Despite challenging economic conditions, Quintain said its ability to collect rents remained strong, with 99.5 per cent of rents due gathered at the last payment date.
While bad debts almost doubled in the period to £580,000 (S$1.38 million) following the administration of furniture retailer MFI, vacancy rates were unchanged since March 31.
Last month, Quintain said the net asset value of its properties plunged 40 per cent to 348 pence per share in the year to end-March 2009.
Shares in the firm have rallied 82 per cent since the start of the year as worries of cashflow pressures and poor access to debt funding subside.
But the stock, which closed at 67 pence on Tuesday, is still 60 per cent below its level of July 2008.
Quintain said it made cost savings of £11 million since April, bringing the total sum of savings to £108.5 million since April 2008.
The company has also renegotiated terms of key borrowing facilities with Barclays, extending repayment dates on some short-term loans to April 2013 from April 2010.
The company's maximum gearing ratio has increased to 150 per cent and net debts stood at £547 million on June 30. -- Reuters
Signs Of Speculation In Private Property Market
Source : 938LIVE, 29 July 2009
The government is seeing some signs of speculation in the Singapore property market, according to National Development Minister Mah Bow Tan.
Marina Bay Financial Centre
Speaking on the sidelines of the topping out ceremony of the Marina Bay Financial Centre on Wednesday morning, Mr Mah said the government is monitoring the situation.
It is uncertain if the buying momentum seen in recent months can be sustained, he added.
"The forecast is still for negative growth this year. Although it's not as negative as it was in the beginning of the year, I think there is still uncertainty... But what is important really is for all of us, all the players in the market, to make sure that the market remains healthy," said Mr Mah.
According to latest data from the Urban Redevelopment Authority (URA), sales of uncompleted private homes reached a record high of 1,825 units in June as improving sentiment in the market spurred homebuyers to snap up more units.
Mr Mah assured that there is adequate supply of units in the market for now and the government is prepared to release more land for sale if necessary.
On the Marina Bay Financial Centre, Mr Mah noted that it has already attracted over S$20 billion of private real estate investments from both local and international investors. About 61 per cent of space in the centre has been pre-leased.
Mr Mah also reiterated the government's commitment to the project, saying another S$1 billion in infrastructure works will be invested over the next 10 to 15 years. The figure is on top of the S$7.5 billion already invested in Marina Bay. - 938LIVE/so
The government is seeing some signs of speculation in the Singapore property market, according to National Development Minister Mah Bow Tan.
Marina Bay Financial CentreSpeaking on the sidelines of the topping out ceremony of the Marina Bay Financial Centre on Wednesday morning, Mr Mah said the government is monitoring the situation.
It is uncertain if the buying momentum seen in recent months can be sustained, he added.
"The forecast is still for negative growth this year. Although it's not as negative as it was in the beginning of the year, I think there is still uncertainty... But what is important really is for all of us, all the players in the market, to make sure that the market remains healthy," said Mr Mah.
According to latest data from the Urban Redevelopment Authority (URA), sales of uncompleted private homes reached a record high of 1,825 units in June as improving sentiment in the market spurred homebuyers to snap up more units.
Mr Mah assured that there is adequate supply of units in the market for now and the government is prepared to release more land for sale if necessary.
On the Marina Bay Financial Centre, Mr Mah noted that it has already attracted over S$20 billion of private real estate investments from both local and international investors. About 61 per cent of space in the centre has been pre-leased.
Mr Mah also reiterated the government's commitment to the project, saying another S$1 billion in infrastructure works will be invested over the next 10 to 15 years. The figure is on top of the S$7.5 billion already invested in Marina Bay. - 938LIVE/so
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