Singapore Property Weekly Issue 212

8/21/2019 Singapore Property Weekly Issue 212

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Issue 212Copyright © 2011-2014 www.Propwise.sg. All Rights Reserved.

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CONTENTS

p2 Is it “Game Over” for Property as an

Investment Tool?

p8 Singapore Property News This Week

p12 Resale Property Transactions

(May 27 – May 29 )

Welcome to the 212th edition of the

Singapore Property Weekly .

Hope you like it!

Mr. Propwise

FROM THE

EDITOR

mailto:[email protected]://www.propwise.sg/advertise/http://www.propwise.sg/advertise/mailto:[email protected]


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SINGAPORE PROPERTY WEEKLY Issue 212

Page | 2Back to Contents

By Gerald Tay (guest contributor)

This week’s article is in the form of an email

from a reader to Gerald Tay about his views

on property as an investment, and his

(lengthened) reply to that reader. Enjoy!

Email From Reader:

Hi Gerald!

I am a subscriber of your blog and often read

your contributions there! Frankly, as I’m a

property agent you strike fear in my heart when you share your dismal views on the

property market.

Is it “Game Over” for Property as an Investment Tool?


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I genuinely want to advise my clients correctly

in the best way to utilize their funds for a

property investment.

May I ask –

if you find property to be a poochoice for investment, what would you

suggest otherwise? Putting your hard-earned

cash in the banks and to having it eroded by

inflation is surely a poor alternative and one

that even lax investors would try to avoid.

Would appreciate you sharing your insights.Hope to hear from you soon! Many thanks!

J

Gerald Tay’s Reply:

Hi J,

First, do allow me to clarify that my opinions

in my blogs are never meant to strike fear into

people buying property. They‟re meant to

impart a strong sense of reality and

pragmatism to ordinary buyers and investors.

Second, I‟ve never said that property is a

poor choice for investment. It‟s the investor,

not the investment that matters.Property has been the favorite traditional

investment for Asians. Many believe one

cannot go wrong when buying property for the

long term. This misinformation is terribly

misguided by people with vested interest in

your money. Property buyers do lose moneyin property even when holding for the long

term.

The Rich make money in real estate?

You often hear people say, “The Rich makes

money in real estate.” This is only half true –the Rich make money selling real estate as

property developers – and not as retail

buyers.


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There‟s a huge difference in creating real

wealth selling wholesale and buying retail.

As retail buyers, we‟ve to be smart to survive

in the large predatory ocean to avoid gettingeaten!

J, have you tried climbing a mountain before

or driven a race car like a race driver? I

haven‟t, and most likely you and many others

have not either, because we think those

activities are very dangerous and could befatal.

But that‟s not the case for professional

mountain climbers or trained race car drivers.

Why? Because they are trained under the

toughest conditions to help them prepare for

the many unforeseen circumstances, i.e. the

car skidding or the rope breaking halfway up

the mountain. Their training prepares them to

deal with tough situations. The skill of the

driver or the mountain climber is what

mitigates the risks for them.

Many investors invest their hard earnedmoney without enough training, education or

any specific knowledge of the investment.

Are there opportunities in the current

market?

Unless one is satisfied with a less than 4%

net ROI with interest rates rising, falling

rentals and rising vacancies, I think buying

now may not be wise if the buyer is looking to

accumulate wealth.

Many investors lack training, education and

skills, and hence will never find that gold atthe end of the rainbow. Instead, they ended

up buying „junk‟ properties (both local and

overseas) because of herd mentality.


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The other silly reason they end up with

“worthless” properties:insufficient cash for

down-payment in our local market. And so

they buy „shoe-box‟ units or cheap overseas

properties with guaranteed yields offered by

developers.

Even if inflation is 4% and bank deposits are

1%, these are not good reasons to buy any

property. But this is what I‟m seeing many

investors currently doing.It took me two years of intense due diligence

and research, starting in 2001, before buying

my first investment property in 2003. It took

me three years to partner and trust my

overseas partners, do hard due diligence and

find co-investors before my first successfuloverseas joint property purchase in 2013,

followed by another in 2014. How many

investors are doing that today?

Many investors I know – simply take a queue

number or ballot, take two minutes or two

hours to make an investment decision on the

spot without even understanding exactly what

the investment is!

Is property a good hedge against

inflation?

High inflation can erode one‟s savings. But

losing your money in a bad investment choice

can multiply that loss.

$300,000 of cash today combined with an

inflation rate of 4% per annum will be worth

roughly $250,000 in 5 years. Your “loss” is

$50,000 ($10,000 a year). A bad investment

choice, on the other hand, can lose the

investor much more than just $50,000 if you

factor in all mortgage interest, expenses,

selling the property at below what was

bought, renting at a negative cash flow every


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month, and the mental stress!

Losing money to inflation may be a painful

inescapable alternative when there‟s a

sudden huge oversupply of money in the

markets, but losing money in a wrong

investment due to greed and impatience is

ust stupid. Patience is one important key to

wealth.

Be wary of the “gurus” who are paid to boost

the market. Take, for example, the recentannouncement of the Jurong Lake District

and the upcoming HSR (High Speed Rail)

connecting Jurong and Malaysia. These

“gurus” say don‟t wait any longer and it‟s a

good time to buy properties in the locality

now. I strongly think otherwise – new launchprices or sellers in that location will ask (or

have already asked) for future prices because

of the media reporting and hype, thus

negating any investment potential.

Slow growth ahead

There will be at least a decade of mutedgrowth in the Singapore economy due to low

productivity. The government trimmed GDP

growth expectations to just 2 to 4 per cent

until 2020 and beyond. By 2030, an ageing

population will further curb prices due to lower

buying activities. Where do you think propertyprices will be then? Just look at Japan and

you‟ll see what‟s in store.

Many forecasters have an agenda that

reflects the interests of the people who pay

their salaries. If they are paid to be positive,

they will be positive. If they are paid to be

negative, they will be negative.

SINGAPORE PROPERTY WEEKLY I 212


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Forecasters do not have crystal balls, they

simply have bills to pay. Markets (stocks, real

estate, bonds) only make money when we

trade in them.

I‟m a career investor. My investments dictate

my net worth. My livelihood depends greatly

on making sensible investment decisions.

I can be brutally honest, but my honesty is

meant to serve as a wake up call to the many

gullible investors out there. I hope they do notlose money because of their

ignorance.Property is not a dismal investment

tool as long as the buyer is educated. That is

why financial knowledge is so important. You

can only rely on you.

I hope this helps answer your question.

Regards,

Gerald Tay

By guest contributor Gerald Tay, who is the

founder and coach at CREI Academy Group

Pte Ltd , an organization dedicated to

empowering retail property investors with

smarter investing philosophy and strategies.

He is a full-time investor with over 13 years of

solid experience in building his wealth

through Property Investment and is financially

wealthy today.

SINGAPORE PROPERTY WEEKLY I 212

http://www.crei-academy.com/http://www.crei-academy.com/http://propertymarketinsights.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/http://www.crei-academy.com/


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Singapore Property This Week


Residential

May’s c o n d o r e s al e p r i c e r e m a i n s f l at

According to the Business Times, the resale

price of condominium units has remained flat

in May from the previous month. In the core

central region, resale prices of condominiumunits fell by 1.2%, however resale prices in

both the city fringe and suburbs increased by

0.8% and 0.3% respectively from April to May.

According to SRX, the median transaction

over X-value showed that transactions made

in District 9 were negative $20,000. As such,majority of the units in District 9 have been

sold for an average of $20,000 less than the

market value estimated by SRX. Eugene Lim

from ERA Realty said that prices seem tohave stabilised in the resale market. Lim

added that prices from December to May

have fallen marginally as home owners prefer

to sell their houses due to difficulties in

securing a tenant.

(Source: Business Times)

May’s c o n d o r e n t a l f a l l s b y 0 . 6 % m o n t h -

o n - m o n t h

Rentals for condominium units have fallen by

0.6% month-on-month in May from April.

Market experts believe that this downwards

trend will persist till 2016. Nicholas Mak from

SLP International said that rental prices have



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been pushed down due to an oversupply of

private condominium units, especially in the

suburbs. To retain tenants, home owners

have been more willing to lower prices, said

the Business Times. In May, rents of condominium units in the central area rose by

0.2% month-on-month, while rentals in the

city fringe and suburbs fell by 0.6% and 1.5%

in the same period of time. Rentals of

condominium units in the core central region

have risen as tenant are choosing to move to

better-located premises when their leases

expire, said Mak. Eugene Lim from ERA

Realty believes that the less than stellar

rental prices indicate that the residential

market has not recovered. Ong Kah Seng

from R‟ST Research echoes Lim‟s concerns

and pointed out that the overall leasing

demand is still weak.


G ov er n m en t c u ts p r iv at e h o u si ng l an d

s u p p l y

According to the Business Times, the

government has cut the land supply of private

housing in H2 this year, in anticipation of a

weaker market. In H2 this year, only 7,852

private residential units will be released

across 17 confirmed and reserve list sites.

This is 11% lower than in H1 this year. Only 4

residential sites have been offered in the

confirmed list, according to the Business

Times. These 4 sites can yield 2,130 units.

According to market experts, the government

has been cutting land supply for private

homes since H2 2010 due to a slowdown in

demand. Christine Li from Cushman &Wakefield believes that the government is

shifting its focus from keeping price growth

low to maintaining a steady supply of land to



11/13



meet long-term housing demand.


K haw : L eas e B uy bac k Sc hem e w ell

received

According to the Minister for National

Development Khaw Boon Wan, the latest

Lease Buyback Scheme (LBS) has been well

received since it took effect in April this year.

Khaw said that 450 households had applied

for the scheme. Of the 450 applications, 214

are four-room flat owners and the rest own

three-room or smaller flats. In April, the

scheme was extended to include four-room

flats owners. The income ceiling was also

raised from $3,000 to $10,000. Under LBS,

elderly living in HDB flats may use their

remaining flat leases to fund their retirement

plans without leaving their flats. Khaw added

that the ministry will review schemes for

studio apartments and two-room flats, in

order to cater to the needs of different

groups.


G C B a t B e l m o n t R o a d f e t c h e d a p r i c e o f

$44m

A good class bungalow that is situated at

Belmont Road has been sold for more than

$44 million or $1,413 psf. The 31,125 sq ft

freehold site has five bedrooms and a pool.

According to market experts, the site may be

subdivided into two plots that are about 1,400

sqm each. Among the other good class

bungalows that have recently changed hands,

is a freehold site at Ridout Road. It was sold

for $1,251 psf based on its 73,277 sq ft of

land area. This translates to a transaction of

about $91.69 million.




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Commercial

W h i t e s i t e a t C e n t r a l B o u l e v a r d e x p e c t e d

t o d r a w s t r o n g i n t er e s t

A white site at Central Boulevard that issituated between the old Shenton Way

financial district and the new Marina Bay

downtown is expected to draw strong interest

due to its prime location. Due to its size and

location, the Business Times said that the site

will have a bid price that is between $1.7billion and $2 billion. According to Desmond

Sim, the hefty bid price will sieve out smaller

developers. The white site which is 1.12-ha

large can yield about 1.2 million sqft of

commercial space and 375 residential units. It

has a gross plot ratio of 13 and is situatednear the Downtown MRT Station.



http://www.moneymatters.sg/


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Non-Landed Residential Resale Property Transactions for the Week of May 27 – May 29

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

3 DOMAIN 21 926 1,338,000 1,445 99

4 THE COAST AT SENTOSA COVE 2,024 3,700,000 1,828 99

4 THE OCEANFRONT @ SENTOSA COVE 1,216 1,850,000 1,521 99

4 CARIBBEAN AT KEPPEL BAY 1,206 1,830,000 1,518 99

4 THE BERTH BY THE COVE 2,002 2,520,000 1 ,259 99

4 HARBOUR VIEW TOWERS 1,206 1,380,000 1,145 99

9 SCOTTS SQUARE 635 2,156,155 3,395 FH

9 THE ORCHARD RESIDENCES 1,808 5,500,000 3,041 99

9 THE COSMOPOLITAN 1,679 3,550,000 2,114 FH

9 THE LAURELS 1,927 3,800,000 1,972 FH

9 ONE OXLEY RISE 1,055 1,840,000 1,744 FH

10 G OODWOOD RESIDENCE 1,970 4,780,944 2,427 FH

10 GRANGE RESIDENCES 2,583 5,400,000 2,090 FH

10 THE SOLITAIRE 1,238 2,200,000 1,777 FH

10 WATERFALL GARDENS 2,196 3,400,000 1,548 FH

11 PARK INFINIA AT WEE NAM 1,668 3 ,128,000 1,875 FH

11 PARK INFINIA AT WEE NAM 1,001 1 ,875,000 1,873 FH

11 PAVILION 11 958 1,569,000 1,638 FH

11 THE ARCADIA 3,778 4,380,000 1,159 99

12 THE MARQUE @ IRRAWADDY 883 1,200,000 1,360 FH

12 THE CALLISTA 1,302 1,245,500 956 999

13 PARC ASTON 1,195 1,350,350 1,130 FH

14 STARVILLE 1,238 1,090,000 881 FH

15 CRYSTAL RHU 1,259 1,620,000 1,286 FH

15 CRESCENDO PARK 1,389 1,542,000 1,111 FH

15 JC RESIDENCE 721 795,000 1,102 FH

15 MANDARIN GARDEN CONDOMINIUM 1,528 1,265,000 828 99

Postal

DistrictProject Name

Area

(sqft)

Transacted

Price ($)

Price

($ psf)Tenure

15 NEPTUNE COURT 1,270 990,000 779 99

15 LAGOON VIEW 1,647 1,282,000 778 99

16 COSTA DEL SOL 1,345 1,600,000 1,189 99

16 PARBURY HILL CONDOMINIUM 1,206 1,320,000 1,095 FH

16 EAST MEADOWS 1,227 1,150,000 937 99

16 AQUARIUS BY THE PARK 1,324 1,210,000 914 99

17 AVILA GARDENS 1,604 1,250,000 779 FH

18 SAVANNAH CONDOPARK 1,238 1,000,000 808 99

18 MELVILLE PARK 1,453 930,000 640 99

18 TAMPINES COURT 1,722 840,000 488 101

19 KOVAN MELODY 904 1,083,000 1,198 99

19 THE MINTON 1,216 1,445,000 1,188 99

19 THE SPRINGBLOOM 1,539 1,600,000 1,039 99

19 THE MINTON 2,788 2,750,000 986 99

20 FAR HORIZON GARDENS 1,389 1,140,000 821 99

21 GOODLUCK GARDEN 1,701 1,710,000 1,005 FH

21 PARC PALAIS 1,389 1,315,000 947 FH

22 THE LAKESHORE 861 960,000 1,115 99

23 ESPA 1,206 1,327,000 1,101 999

23 HILLINGTON GREEN 1,356 1,250,000 922 999

23 MI CASA 1,302 1,200,000 921 99

25 PARC ROSEWOOD 431 545,000 1,266 99

27 SUN PLAZA 1,356 1,020,000 752 99

NOTE: This data only covers non-landed residential resale propertytransactions with caveats lodged with the Singapore Land Authority.Typically, caveats are lodged at least 2-3 weeks after a purchasersigns an OTP, hence the lagged nature of the data.

Singapore Property Weekly Issue 212

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