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CONTENTS
p2 Singapore Property News This Week
p8 How Much Do Property Agents Earn?
p12 Resale Property Transactions
(June 6 June 12)
Welcome to the 57th edition
of the Singapore Property
Weekly.
Hope you like it!
Mr. Propwise
FROM THE
EDITOR
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Singapore Property This Week
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ResidentialAylesbury Pte Ltd bought freehold
Kemaman View en bloc at $45.5m
The 17,388 sq ft site located off Balestier
Road was sold for $45.5 million or $935 psf
ppr based on its 2.8 gross plot ratio and53,813 sq ft potential GFA. If approval for an
additional 10% GFA for balconies is granted,
the additional $2.8 million would mean a
higher unit land price of $816 psf ppr. The site
zoned for residential use has a maximum
height allowance of 36 stories subject toapproval. A new development on the site
could potentially house 98 600-sq ft apartment
units with a selling price between $1,400 and
$1,600 psf.URA and HDB launch two residential sites
at Tanah Merah, Bright Hill
The two residential sites, one located at Tanah
Merah Kechil Road and another at Bright Hill
Drive have been launched.The 99-year leasehold 150,678.5 sq ft site
located at Tanah Merah Kechil Road has a
maximum GFA of 421,901.8 sq ft which can
potentially support 415 homes. It is expected
to attract five to eight bidders, with a top bid
ranging from $500 to $600 psf ppr and an
expected average selling price of $1,100-
$1,300 psf.
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The second site, which is also a 99-year
leasehold plot, is located at Bright Hill Drive. It
has a 144,635.6 sq ft site area and a
maximum GFA of 404,979.7 sq ft and can
potentially yield 405 homes. The site is
expected to attract three to eight bids, with the
top bid at $550-$620 psf ppr and the average
selling price at $1,100-$1,300 psf. While some
believe that the irregular layout of the site may
discourage bidders, others feel that the site
may see pent-up demand since there had not
been new launches in the area for years.
The tender for the two sites will close on noon
on July 31 and August 7, respectively.
Farrer Drive reserve list site draws $1,048
psf ppr record high bid
The private residential site located at Farrer
Drive attracted a record top bid of $1,048.52
psf ppr from a Singapore Land unit despite
garnering only six bids. While the top bid was
within top range of $1,100 psf ppr the site was
expected to fetch, the number of bids fall short
of the 10-20 bids that was predicted. This may
be due to the sites irregular, elongated layout,
its proximity to an electrical substation and its
maximum height condition of eight levels.
There is also competition from the d'Leedon
project nearby. Furthermore, being located in
District 10 means that it does not cater to the
mass market and instead the high-end
residential market which has been seeing
rather lacklustre results. SingLand plans to
develop a 100-unit project comprising mainly
of 1,000 sq ft two-bedroom units and some
smaller units such as one-bedroom units with
a study on the site. The expected breakeven
cost and average selling price are $1,600 psf
and $1,800 psf, respectively.
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which meant that an oversupply of rooms
could result in slower average room rate
(ARR) growth and lower occupancy rates
which is estimated to hit 90% in 2012F before
falling to 84 per cent in 2014F. Revenue per
available room (RevPAR) would parallel the
occupancy rate with a $233 peak in 2012F but
fall to $227-$229 in 2013F-2014F before
peaking again at $237 in 2015F. ARR growth
may fall to 3.2% but RevPAR could remain
above $245 if occupancy rate remains above
80%.
DTZ: Q2 retail rents remain stable
Retail rents for both Orchard and suburban
malls saw a marginal increase from the Q1
2012, with the average gross fixed rent of
prime retail space along Orchard/Scotts Road
having increased by 0.1% to $30.33 psf per
month in Q2 and the average rents in
suburban areas having increased by 0.2% to
$28.35 psf per month. The stability in the
prime retail rents could be attributed to the the
lack of prime frontage retail space as well as
the entry of new international brands such as
Tory Burch and Tommy Bahama. The
surburban retail rents, meanwhile, are
benefitting from the strong retailer demand
and consumer spending, especially with more
expatriates living in the suburban areas.
However, the average retail rents are not
expected to rise by much because of the
uncertain global economic outlook and the
large upcoming supply.
Expression of interest exercise conducted
for three conservation shophouses onAmoy Street
The three 999-year leasehold (with 814 years
remaining) prime conservation shophouses
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(77, 78, and 79/80Amoy Street) have a
combined site area of 8,182 sq ft, with an
estimated floor area of 23,820 sq ft. Buyers
can either purchase 78 and 79/80 Amoy
Street together or all three units. 77 Amoy
Street has a 2,773 sq ft site area, and has an
estimated floor area of 7,610 sq ft. 78 Amoy
Street has a 2,597 sq ft site area and an
estimated floor area of 7,793 sq ft while 79/80
Amoy Street has a 2,812 sq ft site area, andan estimated floor area of 8,417 sq ft. The
shophouses can potentially fetch $1,600 psf
of GFA since the market for conservation
shophouses in strong in the area. It is
expected to be attractive to investors seeking
a more affordable alternative to strata officeunits and office buildings. The exercise will
close on July 25, by 5pm.
30-year leasehold Tai Seng Link industrial
site attracts $23m top bid
The top bid of $23.3 million or $199.69 psf
ppr for the 0.43 ha site came from OKH(Woodlands) Pte Ltd - a unit of OKH
Holdings, exceeding the expectations of a top
bid of around $100 to $170 psf ppr and the
next highest bid by 28%. The number of bids,
however, was a meagre four, despite
predictions that it would draw much interest.
The sites proximity to the Tai Seng MRT
station maybe the reason, since it also
means that no strata subdivision of the site is
allowed within the first 10 years of completing
the project. Located within Paya Lebar iPark,
the site has a permissible gross plot ratio of
2.5 and a 116,681 sq ft gross floor area.
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The expected selling price of the property is
$450 to $500 psf ppr.
Investment sales of property on the
rebound
Preliminary figures showed that investment
sales have increased to $6.4 billion in Q2 as
of June 19, up from $4.8 billion in Q1 2012,
and may possibly hit $7 billion, bringing the
H1 2012 total to $12 billion. This increase
was driven by both the the residential and
office markets and the figure may eventually
result in a total of $21-25 billion for the whole
of 2012, driven by GLS land sales in H2.
Investment sales in the residential sector
have increased by 46% to $3.6 billion fromQ1 2012, driven by the $2.5 billion from GLS
sites, an increase of 38% from Q1 and$1.9
billion, a 91% increase from Q1 in the
commercial segment. Investment sales of
industrial properties and the collective sales
market, however, fell 32% to $766 million and
from $456.6 million to $328.8 million in the
same period, respectively.
High expectations for Bugis Cube strata
units
91 out of the 119 units in Bugis Cube, a 999-
year leasehold retail development located
opposite Bugis Junction, have been
launched. The development consists of over
six floors of prime retail and food-and-
beverage space with units ranging from 129
to 635 sq ft. Prices range from $2,900 psf to
$7,500 psf. Since it is located in the popular
Bugis shopping area, and near amenities andthe Bugis MRT station, it will likely attract both
retailers and investors interested in owning
prime retail property in the city centre.
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How Much Do Property Agents Earn?
By Getty Goh
I was recently invited by the Institute of Estate
Agents (IEA) to be one of the panel judges for
the Realtor of the Year award. Along with my
fellow judges, I was given the task of
interviewing and identifying a suitable
candidate who embodied the values of amodel realtor. Apart from being top
performers (in terms of commissions earned),
they also had to be professional in conduct
and provide warm and personable service.
From the judging session, one thing I notedwas how much these agents earned. As all of
the shortlisted candidates were top achievers
in their agencies,
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almost all of them earned commission
amounting to more than several hundred
thousand dollars. Seeing this, one of my
fellow judges even commented in jest that he
should consider a career switch.
This got me thinking and I started to wonder
how much does a property agent really earn?
We often hear or read about certain agents
making million dollar commissions, but is that
the exception or the norm? That piqued mycuriosity.
Working out the average commission
Based on the caveats lodged with the
Singapore Land Authority (SLA) in 2011, the
number of private residential, commercial,industrial and resale HDB transactions were
about (1) 32,903, (2) 1,411, (3) 2,241 and (4)
22,683 respectively. The total value
transacted for residential, commercial,
industrial and resale HDB amounted to about
(1) $50,448,013,709, (2) $4,087,529,191, (3)
$4,528,320,789 and (4) $9,695,739,615
respectively. Based on these figures, the total
amount of property transactions for 2011
worked out to be about $68.76billion.
If we work on the assumption that the
commission for each HDB resale transaction
is about 2% and about 1% for a private
residential, commercial and industrialtransaction, the total commission generated
by the real estate industry would amount to
about $785million.
Based on this figure, what is the average
commission each agent can expect to make?
According to a Channel News Asia report,
dated 30 Jan 2012, the number of agents in
2011 was 34,300. Assuming everyone gets an
equal share, the average commission
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each agent would get is about $22,873 (or
about $1,906 per month).
I admit that simply taking the average may
not be very reflective of the actual situation
and a more accurate form of approximation,
such as the Pareto Distribution, should be
applied.
Applying the 80-20 Rule to figure out what
the top agents make
Vilfredo Pareto was an Italian economist who
lived in the early 1900s. Through his
research, he discovered that 80% of wealth
was held by the top 20% of the population.
Over time, the 80-20 distribution was found to
be highly accurate in approximating income
distribution and it became an accepted
economic principle, hence the 80-20 rule.
If we were to apply Paretos 80-20 rule to
how the commissions are distributed, we find
that the top 20% of property agents would
have made an average commission of about
$91,493 annually (about $7,624 per month).
In comparison, the majority would make an
average of $5718 annually (about $477 permonth)
Based on MOMs website, the average
employee made about $4,334 per month.
Putting things into perspective, we can
conclude that those who do well (i.e. within
the top 20%) do make a fairly comfortable
living. On the other hand, those who are not
doing as well would just be scraping by.
Million-dollar agents are more the
exception than the rule
More importantly, this analysis also suggests
that agents who make million-dollar
commissions annually are likely to be
exceptions. Even if they were able to do so
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for one year, it would be very difficult for them
to sustain their performance, as there is
simply not enough commission to go around.
For the figures to add up, in order for all
practicing realtors to make commissions of
$1million or more every year, there can be no
more than 785 agents, which is a small
fraction of the total number of registered
agents.
We often hear stories of top property agentsmaking a good income and walk away with
the impression that there is easy money to be
made in the real estate industry. This analysis
shows that for every million-dollar property
agent, there are many others who do not
make it and eventually fall out of the game.
Hence, it does not come as a surprise that
the real estate industry has such a high
turnover rate. Perhaps this is why about
3,700 (more than 10% of the total agent
population) decided not to renew their license
and we are down to 30,600 agents in 2012.
Like any job, those who put in time and effort
will do well and rise to the top. The ethics of
hard work apply to the real estate market as
well. For those who are thinking of making a
career switch to become a property agent,
you must be prepared to invest the effort todo well. Otherwise you may just add to the
statistic of agents who eventually drop out of
the realtor game.
By Getty Goh, Director ofAscendant Assets,
a real estate research and investment
consultancy firm.
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Non-Landed Residential Resale Property Transactions for the Week of Jun 6 Jun 12
Postal
DistrictProject Name
Area
(sqft)
Transacted
Price ($)
Price
($ psf)Tenure
1 MARINA BAY RESIDENCES 2,379 7,255,950 3,050 99
1 THE SAIL @ MARINA BAY 667 1,420,000 2,128 99
1 PEOPLE'S PARK COMPLEX 463 650,000 1,404 99
3 CENTRAL GREEN CONDOMINIUM 926 1,268,888 1,371 99
4 SEASCAPE 2,680 7,316,400 2,730 99
4 THE OCEANFRONT @ SENTOSA COVE 1,356 2,397,500 1,768 99
5 THE PARC CONDOMINIUM 1,507 1,800,000 1,194 FH
5 THE PARC CONDOMINIUM 1,292 1,500,000 1,161 FH
5 BOTANNIA 1,561 1,728,000 1,107 956
5 DOVER PARKVIEW 1,249 1,358,000 1,088 99
5 BLUE HORIZON 936 950,000 1,014 995 THE INFINITI 1,238 1,080,000 872 FH
8 OXFORD SUITES 893 1,205,500 1,349 FH
9 THE PATERSON EDGE 1,281 2,828,000 2,208 FH
9 SCOTTS HIGHPARK 3,466 7,200,000 2,077 FH
9 VISIONCREST 915 1,830,000 2,000 FH
9 THE PIER AT ROBERTSON 678 1,300,000 1,917 FH
9 THE IMPERIAL 980 1,850,000 1,889 FH
9 PARC EMILY 592 1,080,000 1,824 FH
9 GRANGE HEIGHTS 2,713 3,880,000 1,430 FH10 REGENCY PARK 2,260 4,000,000 1,770 FH
10 THE SIXTH AVENUE RESIDENCES 1,518 2,350,000 1,548 FH
10 VALLEY PARK 1,216 1,880,000 1,546 999
10 PALM SPRING 1,485 2,286,000 1,539 FH
10 VENTUNO BALMORAL 1,313 2,000,000 1,523 FH
Postal
DistrictProject Name
Area
(sqft)
Transacted
Price ($)
Price
($ psf)Tenure
10 VALLEY PARK 797 1,179,000 1,480 999
10 VALLEY PARK 1,216 1,680,000 1,381 999
10 JERVOIS GROVE 1,399 1,880,000 1,344 FH
10 ORCHARD BEL AIR 3,229 4,300,000 1,332 99
10 CASABELLA 3,703 4,200,000 1,134 FH
10 DUCHESS CREST 2,088 2,250,000 1,077 99
11 PARK INFINIA AT WEE NAM 1,464 2,760,000 1,885 FH
11 SHELFORD SUITES 1,292 2,280,000 1,765 FH
11 MONTEBLEU 1,475 2,100,000 1,424 FH
11 THE ARCADIA 3,714 4,780,000 1,287 99
11 HILLCREST ARCADIA 1,421 1,280,000 901 9912 PAPILLON 936 1,050,000 1,121 FH
12 MOONSTONE ROYALE 840 898,000 1,070 FH
12 AVA TOWERS 1,227 1,170,000 953 FH
13 ONE LEICESTER 1,378 1,668,000 1,211 FH
13 EURO-ASIA PARK 958 1,000,000 1,044 FH
13 BLOSSOMS @ WOODLEIGH 2,680 2,100,000 784 FH
14 DAKOTA RESIDENCES 1,023 1,227,600 1,200 99
14 ATRIUM RESIDENCES 1,259 1,168,000 927 FH
14 WING FONG COURT 1,055 780,000 739 FH14 MILL CREEK 1,561 1,100,000 705 FH
15 THE SEAFRONT ON MEYER 2,099 3,410,857 1,625 FH
15 THE SEAFRONT ON MEYER 1,604 2,350,000 1,465 FH
15 THE SOVEREIGN 2,637 3,700,000 1,403 FH
15 SUITES @ AMBER 840 1,138,000 1,355 FH
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NOTE: This data only covers non-landed residential resale propertytransactions with caveats lodged with the Singapore LandAuthority. Typically, caveats are lodged at least 2-3 weeks after apurchaser signs an OTP, hence the lagged nature of the data.
Postal
DistrictProject Name
Area
(sqft)
Transacted
Price ($)
Price
($ psf)Tenure
15 THE AMERY 1,356 1,750,000 1,290 FH
15 AMBER RESIDENCES 1,249 1,600,000 1,281 FH
15 THE ESTA 1,561 2,000,000 1,281 FH
15 THE MAKENA 1,582 1,925,000 1,217 FH
15 CAMELOT BY-THE-WATER 3,531 4,220,000 1,195 9915 TANJONG RIA CONDOMINIUM 926 1,020,000 1 ,102 99
15 BLU CORAL 872 935,000 1,072 FH
15 T EMBELING RESIDENCE 1,206 1,235,000 1,024 FH
15 CHAPEL COURT 1,195 1,175,000 983 FH
15 ESPIRA SPRING 1,539 1,400,000 910 FH
15 THE ESTA 1,593 1,366,000 857 FH
16 COSTA DEL SOL 1,324 1,720,000 1,299 99
16 PARBURY HILL CONDOMINIUM 947 988,888 1,044 FH
16 EAST MEADOWS 1,216 1,100,000 904 9916 BEDOK COURT 2,411 1,720,000 713 99
17 CARISSA PARK CONDOMINIUM 1,001 900,000 899 FH
17 DAHLIA PARK CONDOMINIUM 1,270 1,010,000 795 FH
18 TROPICAL SPRING 1,076 988,000 918 99
18 MELVILLE PARK 958 730,000 762 99
18 MELVILLE PARK 1,464 980,000 669 99
19 GILLENIA 861 950,000 1,103 999
19 KOVAN RESIDENCES 4,747 4,200,000 885 99
19 RIO VISTA 1,249 970,000 777 99
20 RAFFLESIA CONDOMINIUM 1,195 1,336,000 1,118 99
20 BISHAN 8 1,163 1,230,000 1,058 99
20 FLAME TREE PARK 1,593 1,500,000 942 FH
20 FAR HORIZON GARDENS 1,389 1,060,000 763 99
21 THE CASCADIA 883 1,452,360 1,645 FH
Postal
DistrictProject Name
Area
(sqft)
Transacted
Price ($)
Price
($ psf)Tenure
21 THE CASCADIA 1,302 2,132,000 1,637 FH
21 THE STERLING 1,432 2,120,000 1,481 FH
21 MAPLEWOODS 2,895 4,000,000 1,381 FH
21 CAVENDISH PARK 1,313 1,550,000 1,180 99
21 CAVENDISH PARK 1,227 1,260,000 1,027 9921 PANDAN VALLEY 2,669 2,620,000 981 FH
21 PINE GROVE 1,755 1,480,000 844 99
21 PANDAN VALLEY 4,585 3,550,000 774 FH
22 THE LAKESHORE 936 950,000 1,014 99
22 PARC OASIS 1,076 950,000 883 99
22 PARC VISTA 1,055 870,888 826 99
22 PARC VISTA 1,152 922,000 801 99
23 PARK NATURA 2,045 2,450,000 1,198 FH
23 MERAWOODS 1,001 955,000 954 99923 HILLBROOKS 1,270 1,200,000 945 FH
23 MAYSPRINGS 818 725,000 886 99
23 HILLVIEW RESIDENCE 1,690 1,330,000 787 999
23 NORTHVALE 1,324 1,003,000 758 99
23 THE MADEIRA 1,894 1,070,000 565 99
26 THE CALROSE 1,023 1,145,000 1,120 FH
26 BULLION PARK 807 800,000 991 FH
27 ORCHID PARK CONDOMINIUM 958 758,000 791 99
27 ORCHID PARK CONDOMINIUM 1,249 910,000 729 99
27 YISHUN EMERALD 1,399 990,000 707 99