14 to 20 March 2023
New private home sales in Singapore, excluding Executive Condominiums (ECs), increased in February 2023, despite the hike in Buyer’s Stamp Duty (BSD) for pricier residential properties. Meanwhile, HDB is piloting a new rental scheme for low-income singles called Single Room Shared Facilities, in which tenants will have their own rooms but share common facilities such as kitchens and bathrooms.
1. New private home sales up in February 2023 despite the hike in BSD
New private home sales in Singapore, excluding ECs, increased by almost 10% to 432 units in February 2023, despite the hike in BSD for pricier residential properties, reported CNA.
The number of units launched in February 2023 also dropped to 401 units from 410 units in January 2023.
On an annual basis, private home sales declined 20.3% from the 542 units shifted over the same period last year.
The majority of the sales were from the Core Central Region (CCR) with 222 units transacted, as projects within the area continued to clear unsold units. The Central Region (RCR) and Outside Central Region (OCR) saw 163 units and 47 units sold, respectively.
Analysts noted that the higher tax did not deter buyers from acquiring a residential property.
“Most buyers may not feel that the increase in buyer’s stamp duty is excessive, especially if the amount is expressed as a percentage of the total purchase price and if the homes were bought for owner occupation or a long-term investment,” said Christine Sun, OrangeTee & Tie’s Senior Vice President of Research and Analytics.
Related article: Buyer’s Stamp Duty Guide for Singapore Property Buyers (2023)
2. HDB to pilot new rental scheme for low-income singles
HDB is piloting the Single Room Shared Facilities Scheme, which will allow low-income singles to have their own room, while facilities such as kitchens and bathrooms will be shared with other tenants, reported CNA.
The pilot will be tested at the former Anderson Junior College hostel in Ang Mo Kio, which has been partitioned into 480 single rooms.
Applications for the rooms – which measure about 9 sq m each and come with basic furnishings, such as a wardrobe, bed frame, small refrigerator, table, and chair – are set to open by end-2023, when the two 11-storey blocks are ready.
Minister for National Development Desmond Lee revealed that the pilot will be evaluated over the next year or two before deciding whether it will be included as part of its rental flat offerings.
Meanwhile, volunteer welfare organisations have welcomed the pilot and offered various suggestions, including enhancing security by installing closed-circuit televisions (CCTVs) in common areas and having gendered floors, reported TODAY.
They added that operators of the pilot should also create a community as well as set ground rules to ensure tenants behave amicably with each other.
Related article: HDB Public Rental Scheme: Can I Rent an HDB Flat from the Government? (2023)
3. Two residential sites at Jalan Tembusu, Tampines Street 62 launched for sale
Urban Redevelopment Authority (URA) and HDB have released two residential sites for sale, with the tender for both parcels closing on 18 July 2023.
The sites comprise a 20,572.1 sq m private residential plot at Jalan Tembusu and a 28,000.2 sq m EC site at Tampines Street 62 (Parcel B). The two land parcels are expected to yield up to 1,540 housing units.
Chia Siew Chuin, JLL’s Head of Residential Research, Research and Consultancy, believe developers would exercise caution when bidding for the Jalan Tembusu plot due to its large size – which could fetch above $1 billion.
She expects the site to draw less than five bids, with the top bid ranging from $1,300 to $1,350 per sq ft per plot ratio (PSF ppr).
The Tampines site, on the other hand, is expected to attract healthy interest from developers as previous EC projects sold well despite the cooling measures and high-interest rate environment.
OrangeTee & Tie’s chief executive Steven Tan expects the site to receive four to seven bidders, with the bid price ranging from $630 to $680 PSF ppr.
Related article: Government Land Sales (GLS) Programme Guide (Updated With GLS Sites for 1H2023 Singapore)
4. Singapore leads the ranking for the city with the strongest prime rental growth
Singapore registered the strongest rise in prime residential rents in Q4 2022, pushing New York off the top position, revealed Knight Frank.
The Lion city saw an annual rent increase of 28% during the quarter, with strong demand and limited stock driving prices higher.
“Around 17,000 new private homes are set for completion in 2023 that should provide some relief to accommodation pressures. However, until such time, it will remain a landlord’s market and rents are likely to rise further,” said Leonard Tay, Head of Research for Singapore at Knight Frank.
In fact, Singapore’s new visa rules to attract foreign talent are expected to supplement tenant demand further.
Meanwhile, New York was ranked second as it posted 18.6% in annual growth, followed by London (17.8%), Toronto (15%) and Tokyo (8%).
Meanwhile, Hong Kong saw the largest fall in prime rents, dropping 6.4% as international corporations deferred expansion plans within the region.
Knight Frank noted that while prime rents remained robust across many global cities, the overall pace of annual growth is beginning to slow.
5. The rental market reaches a peak as agents report fewer viewings, longer listing times
After two years of steady rental increase, Singapore’s rental market may have reached its peak as agents report fewer viewings and longer listing times.
However, landlords are having difficulty accepting that the market is slowing down, reported The Business Times.
According to an agent, the market began to moderate as early as November 2022, but people attributed the slowdown to the usual year-end lull.
With tenants no longer rushing to commit, landlords try to lock in tenants for longer contracts.
Agents said the slowdown is due to fewer tenants, skyrocketing rents, uncertain economic conditions, and increasing options amid the completion of residential projects.
Moving forward, agents believe rents may decline over the coming months, with the market going back to the basics of location, unit condition, and supporting infrastructure as the determining factors for the success of individual listings.
An estimated 40,000 BTO flats and new private homes are expected to be completed in the second half of the year, which may help moderate prices. According to Dr Tan Tee Khoon, Country Manager – Singapore, PropertyGuru, landlords are likely to be “more realistic” with their asking rents.
“Landlords typically rely on rental income to service their mortgage repayments, so securing tenants at a lower rent is still better than leaving their units empty,” Dr Tan said.
6. New residential sales volume drop to a 14-year low in Q4 2022
Sales of new residential properties plunged 68.4% quarter-on-quarter (QoQ) to 690 units during Q4 2022 – or its lowest quarterly sales since Q4 2008, when new sales volume stood at 419 units, reported Singapore Business Review citing Savills Research.
On an annual basis, residential sales fell 77.1% in Q4 2022.
For the whole of 2022, new residential sales dropped 45.5% to 7,099 units from the 13,027 units shifted in 2021. The figure is also the lowest sales volume since 2008 when 4,264 units were sold.
The secondary market also saw sales volume decline 26.8% QoQ and 42.6% year-on-year (YoY) to 2,898 units in Q4 2022.
The CCR registered the biggest quarterly drop in secondary sales at 30.1%
For the whole of 2022, secondary sales also declined by 28%.
7. GCB sales drop in 2H 2022 due to interest rate hikes
The Good Class Bungalow (GCB) market saw sales decline significantly in the second half of 2022, with 18 units sold worth $613.45 million compared to 40 units sold in 2H 2021 for $1.2 billion, reported Singapore Business Review citing CBRE data.
For the full year, GCB sales dropped 54.3% to $1.365 billion as 47 GCBs were sold in 2022 from $2.9 billion as 98 GCBs were shifted in 2021.
CBRE attributed the decline in 2H 2022 sales to faster-than-expected interest rate hikes as well as the worsening macroeconomic conditions. Nonetheless, it noted that GCB sales values for 2022 were still higher than in 2019.
Looking ahead, CBRE expects the GCB market to face further challenges, with transaction activity remaining slow for most of 2023, amid prolonged geopolitical tensions and hikes in interest rates.
“In the longer term, Singapore’s strong positioning as a wealth hub and the continued attractiveness of GCBs as status symbols and for wealth perseveration ought to support demand and prices,” it said.
8. Wing Tai buys Holland Tower for $76.3 million
Wing Tai Holdings, via its fully-owned subsidiary Wincove Investment, has acquired Holland Tower in prime District 10 for $76.3 million, which works out to a land rate of $1,746 PSF ppr.
Located at 10 Holland Heights, the 14-unit development occupies a 2,032.6 sq m site and has a gross floor area of 4,059.05 sq m.
The site is a five-minute drive to Dempsey Hill and Holland Village as well as The Singapore Botanic Gardens. The Orchard Road shopping belt is also a 10-minute drive away.
“We plan to leverage its superior location attributes to develop a luxurious and iconic residential development with stunning unblocked views of the lush greenery in Holland Park as well as the Singapore city skyline,” said Wing Tai Executive Director Tan Hwee Bin.
9. 13 people were arrested for rental scams, and victims lost over $1.3 million
The police arrested 13 individuals suspected of being involved in 480 rental scams, which saw victims lose more than $1.3 million, reported The Straits Times.
The police said four women and nine men, aged between 18 and 56, were nabbed during an islandwide operation from 9 March to 13 March 2023.
The scammers impersonated property agents and asked victims for payment to secure the rental of a unit prior to viewing the property.
The police added that three other women, aged 21 to 27, are assisting in investigations.
Based on preliminary investigations, the 16 suspects purportedly allowed their bank accounts to receive illicit proceeds from rental scams. They then withdrew the proceeds and handed them to others in the syndicate.
Individuals who assist another to retain benefits from criminal act face imprisonment of up to 10 years, fines of up to $500,000 or both.
“To avoid becoming involved in money laundering activities, members of the public should always reject requests to allow their bank accounts to be used to receive and transfer money for others,” said the police.
10. Three Geylang Road shophouses are on sale for $23 million
Three adjoining conservation shophouses at 489, 491, and 493 Geylang Road have been put up for sale via Expression of Interest (EOI) with a guide price of $23 million or $3,113 PSF based on the total floor area of about 7,388 sq ft.
Exclusive marketing agent CBRE said the two-storey shophouses – which come with a combined land area of 3,830 sq ft – are being sold collectively.
The shophouses are currently fully tenanted, with the ground floor occupied by an eating house and the upper floors by a karaoke lounge.
CBRE noted that the shophouses are presently under-developed, enabling the incoming owner to consider building “a five-storey rear extension to maximize the total floor area by an additional 4,100 sq ft, or approximately 36% of the maximum allowable floor area, subject to approval from the relevant authorities”.
Since the site is zoned for Commercial use, both locals and foreigners can acquire the property with no Additional Buyer’s Stamp Duty (ABSD) or Seller’s Stamp Duty (SSD) payable.
The EOI exercise for the shophouses closes on 19 April 2023.
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Marcus Lee, Content Executive at PropertyGuru, edited this story. To contact him about this story, email: marcuslee@propertyguru.com.sg.
