25 April to 2 May 2023
Blossoms By The Park – the first development to be launched following the rollout of the latest April 2023 cooling measures – sold more than 70% of its 275 units at an average price of $2,423 per sq ft (PSF) during its first day of sales on 29 April 2023. Meanwhile, HDB is making its flat buying process easier by consolidating the eligibility assessments for flat purchases, HDB housing loans and CPF Housing Grants into a single application in the HDB Flat Portal.
1. Blossoms By The Park sells over 70% of units despite cooling measures
Blossoms By The Park – the first development to be launched following the rollout of the new cooling measures – sold more than 70% of its 275 units at an average price of $2,423 PSF during its first day of sales on 29 April 2023, reported CNA.
Located at 9 Slim Barracks Rise in District 5, the site has a maximum permissible gross floor area (GFA) of 256,956 sq ft, with the highest plot ratio of 3.0 in its residential cluster. Blossoms By The Park consists of 275 residential units with 1-bedroom to 4-bedroom unit types in a single 27-storey block.
Comparatively, typical residential developments in the one-north area are mid-rise at 13- to 15-storey. The 99-year leasehold development will also have three floors of commercial lots, which have been approved for food-and-beverage outlets, and other types of retail.
The Business Times reported that four units were bought by buyers from China, who would have to pay 60% Additional Buyer’s Stamp Duty (ABSD).
Another four units were snapped by American citizens, who are given the same stamp duty treatment as Singaporeans under the free trade agreement between Singapore and the US.
Mr Lim Yew Soon, Managing Director of EL Development, said: “We are heartened by the very good response from homebuyers. The large majority are Singapore citizens who are buying for owner-occupation or investment. The enthusiastic response reflects strong demand for well-designed homes in the one-north business hub neighbourhood.”
Commenting on the impressive sales results, Dr Lee Nai Jia, Head of Real Estate Intelligence, Data and Software Solutions, PropertyGuru Group remarked that the positive take-up rate shows that the underlying local demand remains robust, especially among those seeking to upgrade or purchase their first home for occupation. It also corroborates the government’s intent to help local buyers get their homes for occupation.
Concurring, Dr Tan Tee Khoon, Country Manager – Singapore, PropertyGuru said that Blossoms By The Park appears to have an acutely high percentage of local buyers relative to other new launches thus far (i.e. 96%). This buyer profile demonstrates the faith and confidence of our local buyers in selecting private residential projects with strong attributes for their purchase. He also noted that 4% of buyers are foreigners and again this reinforces their belief in Singapore’s sound fundamentals despite the increased ABSD rates.
Sizes and prices of the remaining 3- and 4-bedroom units are as follows:
- 3-bedroom units, ranging between 1,044 sq ft and 1,259 sq ft, start at about S$2.3 million or S$2,183 PSF
- 3-bedroom dual-key units of 915 sq ft or 1,033 sq ft starting at about S$2.1 million or S$2,276 PSF
- 4-bedroom units, at 1,302 sq ft and 1,539 sq ft, start at about S$2.9 million or S$2,243 PSF
- 4-bedroom premium units, at 1,507 sq ft or 1,884 sq ft, cost about S$3.3 million or S$2,213 PSF
Blossoms By The Park is marketed by ERA, Huttons, PropNex, and Singapore Realtors Inc (SRI).
2. HDB buyers to enjoy a streamlined buying process from 9 May 2023
HDB is making the flat buying process easier by consolidating the eligibility assessments for flat purchases, HDB housing loans and CPF Housing Grants into a single application in the HDB Flat Portal, reported CNA.
The new HDB Flat Eligibility (HFE) letter, which will replace the HDB Loan Eligibility (HLE) letter, will enable HDB flat buyers to gain a better understanding of their acquisition costs and financing options.
Currently, HDB assesses the eligibility of buyers for flat purchases, HDB housing loans and CPF Housing Grants at different stages of their home-buying journey.
From 9 May 2023, flat buyers must have their HFE letter when they apply for a flat during an HDB sales launch or open booking of flats or once they get an Option to Purchase (OTP) from the seller, and when they submit a resale application to HDB.
Aside from the HFE letter, HDB will also roll out several improvements to the HDB Flat Portal as part of its efforts to streamline the home-buying process.
These include an integrated loan application service and a guided journey for new HDB flat buyers. The HDB Resale Portal will also be integrated into the HDB Flat Portal from 9 May 2023.
Related article: CPF Housing Grant Eligibility in Singapore: How Much HDB Grant BTO, Resale HDB Flat, and EC Buyers Can Get (2023)
3. Singapore doubles ABSD for foreigners in latest April 2023 property cooling measures
The Government has once again raised the ABSD for residential properties, with the rate for foreigners doubled from 30% to 60%, reported CNA.
Minister for National Development Desmond Lee explained that the increases in ABSD are a “pre-emptive measure” to dampen foreign and local investment demand, on the back of renewed interest in residential properties, said CNA.
Meanwhile, Bloomberg reported that Singapore’s 60% property tax on foreigners made other international hubs, such as Hong Kong, New York, and London look cheap.
Mark Elliott, Savills Head of International Residential Sales in Hong Kong, believes the ABSD hike “will be great for London, the US and other markets” as it will not only deter but put a brake on investments in Singapore.
4. City Developments Limited (CDL) postpones Newport Residences preview following April 2023 Singapore property cooling measures
CDL has pushed back the preview for its luxury condominium project, Newport Residences, following the new property cooling measures introduced by the government, reported CNA.
A spokesman for CDL said the preview for the 246-unit freehold development was originally set to start on 28 April 2023.
“With the latest property-related measures released by the government… the market will need time to absorb the news,” said the spokesperson.
“We will monitor market conditions closely and unveil its launch at an appropriate time.”
TODAY reported that real estate agents have seen an increase in enquiries since the new cooling measures were announced, with some foreign clients holding back on selling their property here.
Some are exploring other investment avenues aside from residential properties.
Meanwhile, investors who plan to use the 99-to-1 ownership scheme to avoid paying ABSD should think twice given that such schemes are easy to spot since the sales agreement is registered with the authorities.
The Straits Times said those exploiting the loopholes have more to lose than gain.
Related article: Decoupling Property in Singapore: Should You Do It in 2023?
5. Private home prices rise at a faster pace in Q1 2023
Private home prices in Singapore increased faster in the first quarter of 2023, rising 3.3% compared with 0.4% in the previous quarter, reported CNA, citing Urban Redevelopment Authority (URA) data.
Landed homes registered bigger increases of 5.9%, compared with 0.6% in Q4 2022. Non-landed property prices rose 2.6%, also higher than the 0.3% hike seen in the previous quarter.
For condominiums, the price hike was driven by the robust sales within the Rest of Central Region (RCR), which saw prices increase 4.4%.
Condo prices in the Outside Central Region (OCR) and Core Central Region (CCR) climbed 1.9% and 0.8%, respectively.
Rentals for private homes increased 7.2% in Q1 2023, a slight dip from the 7.4% increase in Q4 2022.
In Q1 2023, developers launched 1,312 uncompleted private homes, excluding Executive Condominiums (ECs), up from 504 units in Q4 2022. Sales also increased to 1,256 units, from 690 units previously.
OrangeTee & Tie’s Senior Vice President of Research and Analytics Christine Sun said the higher proportion of new sales may have driven the price hike during Q1 2023 since new homes are usually sold at higher prices than resales.
6. HDB resale prices were up 1% in Q1 2023, its smallest in over two years
Prices of HDB resale flats increased 1% in the first quarter of 2023, marking its smallest quarterly gain over the past 10 quarters, reported CNA citing HDB.
HDB resale transactions rose 5.8% to 6,979 units in Q1 2023 from 6,597 units in Q4 2022.
Eugene Lim, Key Executive Officer of ERA Realty Network, attributed the slow price growth to the price resistance settling in, saying buyers are reluctant to match the sellers’ high asking prices since it would mean paying higher cash over valuation (COV).
Christine Sun, OrangeTee & Tie’s Senior Vice President of Research and Analytics, believe the slow price increase was due to higher housing inventory.
They pointed out that first-timer HDB flat buyers are “typically very price sensitive”, while some have smaller budgets due to a “combination of skyrocketing home prices, inflationary pressures and rising mortgage rates”.
With resale prices reaching resistance levels, Lim expects HDB resale price growth to moderate over the year, rising between 5% and 7% versus the 10.4% hike seen over the past year.
7. Home rental pressures expected to moderate in coming quarters
The Monetary Authority of Singapore (MAS) believes the pressure on home rentals will ease over the coming months due to a “significant” influx of new housing units, reported CNA.
Nearly 40,000 public and private housing units are set to be completed this year – the highest annual completion since 2018.
MAS expects this pace of completion to continue in the next two years, with almost 100,000 public and private homes set to be completed.
Moreover, rental demand will moderate as people vacate their rental homes following the completion of their new homes.
The central bank also noted that real estate agencies registered fewer viewings and leasing enquiries since the start of 2023.
MAS explained that the hike in home rents was mainly due to an “exceptional demand-supply imbalance” caused by pandemic-induced disruptions, which led to delays in the completion of housing projects.
Nonetheless, such market imbalances “have already started to ease and will continue to do so progressively through this year”, said MAS.
The Straits Times reported that Singapore has surpassed New York to become the city with the highest rental growth globally after rental rates here hit record levels in March.
The rental hike even spilt to the HDB market, with some 5-room flats in Cantonment Road and Ang Mo Kio fetching monthly rents of over $6,000.
8. HDB BTO flats remain affordable, says Deputy Prime Minister Lawrence Wong
Deputy Prime Minister Lawrence Wong said BTO flats remain affordable as prices moved in tandem with incomes, reported CNA.
“When you think about affordability, please don’t just look at the headline price of the BTO flat; also consider how the price relates to income, as well as the proportion of income that’s needed to service the housing loan,” he said during the May Day Rally.
Currently, a typical household uses less than 25% of its income to service their mortgage, just like in 1980. CPF Housing Grants of up to $80,000 are also available to first-time buyers, said Wong in his speech.
In fact, the majority of first-time homebuyers service their housing loans via their CPF contributions, with very little or no out-of-pocket cash, he added.
Related article: Budget 2023 Singapore: Increased BSD Rates, More CPF Housing Grants, and More
9. IRAS to reward whistle-blowers on private property deals evading ABSD
The Inland Revenue Authority of Singapore (IRAS) is offering rewards of up to $100,000 to whistle-blowers who report buyers who are avoiding or reducing their ABSD through the 99-to-1 ownership scheme or other similar arrangements, reported The Online Citizen.
To be based on 15% of tax recovered, the reward will be capped at $100,000 per case and will be given to those who provide information or documents that lead to the recovery of taxes.
This is part of the authority’s campaign to combat tax evasion and avoidance.
Currently, IRAS is investigating private property transactions between 2018 and 2021 that involved 99-to-1 or similar purchase arrangements. The audit will be conducted in phases and include transactions after 2021.
IRAS, however, did not specify if it will also look into decoupling arrangements.
Individuals with information on tax evasion and avoidance can write to IRAS at email@example.com, while those who wish to voluntarily disclose and make good their unpaid taxes will be generally treated more favourably.
10. HDB residents to face higher service and conservancy charges
Housing Board residents will soon face increased Service and Conservancy Charges (S&CC), although the Government is expected to provide temporary financial support to cushion the impact, reported The Straits Times.
Currently, town councils are evaluating their finances to determine the appropriate increase to be imposed.
This increase comes as town councils face rising cost pressures over manpower costs, maintenance costs, and energy prices.
“With the implementation of the Progressive Wage Model to uplift low-wage workers, the town councils’ operational costs have also gone up due to increase in tender prices for conservancy cleaning contracts and horticulture contracts,” said Lim Biow Chuan, who serves as Coordinating Chairman for PAP town councils.
The last increase in S&CC was rolled out in 2017, with the hike ranging from $1 to $17 per month and phased over two years.
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Marcus Lee, Content Executive at PropertyGuru, edited this story. To contact him about this story, email: firstname.lastname@example.org.