Property Wealth Planning - Huttons-Ethan

23/06/2022

https://www.edgeprop.sg/property-news/how-recession-could-affect-property-prices

Summary
- However, developers are more prudent and less leveraged compared to the past. Developers are unlikely to drop price to sell and limit losses
- As of 1Q2022, the level of unsold stock in the market at 14,362 is very low. This is 62% lower than the peak in unsold units in 1Q2019.
- Major launches in 2Q2022, Piccadilly Grand and LIV @ MB have set a benchmark for higher pricing.

Opinion
Without a doubt, the increase in interest rates and the prospect for recession are concerns. However, prices of properties will likely remain due to the above reasons.

Does the property market lead the economy in a downturn? Or does the economy lead the property market? Find out here

11/06/2022

https://www.businesstimes.com.sg/real-estate/h2-government-land-sales-programme-to-have-more-private-housing-supply-first-sale-site

The Singapore Government has released more land for residential projects to help reduce the supply crunch. There are 6 confirmed lists and 8 reserve lists.

Confirmed List (for 3505 units)

Private
-Bukit Timah Link
-Hillview Rise
-Lentor Gardens
-Marina Gardens Lane

HDB
-Tengah Plantation Loop (EC)
-Tampines Avenue 11 (Commercial & Residential)

Do look out for more information on which developers get the sale and at what price, as these will determine the prices of the developements

THE government land sales (GLS) programme for the second half of 2022 will continue to have a larger supply of private housing, amid robust demand and declining inventory. Read more at The Business Times.

26/05/2022

https://www.straitstimes.com/business/property/more-singapore-property-developers-expect-prices-of-new-launches-to-go-up-survey

More developers are expecting prices of new launches to increase over the next 6 months due to
- Increased construction costs
- Positive market sentiment.
- The market has accepted the recent cooling measures

Opinion
- Developers may increase prices of remaining stocks to take advantage of the positive market
- If anybody is looking to get a new launch unit, it is best to consider doing so quickly as the upcoming launches are likely priced higher than existing projects due to rising construction cost and increased land acquisition costs

Rising construction costs have joined rising inflation and interest rates as risks to the property market. . Read more at straitstimes.com.

14/05/2022

https://www.businesstimes.com.sg/real-estate/foreign-buyers-return-to-property-market-in-april-after-q1-pullback

There is some recovery of foreign demands for Singapore Private Properties, with an increase of over 40 units per month after the latest cooling measures on stamp duties were implemented in December 2021

However, the increase is relative small compared to the total number of local and PR buyers, hence the impact of housing prices from foreign demand is likely limited

Read more at The Business Times.

06/05/2022

https://www.businesstimes.com.sg/government-economy/singapore-unlikely-to-have-recession-after-fed-hike-but-near-term-risks-remain

With the FED's recent announcement of a 0.5% increase of interest rates to rein in inflation, many are likely curious how does this impact the Singapore economy.

Summary
- Interest rates in Singapore are expected to rise, but likely to less extent.
- A further increase in the US interest rate, and hence the Singapore interest rate, may happen if inflation in the US is not controlled well.
- Even with high interest rates and stronger Singapore Dollar, a recession in 2022 is not forecasted as Singapore's export demand remains relatively robust and many economies are opening up.

Opinion
- As Singapore's interest rates are likely to rise in tandem with US's interest rates, and that some banks have already stopped offering fixed rate loan packages due to larger costs incurred, one should consider taking loans for large investments now rather than later to take advantage of existing loan rates.
- A study from DBS has shown that real estate is one of the few inflation outperformers for investments, hence one can consider properties to hedge against inflation and potentially profit from such investments

EXPECTATIONS for Singapore's monetary policy or growth trajectory were largely unshaken by Wednesday's (May 4) rate hike in the United States, and a recession looks unlikely for now - though some economists still see a risk of a slowdown, independent of the Fed's decision. Read more at The Business....

28/04/2022

https://www.google.com/amp/s/amp.cnn.com/cnn/2022/04/26/economy/inflation-recession-economy-deutsche-bank/index.html

There are a lot of speculations about the repercussions that could happen after the US central bank raised interest rates. Recession is one of them.

There are 4 factors to predict recession - Non-farm payroll employment, the index of industrial production, real personal income excluding transfer payments, and real manufacturing and trade sales.

All these are at low points, indicating that the risk of recession is very slim.

The rhetoric by the FED is likely an attempt to deflate asset prices as stocks, housing and spending basically are too high, which further drives prices up (inflation).

If inflation cools enough and people spend slower, interest rates may not rise as fast as Fed suggests.

How should I interpret these probabilities as a recession signal?

My opinion: Historically, three consecutive months of smoothed probabilities above 80% has been a reliable signal of the start of a new recession, while three consecutive months of smoothed probabilities below 20% has been a reliable signal of the start of a new expansion, rather than recession

Deutsche Bank raised eyebrows earlier this month by becoming the first major bank to forecast a US recession, albeit a "mild" one.

22/04/2022

https://www.edgeprop.sg/property-news/piccadilly-grand-open-preview-april-23-prices-2186-psf?utm_source=facebook&utm_medium=dlvr.it&utm_campaign=contentdistribution&utm_content=https%3A%2F%2Fwww.edgeprop.sg%2Ftep-solr%2Fapi%2Farticles%2FgetArticlesRssNew.php

One of the biggest launch in H1 2022, Piccadilly Grand will open its preview on 23 April.

An integrated development at Farrer Park, this project is one of the most attractive real estate investment with lower than expected price per squarefoot, with high potential upsides due to future surrounding development. It is also in one of growth hotspots.

Anyone interested to learn out, please reach out.

Sales bookings for the project will begin on May 7.

21/04/2022

https://www.businesstimes.com.sg/real-estate/price-gap-narrows-between-rcr-and-ccr-homes-in-march

Summary:
- Differences between Housing Prices in RCR (Rest of Central Region) and CCR (Core Central Region) have narrowed significantly in March, from 32.6% to 20.3%.
- Lower demand for CCR houses due to the recent cooling measures, lower supply for RCR houses contributed to this narrowing.

Opinion:
- CCR houses might be worth considering now as demand for these houses might not recover very soon (Foreigners make up a significant portion of CCR home purchases)
- With fewer launches and higher price tags, private housing prices are likely to continue increasing for 2022

THE price gap between new homes in the prime areas of Singapore and those outside of them continued to narrow in March, suggesting that there could be buying opportunities for those seeking properties in Districts 9, 10 and 11. Read more at The Business Times.

18/04/2022

https://www.businesstimes.com.sg/brunch/fresh-demand-for-older-flats-as-frustration-builds-over-bto

Opinion:
- Many families are looking into older, existing flats as alternatives to BTO due to delays in BTO. While this may be a viable option, it is important to know which valuation phase of the older flat is at before making such moves. Doing so can help buyers avoid losing money when they sell their flats in the future, especially when considering the CPF Principal + Accrued Interest.
- Current rising price trends are likely to be temporary, as the pandemic that is driving demand and causing supply issues will likely subside in the future.
- However, if buyers are looking to stay "till death", this might not be as relevant.

KELVIN Lim, senior marketing director at real estate agency ERA Realty Network, often advises potential homebuyers to apply for built-to-order (BTO) flats under the Housing and Development Board (HDB) if they are eligible - even if it means he loses out on sale commissions. Read more at The Business...

11/04/2022

https://www.businesstimes.com.sg/hub-projects/property-2022-march-issue/likely-hotspots-for-private-housing-market-in-h1-2022

Some "old" news but still relevant to everyone.

Summary
- 2022 is likely to be a year with low housing supply and absence of mega launches for private properties
- 5 major launches expected are Piccadilly Grand, Liv@MB, The Arden, Sceneca Residence and a not-yet-named launch in Ang Mo Kio. These launches happen in areas with little similar projects within the past few years
- As with previous property trends, prices will likely increase for the rest of the year due to strong demand.

Thoughts
- I recommend those looking for new launches consider these 5 launches, except perhaps The Arden (unless you prefer the West area) because larger developments tend to have more demand.
- Its always better to go in early for new launches because prices tend to increase as when more units are sold.

THE government poured cold water on the property market with the introduction of fresh cooling measures that took effect on Dec 16, 2021. Read more at The Business Times.

07/04/2022

With the 1st round of interest rate hike last month and several more expected for the rest of 2022, many are starting to ask whether the time is ripe to refinance their mortgage loans.

Which loan packages are most suitable for your near term goals and what criteria should you be considering before you decide?

Which are the lowest rates among the more than 12 banks offering mortgage loans refinancing?

PM me for an E-book that will enlighten you on these and more!


Data Driven. All Facts. No Hype.

05/04/2022

https://www.businesstimes.com.sg/real-estate/could-there-soon-be-a-wave-of-hotel-conversions-into-condominiums

More housing options could be coming in an unexpected way.

Summary
- With tourism taking longer to recover and rising costs of labour, utilities etc, hotel operators may be looking to repurpose some of their hotel properties for other uses, such as residential or other commercial uses.
- Successful cases include Sea View Hotel (Marine Parade), Copthorne Orchid Hotel (Dunearn Road) and ANA Hotel (Nassim Road)

Significance
- Such properties may be converted to condominium / integrated developments, and this may affect prices of nearby properties.

Stay tuned of more updates relevant to your property ownership.