​Totalling S$106 billion, this year’s budget is aimed at helping businesses, Singaporeans and workers stay afloat in the face of an outbreak while navigating a weakening economy, technological disruptions and an ageing population.

By Khalil Adis

​Walk around Singapore and you will notice that malls have now become eerily quiet while coughs and sneezing in public have become socially taboo.

Just take a ride on the MRT and observe the look of disdain whenever someone were to accidentally do so. 

Welcome to the Lion City in 2020 where face masks and sanitisers have become the latest fashion accessories.

Already impacted by the ongoing trade war, Singapore is now faced with another invisible threat in the form of a coronavirus which now has a name - COVID-19.

Fresh from the Lunar New Year celebrations, businesses will usually see an increase in consumer spendings during this period.

However, this year is different with a notable dour mood.

Everyone is wary and jobs are now uncertain as the tourism, aviation, hotel, F&B and MICE industries take a hit. 

Thus, it is no surprise that this year’s budget was a marked increase from Budget 2019’s S$78.2 billion to cope with the extraordinary circumstances.

Against a backdrop of a possible election this year, Budget 2020 tackles bread and butter issues head-on.

Here are some of the key takeaways from Budget 2020 and its impact on the property market.

#1: S$800 million budget to fight the virus

Singapore is a global city and an important trading and aviation hub. 

Home to Changi Airport, it is, therefore, susceptible to any major shocks in the region and COVID-19 is no exception.

As such, the entire world is watching closely how Singapore is handling the outbreak and this will have an impact on investors’ confidence.

The World Health Organization (WHO) has so far praised Singapore’s response in containing the coronavirus situation.

With 81 confirmed cases so far, the government has set aside S$800 million for the Ministry of Health and other ministries to protect Singaporeans from the risk of a further spread of the COVID-19 virus.

This budget will have far-reaching implications as it will help to bolster business confidence, protect jobs, minimise economic disruptions while keeping Singaporeans healthy.

#2: Support for hotel, retail, food services, tourism and air transport sectors to minimise business disruptions

These industries will receive help in the form of the enhancement to Adapt and Grow Initiative to help in job redeployments, property tax rebate for qualifying commercial properties, a new Temporary Bridging Loan Programme (TBLP) for tourism sector enterprises, aviation sector measures, 50 per cent port dues concession and rental waivers for commercial tenants in government-owned / managed facilities.

More details can be found here.

Collectively, these measures will minimise business disruptions while mitigating retrenchments.

#3:  S$4 billion Stabilisation and Support Package will help keep businesses afloat

Aimed at helping workers and enterprises weather near-term economic uncertainties, the Stabilisation and Support Package will cushion the impact of COVID-19 and the global headwinds.

For this, the government will introduce a Jobs Support Scheme (JSS) to provide wage support to enterprises that retain local workers.

Employers will receive an 8 per cent cash grant on the gross monthly wages of each local employee for the months of October 2019 to December 2019, subject to a monthly wage cap of S$3,600 per employee.

This applies to Singapore Citizens and Permanent Residents only.

The government will also enhance the Wage Credit Scheme (WCS) to help enterprises with the cost of wage increases.

The monthly wage ceiling for the WCS will be raised from S$4,000 to S$5,000.

These measures are especially beneficial for small to medium enterprises (SMEs) who are facing cash flow problems.

#4: Stabilisation and Support Package and Care and Support Package will help local workers stay employed while defraying living costs

For the average person on the street, the Stabilisation and Support Package means that local workers will remain gainfully employed.

This means their life will go on as usual such as having the ability to continue paying for their HDB or private property mortgages with minimal disruption.

In addition, the Care and Support Package will help to offset their day-to-day living expenses via cash payout of S$300, S$200 or S$100 (depending on their income), Workfare Special Payment with a minimum payment of S$100 for the work year of 2019, a S$100 grocery vouchers for each year, in 2020 and 2021 (subject to eligibility conditions), Additional GST Voucher – U-Save and Service and Conservancy Charges Rebate.

To be eligible for the grocery vouchers, only Singaporeans aged 21 years and above, who live in 1-room and 2-room HDB flats and do not own more than one property, are eligible.

More details can be found here

#5: Budget could mitigate rising home defaults 

Homeowners defaulting on their mortgages have been on the rise since 2015 amid rising interest rates and job uncertainty.

According to data from the Credit Bureau Singapore, there were 65 such cases in 2015 which have since increased steadily to 105, 112 and 156 in 2016, 2017 and 2018 respectively.

Meanwhile, from January to July 2019, the number stands at 79.

Against the backdrop of the COVID-19 outbreak, the number of cases for 2020 could be further mitigated with this budget.

In closing, Budget 2020 is generous and extraordinary to help Singaporeans, businesses and local workers during these extraordinary circumstances.

Strong correlation seen between transacted property price and remaining lease.

By Khalil Adis

Since the Lee Kuan Yew era, Singaporeans have been ingrained with the idea that our HDB flat is an asset.

While you can make a profit from your HDB flat, this depends on the lease that is remaining on your property.

Based on our research and analysis, we found that HDB flats in older estates with a remaining lease of fewer than 60 years saw their property values diminish.

Meanwhile, those that have around 80 years of lease left were able to fetch far higher prices.

This is according to data captured on HDB’s website.

On the other end of the spectrum, HDB flats that are located in newer estates did not see that much price variation.

In conducting this study, we had looked into HDB transactions for 4-room flats that were recorded as of 21 January 2020 and then compared it with the remaining lease.

The estates chosen included the mature estates of Toa Payoh and Ang Mo Kio as well as the non-mature HDB estates of Punggol and Jurong West.

Here are some quick snapshots based on our findings.

#1: Toa Payoh: Older HDB flats changed hands at lower prices 

When it comes to buying an HDB flat, most Singaporeans will prefer to buy in a mature estate such as in Toa Payoh or Ang Mo Kio.

However, if you have a flat with a remaining lease of fewer than 54 years this may have an impact on your resale value.

According to data captured on HDB’s website, there were 14 transactions for 4-room HDB flats in Toa Payoh during this period.

The data showed a strong correlation between the price versus the remaining lease.

For instance, older HDB flats (4) with 54 years or less of the remaining lease were transacted at an average price of S$334,500.

Meanwhile, newer HDB flats (4) with 76 to 81 years of the remaining lease were transacted at an average price of S$641,062.

This represents a price difference of 91.6 per cent.

#2: Ang Mo Kio: Newer HDB flats fetched higher selling prices

Ang Mo Kio is also another favourite estate among buyers explaining why Built-To-Order (BTO) launches have  always been oversubscribed.

Like Toa Payoh, Ang Mo Kio also witnessed a strong correlation between price versus the remaining lease.

According to data captured on HDB’s website, there were 24 transactions for 4-room HDB flats in the estate during this period.

Newer HDB flats (5) with 80 to 91 years of the remaining lease were transacted at an average price of S$622,960.

On the other hand, older HDB flats (14) with 59 years or less of the remaining lease were transacted at an average price of S$390,071.

This represents a price difference of 59.7 per cent.

#2: Punggol: A non-mature estate where capital values experience fewer fluctuations

Punggol is a non-mature estate with a relatively young population.

While it may seem far-flung, Punggol is among the top ten estates in Singapore where HDB resale homes have changed hands.

According to data captured on HDB’s website, there were 36 transactions for 4-room HDB flats in the estate during this period.

The remaining lease in Punggol ranges from 82 to 95 years.

As such, there is not much price variation as seen in the case of Toa Payoh and Ang Mo Kio.

For example, HDB flats (7) with between 82 to 89 years of the remaining lease were transacted at an average price of S$334,500.

Meanwhile, newer HDB flats (29) with 90 years or more of the remaining lease were transacted at an average price of S$477,002.

This represents a price difference of 42.6 per cent.

This suggests that newer estates like Punggol may be ideal if you want to protect the capital values of your property.

#3: Jurong West: A semi-mature estate with a price gap similar to Punggol

Jurong West is a semi-mature area and as such the remaining lease here is between 63 and 94 years.

According to data captured on HDB’s website, there were 41 transactions for 4-room HDB flats in the estate during this period.

Similar to Punggol, there is not much price variation as seen in the case of Toa Payoh and Ang Mo Kio.

For example, HDB flats (11) with less than 70 years of the remaining lease were transacted at an average price of S$328,090.

Meanwhile, newer HDB flats (8) with 93 years or more of the remaining lease were transacted at an average price of S$467,875.

This represents a price difference of 42.6 per cent.

#4: Price gap is widest in Toa Payoh

Toa Payoh makes an interesting case study.

We decided to zoom into this estate as property agents have long complained that they have had a hard time selling older HDB flats in the area.

Our analysis seems to concur with our findings on the ground when speaking to agents as they appear to diminish in value nearing the end of the lease.

In the case of Toa Payoh, the price gap is a whopping 91.6 per cent compared to Ang Mo Kio, Punggol and Jurong West at 59.7 per cent and 42.6 per cent respectively.

#5: Widening price gap between HDB and private property market

According to the third quarter of 2019 data from the HDB and the Urban Redevelopment Authority (URA), the Resale Price Index (RPI) and the Private Property Index (PPI) are at 130.9 and 152,8 percentage points respectively.

This means a price gap of 21.9 percentage points.

The widening price gap is bad news for HDB upgraders thinking of buying a condominium. 

As such, this may not be an opportune time for you to do so.

Should Singapore enter into a recession this year, we are likely to see the PPI drop further narrowing the price gap between the HDB and private property markets.

Good things come to those who wait so wait out.

#6: Sengkang is the most popular estate for resale HDB flats in 2019

Rounding of the top 10 HDB estates, Sengkang is the most popular with 1,795 resale transactions recorded in 2019, followed by Woodlands (1,794), Yishun (1,791), Jurong West (1,705), Bedok (1,513), Tampines (1,413), Bukit Batok (1,241), Punggol (1,160), Ang Mo Kio (1,034), Hougang (968) and Bukit Merah (937).

​While HDB is an asset, older HDB flats in mature estates will likely see their value decline as the data showed.

As such, prospective homebuyers might want to think twice before purchasing such flats.

On the other hand, the data suggests that the capital values of your HDB flat are better protected in non-mature estates like Punggol and Jurong West.

As such, you may want to consider selling your property after five years once you have fulfilled your MOP and then upgrade to private property or downsize according to your lifestyle needs.

Having said that, I would like to stress that your HDB flats are for long-term occupation and not for you to make a quick profit.

In closing, housing is a delicate issue.

The government will need to address their diminishing value sensitively especially to the older generation who are currently living in mature estates.

From map reading to identifying growth areas, this easy-to-understand session aims to assist first-time homebuyers looking for homes along the different train lines in KL/Greater KL.

By Khalil Adis

If you had enjoyed reading 'Property Buying for Gen Y', then you are in for a special treat.

For my upcoming talk on January 11 at Havoc Hartanah 10, I will be including new materials that will cover newly completed as well as upcoming train lines in greater detail.

Take this as 'Property Buying for Gen Y' part two - this time with more emphasis on one of the 5Cs I had mentioned in my book which is to check for transport masterplan.

Here are five things you can expect during my lesson:

#1: A combination of 'Property Buying for Gen Y' and 'Connectivity & Your Property'

I had spent an enormous amount of time to write, conduct research and take photos for my upcoming book. 

For this lesson, I will place more emphasis on transportation, specifically the Sungai Buloh - Kajang Line (SBK Line), Sungai Buloh-Serdang-Putrajaya (SSP Line), Ampang LRT Extension Line, Kelana Jaya LRT Extension Line and LRT Bandar Utama-Klang Line (Klang Valley LRT Line 3).

We will then dive deep into each line before identifying the growth areas.

#2: Learn how to read transportation masterplan 

This is part of the diving deep process that you will undergo.

This is where you will learn some of the key facts and figures of each line.

Understanding transportation masterplan is part of the process in one of the 5Cs in my book - check for budget allocation from the government.

We will then analyse how such budget allocation will have an impact on property prices along the lines.

#3: Find the sweet spot in terms of distance to train stations

While you may want to buy close to train stations, you also want to be careful not to buy to close, especially for elevated train stations.

Also, there are certain requirements that developers will have to adhere to qualify for transit-oriented development (TOD).

Learn what the sweet spots are and how they may impact on your resale and rental value.

#4: Not all growth areas are created equally

During the lesson, we will identify growth areas along the lines.

However, not all areas are suitable for you as some are located in mature areas.
​
For example, while Tun Razak Exchange MRT station will serve the upcoming Tun Razak Exchange, the properties around the area will not be affordable for first-time homebuyers.

On the other hand, such an area will be suitable for investors looking to buy their second home or for rental income.

These are some of the due diligence points we will cover.

#5: Identify areas where you can find affordable properties

The key to finding affordable properties along the lines mentioned is to identify areas where there are new or upcoming train stations and where the government has announced plans to create upcoming economic zones.

Such areas will have to be away from the city centre but close enough to train stations and dedicated hubs mentioned so you can experience price appreciation over the long-term.

Learn where they are along the lines mentioned.

Don’t forget to bring your notebook along and ask questions after the lesson.

Details of my talk below:

Topic: Connecting the dots and finding the hot spots
Date: 11 January 2020
Time: 3.30pm
Venue: Wisma Sejarah, Jalan Tun Razak, Kuala Lumpur

See you there!

​With more and more developers developing land parcels near to train stations, we analyse five key winning points of the project

By Khalil Adis

Ask any Malaysians and chances are the first big-ticket item they had purchased is a car.

This is because getting around Malaysia, particularly in Kuala Lumpur and Greater KL via public transport is such a hassle.

However, since the completion of the Sungai Buloh - Kajang Line  (SBK Line), Transit Oriented Developments (TOD) have become a popular option among first-time homebuyers as the line becomes integrated with other existing lines.

Combined with the popularity of ride-hailing apps like Grab and a generation that is more financially literate, the significant cost savings have made TODs a viable option among Gen Ys and millennials.

Thus, it is no wonder we are seeing developers acquiring land parcels near to train stations to cater to demand.

While some parts of KL and Greater KL still suffer from patchy connectivity, all that is about to change once the upcoming Sungai Buloh-Serdang-Putrajaya Line (SSP Line) and LRT Bandar Utama-Klang Line (Klang Valley LRT Line 3) are completed and integrated with the rest of the existing lines.

Here are five things that make Glomac’s 121 Residences an exciting proposition for homebuyers:

#1: Located in the bustling township of Petaling Jaya

Petaling Jaya, or ‘PJ’ as the locals would call it, is strategically located next to the well-established townships of Bandar Utama, TTDI, Mutiara Damansara, Kota Damansara and Tropicana Golf & Country Resort.

Home to several educational institutions, shopping centres, medical facilities and famous eateries, it is no wonder PJ has become a sought after address.

Over the years, it has seen several established property developers building quality homes to fulfil the demand from sophisticated buyers.

As a result, residential developments in PJ have become extremely scarce.

One such development is 121 Residences by Glomac Berhad.

Glomac is a multi-award winning developer. It recently bagged the IDEA Best Developer at the People’s Choice Award.

Comprising two 33-storey towers with 834 units, this SOHO serviced apartment offers buyers a choice of two- and three-bedroom units starting from RM300,000.

According to data from Brickz, the median transacted price for homes in PJ was RM670,000 from October 2018 to September 2019.

Thus, the lower entry price to live in such an established and well-connected township have made buying a home here even more attractive.

#2: Home Ownership Campaign (HOC) has made buying a property an attainable dream

Due to its strategic location and excellent connectivity, PJ has, over the years, seen its fair share of high-end homes being launched in the market.

However, such homes are generally out of reach for the first time homebuyers.

If you are thinking of buying a home here, fret not.

With the current Home Ownership Campaign (HOC), you will get even more helping hand that will bring you a step closer to owning your dream home.

The HOC entitles you to a waiver on the Memorandum of Transfer (MOT) and loan on stamp duty.

Glomac is also offering buyers of 121 Residences a waiver on the fee for Memorandum of Transfer (MOT), Sales and Purchase Agreement (SPA), free SPA legal fees and disbursements. 

There's more.

Glomac is giving away free kitchen cabinet voucher worth up to RM8,000 and a voucher worth RM3,000 for electrical appliances / furnitures.
​
On top of that, non-Bumi and Bumi buyers will get rebates of 6 per cent + 2 per cent and 7 per cent + 2 per cent respectively upon signing your SPA within 21 days. 

Buyers also get an additional 2 per cent discount if SPA is signed on the spot.

All that is required is a booking fee of RM5,000.

All these added benefits will bring you one step closer to owning your dream home.

#3: Near to newly completed and upcoming transport infrastructure projects

One of the 5Cs that I have mentioned in my book that you should check against before buying your property is to check for the transport masterplan.

121 Residences fulfils this as it is located close to the newly completed SBK Line as well as the upcoming Klang Valley LRT Line 3.

The SBK Line costs an estimated RM23 billion to build while the Klang Valley LRT Line 3 will cost RM16.63 billion.

The latter, in particular, will have, three stations serving Petaling Jaya - Tropicana, Bandar Utama and Kayu Ara.

Why are such infrastructure projects important as a homeowner?

This is because they act as property boosters which will help to enhance the value of your property over the long-term.

This is especially important in the Greater KL area where an oversupply of properties has lead to a stagnation in the resale value of homes.

For instance, the SBK Line is estimated to raise some RM300 million in the gross development value (GDV) per annum for the overall property values in the Klang Valley, create 20,000 jobs with a gross national income (GNI) of RM24, 630.28 by 2020 with a gross national income (GNI) of RM24, 630.28 and have a daily ridership of 400,000.

Meanwhile, the entire length of the Klang Valley LRT Line 3 is 37 km spanning from Bandar Utama to Johan Setia station with 19 stations in total. 

It is expected to serve a population of 2 million in the Western Corridor of Klang Valley

It is worth noting that Bandar Utama LRT station will serve as an interchange station to the SBK Line.

Hence, we can expect the spillover impact from building these lines to be felt in PJ as well.

#4: 400 metres away from Kayu Ara LRT station and near Bandar Utama MRT station

One of the perks of living in such a mature township of PJ is the excellent connectivity via the Damansara-Puchong Expressway (LDP), New Klang Valley Expressway (NKVE) and SPRINT Highway or via public transport via Bandar Utama MRT station on the SBK Line and Kayu Ara LRT station under the upcoming Klang Valley LRT Line 3.

When analysing the value of TOD projects, you should try to buy as close as possible to the train station to experience good capital appreciation.

As a rule of thumb, this would be between 1km to 500 metres to such stations.

The good news is 121 Residences is located 400 metres away to Kaya Ara LRT station.

This station will be located along the Kayu Ara River and will serve the suburbs of Damansara Utama. 

When completed by 2024, it will serve its immediate vicinity which includes 121 Residences, Bandar Utama, TTDI and Damansara Uptown.  

As such, you have around four years to see the potential upside from your investment.

#5: Strategically located close to good schools, hospitals, shopping malls and recreational facilities

One of the perks of living in PJ is its strategic location next to the affluent townships of TTDI, Mutiara Damansara and Kota Damansara.

As such, there are many educational, health, shopping, recreational and lifestyle amenities to cater to the upwardly mobile.

Just immediate next to 121 Residences, for example, is Damansara Uptown.

This commercial hub is home to The Starling Mall, numerous banks such as UOB to Standard Chartered, Jaya Grocer and various restaurants.

Meanwhile, educational and medical establishments that can be found nearby include First City University College, British International School, KPJ Damansara Specialist and Thomson Hospital.

Lifestyle options such as Glo Damansara, One Utama, Centre Point, Central Park, Mutiara Damansara Recreational Park, badminton courts, Tropicana Golf & Country Club and TPC Kuala Lumpur, are just a short drive away.

What to know more? Find out by RSVPing here for a property talk by Khalil Adis

Details below:
Date: 8  December 2019
Time: 12 noon
Venue: Glo Damansara, Main Concourse
*First 30 to RSVP will receive a copy of Khalil Adis's best-selling book 'Property Buying for Gen Y ‘

Pakatan Harapan witnessed its fourth defeat in the Tanjung Piai recent by-election suggesting Malaysians are not satisfied with the performance of the incumbent government. Against this political backdrop, here are our top five predictions for Malaysia’s property market next year.

By Khalil Adis

If the recently concluded by-election in Tanjung Piai is anything to go by, the mood on the ground is clear - Malaysians are frustrated with the lack of reforms, election manifestos that were rescinded, high cost of living, in-fighting among its leaders and a society that appears to be increasingly divided along race and religion fault lines.

Indeed, the Tanjung Piai by-election witnessed Barisan Nasional candidate Datuk Seri Wee Jeck Seng winning by a landslide with a 15,086-vote majority. 

In total, he garnered 25,466 votes.

In contrast, Pakatan Harapan’s candidate from Bersatu, Karmaine Sardini obtained 10,380 votes.

The by-election is particularly significant as Tanjung Piai has a sizable Chinese and Malay voters.

Collectively, this does not bode well as the property market is very much sentiment-driven.

In addition, the latest trade data from Bank Negara showed that Malaysia’s economic growth had slowed down from 4.9 per cent in the second quarter of 2019 to 4.2 per cent in the third quarter.

With a lacklustre economy, a looming global recession and job retrenchments, here are our top five predictions for Malaysia’s property market in 2020.

#1: Kuala Lumpur: High-end properties in KLCC will be the first to be affected

KLCC is a good barometer of the global economy as it attracts foreign investors, speculators and wealthy locals.

It also attracts a sizeable expatriate community who are renting properties here either under a corporate or personal lease.

As such, this is the first sector that will be hit once the economy comes to a grinding halt and they are sent packing home.

This is because landlords who own high-end properties here are hardly able to cover their mortgage even with such tenants secured, resulting in negative cash flow.

Should retrenchments occur, the exodus of the expatriate tenant pool will be a double whammy as landlords are faced with a loss of income and still having to service their mortgage.

Those who face difficulties will be forced to offload their properties.

Historically, the 2008 crisis witnessed the resale values of properties here declining by around 15 to 20 per cent.

One solution for landlords is to convert their homes into Airbnb units.

Then and again, the short-term lease market is extremely competitive and no longer as lucrative as before.

There is currently a price war among online hotel booking sites and Airbnb resulting in a very low-profit margin for such property owners.

#2: Kuala Lumpur: Supply glut makes renting even more attractive

According to the first half of 2019 data from the National Property and Information Centre (NAPIC), entire Malaysia has a total of 54,0078 overhang units worth RM37, 229 million.

Kuala Lumpur has 4,731 such units worth RM4,599.30 million.

With so much supply in the market, those who are struggling to purchase their first home may want to rent instead.

Alternatively, you may want to opt for the Rent-To-Own (RTO) scheme. 

This is specifically for those who are unable to afford the initial 10 per cent deposit and access to financing in purchasing their homes. 

Here’s how it works, you sign a tenancy agreement with the developer where part of your rental will be converted to your deposit. 

After five years, the developer will then ask you to sign a Sales & Purchase Agreement.

Recently, the government announced that for Budget 2020, it will be collaborating with financial institutions for this scheme for the purchase of first home up to RM500,000 property price. 

Under this scheme, the applicant will rent the property for up to five years and after the first year, the tenant will have the option to purchase the house based on the price fixed at the time the tenancy agreement is signed. 

The government will provide stamp duty exemptions on the instruments of transfer between the developer and financial institution, and between financial institutions and the buyer in this scheme.

#3: Iskandar Malaysia, Kuala Lumpur and Penang: Flight to safety among Hong Kong investors

One man’s loss is another man’s gain.

In Malaysia’s case, we have seen Hong Kong investors snapping up medium to high-end properties from Iskandar Malaysia to Penang due to the ongoing unrests happening in Hong Kong.

This will also help to reduce the overhang in the property market resulting in improved cash flow among developers.

These investors are cash-rich which is music to the ears for property developers.

So amid the gloom and doom, the protests in Hong Kong has given a flicker of hope for the real estate sector which has been in the doldrums.

The result is a positive trickle-down effect for the Malaysian economy and helping to create jobs in the property, law and finance sectors.

#4: Iskandar Malaysia, Kuala Lumpur, Selangor and Penang: Affordable homes will continue to be in demand

While the government has announced various initiatives such as Fund for Affordable Homes and Youth Housing Scheme, I believe that young Malaysians should instead focus on buying from private developers through the Home Ownership Campaign (HOC).

This is because land is a state matter and the federal government may have difficulty implementing such homes across Malaysia.

We have already seen from the previous budgets how homebuyers were left stranded when PR1MA was not able to deliver the 1 million units that were promised.

The lack of a single government agency to spearhead the affordable home segment also complicates the matter and may mean one government agency may not be communicating with another.

In addition, the limitations that are imposed on low-cost housing built by either the state or federal government may impact your capital appreciation in the future. 

Private developers are in the business and have to means to deliver such homes. 

Take advantage of the HOC as you can get a 10 per cent discount for qualified properties that will be matched with stamp duty exemptions.  

You may also want to apply for a home jointly with your spouse or another single. This will enable you to combine your finances leading to a higher chance of getting your loans approved. 

This is for those who do not want to take part in the RTO scheme but instead come up with the 10 per cent deposit on your own. 

When choosing for a home, apply the 5CS.

Check the masterplan:
A masterplan would typically define a township’s development in the next one to two decades.

Check the transport masterplan
Generally, properties close to transportation hubs such as MRT or LRT stations can command a premium of between five and 10 per cent over the long term. 

Check budget allocation from the government
Government policies do have an indirect impact on a property. For example, budget allocation for improvements in public infrastructure and new economic drivers will have an impact on new and existing homes in and around the vicinity of an area. So check where the government is building new hospitals or schools.

Check for economic drivers
You should study an area before buying your property. The best strategy is to buy in an area that is not yet developed but where there are plans for various economic drivers. A government-mooted economic corridor or a reputable developer that has experience in building townships are great indicators if the area will ‘succeed’ or not.

Check for job creation
This is like feeling someone’s pulse. You need to check if the township you are eyeing is going to be a ghost town or a happening place. If it is the former, perhaps you should stay away. If it is the latter, more and more workers will be drawn there, becoming a magnet for people and a hive of activity. People are the lifeblood of a neighbourhood. As the area becomes highly desirable, people will naturally want to live and work in and around the vicinity. As there is an increase in demand, property prices in that area will also rise. That is how property prices appreciate.

#5: Confusing message from the government may result in a “wait-and-see’ situation among foreign investors

Recently, the federal government had announced that it was reducing the minimum purchase price from RM1 million to RM600,000 to reduce the overhang in Malaysia’s property market.

To reduce the overhang, Budget 2020 now allows foreigners to buy completed and unsold units that are priced above RM600,000.

Subsequently, Housing and Local Government Minister Zuraida Kamaruddin clarified that will be implemented only for a year starting from 2020.

However, each state has the right to implement its own minimum purchase price which makes the implementation difficult.

In addition, Malaysian My Second Home (MM2H) applicants now can no longer import a car according to MM2H agents who are involved in such applications and will require additional approval from the Housing Ministry

This, they said, results in longer processing time and sends a confusing signal to foreign investors on Malaysia’s intention to lure foreign investors.

So, except for Hong Kong investors, the rest may likely adopt a wait-and-see” approach until they see some clarity.

Here are our top five predictions as the Lion City braces for slower economic growth and the possibility of a recession next year.

​By Khalil Adis

Singapore had narrowly missed a technical recession in the third quarter of 2013 growing by 0.1 per cent on a year-on-year basis according to advance estimates from the Ministry of Trade and Industry (MTI).

Still, the economy remains muted as the labour market continues to soften while retrenchments are on the rise.

We are already seeing firms asking employees to take a shorter workweek, particularly in the manufacturing sector as this is most affected by the ongoing global headwinds.

Given the trade war will likely persist in 2020 combined with a bleak job market ahead, here are the possible impacts on Singapore’s property market.

#1: High-end properties will likely take the first hit

High-end properties are those that are located in Districts 1, 2, 9, 10 and 11.

These properties are first to take the hit should a recession occur next year as they are the most volatile - they are the first to rebound during an upturn but also the first to see the largest decline in capital values.

Why is this so?

This is because this market segment is driven generally by speculators and foreign investors.

As the economy takes a hit, they are likely to offload the properties once they are unable to finance their mortgage or secure tenants.

During the 2008 crisis, for instance, we saw properties in prime areas declining by as much as 30 per cent.

Also, the cooling measures that were announced last year will likely see such buyers staying away from this market.

The only exception is the ultra-high-net-worth individuals as seen in the penthouse unit at Wallich Residence that was purchase by British billionaire James Dyson in April this year.

However, such buyers are far and few between.

#2: Vacancy rates for high-end units will likely increase

The soft job market and increase in retrenchments will see expatriates either being repatriated or a cut in their housing allowance.

As such tenants generally favour renting homes in the prime areas, we are likely to see vacancy rates increase as they exit from the market or opt for cheaper housing options in the city fringe and heartland areas of Singapore.

With an increase in vacancy rates, this will likely trigger a price war among landlords as they reduce their asking price in the hope of securing a tenant.

As a result, rentals in the prime areas will likely decline as well.

Again, this was seen during the 2008 crisis.

#3: Mass market segment will be resilient

Mass market homes are those that are located in the Outside Central Region (0CR) as defined by the Urban Redevelopment Authority (URA).

Why are such homes more resilient compared to those located in the Core Central Region (CCR) and Rest of Central Region (RCR)?

This is because the OCR is driven by genuine homebuyers and where the rentals are more affordable.

While we will likely see a price decline in the secondary market due, it will not be as much as the prime areas.

For instance, during the 2008 crisis, prices in the OCR declined by around 10 to 15 per cent.

#4: Flight to safety in the mass market rental segment

Having said that, the mass market segment is not immune to the economic slowdown and soft labour market.

We are already seeing workers being retrenched or told to take a pay cut, particularly among those in the manufacturing sector.

As the manufacturing sector takes a hit, so will the rental market.

However, this market is still considered relatively affordable for the expatriate worker albeit with a reduced budget.

Therefore, this market will see a flight to safety among the white-collar workers who do not mind living in the heartlands.

Landlords will also likely to lower their asking price in a bid to continue attracting tenants.

#5: Affordable homes will be in demand

​The property market is very much sentiment-driven.

However, the affordable home segment is different as it is driven by buyers who genuinely need a roof over their heads.

As such, the HDB market will see good take-up rates particularly for homes that are being offered under the Build-To-Order (BTO) and Sale of Balance Flats (SBF) exercises.

In November, for instance, the HDB launched 4,571 BTO units and 3,599 SBF units. 

The BTO units are located in Tengah, Tampines and Ang Mo Kio while the SBF units are located in both mature and non-mature estates.

The Enhanced CPF Housing Grant (EHG) of up to $80,000 that was announced in September this year will provide a much-needed help for homebuyers in acquiring their first home and ease their property journey.

Despite its focus on the digital economy, the budget is a regressive one for both local and foreign buyers

By Khalil Adis

Another year, another budget.

This year is no different except that they were announced against a backdrop of the ongoing global trade wars and a general slowdown in the global economy.

While the Malaysian government has announced several measures to spur its economy specifically in the digital arena, Malaysia is likely to ride through the current economic climate largely unscathed as it has a strong domestic economy, unlike Singapore.

As such, I will focus solely on those affecting the property market.

From the looks of it, the measures appear to be cosmetic to address the shortcomings and mess left behind by the previous government.

Foreigners and Malaysians at the losing end

Call it a band-aid if you will but the budget seems regressive by bringing us back to the Budget 2014 and 2016 eras for foreign investors and locals buyers respectively.

Let us look back at Budget 2014.

During this period, the minimum purchase price for foreigners buying a property in Malaysia was raised from RM500,000 to RM 1 million.

This was to prevent a property bubble from forming in the market and thus preventing Malaysians from buying such properties.

Well, guess what?

The situation got even worse despite this measure as there were no checks and balances in place by the Housing Ministry.

As such, developers were at the free reign to build units that local could not buy resulting in a huge glut that we are seeing right now.

To reduce the overhang, Budget 2020 now allows foreigners to buy completed and unsold units that are priced above RM600,000.

So what happens to foreigners who had bought a property at RM1 million and are now looking to sell?

Most probably, due to the current market conditions, they will now be selling at a loss to either a local or a foreign buyer.

Also, they will now have to compete directly with the primary market where foreigners can buy at a steep discount of RM400,000 (RM1 million - RM600,000) directly from developers.

This mixed signal could potentially deter foreign investors from buying property in Malaysia.

Verdict: Foreign sellers: 0, foreign buyers: 1*
*it remains to be seen if subsequent budgets will see a change in the minimum purchase price across the various states in Malaysia.

Next, let us take a look at Budget 2016 in the affordable housing segment for Malaysian buyers.

Previously, under Barisan Nasional, the government had announced that it was building PR1MA homes across various states during Budget 2016.

There were also promises to build such homes that are planned around transport hubs and train stations in Kuala Lumpur.

Back then, the government had announced that a total of 5,000 units of PR1MA and PPA1M houses will be built in the vicinity of LRT and monorail stations in 10 locations, including Pandan Jaya, Sentul and Titiwangsa.

Fast forward four years later, PR1MA has become a massive liability for the government.

As we speak, PR1MA is undergoing restructuring and is nowhere close to the lofty 1 million housing units it had previously promised to deliver.

Meanwhile, there is still no news on the 5,000 transit-oriented development units (TODs).

This leaves Malaysians who are in dire need of affordable homes stranded.

From the looks of it, they are now back to square one with another new policy in place to replace the old one.

A new budget for local buyers

As part of Budget 2020, the government will collaborate with financial institutions in introducing various schemes. 

The first is the Rent To Own (RTO) financing scheme.

This scheme aims to assist those who cannot afford the initial 10 per cent deposit and access to financing in purchasing their homes.

This scheme, however, is not new and has been in place among private developers.

As such, Malaysian buyers who had hoped for a roof over their heads during Budget 2016 are better off buying from private developers.

Verdict: Malaysian buyers: 0, private developers: 1*

*Imagine the agony among those who had applied for PR1MA homes and are still waiting. If I were a Malaysia, it seems buying from a private developer is the way to go.

*It is an open secret that there are many Malaysians who had previously applied under this scheme are still waiting for their homes. Just speak to any Grab drivers.

Conclusion

​While many other schemes are being rolled out such as Fund for Affordable Home that was launched by Bank Negara Malaysia in January 2019 and the Youth Housing Scheme, they remain under the umbrella of various government agencies.

As such, this could be very confusing for the first-time homebuyers who are unsure how to navigate the market.

What would work is for Malaysia to streamline them under one single government housing agency just like Singapore’s HDB model.

​Announced yesterday by Minister for National Development Lawrence Wong, the Enhanced CPF Housing Grant for first-timers and higher income ceilings will provide more flexibility and housing options. We study how this will impact the property market.

​By Khalil Adis

Quick snapshot

​First-time homebuyers will benefit the most especially the middle to low-income bracket groups. It will also benefit first-time homebuyers who want to live close to their parents in mature estates.

#2: Why now?

​This is because incomes have been rising since the HDB last reviewed the income ceiling in 2015. As such, the policy has been tweaked to address this.

#3: How will this affect the HDB market? 

The sandwiched class may now opt to buy an HDB flat compared to buying a private property due to the increase in income ceiling and Enhanced CPF Housing Grant as it will mean less cash upfront.

This will help to prop up demand for resale HDB flats.

It is worth noting that the resale HDB market has been rather muted.

​As such, we are likely to see an increase in activity particularly for those who want to live close to their parents. 

#4: How will this affect the private housing market? 

We may see the sandwiched class now switching to buy from the HDB market and thus ease pressure from the private housing market.

​As such, we are likely to see the Private Property Index (PPI) see a slight correction in the next quarter.

#5: Will this affect HDB prices across the board?

It will affect prices in the HDB resale market as buyers are now given more help with the Enhanced CPF Housing Grant.

The HDB Resale Price Index has seen a decline since the first quarter of 2013.

​However, with the increase in income ceiling and  Enhanced CPF Housing Grant, we could see more sales activity in the otherwise muted resale market.

#6: How will this affect the rental market?

​The HDB and private property rental market will be very soft as more buyers will be switching to buy rather than rent a property. In the HDB market, the HDB will be launching 15,000 units later this year.

Meanwhile, in the private property market, we have a total supply of 53,696 uncompleted private residential units (including ECs) in the pipeline with planning approvals as at the end of the second quarter of 2019.  

Also, we have another 4,398 units (including ECs) that will be completed in the remaining second quarters of 2019.

​This incoming supply, together with the sluggish economy due to the ongoing trade war, will make the rental market extremely soft.

Sited within proximity to mega project such as the Greater Southern Waterfront, the Rail Corridor and the SGH Campus, Avenue South Residence offers owner-occupiers and investors the first-mover advantage.

By Khalil Adis

Developments at Singapore’s Greater Southern Waterfront district is fast gathering pace with the preview of Avenue South Residence last Friday.

This comes hot on the heels when Prime Minister Lee Hsien Loong announced last month during his National Day Rally speech that the government will be developing the Greater Southern Waterfront as a vibrant housing, entertainment and commercial district.

A joint-development by UOL Group Limited (UOL), its subsidiary United Industrial Corporation Limited (UIC) and Kheng Leong Company, Avenue South Residence has been described as “the first major residential project at the doorstep of Singapore’s Greater Southern Waterfront.”

Here are five fast facts on Avenue South Residence:

#1: Located at Silat Avenue the former Kampong Silat site

For those who grew up in the Spottiswoode Park area, Kampong Silat will bring back many fond memories.

Probably named after the Malay martial arts, Silat Avenue was once home to the Silat Community Centre.

Known for its three to four-storeys Singapore Improvement Trust (SIT) flats, some of these landmark buildings were soon demolished to make way for point-block flats.

With the Greater Southern Waterfront announced just last month, Avenue South Residence sits at the doorstep of this massive waterfront city development that will encompass roughly twice the size of Punggol.

Located just off Kampong Bahru Road in the CBD fringe, nearby property boosters include the SGH Campus, two upcoming MRT stations namely, Keppel and Cantonment as well as a new office district with nightlife activities.

This will complement existing office spaces which is home to Google, Cisco and Unilever and add more jobs down south.

Nature lovers will also enjoy direct access to the 24km-long Rail Corridor as well as the park connectors that will be developed along Berlayer Creek and Labrador Park.

#2: A total of 1,074-units on offer

Comprising two 56-storey super high-rise towers and five conserved flats, this 99 years leasehold development features one to four-bedroom units ranging from 474 to 1,668 sq ft.

According to the developer, half of the 1,074-units will be priced below S$1.5 million.

The first 300 units range from S$858,000 for the one-bedrooms to S$1.15 million for the two-bedroom units.

This works out to S$1,810 and S$1,750 per sq ft based on a floor area of 474 and 657 sq ft respectively for such units.

As a piece of background information, the land parcel was awarded to the consortium in May 2018 at $1.035 billion.

This works out to S$1,138 per sq ft based on the gross floor area. 

#3: All units will face the north-south direction while ensuring privacy

With a plot ratio of 3.7, the developer has surprisingly managed to orientate all the units in the north-south direction.

This is considered a feat as according to the Urban Redevelopment Authority’s Master Plan, anything that is above a gross plot ratio of 2.8 is considered a very high-density development.

Additionally, this orientation is considered ideal as it helps to reduce heat gain from the morning sun, especially in Singapore’s tropical climate.

In total, Avenue South Residence will offer buyers a choice of 242 one-bedroom units, 505 two-bedroom units, 223 three-bedroom units and 104 4-bedroom units. 

None of these units will be facing each other which is another plus point for discerning buyers who value privacy while wanting to live close to the city.

#4: Three distinctive collections to choose from

What sets Avenue South Residence from other new launches in the market is the unique development architecture which comprises five conserved buildings.

Formerly known as Singapore Improvement Trust (SIT) flats, these conserved buildings are reminiscent of the charming walk-up apartments in  Tiong Bahru that has made into a hipster enclave.

Built between 1949 and 1952, these buildings are the second oldest surviving public housing estate in Singapore after those found in Tiong Bahru.

For the discerning investors wanting a piece of history complete with squarish Art Deco-styled architecture with a huge red-tiled roof, these buildings have been beautifully restored and rebranded as “limited edition” Heritage Collection.

They are priced at around S$1,780 per sq ft

Meanwhile, the Peak Collection will offer premium homes starting from the 37th storey onwards. 

As its name suggests, the Peak Collection will offer unblocked views of the city skyline with a price tag of S$2,250 per sq ft.

Living up to its reputation of living the high life, buyers will be offered a complimentary platinum membership to the Pan Pacific DISCOVERY.

This loyalty programme offers exclusive privileges to the group’s “Pan Pacific” and PARKROYAL hotels

Last but not least, the Horizon Collection will be launched at $1,980 per sq ft.

All collections come with high-quality specifications such as marble flooring and branded kitchen appliances.

#5: Public preview attracts a strong 7,000 crowd

​Since Avenue South Residence was opened for public preview on 30 August, it has attracted 7,000 people to date at its sales gallery located along Alexandra View.

Sales of the 1,074-unit development will commence on 7 September. 
 
When completed, Avenue South Residence will also offer close to 10,000 sq ft of commercial facilities, including F&B outlets and a childcare centre for the convenience of families with young children.

Announced by Prime Minister Lee Hsien Loong at his National Day Rally speech on 18 August 2019, a vibrant housing, entertainment and commercial district will be developed in phases at Pulau Brani in the next five to 10 years.

By Khalil Adis

"Punggol by the Bay" - that's how Prime Minister Lee Hsien Loong has described the exciting developments that the government has earmarked for the Greater Southern Waterfront.

Extending from Pasir Panjang to Marina East, the relocation of Tanjong Pagar Terminal and Pasir Panjang Terminal to Tuas Megaport by 2027 and 2040 respectively, will witness the Greater Southern Waterfront being transformed into a new major gateway and location for urban living along Singapore's southern coast.

According to the Urban Redevelopment Authority (URA), the development will take place in phases in the next five to 10 years.

It will start at the former Pasir Panjang Power District, Keppel Club and Mount Faber.

Here are five quick facts on the Greater Southern Waterfront.

#1: 2,000 hectares of land 

The development of the Greater Southern Waterfront will encompass roughly 2,000 hectares of land or roughly twice the size of Punggol.

It will also see the development of a 30 km stretch along the southern coastline that spans from Pasir Panjang Terminal to Keppel and Tanjong Pagar Terminal.

The URA has plans to develop a continuous waterfront promenade that will seamlessly connect various places of interest along the Greater Southern Waterfront.

A new Pasir Pasir Panjang Linear Park will connect West Coast Park to Labrador Nature Reserve.

#2: A new transport system that will connect to Mount Faber 

There will also be a future transport system that will connect the waterfront to Mount Faber.

One Faber Group is currently studying a new funicular system at Mount Faber to bring visitors from the foothills to the hilltop and cable car station by 2023.

#3: Enough to build 9,000 housing units

The government has set plans to develop both public and private housing options that will be integrated with waterfront promenades and open spaces.

To do this, the Keppel Club site will be redeveloped into a new residential precinct with easy access to the waterfront, nature and two nearby MRT stations - Labrador Park and Telok Blangah.

Park connectors will also be developed along Berlayer Creek and Labrador Park to bring nature closer to homes.

#4: A new office district with nightlife activities

To bring jobs closer to home, a new office district will be developed along the Greater Southern Waterfront that will act as a gateway district.

This will complement existing office spaces which is home to Google, Cisco and Unilever and add more jobs down south.

On top of this, an entertainment enclave will be developed for nightlife activities.

#5: More entertainment options

​Speaking of entertainment, the government has announced plans to further inject vibrancy in the Greater Southern Waterfront.

For example, two former power station buildings at the Pasir Panjang Power District and Pulau Brani will be redeveloped into new attractions.

Singapore's labour movement, NTUC, will also be developing a new lifestyle destination similar to NTUC Downtown East.

Referred to Downtown South, it will also feature a new resort.