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
#1: Who will this benefit the most?
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.
First residential project at the doorstep of the Greater Southern Waterfront previewed. Here are the 5 key takeaways
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.
An independent analysis from yours truly