Issue 247

Copyright 2011-2016 www.propwise.sg. All Rights Reserved.

CONTENTS
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FROM THE

EDITOR

5 Things You Must Know When Investing

Welcome to the 247th edition of the

Singapore Property Weekly.

in Overseas Property
Hope you like it!

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Singapore Property News This Week

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Resale Property Transactions

Mr. Propwise

(January 27 February 2)

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SINGAPORE PROPERTY WEEKLY Issue 247

5 Things You Must Know When Investing in Overseas Property

By Tam Ging Wien (guest contributor)
Many
South
East
Asian
countries
experienced a surge in property prices in
recent years, with the locals finding it harder
and harder to afford properties. To make
matters worse, governments in Singapore
and Malaysia have put in harsh antispeculative measures to cool the property
markets.
These factors have contributed to a rising
interest in foreign property investments, which
are viewed as affordable compared to the
local properties. However, here are five things
you must know before investing in an
overseas property, to avoid getting yourself
into an unpleasant situation.
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SINGAPORE PROPERTY WEEKLY Issue 247

1. Understand the Local Market, Area and
Developer
Familiarity and local knowledge goes far in
property investment. Know your goals and
investment strategy is this property a buyand-hold or a buy-and-flip?
With your strategy in place, study the
property market cycle in the respective
country and area. Which direction is the
property market trending in? What is your exit
strategy?

Understand the local situation is the country

experiencing political unrest, strikes or antiforeigner sentiments? What kind of natural
disasters could occur in that area?
Research the location thoroughly. Ask for
access to good quality maps of the
surrounding area. Enquire about the
accessibility quality of the public transport,
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access to major roads/highways, proximity to

amenities, distance to commercial areas, and
whether the location is situated in a good
neighborhood.
Examine the track record and reputation of
the developer. Has the developer completed
projects of a similar scale on time? Has the
developer delivered on quality? Have the
necessary permits for construction been
obtained?
Finally, understand the potential tenant and
customer profiles. Who is willing to rent my
unit? Who will buy my unit when I sell?
2. Know the Rules and Restrictions
Some countries may impose limits on
location, types, reselling restrictions, use or
purpose of properties that foreigners may
invest in. Check with a local authoritative
source or read up on the regulations from
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SINGAPORE PROPERTY WEEKLY Issue 247

government websites.
Prior to signing any documents, agreements
or options, ensure that you have read and
understood what the terms and conditions
are. Ask for a translated copy if the document
is written in a foreign language. When in
doubt, seek advice from local lawyers,
bankers or valuers.
Always do your homework!
3. Calculate the Transaction Costs and
Financing Limits
Property transaction costs and financing limits
vary from country to country.
Find out the conveyancing fees, legal fees
and mortgage costs. Obtain independent
valuations on the property and find out the
loan-to-value you are eligible for. Study the
interest rate situation in the country.
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Be sure you have properly understood and

factored the taxation cost in the transaction.
In some jurisdictions, foreigners are subjected
to levies or taxes on property purchases.
Additionally, there may be property related
taxes such as income tax, property tax,
stamp duties, capital gains, estate duties,
state fees and withholding tax that may be
imposed.
Overseas investments also expose you to
currency fluctuations and exchange rate risk.

4. Decode the Sales Pitch from the Reality

Always treat information from sales agents
with a pinch of salt, especially if the claims
are too good to be true. Never trust artist
impressions of the development which
typically paint an unrealistic picture.
Dont be mislead by cheap prices of the unit
especially when they come heavily laden with
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SINGAPORE PROPERTY WEEKLY Issue 247

discounts, waivers or freebies (e.g. free club
membership, legal fee waiver, zero interest
financing, rebates, furniture vouchers, flight
tickets to visit the development). These
carrots are usually priced-in. Check the
terms and conditions of these offers. Ensure
that all special incentives are written into the
agreements. Finally, is the price offered
something a local would pay?
Be cautious of investments that offer
abnormally high returns or guarantee a
minimum yield. These are usually capped,
with a limited time frame or just projections!
Obtain independent valuation reports and
surveys and compare them against their
peers.
5. Confirm the Aftersales Support You Will
Get
Find out the support that the developer
provides to foreign investors. Ask for the
frequency of progress reports and be clear of
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the payment milestones. Obtain contact

information of the agents, bankers, valuers
and lawyers.

Be aware of the legal and dispute resolution

avenues available to you should things turn
against you. What is the jurisdiction that the
dispute is handled?
Who will assist you to run and maintain your
unit? What assistance is available to
advertise and seek tenants? Who will execute
your instructions in your absence?
Never rush into any overseas investments.
Exercise due diligence and do not be
pressured by sales agents. Carefully consider
your strategy and financial commitments
before you take the plunge.
By guest contributor Tam Ging Wien, an avid
investor and blogger who spends his time
empowering the masses in financial
education.
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SINGAPORE PROPERTY WEEKLY Issue 247

Singapore Property This Week

Residential
Jans resale price index for non-landed
homes up by 0.6%

According to flash estimates by SRX

Property, the resale price index for nonlanded private homes had increased by 0.6%
month-on-month in January. Alan Cheong
from Savills said that this increase could
signal an upwards trend for the resale market
in 2016. Cheong added that barring
unforeseen circumstances, he believes that
private home prices in both resale and newsale markets have stabilised. However,
Eugene Lim from ERA Realty argued that this

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year, the overall price trend is still

downwards. Citing the economic downturn
and the weak rental market, Lim believes that
home owners of multiple properties bought
before the imposition of the total debt
servicing ratio framework, may find it hard to
finance their properties, thus choosing to
dispose them. Year-on-year, resale prices
have fallen by 1.7% in January this year and
7.2% from January 2014. In December 2015,
resale prices had fallen by 0.5% month-onmonth. This January, prices had gone up by
1% in the Core Central Region, 0.1% in the
Rest of Central Region and 0.8% in the
Outside Central Region.

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SINGAPORE PROPERTY WEEKLY Issue 247

In January this year, 364 non-landed private
homes changed hands, this was a 20% drop
from the 455 units resold in December last
year. Nonetheless, the resale volume in
January this year had gone up by 3.7% from
the 351 units transacted in January last year.
(Source: Business Times)
Rental index for non-landed homes up by
0.2% in Jan
A 0.2% increase in the rental index for private
non-landed homes was observed in January
this year. This was the second consecutive
month of increase after a 0.4% rise in
December. Nonetheless, rents in January
were still 14.6% lower than in January 2013
and 5.5% lower than in January 2015. Market
experts believe this this increase in rental
does not indicate that the market is
stabilizing. Alan Cheong from Savills said that
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the inking of shorter term leases could have

lent support to the rental index as these
leases tend to lock in higher rents than longer
term ones. Eugene Lim from ERA Realty
added that 21,906 private residential units will
be completed this year. This is more than the
18,971 units completed in 2015. The surge in
completed units may dampen the rental
market, particularly in the suburban areas
where most new completions are located this
year. According to the Business Times, the
rent uplift in January came mainly from the
city fringe and the suburban area where
rental increased by 1.2% and 1.3%
respectively. However in the Core Central
Region, the rental index for private homes fell
by 2.4%. On the other hand, rents of HDB
flats rose by 0.7% in January from December,
but remain 3.1% lower than from a year ago
and 8% lower than in August 2013.
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SINGAPORE PROPERTY WEEKLY Issue 247

HDB rental volume also contracted by 5.4%
month-on-month in January 2016 and 17.7%
year-on-year. The HDB rental market is also
expected to be dragged by weakness in the
private home market, said market experts.
(Source: Business Times)
Commercial
Asia-Pacific expected to see US$8.5 billion
in hotel investments this year
According to the Business Times, US$8.5
billion is expected to be invested in hotels in
the Asia-Pacific this year. This is down from
last years transactions which totalled US$9.2
billion. Particularly, markets such as
Singapore and Hong Kong will be less active
due to a shortage of available assets this
year. Last year, markets such as Japan,

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Australia and Hong Kong were the most

active markets in the hotel industry. Scott
Hetherington from JLL Hotels & Hospitality
said that this year, the transaction activity
across Asia will slow down with a likely shift to
secondary markets in Southeast Asia and the
Indian Ocean. Due to tightly-held hotel
stocks, deals in Singapore are expected to be
slow, added market experts.
(Source: Business Times)
Asians to invest more in
beyond the region than in it

properties

Plagued by slow economic growth and

waning rents, real estate markets in Asia are
expected to remain less appealing than those
in US and Europe this year. Nick Axford from
CBRE predicts that there will be greater
outbound capital flow from Asia this year.

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SINGAPORE PROPERTY WEEKLY Issue 247

Last year, US$39.7 billion worth of properties
outside the region was snapped up by Asian
investors. This was a 26.8% increase from
2014. In 2015, Asian investors had invested
US$14.3 billion in real estate within the
region, which was a 12.3% increase from
2014. These investments include office, retail,
industrial, hotel and mixed-use projects but
excluded
residential
projects
and
development sites. CBRE estimates that
about US$8.1 billion will be invested outside
the region by Singapore-based investors
while an estimated US$6.6 billion will be
invested within the region. Based on
preliminary data from Real Capital Analytics,
Singapore-based
investors
purchased
US$26.3 billion in overseas real estate in
2015, which was a 49% increase from the
US$17.6 billion invested in 2014.
(Source: Business Times)
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SINGAPORE PROPERTY WEEKLY Issue 247

Non-Landed Residential Resale Property Transactions for the Week of Jan 27 Feb 2
Postal
District
1
3
3
5
8
9
9
10
10
10
10
10
10
10
10
11
11
14
14
14
14
15
15
15
15
15
15

Project Name
THE SAIL @ MARINA BAY
RIVER PLACE
ALEXIS
ONE-NORTH RESIDENCES
CARLISLE COURT
NEWTON EDGE
8 @ MOUNT SOPHIA
BISHOPSGATE RESIDENCES
VOLARI
THE LADYHILL
THE LOFT
ST MARTIN RESIDENCE
ROBIN REGALIA
THE MERASAGA
D'LEEDON
NOVENA COURT
CHANCERY COURT
LA FLEUR
RESIDENCES 88
GROSVENOR VIEW
TORIEVIEW MANSIONS
THE MEYERISE
THE SEAFRONT ON MEYER
THE ATRIA AT MEYER
WATER PLACE
SUNSHINE GRANDEUR
COSTA RHU

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Area Transacted Price

Tenure
(sqft) Price ($) ($ psf)
1,647 3,200,000 1,943
99
807 1,089,450 1,349
99
1,076 1,350,000 1,254
FH
1,335 1,830,000 1,371
99
1,119 1,100,000
983
FH
753 1,300,000 1,725
FH
1,378 2,038,000 1,479 103
3,143 10,464,697 3,329
FH
1,324 2,900,000 2,190
FH
3,843 7,000,000 1,822
FH
1,119 2,023,152 1,807
99
2,034 3,620,000 1,779
FH
1,055 1,685,000 1,597
FH
947 1,350,000 1,425
99
6,534 5,300,000
811
99
1,001 1,110,000 1,109
FH
2,034 2,000,000
983
99
409
515,000
1,259
FH
1,012 1,168,000 1,154
FH
1,313 1,230,000
937
FH
1,335 950,000
712
FH
1,270 2,550,000 2,008
FH
1,604 2,550,000 1,590
FH
1,615 2,038,888 1,263
FH
1,216 1,480,000 1,217
99
807
890,000
1,102
FH
5,253 5,750,000 1,095
99

Postal
District
15
15
15
15
16
16
17
17
18
20
20
21
21
21
21
21
22
23
23
27
27
28

Project Name
CALLIDORA VILLE
IDYLLIC RESIDENCES
COSTA RHU
DUNMAN VIEW
THE SUMMIT
BAYSHORE PARK
EDELWEISS PARK CONDOMINIUM
CARISSA PARK CONDOMINIUM
RIS GRANDEUR
CENTRO RESIDENCES
GOLDENHILL PARK CONDOMINIUM
JARDIN
SIGNATURE PARK
SOUTHAVEN II
SPRINGDALE CONDOMINIUM
BEAUTY WORLD CENTRE
PARC OASIS
MERA WOODS
HILLINGTON GREEN
THE MILTONIA RESIDENCES
ORCHID PARK CONDOMINIUM
H2O RESIDENCES

Area Transacted Price

Tenure
(sqft) Price ($) ($ psf)
1,163 1,253,800 1,079
FH
1,076 1,150,000 1,068
FH
1,399 1,370,000
979
99
1,216 1,180,000
970
99
1,249 1,280,000 1,025
FH
936
850,000
908
99
1,625 1,300,000
800
FH
1,324 955,000
721
FH
1,367 1,185,000
867
FH
818 1,170,000 1,430
99
1,335 1,700,000 1,274
FH
1,787 2,360,000 1,321
FH
1,722 1,893,800 1,100
FH
1,356 1,380,000 1,018 999
1,130 1,100,000
973
999
1,873 1,205,000
643
99
1,227 1,030,000
839
99
1,001 1,000,000
999
999
2,347 1,900,000
810
999
861
840,000
975
99
1,249 850,000
681
99
1,389 1,330,000
958
99

NOTE: This data only covers non-landed residential resale property

transactions with caveats lodged with the Singapore Land Authority.
Typically, caveats are lodged at least 2-3 weeks after a purchaser
signs an OTP, hence the lagged nature of the data.
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