The Housing Board has announced that, until further notification, the selling of the BTO flats has been postponed. This has come after the circuit breaker measure got prolonged till June 1 as all the work areas have been shut down and all construction has stopped. More than 3,700 Build-To-Order flats and 160 flats for senior citizens were to be initiated in Pasir Ris, Choa Chu Kang, Tampines, Tengah and Bukit Batok.
The Singapore factory output strikes a 16.5% rise in March: impact of circuit breaker hit yet to be felt
Quite surprisingly, Singapore’s factory output witnessed a rebound in March 2020, as per the data put forward by the EDB (Economic Development Board) on 24th April. However, EDB has also made it quite clear that the manufacturing output in March was not quite affected by the novel coronavirus outbreak. April, on the other hand, will be experiencing the blow as a result of the circuit breaker measures put into force.
As opposed to the figures that were anticipated in the Q1, the prices of private homes only dropped by 1%. Nonetheless, the extension of the circuit breaker period will have its impacts on the market thereby, exposing it downward pressure in the coming days, as per the predictions of the experts.
Experts have also delineated that there can be serious scopes for job losses followed by a string of other economic ambiguities throughout the lockdown.
CBRE’s head of research in South-East Asia, Mr. Desmond Sim, envisages that the prices will correct themselves by 5% to 8% within this year. He further added that uncertain economic situations might hold back buyers but, the developers who have weaker holding power can offer competitive pricing to let out their units in the market.
According to the Monetary Authority of Singapore (MAS), certain limits in the delayed payments for consumer loans and mortgages will be renounced to aid the borrowers to get over the economic setback.
The agency made it clear that the total debt servicing ratio (TDSR) will not be applicable to the deferment of mortgage repayments concerning commercial, residential and industrial property dues, unsecured credit facilities including personal loans and credit cards and refinancing of residential mortgages that are essentially owner-occupied.
If the statement surfaced by the Housing Board is to be believed, the construction of the Build-To-Order(BTO) flats will be accelerated after the previously-imposed circuit breaker measures are relaxed to restore the momentum of the projects.
Just like the other domains of the industry, all the on-site activities circumscribing the BTO projects have been halted since April 7th owing to the government’s attempts to curtail the spread of the novel coronavirus as much as possible. As per reports, the suspension will be valid till the 4th of May, until and unless the government issues any further notice regarding the same.
Since the appearance of the new coronavirus around the world, especially in the eastern world, everything seems to have come to a stop. Or, at least, to slow down, with a trajectory positioned on a downward slope. The same happened with the price and sales volume of private homes in Singapore. Starting in February, both the price and sales displayed decreasing values. Thus, prices recorded a drop of 0.8%, while the sales volume decreased with 13.1%, as stated by the SRX Property’s website. According to the statistics, this month-to-month drop recorded this February is the most significant since October 2016.
When it comes to rented non-landed private homes and HDB homes, it is worth mentioning that the COVID-19 outbreak didn’t affect them at all. Instead of recording a drop in price, as it happened in the case of resale properties, the rents for the previously mentioned units went up this February. SRX Property checked the situation in this sector and no decreases were noticed whatsoever. Thus, compared to last year, rents this February went up with 3.3%. This means that there is still demand rented units. Also, the value of rents for condominiums, for example, recorded an increase of 0.1%. This is a sign that demand is slightly larger than the available units.
According to the head of research of ERA Realty, Mr. Nicholas Mark, this increase in the volume of rented units may be due to the fact that many are returning to Singapore now that the Chinese New Year holiday ended. Besides this, there are educational institutions that begin their school year in the months of February and March, which means more foreign students in Singapore during this period. As it is expected, these students will find accommodation in the country in the form of units put up for rent.
With the ever-increasing repercussions of the coronavirus outbreak, real estate markets in the US and other such countries that depend on Chinese buyers to swell their financial reserves are witnessing a backlog as current deals are being halted and the potential transactions are delayed for an indefinite period.
According to reports, Chinese buyers invested near about US$13.4 billion to procure US homes last year. This was reported as the highest expenditure from any country amidst the financial turmoil that circumscribed the increasing trade war and suppression on accepting cash from China. However, the situation same everywhere; from Vancouver to Singapore, realtors are being challenged with the same issue as all of them depend on Chinese buyers to plump their trade. Evidently, with hundreds and thousands of Chinese efficaciously secluded from the mainstream exchange, it has become difficult to sell real estate.
For instance, in California, where China alone purchased 34% of the foreign properties last year, the brokers have taken to wearing surgical masks while opening the properties and greeting the clients with a wave instead of a handshake. Incessant cancellation of flights is making the situation even worse; clients from China have postponed their visit until the next summer and consequently, the deals will have to be halted till then.
Nevertheless, the picture in Sydney is entirely reverse; as per the statements of the founder of Black Diamondz, Monika Tu, the virus has somehow escalated the demand for luxury assets. A major fraction of her clients from China have their families in Australia and those who were in town to celebrate Chinese New Year extended their sojourns owing to the epidemic. Presently, this very group of people is buying homes in Australia and the weakness of the country’s currency is just being treated as a cherry on the top. But, experts are of the opinion that this surge of demand in Australia wouldn’t be long-lived and might last only through the course of the outbreak.
Closed embassies of Australia have started affixing the process of generating “significant investor” visas, which is regarded as the fundamental channel for the rich Chinese to get their hands on permanent residency in the nation and thus, gain rights to buying its real estate properties. As a corollary of the ongoing humdrum, Singapore is facing a lot of disturbance as the Chinese nationals who happen to be the most esteemed buyers in their market, are backing out. Even though the clients were scheduled to visit the country sometime in late January to inspect the real estate assets but, immediately after booking their flights, Singapore prohibited the entry of Chinese Nationals to safeguard itself from the deadly virus. This implies that the buyers had to keep their plans of purchase on hold until a later date hence, leading to a 20% plunge in the overall sales.
Coming back to California, a luxury home builder known as Toll Brothers stated that about 11 closings were shelved in the preceding month because of the coronavirus.
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Even though the rest of the world is presently combatting a grave social and financial turmoil, the Housing Board Resale market of Singapore has performed proficiently in spite of witnessing a seasonal dip from the last month. As compared to the statistics from January, fewer deals were sealed in the following month with the prices surging by 0.7%.
On the whole, a total of 1,668 resale flats exchanged hands in February which accounts for 13.1% less than that of its preceding month. Nevertheless, when contrasted against the configurations of last year, in February 2020, there has been a 26.9% rise in the units traded and a 1.0% rise in prices.
Interestingly, the net worth of non-mature estates dropped by 0.3% whereas, the mature estates rocketed by 1.3% as competed with January. As per reports, the most-expensive resale flat that was procured in February was a five-room unit and a part of the Commonwealth Drive and was eventually sold at $1.1 million. On the other hand, an executive mansion located in Hougang Street 21 was hawked for $858,000 was the highest bid for a non-mature estate. Additionally, almost five HDB resale flats were marketed in the previous month for $1 million.
Owing to the amount which buyers “overpaid” in February, SRX predicts the amount to be the market value of the flats in concern. The inclusive median transaction over X-value was rendered as positive $2,000 last month and proliferation of $2,500, assessed against January. The primary objective of TOX is to evaluate how much a buyer is underpaying or overpaying for a property on the metrics of SRX’s computer-generated data on the current market value. The catalog only incorporates districts that have more than 10 resale transactions under its name. Properties in Serangoon chronicled the highest median TOX at an assuring $14,000 and flats in Geylang with a constructive $7,000.
In contrast to this, the flats of Marine Parade were logged with the lowest median TOX, at negative $26,000 and the flats of Bishan at negative $24,500. Market experts have held the Chinese New Year festive period for this slow-down of sales; through this phase, the sales activities take the back seat and this year, there’s the added terror of COVID-19 hampering every little activity around the globe.
The reason that is keeping the sales leaders so optimistic about the figures lies in the verity that the resale volume has amplified significantly as weighed against the same period a year ago. Furthermore, February 2020 has observed the highest sales in this month since 2017. After carefully analyzing the present-day situation, Christine Sun, the research head of Orange Tee and Tie, has affirmed that buyers will constantly be on the lookout for properties regardless of the dread related to coronavirus and COVID-19 because all its impacts are likely to be temporary.
If forecasts are to be believed, close to 6,799 HDB flats will be introduced to the HDB resale market within the next months as these units will be reaching their term of five-year minimum occupation span.
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Considering the present situation, it wouldn’t be completely wrong to assert that the greenback too, is being subjected to the same destiny as travelers returning from China or other parts of the world where the coronavirus has spread its wings of prey. As an act of precaution, the US Federal Reserve has taken to isolating the physical dollars that deported from Asia prior to recirculating them in the country’s financial channels. According to the statements of a Fed Spokesperson, the regional Fed banks that will be assisting and managing the money supply will keep back the shipments of dollars hailing from Asia for about seven to ten days before reallocating them to the designated financial institutions
As per the official statements of Reuters, the coronavirus outbreak that originated in China has already affected more than 100,000 people in a total of 85 countries around the world. The CDC believes that the transmission of the virus through paper notes is not unnatural because elements that have had direct contact with infected people is one of the primary sources through which germs spread. Owing to all these circumstances, the CDC has advised US residents returning from China and such other countries to be at their homes for at least 14 days before stepping out in the public.
Nevertheless, the World Health Organization is even more petrified about this possibility; to be on the safer side of the spectrum, they have advised people to avoid using physical notes as much as possible and resort to cashless payments whenever the need arises.
The fact that US dollars form the global reserve currency, inevitably makes them the most widely-distributed notes in the world with a net worth of US$1.75 trillion cash in circulation globally in the present-day. However, a major chunk of this cash is doing rounds in the overseas market, especially in Asia where the dollar is stronger than most of their local currency. A study conducted in 2014 by researchers at New York University revealed that there are around 3,000 different types of bacteria embedded in dollar bills simply because of the verity that they frequently change hands.
In order to ensure that there is no scope for the infection to make way into the domains of their country, the US Federal Bank, quite like China and Korea, has turned to disinfecting the local currency notes with ultraviolet rays or destroying the suspicious ones altogether.
There are 12 Fed banks from Virginia, Richmond to San Francisco in charge of managing and streamlining the supply of coins and dollars, receiving credits of excess cash from banks located in every nook and corner of the world, while sending out currencies to countries in need of them. Some of these overseas banks prefer shipping banks the additional dollars to the United States in commercial flights itself. After this, the Reserve Bank starts processing and segregating the notes they receive and this process includes eliminating the bills that have been damaged through circulation and identifying the counterfeits. On average, the Fed dispenses paper notes worth US$34 billion each year and it takes them around 5 to 60 days to filter currency, with the higher value notes administered quicker than the others.
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As far as the properties are concerned, we can safely say that Singapore is in quite some luck right now and justifiably so. The co-living company, known by the name of Hmlet, has decided to stretch its realms and accommodate the heritage properties located in Tiong Bahru. After including these assets, Hmlet’s present configuration in Singapore shows that it manages a total of 48 properties that comprises of more than 1,000 rooms.
The latest apartments that are essentially walk-up and have loft conversions are spread over 18,000 square feet and across seven locations namely, Tiong Bahru Road, Hoot Kiam Road, Zion Road, Chan Yan Street, Moh Guan Terrace, Guan Chuan Street, and Tiong Poh. More so, these apartments will be rendered as studios and one-bedroom and two-bedroom units along with a courtyard and kitchen for each and communal areas. In the press release on February 6th, 2020, Hmlet confirmed that some of the 80 rooms that are being targeted to be made available for procurement have been already inaugurated on the firm’s platform.
The only thing that could have worsened the current fluctuations in the economic sector was confusion to seek the best data and somehow, this prospect has now been turned into a reality. Economists are constantly struggling to evaluate the ways in which the breakout of the coronavirus has affected the world economy with the impacts of the former still on its way to strengthen its grip. Economists are constantly on the look-out for hints on the points of growth from the configurations put forward by factory shutdowns, store closures, flight-tracking websites about the fatalities of the disease.
On June 2019, the Singapore Housing Development Board set up a seven-member Home Ownership Support Team (HST) in a bid to enable families from making a move from renting to buying homes.
Several families have benefitted from the assistance provided by the team. Records show that over 200 rental households have been provided with guidelines and support. Many have already applied for buying out their flats, some have booked or are ready to book new ones. Depending on family size, age and income of the applicant , many are also settling for Build-to-Order houses.
Most citizens of Singapore, the team found out, were interested in making an investment in their homes but they were hesitant to buy flats as they were not aware of the various assistance schemes available. The HST officers have been outlining available schemes to several families since the team was formed, moreover, they are also assisting in preparing necessary documents for applications as well as starting off the application process.
The guidance of the HST does not stop here, they are also assisting the applicants in planning their finances so they may set up a housing budget in order to actualize their homeownership dreams. This has enabled several persons to work out major factors like home loans, education loans, medical expenses and taxes
The HDB’s move has been well appreciated by the people of Singapore. The team has been looking into each applicant on a case-by-case basis to perform a cohesive all-round assessment of their circumstances. The eligibility is determined only after considering all financial factors like existing loans, savings, employment status. The team has been working very efficiently and has been reaching out to interested households through phone, email, house visits, besides using local advertising.
The HST is also working hand in hand with different social service agencies and partners to enable the families not yet financially stable to move closer to the dream of owning a house. A primary reason for setting up the HST was to work with Singapore’s income disparity so that lower-income families too could dream of owning homes.
As of now, the HST has a mission to reach out to 1,000 rental households as an approximate of 50,000 households currently live in public rental flats.
The anti-government protests that rocked Hong Kong in the second half of 2019 made its impact felt on the country’s economy severely. Among the hard-hit was the property market. Until the country hit a financial crisis, Hong Kong had one of the most expensive real estate markets in the world. The December 2019 price index, however, confirmed a 1.7 per cent decline.
This decline came after a sudden marginal gain in November. Data shows that the gain, however, was more a result of mortgage leniency that was brought in to stall the five-month-long decline in the market. Ever since the protests started, HongKong’s economy has been reeling. The tourism and retail industries of the country were first to bear the brunt of the pro-democracy revolution. In addition, the US-China trade dispute had also brought down the markets.
On January 19. 2020, the Housing Board announced its final plans for the Jurong Lake area under its Remaking Our Heartland (ROH) programme. The area has been under a scheme of rejuvenation since 2011.
Jurong as an industrial town has its beginnings in the 1960s. By the 70s, it had grown to include the resettled areas like Boon Lay, Taman Jurong, Bukit Batok, Bukit Gombak, Hong Kah, Teban Gardens and Yuhua. The huge area was in need of a makeover suitable for the times and was selected for the same in 2011.