HardwareZone Forums Singapore Residential Property Market Update: Community Insights and Analysis (24 Nov – 22 Dec 2024)

Executive Summary

The Singapore residential property market remains a hot topic of discussion on HardwareZone, with recent focus on new launch sales, particularly in the Lentor and District 15 (D15) areas. Strong sales figures, especially for projects like Emerald of Katong (EOK) and The Continuum (TC), have fueled debate about oversupply and potential cooling measures. The community is also closely monitoring interest rates, loan refinancing options, and the impact of various government policies. A key point is the perceived disparity between rising property prices and stagnant rental yields.

Significant updates include the rapid sales of new launches, with some projects achieving near *100% sold status within a short period. Agency data often shows higher sales figures compared to URA caveats lodged, indicating a lag in official data. The discussion also highlights the increasing cost of new launches, with some units transacting at SGD 2900*+ psf, raising concerns about future resale potential and the need for a realistic exit strategy.

Key Developments

New Launch Sales in Lentor and D15

Recent forum discussions heavily focused on sales performance in the Lentor and D15 areas. Several new launches have shown strong demand, with many units being sold shortly after launch. For example, Emerald of Katong (EOK) reportedly sold 840 out of 846 units based on agency data, reaching *99.29%* sold as of late November 2024.

“TC moved 88 units in Nov alone… based on caveats… power, many huat kuehs looks like eok sold out is good news for all the d15 new condos.” –
Similarly, the Lentor area has seen impressive sales. Lentor Modern is reported to be *100%* sold, while Lentor Hills Residences is at *98.33%* sold based on agency data. These figures highlight the strong demand for new properties in these areas. The difference between agency data and URA caveats lodged is noted, with some users suggesting that the lag in URA data is due to the time needed to finalize legal processes.

URA Data vs Agency Data

Users have observed discrepancies between sales data from the Urban Redevelopment Authority (URA) and real-time agency data. URA data, based on caveats lodged, often lags behind agency data, which reflects units sold or issued with Option to Purchase (OTP). For example, URA data as of *22 November 2024 showed EOK at 97.5% sold, while agency data reported 99.29%*. This difference is attributed to the time needed for buyers to secure legal representation and lodge caveats.

“I suppose 88 is cos URA is based on caveats lodged as of Friday, the data so not caveats + agency data.” –
This difference highlights the importance of considering various data sources when assessing market activity. Agency data offers a more immediate view of sales, while URA data provides a more official record.

Rising Prices and Potential Oversupply

Despite strong sales, discussions about potential oversupply are prevalent. While many forum members agree that current demand is strong, some express concern about the number of new launches hitting the market, particularly in the Lentor area. Some users suggest that oversupply issues might surface upon TOP (Temporary Occupation Permit), leading to increased competition in the subsale and rental markets.

“Subsale/rental competition at Lentor area confirmed gona be more challenging compared to other districts when all the projects TOP one after another.” –
Furthermore, rising prices in the new launch market are a concern. Some transactions are reported above *SGD 2900* psf, leading to speculation that resale prices might not be able to match the high entry costs. This is particularly a concern for those aiming for quick profits through flipping.

Interest Rates and Loan Refinancing

Interest rates and loan refinancing are also key discussion points. Users are sharing their experiences with different banks, comparing fixed rates and seeking advice on when to reprice or refinance their loans. Some users have secured 2-year fixed rates at 2.5%*, while others are quoted rates as high as 2.7%***. The general consensus is that rates are not at their most competitive but are still decent.

“Based on 600k loan size, the market rate for fixed rate is around 2.55%+- fixed for 2 years. So I will say that 2.7% is not the most competitive rate but is still quite decent.” –
Users are advised to shop around for better rates and leverage offers from competing banks to negotiate with their existing lender. The importance of a clean payment track record and a healthy loan-to-value (LTV) ratio is also emphasized.

Community Insights

User Experiences

Users have shared a variety of firsthand experiences, ranging from successful purchases to unexpected challenges. One user recounted their experience of a buyer backing out of an agreed completion date, causing delays and forcing them to take out a bridging loan. This highlights the importance of having contingency plans and being prepared for unforeseen circumstances.

“My buyer back out on the initially agreed completion date and I further escalated my case and they give us a date through still no sms yet” –
Another user shared their experience with HDB resale application delays, noting that their application took longer than the standard 28 working days. They had to escalate their case to get a resolution, which highlights the potential for delays in the resale process. Conversely, some users shared positive experiences with their HDB applications being processed faster than expected.

“Hello, my HDB acceptance came in today on 13 Dec at 3.30pm! Happiest news ever after chasing them…” –
Users also shared their experiences with banks for loan repricing, with some being able to successfully negotiate for better rates and free conversion options. This shows that it’s beneficial to shop around and negotiate with banks.

Tips and Recommendations

The forum is a valuable source of practical advice. Here are some key tips and recommendations shared by users:
– Shop around for loan rates: Don’t settle for the first offer from your existing bank. Get quotes from other banks and use them to negotiate a better rate.
– Be prepared for delays: Resale applications and legal processes can take longer than expected. Have a contingency plan in place.
– Consider long-term goals: Don’t buy solely based on potential short-term gains. Consider your long-term needs and financial situation.
– Do your own research: Don’t rely solely on agent advice. Verify information and understand the market dynamics.
– Understand the difference between agency and URA data: Agency data is more immediate, while URA data is official. Use both to assess market trends.
– Look at the fundamentals: Consider factors like supply, demand, demographics, and financial drivers when assessing the market.

“If you choose to wait it out. You need to get ~2.4% on the refinancing to make it worth it” –
Users also recommended that buyers be prepared for a potential negative cashflow if rental yields do not meet expectations upon TOP. They should have a plan to rent out their units if their price targets are not met.

Important Considerations

Several important considerations were raised by the community:
– SSD (Seller’s Stamp Duty): The SSD has implications for those looking to flip properties. The current holding period is 3 years to avoid the SSD.
– Potential Cooling Measures: Users are discussing the possibility of new cooling measures, such as increased ABSD (Additional Buyer’s Stamp Duty) for PRs or lower LTV ratios.
– Agent Priority Sales: There is growing concern about agents using priority lanes to purchase new launches, potentially distorting the market.
– Rental Yields: The community is concerned that rental yields are not keeping pace with rising property prices, which may impact investment returns.
– HDB Resale Delays: Users are experiencing delays in HDB resale applications, with some waiting longer than the standard 28 working days.
– The importance of a realistic exit strategy: The importance of having a sound exit strategy is emphasized, especially with the high cost of new launches.

“There is not much of cooling measure govt can do currently 1) lower ltv from 75% to 65% 2) decrease loan tenor to 20 years 3) increase ssd back 4/8/12/16% for 4,3,2,1 years of holding 4) increase bsd/absd” –
Users also highlight the importance of understanding the terms and conditions of their loans and to be aware of potential penalties for prepayment during the lock-in period.

Looking Ahead

The community is closely monitoring several upcoming developments:
– New GLS Sites: The upcoming launch of Lentor Central Residences (477 units) is generating interest.
– Potential Cooling Measures: Users are speculating on possible cooling measures post-election, such as increased SSD from TOP, higher ABSD for PRs, or a reduction in the LTV ratio.
– Interest Rate Trends: The community is watching for changes in interest rates and their impact on loan refinancing options.
– Rental Market Dynamics: Users are keen to see if rental yields will catch up with property prices.
– Impact of New Launches: The community is monitoring the impact of the many new launches on the resale market.

“After CNY, frenzy shall continue And with another launch, it will push the sales of remaining units from Hillock Green and Lentoria to sell out soon.” –
Users are generally expecting the property market to remain active, but some are anticipating a potential slowdown or policy intervention to curb speculation. The community also expects to see more launches near MRT stations which might impact prices of existing properties.