Sentosa Cove: The Silver Lining For Foreign Buyers of Landed Properties

Buying activities have of late revved up in the bungalow market on Sentosa Cove, the only place in Singapore where a foreigner may seek approval to buy a landed home for their own use. Thus far, 10 villa deals in the waterfront housing district have been sealed this year.

In the last two months, Pearl Island, one of five man-made islets in Sentosa Cove, has seen three villas sales transacted at between S$16 million and S$21 million each, working out to S$1,725 per square foot (psf) to S$2,000 psf on land areas of about 9,270 sq ft to 11,667 sq ft.

The foreign Chinese buyers of all three units paid an additional 20 per cent in ‘Additional Buyer's Stamp Duty (ABSD) on top of the standard buyer's stamp duty of up to 4 per cent.

Pearl Island, which holds 19 bungalows with a 99-year leasehold tenure, was developed by Ximeng Land (S) Pte Ltd. Completed in 2012. All 19 bungalows in the project have three storeys and a basement and come with its own private lift, a swimming pool and berth.

The Covid-19 situation has taken down most owners expectations to a more realistic price level. Bungalow prices in Sentosa Cove have eased by about 40 per cent from the peak in 2010-2012. Thus it is a good time to enter the Sentosa Cove market.

2020 may well close the year potentially with at least 15 deals. Buyers from China, Indonesia, Malaysia, India and Singapore have expressed interest.

China Buyer Of S$23.8m Sentosa Villa Arrested, Deal Vaporised

The Gift That Never Was

It seems the S$23.8 million bungalow deal at Lakeshore View in Sentosa Cove last year had fallen through. The property sits on 8,576 sq ft of land and has a balanced lease term of 89 years at the time of the option.
Zhang Min, the China businesswoman who had inked the deal in October 2015 and lodged a caveat for the property in November did not complete the purchase.

A Gift Nonetheless By Defaut

It is supposedly reckoned that S$1.19 million or 5% deposit of the purchase price would have been forfeited with the default. It's pretty good money for a 3-month default.

The sellers, three siblings from a Hong Kong family, two of whom are British citizens and the third, a Singapore citizen are now on the lookout for a new buyer for the bungalow which fronts the Serapong Golf Course and overlooks the sea.

The ponzi scandal in China
As the story goes, Zhang Min, the Chinese businesswoman in the Sentosa Villa default, was arrested by the Chinese authorities for her involvement in the Ezubao ponzi scandal in China

Launched in July 2004, Ezubao one of China's biggest Internet peer-to-peer (P2P) lenders had amassed over 50 billion yuan (S$10.8 billion) from an estimated 900,000 investors.
When Ezubao's fraud came to light late last year, executives buried 80 bags of documents in a six-meter hole on the outskirts of Hefei in Anhui province, where the company originated from.
It was reported that the company have fabricated most of the projects on its website and paid old debts with money from new investors.

Xinhua reported that it was executives from Yucheng Group, the parent company of  Ezubao, who spilled the beans, saying that it was a "complete Ponzi scheme" that used monies raised from investors to support a lavish lifestyle. 
Among the gifts were a S$20 million Singapore villa, a US$1.8 million pink diamond ring, luxury limousines and watches and more than US$83 million in cash which the chairman of Yucheng Ding Ning gave to Zhang, who was Ezubao’s president.

News of the Q4 S$23.8 million or S$2,775 psf Lakeshore View transaction last year boosted sentiment in the generally quiet waterfront housing district. Of course the relatively high psf price also help.

Mortgagee Sale: Branksome Road Bungalow, From have to have not

“In the valley of ups and downs, Life is just a long ride. ”

— Zen Tan

A District 15 freehold bungalow in the Tanjong Katong area is up for mortgagee sales at Amara Hotel on Mar 30.

Indicative price for the single storey bungalow at 85 Branksome Road, is about S$16 million, or S$1,213 psf on a land area of 13,189 sq ft with a 30-metre-long frontage.

The regular sized plot may be subdivided for redevelopment, into a pair of bungalows or semi-detached houses, subject to official approval.

The bungalow is owned by the recently bankrupted Mr Sharma, managing director of spice and nut trader Pars Ram Brothers.

The mortgagee for 85 Branksome Road is UOB.

BT reported earlier this week that Mr Sharma, his wife and son have been declared bankrupt, following the liquidation of their spice and nut trading business.

Mr Sharma, 60, had given personal guarantees to a number of banks for loans extended to Pars Ram Brothers, which was placed under provisional liquidation in Nov 24 last year. He was a director and major shareholder of the firm.

Mr Sharma, with liabilities of more than US$130 million, had filed for his own bankruptcy. The order was issued on Jan 28. As joint guarantors for the bank loans, his wife and son were also made bankrupt after an Indian bank filed applications against them. The company is said to owe money to between 10 and 17 banks.

Mortgagee sales occur when banks repossess the properties of financially stretched borrowers unable to repay their loans and resell them in an auction.

2 Good Class Bungalows At Camden Park Up For Tender

TWO adjacent bungalow plots in the Camden Park Good Class Bungalow (GCB) Area near the Botanic Gardens put up for sale by tender by a church will close on April 12. 

An old single-storey house sits on each plot. Indicative price is S$35 million for both properties with a total land area of 27,176 sq ft or S$1,288 psf. Both sites may be amalgamated.

The GCB at Camden Road was bequeathed to the Kampong Kapor Methodist Church by the late Anglo-Chinese School (ACS) principal Earnest Lau who died in March 2011.

Plot Details

• 15 Camden Park has a land area of 13,115.81 sq ft and a S$16.9 million guide price. 
• 15A Camden Park carries a land area of 14,059.81 sq ft and a guide price of S$18.1 million

The properties are close to Hollandse Club and the Japanese Association, Singapore.

GCBs are a prestigious type of landed housing in Singapore with specific constraints to preserve their exclusivity and low-rise character.
Typically, GCBs have a minimum land area of 1,400 sq m (15,069 sq ft). However, some smaller existing sites were included during the gazetting of GCB Areas in 1980. These are still considered GCBs since they are bounded by other GCB planning rules if they were to be redeveloped. 

As an illustration, such plots cannot be sub-divided and they cannot built more than two storeys high (plus an attic and a basement).

High-End Home Sales Picks Up

Private homes sales above S$3 million line have picked up. Emerging value and currency movements paved the way to an upsurge in high-end home sales, rising 17.7% to 659 units for the first seven months of this year. Only 560 were done in the same period last year.

The pick-up in transactions above the S$3 million category cut across both the landed and non-landed segments. 

January to July Period
Sales of landed homes, 2015 - 318 transactions.
Sales of landed homes, 2014 - 280 transactions.

Non non-landed sales, 2015 - 341 transactions.
Non non-landed sales, 2014 - 280 transactions.
 

Contributing factors

Steeper drop in property prices in the high-end property market - the luxury non-landed private home prices have fallen 11.2% from its peak in Q1 2013.

Currency appreciation in the USD, Hong Kong dollars and the British pound against the Singapore dollar creates incentive for buyers.

The completion of new condo developments such as Leedon Residence in District 10.

Upsurge in landed property demand - 48% of private homes that changed hands at above S$3 million in the first seven months were landed homes.

Longer term view, owner occupation, upgrading of portfolio or positioning themselves for capital appreciation in landed properties in land-scarce Singapore.
 
Redevelopment – developers buying interest in old houses for redevelopment purposes.

Realistic pricing - developers of new landed projects have a certain timeframe to sell off their properties or pay a penalty.

Surge in number of landed properties bought by companies - totalling 30 units  from Jan-July 2015.

Transactions above the S$3 million price tag in the first seven months of 2015

Singaporeans bought 442 private homes - up 20.8%.
PRs bought 104 private homes - up 13%.
Companies bought 42 homes, up from 32 previously - up 31.3%.
Purchases by foreigners fall to 64 units - down from 69 previously in the S$3-4 million range but transactions shoot up above S$4 million mark.

In contrast, the number of private homes sold at prices below S$3 million mark is almost unchanged; the figure inched up 0.3% to 8,763 units in January-July 2015 from 8,736 in the same year-ago period.

Still, the latest sales volumes in the property market are some way off the peak levels of 2013, before the roll out of the total debt servicing ratio (TDSR) in June 2013.

Source - Business Times

Cluny Hill GCB Goes For S$21.52M

A 15,097 sq ft in the Cluny Hill Good Class Bungalow freehold site is being sold for S$21.52 million or S$1,425 psf on land area.

Standard Chemical Corporation is selling the property to Aston Holdings which is 90% owned by Tan Koo Chuan, who also controls developer Yi Kai Group.

Estimated cost to build and fit out a new bungalow of between 8,000-10,000 sq ft gross floor area (GFA) is around S$6-8 million.

The initial asking price is S$24 million earlier in the year.

The sole transaction in 2014 along Cluny Hill was transacted at S$1,976 psf. The freehold GCB at 33 Cluny Hill has a land area of 15,177 sq ft. It was sold for S$30M. 

In total, there were only 3 Cluny Hill transactions between 2010 to 2014 - two at $30M and one at $28M. Land prices were done between $1,533 psf to $1976 psf.

Buyers are on the lookout for GCBs in the S$20-25 million range these days.  The number of transactions is expected to pick up at these levels.

GCB buyers potentially come from those aspiring to upgrade from smaller bungalows and new citizens.

GCBs are the crème de la crème of landed housing in Singapore. Only 39 locations in Singapore are designated as Good Class Bungalow Areas with strict rules to preserve their exclusive identity.

Source: The Business Times

Queen Astrid GCB Site Up For Estate Sale

A freehold Good Class Bungalow (GCB) redevelopment site in Queen Astrid Park with an indicative price of S$49-51 million is up for estate sale by tender.

This works out to S$1,399 to S$1,456 psf.

The 35,011 sq ft site at the junction of Queen Astrid Park and Coronation Road West is currently occupied by a single-storey detached house.

The indicative price is relatively tempting when matched against the peak median price of S$1,749 per sq ft recorded in Q2 of 2014.

In Q2 of this year, the median price for detached houses with land area of 15,000 sq ft and above in District 9, 10 and 11 is S$1,410 psf.

GCBs are highly coveted here due to its scarcity, with only some 2,500 islandwide.

The GCB site at 2 Queen Astrid Park would not have been made available had it not been an estate sale.

The Queen Astrid Park site is appealing because of its exclusivity, elevated grounds, lush greenery, tranquil surroundings and easy accessibility to Holland Village and Orchard Road.

There is also the potential for sub-division into two smaller plots, a rare attribute. The GCB site enjoys wide double road frontages onto Queen Astrid Park and Coronation Road West.

The tender for the site closes on Nov 12.

Total transactions in GCB areas rise to at least 11 deals in Q2 of 2015, amounting to S$282.3 million.

Just four deals totalling S$95.3 million will transacted in Q1 of this year.

GCB Recent Transactions:

45 Belmont Road
Site: 31,125 sq ft
Sold at S$1,420 psf (June 2015)

26 Bin Tong Park
Site: 21,426 sq ft
Sold at S$1,400 psf (June 2015)

21, Queen Astrid Park
Site: 27,373 sq ft
Sold at S$1,169 psf (July 2015)
Transaction Price: S$32 million

Source: Business Times