More than 800 condo units were resold at a loss this year as economy slows

An ultra-luxury apartment with a sea view at Sentosa Cove has made the largest loss in the property market so far this year.

Originally bought for $11 million in 2011, the condominium unit at Seascape was sold for $6.35 million in October at a loss of $4.65 million.

A high-end property at The Ritz Carlton Residences in Cairnhill Road made the second-largest loss-making deal of $3.7 million in March.

Another Sentosa Cove unit at Turquoise came in third, in a transaction that made a loss of more than $3.3 million in June.

Statistics from property portal SRX show that sales of condo units with losses of more than $1 million each rose substantially this year, with 48 such transactions, compared with 31 in 2015.

Most of these luxury homes were bought during the property boom years of 2007, 2011 and 2013. Up to November this year, more than 800 transactions involving non-landed private properties were loss-making, double the figure in 2015.

There were nearly 6,000 resale non-landed private property transactions in the first three-quarters of this year, Urban Redevelopment Authority (URA) statistics show.

GROWING TREND

Analysts told The New Paper that “unprofitable” deals are common in a cyclical downturn where market sentiment and employment prospects are poor.

Expectations of a US Fed rate hike by the end of the year, which would increase interest rates here, are also driving these loss-making sales.

R’ST Research director Ong Kah Seng said: “It is easy to advise people to avoid buying when there is a property bubble but in reality, people tend to avoid buying property only when there is a slump because they lack confidence.”

The high-end property market, buoyed by luxury home collectors in the mid to late 2000s, is losing its appeal because of the sluggish market, he added.

Interested parties now are cash-rich buyers from developing Asian countries who would usually avoid splurging on the luxury market but are now looking for a good deal.

Mr Ong said: “In the past, these properties were a status symbol. The more expensive it was, the higher its value. (Their losses) can be justified by the enjoyment and prestige of occupying these properties for the past couple of years.

“Besides, they would have paid a certain price if they had rented them.”

Mr Desmond Sim, CBRE head of research for Singapore and South-east Asia, thinks some of these “bold” multi-million losses are paper losses, which are mitigated by foreign exchange in light of the strong Sing dollar.

“A $2-million loss could also be considered ‘manageable’ if it means they can unlock $10 million in a more profitable investment elsewhere,” he added.

Huge losses for properties in high-end areas

The top-10 loss-making properties are in two affluent neighbourhoods, Sentosa Cove and the Central area. 

All of them were bought during the property boom years in 2007, 2011 and 2013. Seven were bought in 2007.

R’ST Research director Ong Kah Seng said: “Interest in the high-end segment was at the peak then because of the exciting plans that were announced at that time – such as the integrated resorts, plans to transform the Central Business District – which attracted many foreigners to have a stake in the hype.”

Massive loss-making property deals have made the headlines in recent years.

Last year, a Japanese tycoon made an eye-popping S$15.8 million loss on a penthouse unit at St Regis Residences.

The Monetary Authority of Singapore, in its Financial Stability Review released last month, warned property investors to be aware of rising vacancy rates, declining rentals and impending interest rate increases.

RENTAL

These factors mean they may not always be able to rely on rental income to service their investment property loans.

CBRE’s head of research Desmond Sim said: “The slew of government policies (such as the Total Debt Servicing Ratio and Additional Buyer’s Stamp Duty) are put in place to ensure investors don’t bite off more than they can chew, or they will choke.

“Those who made such huge losses are not in need of a Heimlich manoeuvre, but they are spitting it out now.”

linheng@sph.com.sg

This article was first published on Dec 13, 2016.
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SINGAPORE – Prime Minister Lee Hsien Loong will visit Putrajaya on Tuesday (Dec 13) for the annual Malaysia-Singapore Leaders’ Retreat with Malaysian PM Najib Razak.

Both prime ministers will witness the signing of a bilateral agreement for the high-speed rail linking Singapore and Kuala Lumpur, the Prime Minister’s Office (PMO) said in a statement on Monday (Dec 12).

The 350km high-speed rail line, first mooted in 2013, has been billed as a “game changer” for both countries. It will shave travel time by land between Singapore and Kuala Lumpur to 90 minutes, compared to more than four hours by car.

The signing of the agreement is a culmination of intensive bilateral discussions since the 2013 Leaders’ Retreat, and furthers the good progress made by both countries since a Memorandum of Understanding was signed in July, the PMO statement said.

“It also demonstrates the two governments’ commitment to the project, which will boost connectivity, strengthen economic ties and enhance people-to-people linkages when completed,” the statement added.

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Singapore-Malaysia ink landmark High Speed Rail MOU

Source: The Straits Times

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PM Lee will be accompanied by Mrs Lee and a high-level delegation comprising Deputy Prime Minister and Coordinating Minister for National Security Teo Chee Hean; Transport Minister Khaw Boon Wan; Minister for Foreign Affairs Vivian Balakrishnan; Minister for Culture, Community and Youth Grace Fu; Minister for National Development and Second Minister for Finance Lawrence Wong; Minister for the Environment and Water Resources Masagos Zulkifli; Minister for Education (Schools) and Second Minister for Transport Ng Chee Meng; Senior Minister of State for Finance and Law Indranee Rajah; Senior Minister of State for Home Affairs and National Development Desmond Lee; and Minister of State for Health Lam Pin Min.

Mr Khaw and Malaysian Minister in the Prime Minister’s Department Abdul Rahman Dahlan will sign the bilateral agreement.

Both sides were originally scheduled to meet on Dec 5, but that meeting was postponed.

Datuk Seri Najib told reporters in Iskandar Puteri, Johor, that Singapore had requested a bit more time as it needed the President’s approval before inking the pact.

Construction of the 350km line is expected to start in 2018, with trains running by 2026.

Three services will run along the eight-station, dual-track line.

There will be an express service between the two terminal stations – Jurong East in Singapore and Bandar Malaysia in Kuala Lumpur; a shorter shuttle service connecting Singapore and Iskandar Puteri in Johor; and a domestic service linking the seven stations in Malaysia.

Besides Bandar Malaysia and Iskandar Puteri, the other five stations in Malaysia will be at Putrajaya, Seremban, Ayer Keroh, Muar and Batu Pahat.

International-bound travellers will need to clear customs and immigration only when departing the respective countries.

This article was first published on Dec 12, 2016.
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SINGAPORE – Police are investigating possible traffic offences in the case of a dispute between two drivers on the Pan-Island Expressway (PIE) on Friday (Dec 9).

Both drivers submitted videos of the incident from their dashboard cameras to road safety community page Roads.sg and the videos went viral over the weekend as readers had heated debates about which driver was in the wrong.

One driver, known only as Mr Lim, drives a white BMW. He said he was driving his car on PIE towards Tuas at 12.16pm when the incident happened.

In the video, a black Chevrolet entering the expressway appears to have cut into his lane and stops in front of his car.

Mr Lim said he sounded his car horn in response, but the other driver suddenly braked and stopped.

Mr Lim wrote on Facebook: “He accused me of not slowing down my vehicle (I am already driving at 60kmh) and I should brake to allow him to enter PIE. But I did not even see his vehicle in front of me.”

The driver of the black car later came over to Mr Lim and shouted at him even though an older woman passenger tried to stop him.

Both said they will report the matter to the police.

The driver of the black car, known as Mr Chong, later submitted the video from his car camera to Roads.sg.

It showed Mr Chong driving on the road shoulder to overtake Mr Lim’s car.

Police said on Monday that a police report was lodged and investigations are ongoing.

This article was first published on Dec 12, 2016.
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At a recent interview, Ms Qin Yunquan described her teenage self as someone who lacked self confidence.

But the now 27-year-old is no longer the same insecure girl.

In fact, the self-defence instructor has just been named one of the winners of the Queen’s Young Leaders Award 2017 for her work in teaching martial arts to women and children so that they can protect themselves.

Ms Qin’s story kicked off a new video series, Heroes Among Us, produced by The Straits Times. The eight-part series tells the stories of ordinary Singaporeans who overcame personal struggles to achieve greater things.

In the first episode, launched yesterday (Dec 11), Ms Qin spoke candidly about her past struggles. Up until junior college, she was the only girl in her school’s trim-and-fit club.

“I felt like a social outcast and decided to lose weight drastically,” she told The Straits Times during the video shoot.

She started to exercise vigorously and ate only one meal a day. Her wake-up call came when her doctor told her in 2007 that she was going to die if she lost another 2kg.

She stopped her weight-loss regime and picked up Kapap, a form of martial arts developed by the Israeli military.

In 2013, she took over the reins of Kapap Academy Singapore from her master Teo Yew Chye. The academy not only teaches Kapap but also provides free self-defence classes for women, children and the elderly.

“(We) teach our students to train and respond like a bodyguard… to overcome fear,” Ms Qin said in the video.

Future episodes of Heroes Among Us will include the stories of former national gymnast Eileen Chai, whose sporting career was cut short by injury, and former prostitute Sherry Sherqueshaa, who is now an activist fighting for the rights of sex workers.

Heroes Among Us is one of five programmes helmed by ST in a recently announced partnership between Singapore Press Holdings and the Info-communications Media Development Authority.

For more on ST’s new programmes, go to http://www.straitstimes.com/videos.

This article was first published on December 11, 2016.
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