SINGAPORE: The Year of the Ox begins later this month but the bull run is already over for Singapore's property sector, described as the world's hottest market just two years ago.
Prices of private homes fell 5.7 per cent in the fourth quarter, following a 2.4 per cent drop in the preceding period, according to the latest data from the Urban Redevelopment Authority (URA), the state agency responsible for land use planning.
The fourth quarter marked the sharpest drop in home prices in a decade, the URA said.
"Further contraction is on the way," analysts from the Hong Kong-based CLSA brokerage and investment group said in their outlook for the property sector. "We continue to expect the URA in-dex to see an accelerated fall in the next quarter."
Local home prices have not fallen so far since 1998 when Singapore was stung by the Asian financial crisis that pushed the local property sector into a slump lasting until 2005, when the government approved the construction of two multi-billion-dollar casino complexes.
By 2007, real estate giant Jones Lang LaSalle was describing Singapore's market as the world's hottest, and the city-state's property prices surged 31 per cent overall.
Rents at condominium units favoured by the many expatriates here also dramatically increased, and in some cases doubled.
While fourth-quarter data is preliminary, analysts say the casino-inspired property boom is history now that the economy is in recession.
Analysts said the duration of the current property slump was difficult to predict but they agreed it will hinge on when Singapore pulls out of the recession.
"A lot of it depends on the economy," said Ong Choon Fah, executive director for consulting and research with DTZ real estate consultancy.
"The economy really underpins the market... People have to feel safe about their jobs. That is the first thing," she said.
Serious buyers see pockets of opportunity in the current slump but are being unusually cautious because of the recession, Ong added.
Property agents at a show flat for a yet-to-be built condominium, located less than 20 minutes' drive from the main Orchard Road shopping belt, said they were hopeful, despite the dismal market.
"There will always be buyers even in a tough market and our prices are rather attractive," said one agent, who did not want to be named.
A two-bedroom unit at the condominium, which will come with a heated swimming pool and a gym, sells for about S$860,000 (S$1 = RM2.40).
In good times, the 915 sq ft apartment could fetch at least US$915,000 (US$1 = RM3.54), the agent said.
Until the economy recovers, prospective property buyers are likely to hold out in hope of better bargains, said Song Seng Wun, a regional economist with CIMB-GK brokerage.
By AFP
Monday, January 12, 2009
Metro Kajang plans RM1.6b projects
METRO Kajang Holdings Bhd (6114) plans to launch at least three new projects with a gross development value (GDV) of RM1.6 billion this year.
Group managing director Datuk Eddy Chen Lok Loi said the company will focus on the medium-to-high-end properties that are resilient even in recession.
The company is the biggest property developer in Kajang and Semenyih and is keen to strengthen its position.
It bought a 110ha of prime freehold land close to the Kajang town centre for a mixed development project. The land will be turned into a high-end integrated township with a GDV of RM1.4 billion.
"This new township project will have six phases and will keep us busy over the next eight years," Chen told reporters after receiving the QLASSIC award for quality construction from the Construction Industry Development Board Malaysia in Semenyih on Saturday.
Metro Kajang will launch a new housing project in June this year, spread over 47.2ha in Bandar Teknologi Kajang.
The gated and guarded community will comprise 500 units of landed properties with a GDV of over RM100 million.
It also hopes to launch semi-detached homes and bungalows at its Sentosa Villas project The total GDV for the Sentosa Vilas project will come to RM83 million when combined with the launched three-storey link houses.
Plans to build 523 units of serviced apartment at Desa Melawati worth RM140 million project are also put on hold.
"We will assess the economic situation first before deciding to launch the project," Chen said.
Nevertheless, Chen is optimistic on the property market and is scouting for more land.
At present, the company holds 200ha of undeveloped land in the Klang Valley.
On the award, Chen said Metro Kajang will not cut corners in its projects although the economic condition may be tough.
By Business Times (by Rupinder Singh)
Group managing director Datuk Eddy Chen Lok Loi said the company will focus on the medium-to-high-end properties that are resilient even in recession.
The company is the biggest property developer in Kajang and Semenyih and is keen to strengthen its position.
It bought a 110ha of prime freehold land close to the Kajang town centre for a mixed development project. The land will be turned into a high-end integrated township with a GDV of RM1.4 billion.
"This new township project will have six phases and will keep us busy over the next eight years," Chen told reporters after receiving the QLASSIC award for quality construction from the Construction Industry Development Board Malaysia in Semenyih on Saturday.
Metro Kajang will launch a new housing project in June this year, spread over 47.2ha in Bandar Teknologi Kajang.
The gated and guarded community will comprise 500 units of landed properties with a GDV of over RM100 million.
It also hopes to launch semi-detached homes and bungalows at its Sentosa Villas project The total GDV for the Sentosa Vilas project will come to RM83 million when combined with the launched three-storey link houses.
Plans to build 523 units of serviced apartment at Desa Melawati worth RM140 million project are also put on hold.
"We will assess the economic situation first before deciding to launch the project," Chen said.
Nevertheless, Chen is optimistic on the property market and is scouting for more land.
At present, the company holds 200ha of undeveloped land in the Klang Valley.
On the award, Chen said Metro Kajang will not cut corners in its projects although the economic condition may be tough.
By Business Times (by Rupinder Singh)
Metrojaya: New stores will drive up sales
RETAILER Metrojaya Bhd expects sales to grow by five per cent this year, driven by new stores and ongoing marketing and promotion activities.
Last year, it made some RM400 million in sales.
The group operates seven department stores which account for 60 per cent of its revenue, three specialty stores and a new venture called MJ Outlet, which sells off-the-season products from its department and specialty stores.
"The idea to operate MJ Outlet is to provide a proper avenue to market our off-the-season products instead of having a warehouse sale all the time," chief executive officer Robert Heng said.
Metrojaya had launched an MJ Outlet and a Reject Shop at Brem Mall in Kepong on Saturday. Covering 46,000 sq ft of retail space, the stores offer men, ladies and children apparels and household items.
Well-known brands like Somerset Bay, East India and household items from Laura Ashley and Living Quarters are all available at MJ Outlet where prices are reduced by up to 70 per cent.
Heng said since its soft launch on December 20 last year, MJ Outlet has received positive feedback from customers who shop for quality products at lower prices.
"Our customers appreciate the move especially during challenging times like now," he adds.
Metrojaya has signed an 18-year lease with Brem Holdings Bhd and spent a total of RM4 million or RM2 million each to open MJ Outlet and Reject Shop.
Depending on the response, Heng said the group may open more MJ Outlets but it has not set any targets or budgets.
"It depends, as we move along, since our main focus is still department stores. If we do open more MJ Outlets, it will be at the edge of town," he said.
Meanwhile, Metrojaya will open a 125,000 sq ft department store in Sabah by the third quarter this year.
By Business Times (by Zurinna Raja Adam)
Last year, it made some RM400 million in sales.
The group operates seven department stores which account for 60 per cent of its revenue, three specialty stores and a new venture called MJ Outlet, which sells off-the-season products from its department and specialty stores.
"The idea to operate MJ Outlet is to provide a proper avenue to market our off-the-season products instead of having a warehouse sale all the time," chief executive officer Robert Heng said.
Metrojaya had launched an MJ Outlet and a Reject Shop at Brem Mall in Kepong on Saturday. Covering 46,000 sq ft of retail space, the stores offer men, ladies and children apparels and household items.
Well-known brands like Somerset Bay, East India and household items from Laura Ashley and Living Quarters are all available at MJ Outlet where prices are reduced by up to 70 per cent.
Heng said since its soft launch on December 20 last year, MJ Outlet has received positive feedback from customers who shop for quality products at lower prices.
"Our customers appreciate the move especially during challenging times like now," he adds.
Metrojaya has signed an 18-year lease with Brem Holdings Bhd and spent a total of RM4 million or RM2 million each to open MJ Outlet and Reject Shop.
Depending on the response, Heng said the group may open more MJ Outlets but it has not set any targets or budgets.
"It depends, as we move along, since our main focus is still department stores. If we do open more MJ Outlets, it will be at the edge of town," he said.
Meanwhile, Metrojaya will open a 125,000 sq ft department store in Sabah by the third quarter this year.
By Business Times (by Zurinna Raja Adam)
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