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Govt policies could dampen demand in prime property markets in Asia Pacific in 2013 - 27 Dec 2012 from http://www.propertywire.com
Asia-Pacific prime property markets are unlikely to outperform the other regions of the world in 2013 as government policies dent demand for residential homes, it is predicted.
According to Nicholas Holt, Knight Frank’s research director for the region, government interventions, aimed at mitigating the risk of asset bubbles and addressing concerns of affordability are taking a toll.
‘These cooling measures have dented demand for prime residential product in some markets, through limiting financing, introducing extra taxes for foreign buyers and penalties for disposing of the property within a certain time period,’ he explained.
Many of these measures have targeted the high end residential market. For example, loan to value ratios in Hong Kong are limited to 50% for properties over HK$10 million. But more often they have been introduced to penalise multiple home owners at the expense of first time buyers, which disproportionally impacts the prime residential markets.
‘At the same time that the market has become more difficult for some buyers, the attraction of prime property markets outside their domestic markets has continued to provide incentives to move their money abroad,’ said Holt.
‘With an increasingly mobile, educated and well travelled class of property owners in the Asian region, the lifestyle choice of having a second home abroad, for personal or for children’s educational use is proving to be one of the key narratives for HNW Asian buyers,’ he explained.
‘Given the lack of alternative investment options, property in so called safe haven cities around the world has become an attractive asset for Asian HNWIs. Domestic currencies that have strengthened against destination market currencies have also provided a currency play which has, in some cases, provided significant discounts in real terms,’ he added.
He pointed our that with the ongoing global west-east shift in the economic balance of power, there is no doubt that the prospects in the medium term for prime residential markets in the region are promising.
‘Our forecasts show however, that given the protectionist measures introduced over the last 12 months in the Asian safe haven and lifestyle destinations of Singapore and Hong Kong, we expect fairly subdued price performances in these markets through 2013,’ said Holt.
A survey by Knight Frank found that shrinking mortgage availability is the top risk that respondents regard to be affecting markets followed by restrictions on multiple ownership, changes to CGT rules, large scale house building programmes and finally stamp duty increases.
Price tightening policies expected to continue in China and Hong Kong in 2013 - 12 Dec 2012 from http://www.propertywire.com
Global economic uncertainty, slow expansion in local economies and the continual effect of tightening policies are the key issues likely to impact the mainland China and Hong Kong property markets in 2013.
Residential prices in both Mainland China and Hong Kong are expected to experience mild movements in 2013, according to the latest joint market update from Knight Frank China and Holdways.
In October, the Hong Kong government introduced a new buyers stamp duty tax and also extended the existing special stamp duty but neither have affected prices which are still growing although transactions have fallen.
Demand from speculators and investors is expected to be checked by the increased policy risks and investment costs. This will be particularly apparent for primary residential projects, where a significant proportion of buyers are companies or mainlanders,ђ said Thomas Lam Ho Man, head of research at Knight Frank in Greater China.
The number of residential transactions totaled 71,012 in the first ten months of 2012, but is expected to drop over 10% to only 75,000 in the whole of 2012, compared with 84,442 transactions over 2011.
However, with low interest rates and strong financial conditions, landlords and developers are not expected to offer significant price cuts. Residential prices are set to remain stable in 2013, with mild upward or downward movements of less than 5%.
On the mainland, where all eyes are on the March 2013 handover of power, property analysts are waiting to see whether the new leadership continues with the current property cooling measures, given the slowdown.
Helen Liu, general manager at Beijing Holdways Information and Technology, expects the government to continue with its determination to curb the residential property market.
However, residential transaction volumes have started to rebound since the second half of 2012, due to strong end-user demand. They are expected to rise 30% year on year in 2012 and grow another 15% year on year in 2013,ђ she said.
Home prices have also started to experience mild rebound. We expect home prices in first tier cities, such as Beijing and Shanghai, to further growth by less than 5% in 2013, while those in second and third tier cities could be under downward pressure,ђ she added.
Jakarta expected to have strongest price growth in Asia in 2013 - 4 Dec 2012 from http://www.propertywire.com
Luxury residential property prices in Singapore and China are showing signs of stabilising after declining over the past six months, according to the latest index.
Meanwhile, luxury residential prices in Hong Kong rose a further 1.7% in the third quarter of the year with year to date price growth totalling 5.7%, the residential index from Jones Lang LaSalle also shows.
Across the nine luxury residential markets in Asia monitored by the firm, average capital values rose by 1.9% quarter on quarter compared with the 0.8% recorded in the second quarter of 2012.
The index also shows five out of nine monitored markets saw an increase in capital values during the quarter, while the remainder recorded minimal or no change.
Luxury residential prices in Singapore stabilised after correcting for two consecutive quarters, largely supported by end user demand.
Average prices also began to stabilise in China, helped by fewer price discounts from developers. Primary capital values for the high end market in Beijing rose by an average of 7.4%, although due mainly to larger units being launched, while capital values for luxury apartments in Shanghai were largely unchanged.
While Jakarta continues to outperform all monitored South East Asian markets with quarter on quarter price increases of 6.3%, average prices were flat in Manila and Kuala Lumpur and rose modestly in Bangkok.
The form says that a significant amount of new supply over the next one to two years is limiting upside potential in these markets.
The residential market in Hong Kong has been particularly strong this year, thanks to low interest rates and stronger buyer sentiment, according to Joseph Tsang, managing director and head of capital markets, Jones Lang LaSalle Hong Kong.
Hong Kongs capital values are expected to see a mild correction over the short term after the government introduced buyers stamp duty on foreign and corporate buyers in late October. However, any further downside risk should be limited by tight supply and low holding costs,Ғ he said.
Looking ahead, Jane Murray, head of research, Asia Pacific at Jones Lang LaSalle, predicts that policy restrictions in various markets, such as special and buyers stamp duty in Hong Kong and home purchase restrictions in China, should remain in place at least until 2014.
She said this has the potential to limit sales activity and further price increases despite low interest rates. ґCapital values of Singapores high end properties are expected to edge up modestly in the next twelve months, mainly supported by domestic buyers. Among the emerging South East Asia markets, Jakarta will likely to see the strongest price growth for the next 12 months due to solid local demand,Ғ she added.
Hong Kong property prices expected to rise by up to 15% - 26 Sept 2012 from http://www.propertywire.com
Residential property prices in Hong Kong are expected to have risen by up to 15% by the end of 2012, according to the latest housing market analysis from Knight Frank. Sentiment in the residential market improved in August, as people became more convinced that the government would not introduce major cooling measures, the property firm says in its September 2012 monthly report.
It points out that pent-up demand drove up transaction volume by 41.7%, month on month and while prices in luxury developments remained stable last month, those in the mass residential market continued to rise, growing 1.4% month on month, with a number of record breaking deals having taken place. Examples include a 2,319 square feet duplex in Taikoo Shing, Quarry Bay which was sold for HK$31.4 million, HK$13,540 per square foot, the highest ever transacted price in the development.
Meanwhile, a mid-level unit in Block 1 of Metro Harbour View in Tai Kok Tsui was sold for HK$8,553 per square foot, a new per square foot high for the development. In the primary market, new projects continued to receive a positive response last month. The Met. Sublime in Sai Wan, for example, reportedly sold over half of the 97 units available in three days and The Riverpark in Shatin reportedly sold over 710 of its 981 available flats. A number of new developments are expected to launch in September. These include Century Gateway atop the Tuen Mun MTR station, owned by Sun Hung Kai Properties and Double Cove in Lok Wo Sha, a joint development by Henderson Land, New World Development and Peterson Group.
The report also says that the leasing market stabilised in August, towards the end of the summer peak season, with luxury home rents remaining unchanged. Demand from multinational corporate tenants was still impacted by uncertainty in the global economy. At the end of August, the Hong Kong government announced ten measures to increase housing supply in the short to long term. Major measures included the sales of 830 Home Ownership Scheme (HOS) units in Tin Shui Wai early next year, putting 1,000 flats in Tsing Yi up for sale at a discount under the My Home Purchase Plan and speeding up the approval process for pre-sale flats.
We believe the increase in supply will contribute to the healthy growth of the market in the long term. However, the immediate impact is limited, as only about 1,000 units will be added to the market in the short term,ђ says the report. The governmentђs measures for increasing housing supply will take years to realise. In the near term, favourable factors, such as limited new supply, low interest rates and low unemployment levels, will prevail, it explains. ґWe have therefore revised our forecasts and expect luxury residential prices to rise by up to 10% by the end of year, while mass residential prices could increase by up to 15% over the same period. However, a price correction could be witnessed from 2013 onwards, when supply starts to increase notably, it concludes.
Overseas buyers boost Singapore property sales - 26 Aug 2012 from http://www.propertywire.com
Buyers from Indonesia, China and India are boosting demand for private residential properties in Singapore.
The latest figures from the Urban Redevelopment Authority (URA) show that sales, excluding Executive Condominiums, soared in July, up almost 42% compared with the previous month.
Three out of the top four best selling projects were located in the suburban areas. They were Parc Centros in Punggol which sold 492 units last month, Parc Olympia located in Loyang at 204 units, and River Isles in Punggol with 86 units.
The figures also showed that developers sold 253 units of new homes located in the core central region, 181 units at the city fringe, and 1,509 units in suburban areas last month. Including ECs, URA said a total of 2,067 units of new homes were sold in July. Private home sales in the month of July for Singapores Core Central Region (CCR) jumped by almost 80% month on month to reach 253 units.
As the market prepares for the upcoming Ghost Month, all segments have seen a jump in sales. A notable rise was recorded in the CCR which saw home sales peak at 253. In fact, Julys home sales in the CCR were the highest in the last 15 months, only after April 2011Ғs sales volume of 306, said Tejaswi Chunduri, regional analyst at PropertyGuru.
This reinforces the fact that location is the most important factor when considering property investment. This also indicates a return in developer investor confidence as investors are on the lookout for strategically located projects, she added.
Meanwhile the URA has put up new residential sites for sale to provide developers and home-buyers with more choices for private housing with the expectation of creating 1,600 residential units. A site at New Upper Changi Road is described as being located within an established private housing estate and close to Tanah Merah MRT Interchange station. It is also easily accessible by East Coast Parkway and Pan Island Expressway.
Another at Prince Charles Crescent is located in an established residential area within the central region. It is located near Redhill MRT station and is also a short drive away from the Central Business District, Marina Bay and Orchard Road. And a land Parcel at Woodlands Avenue 6/Woodlands Drive 16 is situated within the HDB Woodlands estate, the site is near to Admiralty and Woodlands MRT stations. It is also easily accessible via Seletar Expressway (SLE).
Tender for the residential sites at Prince Charles Crescent, Woodlands Avenue 6 / Woodlands Drive 16 and New Upper Changi Road and will close at 12 noon on 20 September 2012, 9 October 2012 and 16 October 2012 respectively. Selection of the successful tenderer will be based on the tendered land price only.
Chinese property prices rising again despite slowing measures - 14 Aug 2012 from http://www.propertywire.com
Average residential property prices in China edged upwards in July, the second consecutive month in a row since prices began falling due to government curbing policies.
The average home price in China’s 100 major cities increased by 0.33% compared with June, coming on top of June’s month on month rise of 0.05%, the data from the China Real Estate Index System (CREIS) shows.
The rises come despite government curbs as at a local government level officials try to get around the policies. It is reported that inspection teams have been sent to some cities to check whether local governments are enforcing property curbs.
On a year on year basis prices are still down by 1.77%, the fourth year on year fall since June last year when CREIS first began calculating the year on year change.
Analysts have different views on whether stricter curbs will be imposed. ‘The investigators mainly enquired about the sales situation of existing and new apartments and the working procedures of financial departments, and read related files and data, but didn't give any instructions to us,’ said Chen Zhi, secretary general of the Beijing Real Estate Association.
‘In general the investigators are satisfied with the investigation results, according to my colleagues who were invited to attend an enquiry meeting in Beijing,’ said Liu Yuan, research director at Shanghai branch of Centaline China Real Estate.
Analysts said the move by the central government is intended to find out major causes of the recent recovery of the property market, especially in the big cities like Beijing and Shanghai.
Increased demand for apartments, which has accumulated for around two years since the launch of the government curbs, could be the major cause of the recent market recovery, Liu believes.
He added that the credit policy easing, aimed at stimulating the economy, has also boosted confidence of the property sector.
ASIAN PROPERTY