S'pore property prices drop by 12.1 percent<\/p>\n
SINGAPORE (AFP): Singapore property prices fell by an average
\nof 12.1 percent in 1997, a land management agency said yesterday
\namid fears that many new developments would be frozen this year
\ndue to a glut and an economic slowdown.<\/p>\n
The Urban Redevelopment Authority (URA) said prices in the
\nprivate residential sector fell 12.5 percent, with landed
\nproperty prices falling 11.3 percent, and non-landed properties
\ndeclining 13.4 percent.<\/p>\n
Prices of commercial properties fell 11.3 percent while
\nindustrial property prices were down 4.7 percent last year.<\/p>\n
The statistics added to the gloom in the sector following
\nreports that up to 70 percent of new housing launches in
\nSingapore could be postponed this year, and that developers were
\ndelaying payments for state-owned land parcels.<\/p>\n
In a statement yesterday, top developer Far East Organization
\nconfirmed that it had asked the URA for a deadline extension of
\nthe remaining 75 percent of 363 million Singapore dollars (US$226
\nmillion) owed for three sites.<\/p>\n
But it vowed to pay the balance when it is due and stressed
\nthat it was "not the first developer to seek such an extension,"
\nadding that "we wish to dispel all malicious rumors" that Far
\nEast was unable to pay the balance.<\/p>\n
The Straits Times newspaper reported yesterday that delayed
\ndevelopment launches would cut the number of new private homes to
\nfewer than 10,000 units but would still leave a 20,000-unit
\noversupply.<\/p>\n
"Some entire projects are also being put in cold storage,"
\nPhilip Ng, chief executive of Far East, was quoted as saying.<\/p>\n
Speculation was rife last month that Far East-related property
\ngroups in Hong Kong and Singapore had defaulted on loans. Their
\nstock counters dropped despite repeated denials by Far East.<\/p>\n
Two other Singapore developers are also said to have received
\nsimilar extensions from the Urban Redevelopment Authority.<\/p>\n
This is believed to be the first time since the mid-1980s
\nproperty glut here that developers have been allowed payment
\nextension on state land sales. The current extensions carry a
\nnine percent per annum interest charge.<\/p>\n
Ng of the Far East group said most developers were staggering
\ntheir launches this year.<\/p>\n
Another property heavyweight, City Developments Ltd., was also
\nreviewing its property launches in view of the current market
\nconditions, the newspaper said.<\/p>\n
Real Estate Developers' Association of Singapore President
\nDaniel Teo was quoted saying that private residential prices had
\nslipped 20-to-30 percent since anti-speculation measures were
\nintroduced here in May 1996.<\/p>\n
He said that it might take "another year or so before prices
\nsettle down."<\/p>\n
Singapore's residential property market has been increasingly
\nbattered over the last year in the face of a supply glut and the
\nregion's economic woes.<\/p>\n
Market confidence has been dampened by the plunging property
\nand stock markets, rising interest rates and volatile regional
\ncurrencies.<\/p>\n
A recent report by international property consultancy Richard
\nEllis said that close to 10,000 new housing units were launched
\nin 1997, while the total number of new units sold was estimated
\nto be 5,500 units.<\/p>\n
According to data from the URA, there were 15,661 unsold units
\nat the end of the third quarter of 1997.<\/p>",
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