Real Estate Characteristics

• immobile
• illiquid
• indivisible
• indestructible
• heterogeneity = every property is unique

Real Estate Market

• NO Central Market (unlike stock exchange)
• Imperfect Knowledge
• Highly Regulated
• Imperfect Competition
• Real Estate Industry Transformation Map (REITM) to improve using technology

vs Reits

• Investors (beneficiaries) buy shares
• Revenues distributed to shareholders

Types of Residential Property

• Landed
  • Land Titles = Certificate of Title (CT)
  • Strata Titles = Subsidiary Strata Certificate of Title (SSCT)
    • Own the “air space”
• Non-landed
  • Strata Titles
• HDB flat gets Subsidiary Certificate of Title

Housing Forms

• GCB
  • Min 1,400sqm
  • Height max 12m
  • Min width x depth: 18.5m x 30m
  • Setback: 7.5m front, 3m sides & rear
• Bungalow/Detached
  • Min 400sqm
  • Min width: 10m
  • Setback: 7.5m front, 2m sides & rear
• Semi-Detached = a pair sharing common wall
• Terrace = 3 or more in a row
  • Corner = end of row
• Cluster = mixture
• Apartment
  • Minimum site 1,000 sqm
  • Maximum site coverage 50%
• Maisonette = 2-level with staircase
• Penthouse = highest floor, normally with roof garden
• EC = strata built by private, with some restrictions as there are subsidies
• Condominium
  • Minimum site 4,000 sqm
  • Maximum site coverage 50%
• HDB
• Shophouse
  • 1st level commercial
  • 2nd level residential
• Business 1 (B1) = clean & light
• Business 2 (B2) = general industry, warehouse (more pollution)

Foreign Person

• Foreigners & PR
• Require approval from Land Dealings Approval Unit (LDAU)
• PR should by 5y, with exceptional economic contributions
• These requires approval
  • Vacant land
  • Landed
  • Strata Landed not condo status
  • Shophouse (for non-commercial purpose)
  • Place of worship
  • Worker’s Dormitory/Serviced Apartments/Boarding House (not registered under the provisions of the Hotels Act)

Demand & Supply

• Supply Curve /
  • Quantity supplied (x) vs Price (y)
  • As price increases -> motivates supplier to supply more
  • elastic = can increase supply without a rise in cost or a time delay
  • inelastic = firms find it hard to change production in a given time period
• Demand Curve \
  • Quantity demanded (x) vs Price (y)
  • When demand increases, the curve shift upwards
• Equilibrium
  • The intersection of supply and demand
  • Will find its way in open market
• Property is relatively inelastic in response to changes in price
  • change in demand cannot be matched by a change in supply -> large change in price
• Factors affecting prices
  • Location
  • Tenure
  • Accessibility

Property Cycle

• Lags behind business cycle
• 4 Stages
  1. Recovery (upswing)
  2. Expansion (peak or boom)
  3. Decline (downswing)
  4. Recession (bottom or trough);

Statistics

• Submarket for private
  • CCR (Core) -> RCR (Rest) -> OCR (Outside)
• Primary Market = New Sale
• Secondary Market = Resale
• Temporary Occupation Permit (TOP)
• Certificate Of Statutory Completion (CSC)
  • Usually TOP then CSC
  • But can be CSC first
• URA uses Property Price Index (PPI) to track market prices
• HDB uses Resale Price Index (RPI) to track market prices
  • Based on only HDB (no private)

Postal Code

• 6 digits
  • First 2 = Sector code (01-81)
  • Next 4 = Delivery Point
• 4 digits (OLD)
  • First 2 = Postal Code (01-28)
  • Next 2 = Sector code
• 2 digits (OLDEST)
  • Postal Code (01-28)

Postal code is property district D01-D28.

Government

Others: IRAS, MAS, LTA