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THE resale market for Housing and Development Board (HDB) flats continues to improve.

Latest official figures show that HDB's resale price index rose by one per cent in Q2 2006 from the previous quarter.

Resale transactions for four-room flats - the largest segment at 2,729 transactions - rose 1.1 per cent while the increase for five-room flats (1,611 transactions) was 6.7 per cent.

The number of resale three-room transactions was also high - up 8.5 per cent - although average valuations remained unchanged.

Similarly, resale transactions in executive condominiums rose 5.2 per cent but average valuations fell by 0.1 per cent (quarter-on-quarter).

For four-room flats, the quarterly average valuation increased 0.2 per cent from the previous quarter's valuation. Five-room flats also saw a 0.2 per cent rise after dropping 0.1 per cent in the previous quarter.

The most expensive four-room flats (by average valuation) are in Bukit Merah ($311,700) and Queenstown ($309,200). For five-room flats, the most expensive ones were in Queenstown ($420,000) and Marine Parade ($417,800).

Propnex CEO Mohamed Ismail believes the buyers who have returned to the market are upgraders. 'I believe they make up around 60 per cent,' he said.

He also said that the improving resale market - with between 80-90 per cent of sellers breaking even or making a small profit - has seen an increase in sellers, resulting in more choice for buyers.

However, ERA Singapore assistant vice-president Eugene Lim noted that even though resale prices were 1.2 per cent higher than a year ago, it was still 3.7 per cent lower than previous peak prices of Q1 2005. This was, of course, before anti-cashback measures were put in place.

By BT's calculation, the index is now 7.6 per cent above the low point in Q1 2002 but 7.5 per cent below the recent peak in Q1 2000.

On the latest price index, Mr Lim said: 'It shows that prices have stabilised and any increase is based on genuine demand.'

ERA also noted that the resale market has seen an increase of supply. Its data shows that in the last three months, high-floor four-room resale flats located within a five-minute walk to an MRT station changed hands for about $10,000-$20,000 above valuation, while five-room flats with similar attributes fetched between $5,000-$10,000 above valuation.

Mr Lim also said a slowdown in the release of unsold HDB flats could have boosted the index. He noted that only 897 units were launched in its Walk-in-Selection programme in Q2 2006, compared with 3,297 in Q2 2005.

THE owners of Derbyshire Mansions in Thomson Road near United Square are teaming up for a collective sale for their 36,098 square foot freehold site.

Derbyshire Mansions: The 36,098 sq ft freehold site could yield up to 74 units averaging 1,300 sq ft

Market observers expect the site to fetch about $50 million or $496 per square foot of potential gross floor area including an estimated $160,000 development charge.

The site is zoned for residential use with 2.8 plot ratio - the ratio of potential gross floor area to land area - and a 36-storey height limit.

This could yield up to 74 units averaging 1,300 sq ft, says Jones Lang LaSalle, which is marketing the property through a tender that will close on Aug 24.

Based on the $50 million price expectation, the proceeds for owners of the existing 33 units housed in a 12-storey block reflect a collective sale premium of about 60 per cent.

Another property put on the market earlier this week is a Good Class Bungalow at Bin Tong Park being offered by its owner, The Asia Life Assurance Society.

The vendor is part of the Asia General Holdings group, which recently sold Asia Insurance Building at Finlayson Green and Hotel Asia in Scotts Road to The Ascott Group, and White House Park Apartments in Stevens Road to Novelty Group.

The asking price for the Bin Tong Park bungalow is said to be $11.8 million to $12.3 million.

This works out to around $450 to $470 per square foot of land area.

A single-storey detached house stands on the 26,254 sq ft freehold site.

The tender for the property, which closes on Aug 21, is being handled by Credo Real Estate.

WING Tai Holdings has sold 70-plus units at its Draycott 8 condo at prices ranging from $1,600 to $1,850 per square foot since it began previewing the development in November last year.

Draycott 8: Wing Tai plans to launch the leasehold development officially next month at a higher expected price range of $1,700 to $2,000 psf

The listed property group now plans to officially launch the leasehold development - marked by the start of an advertising campaign - in late August, at a higher expected price range of $1,700 to $2,000 psf.

As well, the group has started to sell two-bedroom units in the condo, located in the prime Draycott Park area.

Wing Tai began selling the project in November when landscaping work was completed.

The project received its Temporary Occupation Permit in July last year

The 136-unit condo stands on a site with a remaining lease of about 90 years of the original lease of 99 years.

The development comprises three blocks of 24 storeys each.

Two of the blocks each have 44 four-bedroom apartments and two penthouses while the third tower comprises 20 two-bedroom units and 24 two-bedders with lofts.

Wing Tai told BT earlier this week that about half of the 70-odd units sold so far were snapped up by a US fund. The price is understood to be around $1,600 psf.

The company said the rest were bought by individuals from the United Kingdom, Australia, Denmark, France, Russia, Japan, Hong Kong, Taiwan, Indonesia, Malaysia and Singapore.

Wing Tai deputy chairman Edmund Cheng, pleased with the consistent take-up since the preview, attributes this to the development's prime location, high quality and exclusive services, including a spectacular clubhouse said to be the biggest for a condo here, plus concierge services for residents.

Mr Cheng also believes that Draycott 8 has benefited from the ongoing collective sales of both freehold and leasehold properties in the neighbourhood in several ways.

First, it provides immediate replacement units to occupants of collective sale properties. And from the viewpoint of those investing in Draycott 8, the entry price level is lower compared with a freehold property, resulting in a higher yield on rental income.

Also, investors can eventually look to a collective sale of the estate as a strategic exit option, given the growing phenomenon of en bloc sales involving leasehold properties.

'These factors, coupled with the changing mindset of buyers towards leasehold properties, bode well for Draycott 8,' Mr Cheng said.

The Draycott 8 site has a remaining tenure of 90 years because Wing Tai had to hold back the project after it bought the plot for a record price at a state tender that closed in early June 1997 - on the eve of the Asian financial crisis.

Wing Tai paid $1,103.60 psf per plot ratio - the highest amount ever for 99-year leasehold residential land in Singapore.

BT reported in August last year that market watchers reckon Wing Tai could have written down the site's land value to a level that reflects a breakeven cost of below $1,400 psf, after making provisions in financial years 1998, 1999 and 2002.

MORE non-related singles have jointly bought property. According to the Central Provident Fund (CPF) Board, as at June 30, it has approved 637 applications from non-related singles wanting to use their CPF savings to buy private property together.

In October 2005, CPF told BT that it had received 159 applications. By December, the number of approved applications hit 321.

The number may not seem very big but CPF only started to allow non-related singles to buy private property with their savings in July 2005 as part of a basket of property-related measures.

Of these measures, the other significant change was that CPF savings could be used to buy properties with remaining leases of 30 to 50 years.

Previously, only private homes with remaining leases of at least 60 years could be bought.

On this change, CPF also announced yesterday that it has approved 29 applications for such property purchases in the same period.

Knight Frank director of consultancy and research Nicholas Mak said that the numbers in both cases are still not significant enough for the industry, including property developers, to 'sit up and take notice'.

'It would be useful if CPF released more information on the demographics of these people. For instance, it would be interesting to know if they were retirees,' he said.

He added that he believes these are buyers looking at mid-range developments because high-end buyers would not have problems financing a property purchase.

By Mr Mak's estimation, the number of non-related singles using CPF savings amounts to only about 3-4 per cent of the number of total property transactions over the last 12 months.

Relaxation on the age of leasehold developments has also not generated many new buyers.

Jones Lang LaSalle regional director and head of investment capital markets Lui Seng Fatt said: 'Financing providers, banks and finance companies included, generally assess the lending risk of such shorter lease properties more stringently.'

He added that the low numbers of buyers for old leasehold homes could also be due to its lower investment value.

Asked if recent en bloc sales of leasehold developments would change public perception, Mr Lui said: 'Leasehold properties have been around for more than 30 years and buyers are generally familiar with them but the key issue is how much discount investors want for leasehold properties.

'The 99-year leasehold properties in prime districts 9, 10, 11 and 15 are generally well received and do not have any difficulty in finding investors.'

The numbers, though small, are still worth noticing, not least because it reflects lifestyle trends.

Noting that couples buying Housing and Development Board flats have to be married, Chesterton International head of research Colin Tan said: 'Actually the suburban condo market is very stable now and pretty affordable. It is a good opportunity to jump straight into the private sector without having to go through ownership of an HDB apartment.'

He did, however, say that he believes these couples probably intend to marry in the future.

'Of course, there will be the odd case here and there - such as your gay couples,' he added.