Weekly Kopi Talk (13/1/18 – 19/1/18)

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15th Jan 2018 – Home loan gets pricier as banks hike interest rates again

SPK: A 30 basis points increase for a S$1 mil loan would translate to an extra S$144 every month in mortgage repayment. For a household that earns S$12,000 a month, the increase is only 1.2% of their combine income. When interest rate approaches 3.5%, it is time to be cautious as banks may start to increase their stress-testing interest rate for loan approvals.

16th Jan 2018 – 2017 developers’ sales hit 4-year high; momentum expected to continue

SPK: Barring unforeseen government policy changes or economic/interest rate shock, developers’ sales likely to remain strong in 2018. You can read more on SPK’s market outlook here.


16th Jan 2018 – Paya Lebar Quarter signs up tenants for over half of office space

SPK: The numbers look impressive, but considering that 15% of office space is used for Lendlease’s own co-working facilities and that some of the advance negotiations are also included in the numbers, it seems as though the actual pre-commitment might not be that impressive after all.

18th Jan 2018 – Further upside for developers that can deliver on strong sales, higher selling prices

SPK: Small-mid cap Singapore developers looks good for investors to ride on the upturn in Singapore property market. These companies tend to have higher balance sheet exposure to Singapore property market in comparison to big-cap developers, which are more geographically diversified. The relatively low equity base of small-mid cap developers also works to their advantage. One single profitable development project in Singapore can result in significant accretion to the NAV of a small-mid cap developer.


Happy weekend!


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