US housing market weakness long-term: survey

US housing market weakness long-term: survey


NEW YORK – US consumers expect housing market weakness to linger for longer than they did a few months ago, a survey showed on Friday.


The Reuters/University of Michigan Surveys of Consumers Home Prices Report for June also cited a broad gulf between buyers and sellers in the housing market.


Economists broadly agree that US house prices peaked sometime in 2006. According to some measures, they have fallen about 16 per cent since then.


‘Consumers now anticipate that the weakness in home prices will last much longer than they had anticipated a few months ago,’ wrote Richard Curtin, director of the survey.


‘Record numbers of consumers now think there are very attractive prices on homes for sale,’ Mr Curtin said. ‘The problem has been that record numbers of consumers have objected to selling their home at such deeply discounted prices.’


Asked about prospects for home prices during the year ahead, 23 per cent of homeowners reported that they anticipated declines, down from 27 per cent in the May survey. In June, 19 per cent said they expected home prices to rise in the next year, unchanged from May’s reading.


Asked about the direction of house prices over the next five years, 13 per cent of respondents said they expect prices to fall, while 55 per cent said they expect prices to rise. That was down from a 2007 peak of 70 per cent who said they expected house prices to rise. — REUTERS


Source: Business Times

Housing crisis brings Wall St arrests, veto threat

Housing crisis brings Wall St arrests, veto threat

* Former Bear Stearns managers charged over fund losses

* Federal authorities announce crackdown on mortgage fraud

* White House threatens veto of housing rescue



WASHINGTON – The US housing crisis produced its first high-profile Wall Street arrests on Thursday, while the Bush administration called for broadening the Federal Reserve’s powers over investment banks and said it has charged hundreds of people in a mortgage fraud probe.


At the same time, the White House issued a surprise veto threat against a Senate bill aimed at preventing hundreds of thousands of foreclosures. The threat signalled more partisan warfare on Capitol Hill as homeowners struggle.


Two former managers for Bear Stearns Cos, itself a recent victim of bad bets on mortgage securities, were arrested and indicted on securities fraud charges in New York in connection with the US$1.4 billion collapse of two hedge funds.


Ralph Cioffi, 52, and Matthew Tannin, 46, each pleaded not guilty. In a scene reminiscent of Enron-era scandals, the men surrendered to officials and were paraded in handcuffs in front of onlookers en route to their arraignment on Thursday.


The two were charged with defrauding investors by concealing problems that led last year to the disintegration of the two hedge funds. That event raised fears about risky subprime mortgages and helped usher in a global credit crunch that governments around the world are still sorting out.


With falling home prices and rising foreclosures, the US Justice Department said it charged more than 400 people in a 3-1/2-month, national probe. Dubbed ‘Operation Malicious Mortgage,’ it involved US$1 billion in losses and 144 cases, mostly of lending fraud and foreclosure and bankruptcy scams.


The department’s get-tough display came amid rising fears the housing slump is pushing the economy into recession – an issue playing a prominent role in the presidential race.


Both contenders – Illinois Democratic Sen Barack Obama and Arizona Republican Sen John McCain – are making economic recovery central to their campaigns.


‘No one can predict when the fiscal chaos in housing will end, but it doesn’t look like we will be done any time soon,’ said David Abromowitz, a senior fellow at the Centre for American Progress, a think tank in Washington.


‘Trillions of dollars in lost family home equity … has been wiped out for many families in just a short time. We would expect this to impact lives and put a drag on the economy well past the day when foreclosures slow and prices stop falling.’



Fed expansion urged

US Treasury Secretary Henry Paulson on Thursday urged broad new powers for the Federal Reserve over investment banks, following actions taken by the US central bank in March that changed its relationship with Wall Street.


In March, the Fed helped broker a takeover of Bear Stearns by JPMorgan Chase & Co and guaranteed a US$29 billion loan to facilitate the deal out of concern a Bear Stearns bankruptcy could trigger a financial panic.


It was the first time since the Great Depression of the 1930s that the Fed, which regulates commercial banks, had stepped in to rescue a nondepository institution. The Fed also set up a special credit line to make emergency loans to major investment banks in an effort to ease credit market strains.


In an opinion piece in The Wall Street Journal on Thursday, Securities and Exchange Commission Chairman Christopher Cox said decisions must be made on whether and how long to maintain the emergency lending program, scheduled to expire this fall.


Another SEC official told a congressional panel on Thursday that the investor protection agency and the Fed have nearly completed a formal agreement to oversee investment banks until Congress can set up a permanent system through legislation.



Congress debates

It looked unlikely that Congress would tackle such complex structural issues this year, given the difficulties it was having agreeing on legislation to help homeowners.


The White House issued a surprise veto threat against a Senate bill that would, like a similar bill already passed by the House of Representatives, create a new fund to underwrite up to US$300 billion of failing home loans. It would also offer billions of dollars in emergency housing relief.


Proponents say the bill could save 400,000 homeowners from foreclosure. But the Bush administration House objected to a provision that would give state and local governments money to buy and fix foreclosed properties.


Congressional leaders were trying to hammer out a final bill and send it to President George W. Bush before lawmakers leave town at the end of next week for the July 4 holiday.


Some House Republicans also threatened to stall a final version of the housing bill, demanding more information about preferential mortgage terms given to two Democratic senators by Countrywide Financial Corp.


‘Given the questions around Countrywide, preferential loans need to be investigated,’ House Republican leader John Boehner told reporters. ‘To think that we’re going to move a housing bill with these questions looming I think is irresponsible.’ — REUTERS


Source: Business Times

CDL sells Commerce Point for US$132m

CDL sells Commerce Point for US$132m


SINGAPORE – Singapore’s City Developments confirmed on Friday that it has entered into an agreement to sell an office building for S$180.7 million (US$132 million) to Pioneer Panda Pte Ltd.


The completion of the sale for the 19-storey building, called Commerce Point, is scheduled to take place on July 3, CityDev said in a statement.


‘The above transaction is in line with the Group’s continuous review and evaluation of its existing asset portfolio,’ it said.


Singapore‘s Business Times newspaper reported on Friday that CityDev had sold the property to Morley Fund Management, part of the Aviva Group. — REUTERS


Source: Business Times

Building consultancies win more overseas deals

Building consultancies win more overseas deals


SINGAPORE construction consultancies won 406 projects overseas last year, up from 360 in 2006, according to a survey by the Building and Construction Authority.


BCA said that following a decline in 2006, China regained top spot as the largest overseas market, with 137 projects won last year. Ninety contracts were secured in India, the second-largest overseas market. Vietnam and Malaysia remained attractive, along with Abu Dhabi, Dubai, Saudi Arabia and the United Arab Emirates in the Middle-east.


BCA said the most sought-after services were architectural and master planning – more than half of all projects won, up from just 28 per cent in 2006.


The BCA survey also found that Singapore construction firms clinched $2.7 billion of contracts overseas – the highest value in five years, with the greatest growth in environmental-related construction projects. About $1.2 billion of such projects, including water treatment plants, were signed last year, in comparison with $330 million in 2004.


On the other hand, the value of general construction work contracts won overseas fell as the booming local market absorbed firms’ capacity and attention, BCA said.


In all, the Middle-east was the leading market for Singapore construction exports, with $1.7 billion of deals signed, against just $200 million in China. However, construction exports to India and South-east Asia declined sharply, according to BCA.


Source: Business  Times

Ascott launches new hospitality centre

Ascott launches new hospitality centre


The Ascott Group today officially opened its new global hospitality training centre in Singapore called Ascott Centre for Excellence.


The centre will train Ascott’s 5,000 employees located in the Asia Pacific, Europe and the Gulf region to support its global expansion.


Besides Ascott’s proprietary programmes, the training centre is the first in Singapore to offer the Workforce Development Agency’s full range of Hotel and Accommodation Services programmes.


This full range of hospitality programmes will be opened to the Singapore public from October this year.


They range from Certificate and Advance Certificate to Diploma level.


In addition, Ascott has signed a Memorandum of Understanding with Nanyang Business School to offer management trainee programmes and internships to its Tourism & Hospitality Management students.


Ascott’s President and CEO Jennie Chua said by providing students with real work experience and learning opportunities, the centre hopes to raise awareness of hospitality as an attractive career among the younger generation.


Source: 938Live




MR DESMOND Woon Choon Leng, an executive director at Ho Bee Investment, has raised his direct stake in the property developer this week.


He bought 100,000 shares on Wednesday on the open market at 83 cents apiece, raising his direct stake to 1.65 million shares, or 0.224 per cent of the company’s issued share capital.


This follows two purchases he made last month, when he bought 250,000 shares at 93.7 cents apiece and 150,000 shares at 95.8 cents apiece on the open market.


Mr Woon does not have a deemed stake in the company.


Earlier this month, independent director Bobby Chin Yoke Choong bought 50,000 shares at 92.5 cents apiece.


Property developers are facing challenging times given the cooling property market.


Sales of Ho Bee’s 348-unit Dakota Residences condominium are expected to start tomorrow. If the project is positively received, that would provide a catalyst for the company’s share price, said DBS Vickers Securities.


Ho Bee shares have been on a decline since reaching a high in October last year. The counter has fallen more than 44 per cent since the start of this year. It closed half a cent, or 0.61 per cent, lower at 81.5 cents yesterday.


Source: Straits Times

Building consultants’ overseas jobs up 12%

Building consultants’ overseas jobs up 12%


THE construction sector may be booming in Singapore, but that did not stop local building consultancies from securing more projects abroad – up 12 per cent last year over the previous year.

A survey by the Building and Construction Authority (BCA) showed that Singapore consultancy firms won 406 projects last year compared with 360 in 2006.


These deals were secured by 65 firms, compared with 68 the previous year.


Among the different consultancy services, architectural and masterplanning services were the most popular, the BCA said.


The top markets for Singapore consultancies were China and India, with 137 and 90 projects respectively.


BCA director of business development William Tan said: ‘Our firms should continue to focus on niche areas such as planning and design as well as quality construction and environmental- related constructions.


‘The continuous efforts in establishing an overseas presence by our firms despite their current workload in the domestic market are definitely an excellent business strategy to mitigate the effects of the cyclical nature of the construction sector.’


The survey also showed local firms winning the most construction and engineering projects in the last five years.


These firms won $2.7 billion worth of deals compared with $2.1 billion in 2006, despite strong domestic demand, BCA said.


Source: Straits Times