City Fringe wins once more

From Marine Parade to Novena to Kampong Glam, areas surrounding the busy city centre and central business districts are some of the best spots for property investments and this has hardly changed over the years.

The mixed-use development DUO at Ophir road was one of the latest offerings late last year. This year, another similar residential-cum-commercial project join their ranks – the City Gate on Beach road. But before these giant developments came into play, the Concourse Skyline condominium apartments were already in place. This 360-unit property was priced at $1, 590 psf at its 2008 launch. Despite 101 of its units remaining unsold, existing units have gone for as much as $2, 075 psf in the last quarter of 2013.

CIty GateWith the large number of incoming units from City Gate, which is targeting a price range of $1,900 to $2, 000 psf, these remaining units at the Concourse Skyline may be up for some fierce competition. Developers, Hong Fok Land, may experience some pressure to lower prices in order to meet the “All sold” status.

City Gate will sit on the site of the former Keypoint and will feature 188 commercial units and 311 apartment units ranging from one- and two-bedders to the increasingly popular dual-key units. Penthouses will vary in size, from 484 sq ft one-bedders to 1, 819 sq ft four-bedders. The wide variety of units will draw buyers with different intentions in mind, but with such a prime location, the only thing that might stop consumers in their tracks is the strict loan limits.

Smaller apartments gaining popularity once again

Just a couple of years ago, there were debates about whether homes were becoming too small for comfort as the 500 sq ft studio apartments or shoebox units took the market by storm. Some shunned small units, preferring instead to go for larger ones with a lower psf price.

But now as loan limits are truly showing their might, buyers are favoring smaller apartments once again due to their lower quantum prices and the ease of rental. Though not all are flocking to shoebox units, after all, young families do need a reasonable amount of space, the average home size has dropped to 947 sq ft from June last year. And for HDB upgraders, their chances to move onto the private property market might have become slimmer, especially if size is a major consideration. The average 4-room HDB flat is around 969 sq ft.

CIty GateOne- and two-bedders have increasingly become more popular with buyers as they are usually within their budget and investors find them easier to rent out. URA figures in fact also showed that new residential properties have also featured smaller units, with the average size being 753 sq ft. But this hardly comes as a surprise as home size has been shrinking since 2009.

The other popular property  type is the dual-key apartment which provides the atmosphere of having two separate living spaces within the same home. Some of these units share the same entrance but separate facilities such as kitchens and toilets, while others share the same facilities but have separate entrances, providing privacy for bigger families and offering more rental options.

As we progress into the second half of the year and the market evolves in reaction to buyers demand and supply of land, will developers be quick to re-strategize and cater to the majority?

$1 million sweet spot for home prices

The average affordability ceiling for properties have dropped by almost $200,000 ever since the Monetary Authority of Singapore (MAS) placed curbs on loans. The average price home buyers can now afford, or are willing to fork out, is $1 million. Properties between the total quantum range of $800,000 to $1. 2 million generally sit better with buyers. The range used to be wider, with homes reaching $1.4 million selling just as well.

LakevilleDevelopers have been quick to realize the shift and have been offering considerable discounts or competitive pricing for new launches. Smaller units such as studio apartments and one- or two-bedders have also performed better than their larger counterparts. About 8,254 homes priced between $700,000 and $1.2 million were sold during the last year. Properties which were offering more affordable units, such as the Coco Palms in Pasir Ris which launched units at $980 psf, were able to garner more sales.

And for buyers hoping to secure a home below $500,000 there are now more available, and more sold. In the last year, 291 units below $500,000 were sold from June 2013 to June 2014. Comparing to the year before, only 61 units were sold within the same time frame. Buyers consider smaller units easier for both occupier and rental purposes, plus most HDB upgraders rate affordability of homes as between $900,000 to $1 million.

Orchard road’s West end revamp?

A little off the main stretch, but nearer the exclusive Botanic gardens and Tanglin stretch of sprawling private homes and foreign embassies, the West end of Orchard road looks set for a revamp as MRT stations and other area redevelopment plans are in the works for this spot.

The TomlinsonA MRT stop which is part of the latest Thomson Line is planned just next to the Camden Medical Centre and targeted to be ready by 2021. Now may be the time developers will consider expanding or redeveloping land and older properties around the area. There have been movements in the recent years, with the latest property being St. Regis Residences. Sales at this luxury property has not always been positive however. Prices of $4, 653 psf in 2007 have since almost halved to $2, 399 psf.

Older properties in the same area, such as Cuscaden Residences and The Tomlinson, however fetch a lower sales price, and may be more palatable to those seeking an investment. But due to the relatively large size of most apartment units in the area, it also narrows the target audience. Those who are able or willing to purchase properties here will be limited as it may be more difficult to rent out. At The Tomlinson, the average resale price is $1, 896 psf.

Will the new MRT line bring refresh the market even as luxury homes sales are on a decline? Will the possibility of future collective sales of older condominiums be an incentive to purchase now?

Woodlands’ popularity to rise with the Singapore-JB Rail

It’s almost another country, but not yet. Woodlands used to give one that feeling. But as Singapore welcomes foreign workforce from our neighbouring Malaysia, and as governments from both countries make a concerted effort to improve transportation between the 2 locales, Woodlands may be the next spot to watch.

The Woodlands Regional Centre and the Rapid Transit Systerm (RTS) will be the main boost to the far flung town and residents will be happy to see the increase in connectivity and activity in the estate. Completion of the RTS is expected to be in 2018, and it should be ready for use in 2019. It seems a long way away, but in just 5 years’ time, Woodlands could be a changed man.

Parc RosewoodThere may be more Malaysians and Permanent Residents (PRs) relocation to the area and rental of HDB flats and apartments in the area is likely to rise. Comparably, homes in the area are now priced much lower than more popular areas of Singapore, but all these may change as the influx of human traffic in Woodlands creates a regional buzz with new businesses opening up. URA is planning to revamp the area to be a modern sub-regional centre with commercial and retail businesses setting up shop. Schools in the area include Innova Junior College and Republic Polytechnic.

The newer condominiums in Woodlands are far and few in between, namely Parc Rosewood and Rosewood Suites. Older developments include Rosewood and Casablanca. Prices of the older apartments range between $800 to $873 psf and $872 to $1, 319 psf for the newer Rosewood Suites and Parc Rosewood. The process of converting Woodlands may be gradual but imminent. But perhaps once again, early adopters will benefit the most in the long run.

Queenstown has more flats to offer

One of the oldest HDB estates in the West, Queenstown looks set to have a fresh set of HDB flats. For the 3,480 flats from Tanglin Halt road to Commonwealth Drive will be torn down and rebuilt under the Selected En Bloc Redevelopment scheme.

Queenstown-HDBThis will be a promising move for the mature estate as these two to four-room flats make way for newer, bigger blocks. Most of the residents were offered replacement flats and compensation based on current market value of their units. Most three-room HDB flats in the Queenstown area are priced between $305,000 to $390,000 according to current HDB transaction values.

Residents can look forward to new sky gardens and terraces, panoramic views of the city and new shops, eateries, supermarkets and hawker centres. Considering these flats will have a new 99-lease of life, future residents will be stoked that their new flats will possibly fetch even higher prices in the future.

Commonwealth TowersOne of the more prominent private property offerings in the area is Commonwealth Towers, which is particularly attractive to buyers due to its proximity to the Queenstown MRT station. In nearby Alexandra and Tiong Bahru, there are other popular apartments such as Highline Residences, Ascentia Sky and Alexis. Will surrounding properties also benefit from this redevelopment process?

Paya Lebar thriving area for properties

A largely commercial and industrial area, one would not have thought Paya Lebar would bring much cheer to anyone but the landlords of commercial properties. But the large number of foreign workforce these businesses will bring to the surrounding districts may be something to look forward to.

Katong Regency - Mixed-used development on Tanjong Katong Road.

Katong Regency – Mixed-used development on Tanjong Katong Road.

Slated for sale in the next half of 2014, Paya Lebar Central will see a 132, 000 sq m new building with offices, retails businesses and even a hotel. What now stands on the spot is the Singapore Post Centre amongst other industrial properties. Its proximity to the city centre and its competitive rental rates will no doubt make it one of the more popular commercial districts in the country and residential properties nearby could be looking at positive rental possibilities.

There are a variety of both landed homes and high-rise apartments in Paya Lebar, Joo Chiat, Katong and Marine Parade. Urban Villas is a cluster of private terraces and semi-detached houses which are freehold. In the Katong area, there are Katong Regency, The Lush and Aura 83 condominiums, an area which has been a hive of activity since the opening of many new eateries and shops and also the 112 Katong shopping mall.

The East has never looked so exciting. And we can expect it to be the next big thing in a few years’ time.

Luxury apartments – Leased instead of Sold?

As the property market lull continues, developers of luxury properties are finding the going all the tougher. As the number of unsold units loom large in the horizon, some property developers have considered turning their private condominiums into serviced apartments instead.

iLiv@Grange

iLiv@Grange

The only other options are for those with deeper pockets to hold off their launches till the market turns around, or to offer steep discounts. Ardmore Residences is just one of the possible few luxury residential developments whose launch has been held off. Wealthy investors do not seem to be keen on hopping on the market for now, probably in lieu of the tightening measures placed around the housing and finance sectors. Since its completion last year, developers have chosen instead to lease out units at the Ardmore Residences for approximately $25, 000 per month. The Sculptura Ardmore condominium nearby has also not been launched.

Sculptura ArdmorePhoto credit: SC Global.

Although some marketing has been done for the iLiv @ Grange apartments in Grange road, it has not been officially launched as well. At its unveiling in 2010, developers were targeting selling prices of $3, 000 psf. But in the current market, that figure might be unrealistic. There has been talk of the developer, Heeton Holdings, possibly selling the units in bulk to a single buyer at $2, 200 to $2, 300 psf. Developers generally have a window of 2 years after completion of the project to sell off the units. Remaining units are not allowed to be rented out. Since Singapore may require more hotels and short-term accommodation, it may be a new venture should these luxury residential projects near the city centre to be converted into serviced apartments.