Up and coming district – Jalan Besar

As properties in the city centre become increasingly out of reach for the average investor hoping to gain a footing in the property industry, more are turning to the city fringe areas such as Marine Parade, Kampong Glam and Novena. Now, the Jalan Besar and King George’s Avenue districts could also be attracting buyers.

CitronThough the private homes market in the area has softened in the past year due to mortgage limits, its proximity and increasing popularity with the young and hip crowd and potential connectivity with future MRT lines in its midst, has renewed interest from investors. An area in King George’s Avenue has also been gazetted for future HDB blocks. One completed condominium apartment block in its vicinity is the City Square Residences, which during its launch drew huge crowds looking to purchase smaller units for rental purposes. Other private residential properties include Parc Somme and Kerrisdale.

Buyers waiting for new options can keep an eye out for private residential properties such as The Citron Residences on Marne road. Property experts are positive about the potential rental yields of smaller apartment units in the area as the district continues to bring in a variety of new businesses. Currently rents for smaller apartments in the area go for as much as 4 per cent more.

$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?

Bijou – Far East Organization’s first Dual-key SOHO

Whether you’re looking for a place to call home or seeking out the best property investment deal, location and design are often top of the consideration list. Thus, when something comes along that has both, savvy buyers will naturally gravitate towards it. The latest property by Far East Organizrtion – the freehold Bijou, is one such property.

Though dual-key apartments have been in the limelight for sometime now, most units have a separate smaller area with its own entrance but without its own facilities such as a kitchen and toilet. Bijou’s dual-key apartments however, are designed much like the much-desired maisonette, with one entrance but entirely distinct living spaces upstairs and downstairs, each with their separate kitchen and toilet. It’s extremely suited for rental since it maintains your and your tenant’s privacy. It’s almost as good as buying one condominium unit but owning two, without having to pay additional stamp duty and taxes.

Bijou1Combined with their french-inspired garden landscapes and rooftop garden views of the city, this exclusive 5-storey residential development only has 24 of these dual-key units in its 120-unit, which makes it all the rarer. Entering the market as the first dual-key SOHO, the freehold Bijou is located in one of the fastest-rising areas under URA’s latest Master Plan 2014. With the development of the Greater Southern Waterfront and the regional commercial hubs in the Pasir Panjang district, the influx of a burgeoning workforce seems more than likely. Traveling to the Marina Bay Financial Centre will also be much quicker, and as a mixed-use development, Bijou will also have retail and dining options right at its doorstep.

As the Singapore landscape changes in big ways, so will the property market and areas which have once been put on the back burner will not come into the forefront.

CBD Living on the rise

Despite restrictions in the property market and decreasing sales in the private property sector, more buyers are looking to purchase apartments in the CBD (Central Business District).

Tanjong Pagar CentreLiving just a walk away from the office has its positives. But recent interest has dawned from the promise of change. New mixed-use developments such as GuocoLand’s Tanjong Pagar Centre, will bring live into the sleepy after-hours districts of Shenton way, Raffles Place and Tanjong Pagar and change the fact that CBD living often comes with its fair share of inconveniences such as not having schools, supermarkets or shopping centres which open beyond the normal office hours in the vicinity.

Tanjong Pagar Centre will feature Grade A office spaces, luxury serviced apartments – Clermont Residences and other commercial businesses. It will be linked to the Clermont Singapore Hotel. Just a little way off are other residential options – the Marina One residences. This project will go on sale later this year, and prices are expected to start at $2, 800 psf. There are other new private apartment developments in the pipeline, giving this city-nation a new meaning to city-living. Skysuites @ Anson, 76 Shenton and Altez, just to name a few of the many which have come up in the last 10 years.

76 ShentonWith news of the Southern Waterfront development under URA’s draft masterplan 2013, the area looks set to be booming with activity within the next decade. Considering the fact that rental yields now are already at 4 to 4.5 per cent, higher than the island-wide average of 3.8 per cent, it will be no wonder what the future will bring.

Kovan and Dual-key apartments – A Perfect Match

Dual-key apartments were a relatively new property type just a couple of years ago, but now, they are all the rage, especially with big families and property investors who are looking for prime property to rent out. And the latter could have found their perfect match with dual-key properties.

Trilive KovanThese dual-key apartments are unique for its 2 entrances within one unit. And this helps investors rent out the same unit they live in, while still keeping their privacy, all the while avoiding the ABSD (additional buyers’ stamp duty). If you own more than 1 property, subsequent properties will mean higher taxes and duties.

Developers are quickly picking up on buyers’ keen response to dual-key apartments and are including more of them in new launches. A new condominium development, Trilive in Kovan, will feature 88 dual-key units , that’s almost 80% of its total 124 units. To be launched later this year in June, dual-key units will start from its 614 sq ft two-bedders. Prices have yet to be released but are expected to be similar to that of the nearby The Tembusu, at $1,400 to $1,500 psf.

Kovan is an up and coming area for high rental take-up rates as rents there are relatively affordable for its convenient location and surrounding amenities. It has one of the highest rental yields in Singapore. It’s proximity to areas such as Hougang and Serangoon also means it is close to a number of schools, various modes of transport and just a few stops away from the city center.

The road ahead for the property market could be spiced up with the introduction of more dual-key units in future launches. Buyers will undoubtedly be interested to see how these new properties provide an edge up from what is currently in the markets.

More looking to rent private property

Immigration rules have shrunk the pool of foreign workers here in Singapore, and that also meant a lower demand for home rentals. Closely linked to this are the prices and sales of private homes,  which have been on the decline for sometime now.

But the market is starting to look up as the previous quarter saw a increase in demand for private rental homes. The growth is expected to continue into the second half of the year. Though figures are somewhat positive, the number of vacant rental units available in the market also means tenants will have more to choose from and competition will be fierce.

Shore-Residences-Amber-Road.jpgTenants seemed to favour the city fringe areas, as rental budgets have been largely reduced, and price-conscious expatriates are now more stringent with their spending. The Rest of Central Region districts received the most loving from rental home seekers, including areas such as Bishan, Toa Payoh, Little India, Queenstown and Geylang. New private condominium developments in these areas have accounted for renewed interest. Slightly further west, Ascentia Sky, Waterbank at Dakota and The Interlace all in the Alexandra, Depot road region meant up to 2,500 new units, some of which no doubt will join the rental pool. In the East, Waterview in Tampines, Vacanza@East and The Shore Residences will be completed in the first quarter of 2015.

The Loft at Nathan, situated in River Valley on the city fringe.

The Loft at Nathan, situated in River Valley on the city fringe.

Landlords of high-end apartments may continue to see a lack of movement in the rental front. And units are already expected to add to the mix, with the completion of Suites @ Orchard and Loft@Nathan next year.

Dual-key units not forgotten

In fact, property developers are still building a number of dual-key apartments in new suburban condominiums despite its decline in recent months. These 2-entrances, 2-keys units are not very common though they can be found in some executive condominiums (ECs) and larger private suburban condominium developments. But they have appealed to large, multi-generational families.

For executive condominiums (ECs), only families who qualify as a multi-generation family as follows can apply:

  • Married couple with parents/grandparents
  • Fiance and fiancee couple with parents/grandparents
  • Widowed/divorced with children and parents/grandparents

SantoriniIn the private property sector, there are no such restrictions and those who are hoping to reap some profits from rental will find them particularly attractive. But the large size of these dual-key units may be an indirect reason for its fall in sales volume since the introduction of property loan limits. Home buyers simply are not able to afford the high quantum prices these units demand.

So far, dual-key apartments have been prominently featured in up to 8 private residential developments and now more than half of the condominiums with more than 400 units include dual-key units in their midst. Some of the more notable launches with dual-key apartments available for sale are:

How will these large condominium units fare in the later half of this year? Will it be a battle between the small shoebox apartments and larger rarer units?