» Private homes for $1 million
or less
Straits Times: Sat, May 19
BUYERS can still snap up
private apartments of
reasonable size for less than $
1 million - but do not expect
up-to-the-minute styling or
prime locations.
Yet such buys could end up
being a good deal if they are
in an area that is set to be
revitalised or developed.
Buyers have been quick to
jump in.
There were 1,249 private flats
of 1,000 sq ft or more sold for
below $1 million in the period
from Jan 1 to May 4,
consultant Nicholas Mak said.
This includes new and resale
private and executive
condominiums.
Mr Mak, the head of research
at SLP International Property
Consultancy, added that most
sales were made in 99-year
resale condos in suburban
areas. The freehold properties
were mostly in city fringe
areas such as Geylang, where
there is a higher
concentration of such homes,
he said.
Homes costing less than $1
million can be found in both
new launches and the
secondary market but it is
rarer in the former, because
the increase in land prices has
led developers to offer higher
per sq ft (psf) prices and
smaller units, R'ST Research
director Ong Kah Seng said.
New launches of flats of at
least 1,000 sq ft and costing
below $1 million can be found
in the north-eastern areas like
Hougang, Sengkang and
Punggol.
Mr Ong noted that in the first
four months of the year, there
were 74 such transactions at
The Minton, an upcoming 99-
year condo in Lorong Ah Soo,
and 36 at Sengkang's
Riversound Residence, a 99-
year condo.
Deals can also be found in
upcoming condos in Pasir Ris.
There were 24 sales at The
Palette and 12 at Ripple Bay.
For example, a 1,076 sq ft flat
at Ripple Bay was sold for
nearly $902,000 last month.
That works out to $838 psf.
The 99-year condo is expected
to be completed in 2015.
'(These areas) are more
valued propositions as the
north-east promises exciting
future growth while Pasir Ris
is an established and
refreshing resort-living area,'
he said.
In Yishun and Sembawang,
some similar transactions
were made at The Nautical
and Eight Courtyards.
These areas are also good
scouting grounds for buyers
looking to get a resale unit,
which could be as big as 1,400
sq ft for that price, Mr Ong
said.
Based on caveats lodged in
the first quarter of the year,
completed condos like Regent
Heights, Changi Rise
Condominium, The Mayfair,
The Warren and Hillview
offered bargains.
Last month, a 1,346 sq ft unit
at Melville Park in Simei was
sold for $888,000. The 99-year
condo was completed in 1996.
Many shoebox units -
measuring about 540 sq ft or
less - cost less than $1 million
but these are said to be too
small for a family.
Decent-sized units can also be
had for a similar price, but
buyers have to bear in mind
the trade-offs, like how an
older condo may look dated.
Mr Lee Sze Teck, senior
manager of research and
consultancy at Dennis Wee
Group (DWG), pointed out:
'When a property is older...
there will be more
maintenance issues which may
require higher upkeep.'
He warned that major repairs,
if any, will 'dip into the sinking
fund of a strata-titled
property' and if it is not
enough, buyers will have to
pay in cash. 'Also, banks may
not be willing to lend to
leasehold properties with
short leases remaining,' he
said.
While R'ST Research's Mr Ong
noted that some people might
not mind buying a older
project, those looking for
homes with lasting power may
find it worthwhile to look into
executive condominiums
instead, Mr Mak suggested.
'Other than that, private
condos that are more than 10
but less than 20 years old can
beat newer launches in size
and price, even though there
might be some wear and tear,'
he said.
Credo Real Estate executive
director Ong Teck Hui pointed
out that a freehold unit would
be 'better value compared to
99-year leaseholds'.
'The latter would have run
down by quite a number of
years and may not appreciate
as well over the longer term,'
he said.
Buyers, of course, must know
what they are buying the unit
for before snagging a deal.
For instance, investors must
consider the 'rentability' of
the unit, said Mr Danny Yeo,
group managing director of
property consultancy Knight
Frank.
'They will also look at capital
appreciation. Thus, it's better
to select locations closer to
MRT stations and town,' he
said.
However, owner-occupiers
could be more willing to trade
a good location for a family-
sized unit, given that budget.
Aside from private projects,
landed homes have also
recently sold at low prices.
DWG's Mr Lee said a 60-year
leasehold terraced house at
Geylang's Lorong 3 was sold
for $90,000 this year, although
it only had seven years of the
lease left.
'People who buy such homes
are likely to be looking at
getting passive rental
income ... it is unlikely that
they will be able to resell it
for gains,' he said.
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