Earlier this month, a three-room HDB flat at 2 Tanjong Pagar Plaza was sold for $490,000 ($772 psf). The 635-sq ft flat is in the Central Area HDB town in District 2.

We used our analytics tool, Is it a Good Deal?, to assess the transaction and determine whether the buyer of this flat, located on the fourth to sixth storeys, secured a bargain.

Short walk to Tanjong Pagar MRT Station

The subject flat at 2 Tanjong Pagar Plaza is surrounded amenities as it is within walking distance of Duxton Hill, Tanjong Pagar Plaza Market and Hawker Centre, 100 AM, PS 100, Carlton City Hotel Singapore, Orchid Hotel and Oasis Hotel Downtown Singapore. The Ayer Rajah Expressway is also a short drive away.

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Furthermore, Tanjong Pagar MRT Station on the East-West Line is a short walk away, meaning residents are only one stop from the CBD (see Map 1). Residents will also have access to the Circle Line via the upcoming Prince Edward Road MRT Station. However, the upcoming station is further away and will only be completed next year.

The main locational drawback of the flat is the lack of nearby schools, with Cantonment Primary School being the only one within a 1 km radius. If the distance is extended to 2 km, CHIJ (Kellock) and Outram Secondary School fall within the radius. However, Outram Secondary School is slated to move to Sengkang next year.

Another drawback of the subject flat is its short remaining lease of 51 years, as its lease commenced in 1977 (see Screenshot 1).

The onset of lease decay could be why the transacted price of the subject flat is only marginally above the average price for the district and lower than the average for several nearby projects (see Screenshot 2).

Lower end of price spectrum

So far this year, 62 three-room flats in Central Area town have been sold at prices ranging from $400,000 to $640,000.

Notably, the record-high of $640,000 ($849 psf) was paid in May for another three-room flat at 2 Tanjong Pagar Plaza. However, this 753-sq ft flat is larger than the subject flat (635 sq ft) and is on a higher level of 16th to 18th storeys.

Read also: Is it a Good Deal?: A condo along River Valley Road fetched a profit of $6.55 million

In contrast, this year’s lowest price of $400,000 ($641 psf) was paid in January for a 624-sq ft three-room flat at 9 Selegie Road. The flat is in close proximity to Rochor and Little India MRT Stations, Tekka Market, Sim Lim Square, School of the Arts and St Margaret’s School (Primary). Despite the many surrounding amenities, its price could have been dampened by its short remaining lease of approximately 48 years.

Third lowest among three-room flats along same road

This year, 18 three-room flats along Tanjong Pagar Plaza have been sold at $448,000 to $640,000. The transacted price of $490,000 for the subject flat is the third lowest (see Table 1).

Meanwhile, another three-room flat at 3 Tanjong Pagar Plaza was also sold this month, albeit at a higher price of $510,000 ($803 psf) (see Table 2). This flat is the same size as the subject flat and is also on the fourth to sixth storeys. Additionally, it has the same remaining lease of 51 years.

Average price for three-room flats in Central Area less volatile than larger counterparts

Last year, the average resale price for three-room flats in Central Area town dipped below that for five-room flats but rebounded to $1,335 psf this year, higher than the average of $1,246 psf for five-room flats (see Chart 1). Meanwhile, the average resale price for four-room flats ($2,158 psf) has trended above its three-room and five-room counterparts since 2022.

Hence, the transacted price of $772 psf for the subject flat is lower than the average for similar flats in the same town ($1,335 psf).

Notably, the average resale price for three-room flats in Central Area is less volatile compared to their four-room and five-room counterparts. Prices for the larger flats could have been affected by transactions at The Pinnacle @ Duxton, which tend to skew the average price upwards. The average price for three-room flats remains unaffected because The Pinnacle @ Duxton does not feature such flats.

Read also: Is it a Good Deal?: $439,000 for a three-room flat near Holland Village

For example, six four-room flats from The Pinnacle @ Duxton have fetched at least $1.4 million each this year, with the highest being $1.518 million ($1,501 psf). If transactions for The Pinnacle @ Duxton are disregarded, the highest transacted price for four-room flats in Central Area town is $850,000 ($963 psf) for a flat at 232 Bain Street.

Only one leasehold condo obtained TOP before 2000

There are 14 condos within a 500 m radius of the subject flat. With the exception of Onze @ Tanjong Pagar and The Arris, all the condos are 99-year leasehold developments. Among the 12 leasehold developments, TMW Maxwell and One Bernam are still under construction.

Of the 10 completed leasehold condos, International Plaza is the only development that obtained its temporary occupation permit (TOP) before 2000. The 210-unit development obtained its TOP in 1976. However, its land lease started in 1970, leaving it with a remaining lease of 44 years.

International Plaza is located along Anson Road in District 2. The development is opposite Tanjong Pagar MRT Station and a short drive from the Ayer Rajah Expressway (see Map 2). In addition to the shops on the ground floor of the development, residents can also enjoy amenities provided by the nearby Amoy Food Centre, Maxwell Food Centre, Duxton Hill, Tanjong Pagar Plaza, PS 100 and 100 AM.

The average resale price for International Plaza is starting to reflect its age, declining by 4.9% since 2023 to $1,185 psf (see Chart 2).

In comparison, the average resale price for 99-year leasehold condos in District 2 has also declined since 2023, albeit by a smaller 0.4% to $2,368 psf (see Chart 3). In contrast, the average resale price for 99-year leasehold condos islandwide rose by 10.1% since 2023 to $2,287 psf.

Conclusion

The transacted price of $490,000 for the subject flat at 2 Tanjong Pagar Plaza is among the lowest for similar flats along the same road. Its price of $772 psf is also lower than the overall average for three-room flats in Central Area town.

Its low-than-average price could be due to its short remaining lease of approximately 51 years. This is despite the subject flat being conveniently located in Tanjong Pagar which is only one stop away from the CBD as well as being surrounded by amenities such as Tanjong Pagar Plaza Market and Food Centre, 100AM and PS 100.

To learn more about this transaction, and whether it is a good deal, click here.

Check out the latest listings for International Plaza properties