COMMENTARY: Can you afford a 3-bedroom home?

By Elizabeth Choong
/ EdgeProp Singapore |
D’Leedon (Picture: The Edge Singapore)
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Pendulum swinging back to larger units

The Covid-19 pandemic has resulted in many companies adopting work-from-home arrangements and causing homeowners to realise a need for more space.
Before the pandemic, the home sizes were shrinking especially in the central region. With increasing demand for larger homes, prices for such units have been given a boost. However, there are still affordable three-bedroom gems to be found.

Costly dream homes in central region

From January 2021 to March, there were 33,602 sales transactions for condominiums. Of which, 18,158 transactions (54.0%) were for units in the central region due to a number of well-received launches; namely Normanton Park (1,717 sold units), CanningHill Piers (601 sold units), Irwell Hill Residences (422 sold units), Midtown Modern (412 sold units) and Avenue South Residence (369 sold units).
While many dream of living in districts 9, 10 or 11 with their family, the high cost of large condominium units in these prime districts can be prohibitive. Irwell Hill Residences in District 9 has a take-up rate of 78.1%. The uncompleted 540-unit leasehold project is within walking distance of Great World City and Zion Riverside Food Centre. In 2021 and 1Q2022, 55 three-bedroom units of 861 to 1,270 sq ft in the development sold for $2.14 to $3.47 million ($2,463 to $2,919 psf).
Irwell Hill Residences - EDGEPROP SINGAPORE
Irwell Hill Residences (Picture: Samuel Isaac Chau/EdgeProp Singapore)
Buyers looking for completed projects can consider D’Leedon. The leasehold condominium in district 10 was completed in 2014 and has 1,703 units. There are 752 three-bedroom units in the development ranging from 786 to 1,938 sq ft. From January 2021 to March, 27 three-bedroom units sold for $1.53 to $2.53 million ($1,421 to $1,874 psf); making three-bedroom units in D’Leedon at least $1,000 psf cheaper than Irwell Hill Residences.

Look to HDB resale market for more affordable alternatives in central

Buyers who are still keen to live in the central region despite their modest budget should consider the HDB resale market.
According to HDB, Geylang, Kallang/Whampoa and Bishan have the cheapest five-room flats in the central region in 4Q2021 despite tremendous price growth for these towns. A typical five-room HDB flat has three bedrooms and is 1,152 to 1,216 sq ft.
It is interesting to note that five-room flats in Queenstown, Toa Payoh and Bukit Merah are not just the most expensive in the central region, they are also the most expensive in Singapore. However, median prices for these three towns are still under $1.0 million; making them a steal compared to condominiums in the same region.
The average price for resale HDB flats in Queenstown (red line) is $755 psf; almost $800 psf lower than resale leasehold condominiums (blue line) and $1,130 psf lower than new leasehold condominiums (dark blue line). However, price growth for condominiums is double that for HDB flats in Queenstown. (Find HDB flats for rent or sale with our Singapore HDB directory)

More space and choice can be found in the east

The east accounts for 5,622 transactions (16.7%) in 2021 and 1Q2022. As such, the eastern region has the most sales transactions after the central region. Sales transactions for the east were given a boost by new sales from Pasir Ris 8 (432 sold units) and Treasure at Tampines (580 sold units)
Pasir Ris 8 is an uncompleted leasehold condominium with a current take-up rate of 88.7%. The 487-units development is within walking distance to Pasir Ris MRT station and White Sands. The 146 three-bedroom units in the project are a sizable 1,023 to 1,302 sq ft. From January 2021 to March, 96 such units sold for $1.48 to $2.17 million ($1,411 to $1,820 psf).
Treasure at Tampines is a massive leasehold development that is a short walk to many amenities including supermarkets, hawker centres and Changi General Hospital. All 2,203 units in the project are sold including three-bedroom units which range in size from 818 to 1,087 sq ft. In 2021 and 1Q2022, 163 three-bedroom units transacted for $1.19 to $1.64 million ($1,305 to $1,585 psf).
Sales performance for Treasure at Tampines was better because of its lower overall average price of $1,427 psf compared to $1,620 psf for Pasir Ris 8. Additionally, Treasure at Tampines was launched earlier in 2019 while Pasir Ris 8 was launched last year. Despite the higher price, Pasir Ris 8 might be a better choice for large families because the development has larger three-bedroom units.
Treasure at Tampines - EDGEPROP SINGAPORE
Three-bedroom showflat for Treasure at Tampines (Picture: Samuel Isaac Chua/EdgeProp Singapore)
Buyers who need immediate housing might want to look at resale developments such as Edelweiss Park Condominium which obtained TOP in 2006. The freehold project has 517 units and more than half are spacious three-bedroom units ranging from 1,270 to 2,691 sq ft. From January 2021 to March, 19 three-bedroom units changed hands for $1.03 to $2.03 million ($682 to $1,015 psf).
The newer leasehold Palm Isles along Flora Drive achieved lower total prices of $850,000 to $1.36 million ($858 to $1,060 psf) for 21 three-bedroom units. Palm Isles was completed in 2015 and has 153 three-bedroom units of 990 to 1,324 sq ft.
Both condominiums are located within 500 meters of each other but Edelweiss Park Condominium is fetching lower prices despite being freehold. The overall average price for Edelweiss Park Condominium is $942 psf; lower than Palm Isles ($1,013 psf) and the surrounding condominiums ($958 psf). The price disparity could be due to age as Palm Isles is nine years younger than Edelweiss Park Condominium. Despite its age, large families should consider Edelweiss Park Condominium because it has larger three-bedroom units at lower prices. Additionally, the project’s freehold tenure will delay the impact of lease decay.

North is the most affordable region

According to HDB, the cheapest five-room flats are found in Sembawang ($501,500) and Woodlands ($505,000) in the north. Five-room flats in Yishun, the remaining HDB town in the north, are also an affordable $580,000.
Current average prices for resale five-room HDB flats in Woodlands (blue line) and Sembawang (dark blue line) are $418 psf and $465 psf respectively which are way below the islandwide average (red line) of $504 psf.
Condominiums in the north also tend to be less pricey compared to other regions. The current average price for resale condominium units in the north (blue line) is $1,097 psf; lower than the islandwide average (red line) by $343 psf.
Of the 1,377 transactions for condominiums in the north, all new sales were for leasehold projects with The Commodore and The Watergardens at Canberra chalking up 37.1% of the transactions for the region. Both developments are uncompleted leasehold projects located near Canberra MRT station, Sembawang Shopping Centre and Canberra Plaza. Take-up rates for The Commodore and The Watergardens at Canberra are 74.4% and 78.8% respectively.
The Commodore has 44 three-bedroom units and 40 of them fetched $1.36 to $1.76 million ($1,307 to $1,527 psf) between January 2021 and March. The Watergardens at Canberra has 129 three-bedroom units and 104 of them sold for $1.34 to $1.72 million ($1,232 to $1,543 psf).
Besides having more three-bedroom units, The Watergardens at Canberra also has bigger ones; ranging from 904 to 1,324 sq ft; making the development an ideal choice for owner-occupiers in need of space. Three-bedroom units in The Commodore are 969 to 1,184 sq ft.
The Watergardens at Canberra  - EDGEPROP SINGAPORE
The Watergardens at Canberra (Picture: UOL Group, Kheng Leong Company, Singapore Land Group)
Owner-occupiers can consider Eight Courtyards because it has 400 three-bedroom units with a wide range of sizes from 958 to 1,894 sq ft. The 654-unit leasehold project received TOP in 2014. During the past 15 months, 19 three-bedroom units were sold for $888,000 to $1.27 million ($878 to $1,119 psf).
The average resale price for leasehold condominiums in Yishun (red line) surpassed Sembawang (blue line) after 2020. Price growth is 47% for Yishun; slightly higher than Sembawang and double that of Woodlands (dark blue line) which makes Yishun and Sembawang strong contenders for owner-occupiers with an eye towards investment. The Commodore and The Watergardens at Canberra are in the planning area of Sembawang while Eight Courtyards is in Yishun.

To sum up

  • Condominiums in the central region tend to have a limited number of large units and higher average prices than other regions. Prices for three-bedroom units in new condominiums in districts 9, 10 and 11 starts from $2.0 million.
  • Five-room HDB flats in the central region are an affordable alternative as median prices for such flats are still under $1.0 million.
  • Pasir Ris 8 and Treasure at Tampines dominated sales transactions for condominiums in the east. Prices for three-bedroom units in both upcoming projects range from $1,305 to $1,820 psf. Older leasehold developments are cheaper by at least $245 psf.
  • Buyers with modest budgets should look to the north where there are transactions of about $1,000 psf for three-bedroom units in leasehold completed developments and about $1,400 psf for leasehold new condominiums. Sembawang and Woodlands also have the cheapest five-room HDB flats in Singapore.

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