COMMENTARY: Can you still get anything for $1 million?

By Elizabeth Choong / EdgeProp Singapore | April 5, 2022 11:16 AM SGT
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More than half of transactions are for $1.5 million and below

It is commonly assumed that private residential properties in Singapore are expensive and way beyond the reach of the ordinary household despite reports from the Department of Statistics Singapore (DOS) revealing that median monthly household increased from $9,189 in 2020 to $9,520 in 2021.
Examination of URA sales transactions for condominiums from January 2021 to March reveals that the majority were for $1.5 million and below. Sales of $1.0 million and below accounted for 19.3%.
sales transactions - EDGEPROP SINGAPORE

Properties under $1.0 million in Bukit Timah

Bukit Timah is known as an exclusive residential enclave full of expensive and luxurious landed homes. Most will be surprised to know that there are condominiums that sold for under $1.0 million in the Bukit Timah planning area. From 2021 to 1Q2022, there were 18,104 sale transactions for condominiums in the central region. Of which, 2,384 transactions were in the Bukit Timah planning area and 117 of them were for $1.0 million and below.
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During the analysed period, 26 units in The Hillford along Jalan Jurong Kechil sold for $480,000 to $750,000 ($1,036 to $1,281 psf) and ranged in size from 398 to 657 sq ft. The lower cost could be attributed to the shorter than usual tenure of 60 years as the development was designed as a retirement resort. Sale is not restricted to the elderly so the development presents an opportunity to stay in a prime area for under $1.0 million if one is willing to compromise on tenure. However, investors on the hunt for capital appreciation should steer clear because the shorter tenure would mean an earlier onset of lease decay.
Single owner-occupiers should consider freehold Suites at Bukit Timah. The exclusive 71-units development is along Jalan Jurong Kechil and a short walk from Beauty World MRT station. In 2021, six units were sold at $610,000 to $665,000 ($1,507 to $1,858 psf) for units between 344 and 441 sq ft. As the units are under 500 sq ft, they will not be suitable for large families. However, investors should consider the development as it is setting the ceiling for rents in the neighbourhood. It is commanding average rents of $4.47 psf per month; way above the average monthly rent of $3.00 psf for nearby condominiums.
average monthly rent - EDGEPROP SINGAPORE

Look west for variety

More affordable choices are available outside the central region including newly launched projects which tend to command the highest price in the vicinity.
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From 2021 to 1Q2022, 31 units in Whistler Grand were sold for $750,000 to $998,400 ($1,548 to $1,809 psf). The units ranged from 441 to 614 sq ft which is a comfortable size for a couple or a small family. However, the leasehold development is still under construction so buyers will not be able to move in immediately. Moreover, all 716 units in the leasehold development are sold so interested buyers will have to look to the secondary market. The average price for brand new Whistler Grand is $1,605 psf; $298 psf above the overall average price for the neighbourhood which comprises older condominiums.
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average price - EDGEPROP SINGAPORE
Those in urgent need of housing can consider J Gateway which is located within walking distance of Jurong East MRT station and several large malls. From 2021 to 1Q2022, 58 units of the leasehold development were sold in the resale market. Of which, 26 transactions were for $812,000 to $965,000 ($1,528 to $1,959 psf) for units of 474 to 581 sq ft. J Gateway has a lot of potential for capital gains because Jurong East is designated as Singapore’s second CBD. Additionally, the Singapore Tourism Board (STB) has just invited proposals to develop and operate an integrated tourism development in Jurong Lake District.
J Gateway - EDGEPROP SINGAPORE
J Gateway (Picture: Samuel Isaac Chua/EdgeProp Singapore)

Go east for space

Astute readers would have noticed that most units under $1.0 million in the central and west regions tend to be small which renders them unsuitable for larger families. The east region may hold the answers to the families’ need for more space.
Eastpoint Green along Simei Street 3 saw 32 units change hands for $718,000 to $1.0 million ($683 to $927 psf). The units range from 904 to 1,302 sq ft. The larger sizes and prices of below $1,000 psf make the leasehold development a spacious and affordable choice. A drawback will be the age of the development which obtained TOP in 1999. Its distance away from the city centre and public transport nodes could be another deterrent. However, buyers may be swayed by the average price of Eastpoint Green ($861 psf) which is lower compared to the overall average of $1,007 psf for condominiums in the neighbourhood.
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graph 3 - EDGEPROP SINGAPORE
Buyers can consider Archipelago along Bedok Reservoir Road if they desire a newer development in a more established neighbourhood. The leasehold condominium received TOP in 2015 and is within walking distance to Bedok North MRT station, two primary schools and two supermarkets. During the last 15 months, 67 resale transactions took place for Archipelago. Of which, 28 transactions were for $525,000 to $990,000 ($663 to $1,346 psf) for units of 527 to 840 sq ft. In addition, the average price for Archipelago ($1,244 psf) is slightly below the overall average price ($1,271 psf) for nearby developments.
graph 4 - EDGEPROP SINGAPORE

Up-and-coming north

Woodlands is slated to be a regional hub for the north of Singapore so there is much room for capital appreciation for properties in the area.
Rosewood and Casablanca are leasehold condominiums located along Rosewood Drive and within walking distance to several supermarkets and schools. Rosewood was completed in 2003, which was two years earlier than Casablanca.
From January 2021 to March, Rosewood and Casablanca had 31 and 24 resale transactions respectively that were for $1.0 million and below. The transactions for Rosewood were from $750,000 to $998,000 ($699 to $851 psf) for units of 1,001 to 1,173 sq ft. Some units at Casablanca were smaller at 893 to 1,324 sq ft and fetched $702,000 to $1.0 million ($682 to $870 psf).
Bargain hunters may be able to pick up a deal. The average price for Rosewood and Casablanca is $804 psf and $863 psf respectively which is way below the overall average price of $976 psf for condominiums in the vicinity. The disparity in price could be due to age. Nearby Woodhaven which was completed in 2015 achieved an average price of $1,098 psf. Parc Rosewood obtained TOP in 2014 and has an average price of $1,059 psf.
graph 5 - EDGEPROP SINGAPORE
Investors can also consider purchasing a unit for rental. Rental demand is expected to come from expatriates whose children attend The Singapore American School along Woodlands Street 41 or employers of companies with offices in the Woodlands regional hub. The rental yield for Rosewood is 3.6% while Casablanca is fetching a slightly lower 3.4%.

To conclude

  • Almost 20% of sales transactions for condominiums from January 2021 to March are for $1.0 million and below. More than half of the 33,482 transactions are for $1.5 million and below.
  • While there are units sold for under $1.0 million in the central region, they are more suitable for single owner-occupiers or investors because the units tend to be small. Owner-occupiers and their families should look outside the central region for larger units.
  • Buyers have to decide if they wish to compromise on space or location if they have a budget of only $1.0 million to purchase a private residential property.

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