Private apartments under $1m

But buyers may need to compromise on facilities, location or appearance

Published on Sep 29, 2012

By Esther Teo, Property Reporter

NEWS that a HDB flat sold for $1 million sent a chill through many home seekers but cheaper homes can still be bought without paying a king's ransom - just don't expect too much for your money.

Buyers willing to compromise on facilities, location, appearance and other features can land a private apartment for under the $619 per sq ft (psf) price paid for that 1,615 sq ft HDB home in Queenstown this month.

There are at least 10 private non-landed developments where units - not the shoebox variety - have sold for less than $600 psf this year, giving a total price tag of below $1 million.

Some of the projects are old and in suburban areas far from MRT stations while others may have been sold to relatives at a discounted price, were stress sales or recorded at a lower psf due to a flat's large size. Some might also not come with facilities.

As Mr Colin Tan, research head at Chesterton Suntec International, noted, the fact that old and inaccessible properties can now fetch such prices is a testament to how pricey homes have become.

Private home prices have rocketed 55 per cent since the second quarter of 2009. "Compared to about five years ago, a home buyer would be able to get a condo in a city centre area like River Valley for about $800 psf," he said. "(Singapore) is more compact now, especially with the improved transportation network. That's why all property prices have moved up."

Mr Ong Teck Hui, Jones Lang LaSalle's national director of Singapore research, pointed out that only 13 private non-landed properties were sold within the criteria under $1 million and under $600 psf from June to August.

They comprised a 0.2 per cent blip in the non-landed housing market, which recorded 6,175 transactions in that period, excluding executive condos.

The cheapest home sold this year was a 2,454 sq ft unit at Toh Tuck Lodge that went in January for $680,000 - or $277 psf, according to caveats lodged with the Urban Redevelopment Authority.

Other seemingly low-priced homes include a 2,282 sq ft unit at Sembawang Cottage that sold for $920,000 - or $403 psf - in June and a 1,970 sq ft apartment at Lakeside Tower in Yuan Ching Road that changed hands in January at $905,888 - or $460 psf.

However, PropNex chief executive Mohamed Ismail said the unit at freehold Toh Tuck Lodge could have been sold at a discount to relatives or have a lower psf due to it having an open terrace or huge private enclosed space.

The next most recent sale was in April last year when a unit went for a significantly higher $795 psf.

Developments like Lakeside Tower and Lakeside Apartments, both in Yuan Ching Road, and Phoenix Heights in Bukit Panjang have consistently recorded prices of less than $600 psf although the three developments are at least 35 years old and on 99-year leases.

A 1,335 sq ft four-bedroom unit at Phoenix Heights is being marketed at $780,000 - or $584 psf - while a 1,975 flat at Lakeside Tower has a negotiable $1 million - or $506 psf - price tag.

Mr Png Poh Soon, head of research at Knight Frank Singapore, said it will get more difficult to find homes below $600 psf and buyers will have to compromise on factors like location.

"(But) some of these homes are freehold which may offer an attractive proposition to home buyers. Additionally older homes tend to be bigger," Mr Png said.

Mr Chris Koh, director of Chris International, noted that homes with under 60 years on the lease might be harder to sell as buyers could face lower Central Providend Fund withdrawal limits.

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