Artist’s impression of the clubhouse and swimming pool of The Gazania (Credit: SingHaiyi)
SINGAPORE (EDGEPROP) - Despite having higher prices than their leasehold counterparts, freehold condominiums are very well-sought after by buyers because of their scarcity and longer tenure.
Current average price for islandwide freehold condominiums is $2,031 psf, 16.2% higher than 99-year leasehold condominiums ($1,701 psf).
Our analysis indicates that there are affordable condominiums. However, such freehold developments are usually older, have limited nearby amenities, are not located near an MRT station and are far from the central area. Buyers on the hunt for an affordable freehold property must be willing to compromise on convenience, connectivity and age of the development.
Read also: ANALYSIS: Does age matter? Impact of ageing on freehold and leasehold condos
For the purpose of this article, freehold condominiums are ranked according to their average price, which is based on sales transaction caveats lodged with URA over the last 12 months from the time of writing.
Only condominiums that have at least 10 sales transactions in the past 12 months are considered. This is to avoid having the average price for the whole development being skewed by any particular unit sale that was transacted at a price that was significantly higher or lower than transacted prices for other sales in the development.
The top five cheapest freehold condominiums have average prices of below $1,100 psf, which is almost half the national average of $2,031 psf for such developments. The freehold condominium with the lowest average price is Ballota Park Condominium ($892 psf), while Carissa Park Condominium ($1,028 psf) has the highest average price among the five developments.
Avila Gardens is the oldest among the five developments, having obtained temporary occupation permit (TOP) in 1995. Edelweiss Park Condominium (TOP 2006) is the youngest. The five developments range in size from 299 units (Dahlia Park Condominium) to 528 units (Carissa Park Condominium).
All top five cheapest freehold condominiums are located in District 17 and within a 500m radius of each other. Ballota Park Condominium is located beside Edelweiss Park Condominium and faces Changi Prison. The other three developments are located across the road in a cluster.
There are limited amenities within a 500m radius of the five condominiums, although this is set to change with the opening of Komo Shoppes next year. The two-storey retail podium will have FairPrice Finest as an anchor tenant. Komo Shoppes is integrated with Parc Komo, an uncompleted 276-unit freehold condominium with an average price of $1,639 psf.
The Japanese Primary School, East Spring Primary School and East Spring Secondary School are the only schools within a 1km radius. The nearest existing MRT station - Tampines East - is about 1.5km away. Loyang and Pasir Ris East MRT Stations on the upcoming Cross Island Line are about 1.3km and 1.4km away respectively.
The lack of a MRT station and limited existing amenities within walking distance likely contributed to the low average prices of the five developments. This is a good example of convenience and connectivity being valued over freehold tenure. However, prices of condominiums in the area might see stronger growth on the back of improved convenience with the opening of Komo Shoppes.
Among the five cheapest freehold condominiums, Ballota Park Condominium not only has the lowest average price but also has the strongest price growth (22%) since 2012. This is followed by Carissa Park Condominium (19%) and Edelweiss Park Condominium (17%).
As such, Ballota Park Condominium would seem like the obvious choice for home buyers. Moreover, Ballota Park Condominium has many spacious units that are suitable for families. About half of its units are between 1,300 and 1,500 sq ft.
However, Ballota Park Condominium is located opposite Changi Prison which could be a deal-breaker for some buyers. Residents can also expect some noise pollution from Changi Airport which is within a 2km radius. There is also a lack of amenities and MRT stations within walking distance.
Investors should note that the average rent for Ballota Park Condominium is the lowest compared to the other four condominiums. Ballota Park Condominium is attracting rents of $2.1 psf per month compared to $2.4 or $2.6 psf per month for the other four developments.
Investors might want to consider Carissa Park Condominium instead. Although it has the highest average price among the five condominiums, it has the most number of rental transactions in the past 12 months - an indication of its popularity among tenants. The five developments are probably attractive to tenants working in the nearby Changi Airport or Changi Business Park.
The main drawback for Carissa Park Condominium ($1,028 psf) is that it has the highest average price among the five developments. It is also located next to Tampines Expressway, which could mean more traffic noise for residents.
For investors who are risk-takers, they might want to consider Avila Gardens. It has the weakest price growth of 12% and the least number of rental transactions. However, Avila Gardens is the nearest to Komo Shoppes compared to the other four developments, which means that its residents will benefit most from the improved convenience. Avila Gardens is also the oldest development among the five condominiums, which could mean that it has the most en-bloc potential.
Serenity Park is located near the Central Expressway and the Yio Chu Kang Flyover. The nearest MRT station is Yio Chu Kang but it is almost 1.8km away while the nearest school - Fernvale Primary School - is almost 1.7km away.
Serenity Park is surrounded by landed residential houses, and Sunrise Gardens is the only condominium within a 500m radius. Average price of Sunrise Gardens ($931 psf) is lower than Serenity Park ($1,108 psf) because of its 99-year leasehold tenure. This is despite Sunrise Gardens (TOP in 1998) having obtained TOP three years after Serenity Park (TOP in 1995).
The lack of amenities, coupled with traffic noise from the expressway and flyover, likely dampened demand and prices for both condominiums.
Among the top five cheapest freehold condominiums that are not in District 17, three are along Changi Road East in District 16, namely Changi Green, Changi Court and Sunhaven. Changi Green and Changi Court are beside each other while Sunhaven is within a 500m radius. These three condominiums are located in close proximity to the five cheapest condominiums in District 17.
Average prices of Changi Green, Changi Court and Sunhaven are just above $1,100 psf, although Sunhaven is younger (TOP in 2002) compared to Changi Green (TOP in 1998) and Changi Court (TOP in 1997).
There are a number of amenities near Changi Green, Changi Court and Sunhaven. Upper Changi MRT Station, East Spring Primary School as well as Singapore University of Technology and Design are in the vicinity.
Among the three freehold condominiums, Changi Green ($1,113 psf) has the lowest average price while Changi Court ($1,158 psf) has the highest. Average price for Sunhaven is slightly above Changi Green at $1,118 psf. This is despite Sunhaven (TOP in 2002) being five years younger than Changi Court (TOP in 1997). This could be because Changi Court is less than 300m away from Upper Changi MRT Station, while Sunhaven is about 700m away.
However, price growth for Sunhaven is the strongest (23% since 2012). Changi Court (21%) is slightly weaker and Changi Green (16%) brings up the rear.
Sunhaven seems to be a better buy for investors because of its stronger price growth and younger age. However, owner-occupiers might wish to consider Changi Court because of the connectivity offered by its closer proximity to an MRT station. Although Changi Court is the most expensive among the trio, its average price of $1,158 psf is still much lower than the national average of $2,031 psf for freehold condominiums.
There are a number of freehold condominiums that are under construction and still have available units for sale. Average price for some of them is under $2,300 psf, which is significantly below the national average price of $2,608 psf for new freehold condominiums and just slightly above the national average price of $2,221 psf for new 99-year leasehold condominiums.
Forett at Bukit Timah is a 633-unit freehold condominium along Toh Tuck Road in District 21. According to caveats lodged with URA at time of writing, only 619 units have been sold, which translates to a take-up rate of 97.8%. The development is also within a 1km radius of Beauty World MRT Station, Pei Hwa Presbyterian Primary School and Beauty World Plaza.
The Gazania is a freehold condominium along How Sun Drive in District 19. According to URA data, only 200 units in the 250-unit development have been sold, indicating a take-up rate of 80%. It is near several reputable schools such as Maris Stella High School, St Gabriel’s Secondary School and Paya Lebar Methodist Girls’ School (Primary and Secondary). Bartley MRT Station is within walking distance. Upper Serangoon Shopping Centre, Nex and Bidadari Park are also nearby.
Buyers might wish to consider Myra if they prefer a smaller development. Myra is an 85-unit condominium along Meyappa Chettiar Road in District 13. The freehold development has a take-up rate of 74.1% based on the 63 caveats lodged with URA. It is within walking distance to Potong Pasir MRT Station, St Andrew’s Junior and Secondary School, The Poiz Centre, Broadway Food Centre and Kallang River. The District 13 development is also within a 1km radius of Cedar Girls’ Secondary School, St Andrew’s Junior College and Stamford American International School.
Artist’s impression of Myra, which is an affordable freehold condominium that is within walking distance to many amenities. (Credit: Selangor Dredging)
Among the three uncompleted freehold condominiums, Forett at Bukit Timah has the lowest average price of $2,129 psf based on transactions in the past 12 months. This is followed by The Gazania ($2,225 psf) and Myra ($2,240 psf).
However, there are no schools within a 1km radius of Forett at Bukit Timah, which could deter some parents. In contrast, Myra and The Gazania are near several popular schools, which could make them better buys for parents with school-going children.
Families are likely to prefer The Gazania over Myra because The Gazania has larger units. There are also more schools within a 1km radius of The Gazania. Moreover, The Gazania ($2,225 psf) is cheaper than Myra ($2,240 psf) by $15 psf.
However, Myra might be more attractive to investors despite its higher price compared to The Gazania. This is because of its proximity to an international school – Stamford American International School – which would add to Myra’s appeal to tenants.
Check out the latest listings near Ballota Park Condominium, Carissa Park Condominium, The Gazania, Myra, Sunhaven, Changi Green, Changi Court, Forett at Bukit Timah, Tampines East MRT station, Loyang MRT station, Pasir Ris East MRT station, Yio Chu Kang MRT station, Potong Pasir MRT Station, Upper Changi MRT Station, Fernvale Primary School, East Spring Primary School, East Spring Secondary School