Is it a Good Deal?: $4.9 million for a freehold 3-bedder in CCR

Despite its freehold tenure and prime location, The Orange Grove has had 16 unprofitable transactions. (Photo: EdgeProp Singapore)

SINGAPORE (EDGEPROP) – Last month, a three-bedroom unit in The Orange Grove was sold at a loss of approximately $150,000. The seller sold the 2,153 sq ft unit for $2,276 psf, having originally purchased it in April 2011 for $2,346 psf.

At the time of writing, the freehold condo, located in District 10 and within the Core Central Region (CCR), had only three profitable and 16 unprofitable transactions. Losses ranged from approximately $80,000 to $2.9 million. Therefore, the recent $150,000 loss is on the lower end of this loss spectrum. Profits ranged from approximately $95,000 to $290,000.

We used our analytics tool, "Is it a Good Deal?", to determine whether the buyer of the 2,153 sq ft unit in The Orange Grove had secured a bargain.

Freehold boutique development in prime District 10

The Orange Grove is a boutique development with only 72 units. All units in the development are over 2,100 sq ft in size. The freehold development obtained its temporary occupation permit (TOP) in 2010.

The Orange Grove is located a short walk away from Shangri-La Singapore, Mercure Singapore on Stevens, and Novotel Singapore on Stevens. The condo is also within a 1km radius of the reputable Singapore Chinese Girls’ School (Primary and Secondary) (see Map 1). Other amenities within a 1km radius include the dual-line Stevens MRT Station, Four Seasons Hotel, St. Regis Hotel, and Forum The Shopping Mall.

Source: EdgeProp LandLens (as at 13 August 2024)

More pros than cons

Our "Is it a Good Deal?" analytics tool indicates that the transacted price is slightly above the average price for the development but below the average price for three nearby condos (see Screenshot 1). The development’s freehold tenure is another plus point. The main drawback is that the transacted price is 5.2% higher than the average price for the district.

Source: EdgeProp Is it a Good Deal (as at 13 August 2024)

The Orange Grove has only one resale transaction this year

At the time of writing, only one resale transaction has taken place for The Orange Grove this year. The transaction occurred last month and resulted in a loss of approximately $150,000 for the seller. The fourth-floor unit measures 2,153 sq ft. It features a private lift, a dry and wet kitchen, and a balcony that is accessible via the living room and the master bedroom (see Floor Plan 1).

Source: EdgeProp Research

The Orange Grove had only one resale transaction last year, but it resulted in a profit of approximately $230,000. The seller purchased the 2,336-sq ft unit in September 2009 for $2,085 psf and sold it in December 2023 for $2,183 psf.

Despite the significant difference in purchase dates, it is notable that both sellers bought their units directly from the developer. The seller who made a profit purchased their unit for $2,085 psf in September 2009, while the seller who incurred a loss bought their unit for $2,346 psf in April 2011.It is noteworthy that the unit that yielded a profit was sold at $2,183 psf, while the unit that generated a loss was sold at a higher price of $2,276 psf (see Table 1). The significantly lower purchase price allowed the seller to earn a profit.

Source: EdgeProp Buddy (as at 13 August 2024)

Only two transactions generated losses above $1 million

At the time of writing, The Orange Grove has had 16 unprofitable transactions. The silver lining is that only two of these resulted in losses exceeding $1 million for their sellers (see Table 2).

It is notable that the seller of the unit on the ninth floor had purchased it in a sub-sale in May 2010 for $2,200 psf, resulting in a loss of approximately $429,000 for the first owner. The unit was first purchased for $2,345 psf in June 2009. Readers should note that Seller’s Stamp Duty (SSD) is only payable for properties purchased on or after 20 February 2010.

The 2,960-sq ft unit has four bedrooms, a private lift, and two sizable balconies. One balcony is accessible from the living area and master bedroom, while the smaller balcony is accessible from Bedroom 2 and Bedroom 3 (see Floor Plan 2). One reason for the unit's unprofitability could be that buyers tend to favour indoor space over outdoor space due to Singapore’s hot and humid weather.

Source: EdgeProp Research

Surrounded by similar developments

There are 43 freehold condos, representing over 2,200 units, within walking distance of The Orange Grove. However, the majority of them are small developments with fewer than 100 units.

After taking into account their distance from The Orange Grove, the size of the developments, and their TOP dates, the most comparable developments are Orange Grove Residences (60 units) and The Solitaire (59 units). Both freehold developments are located a short walk from The Orange Grove (see Map 2). They are also a year older, having obtained their respective TOP in 2009.

Source: EdgeProp LandLens (as at 13 August 2024)

Orange Grove Residences and The Solitaire have more unprofitable than profitable transactions

Similar to The Orange Grove, Orange Grove Residences and The Solitaire have more unprofitable than profitable transactions. At the time of writing, Orange Grove Residences has 29 unprofitable and 11 profitable transactions, while The Solitaire has 33 unprofitable and 21 profitable transactions. Losses range from approximately $8,000 to $2.066 million for Orange Grove Residences, and from approximately $31,000 to $1.38 million for The Solitaire.

However, unlike The Orange Grove, neither development has had any unprofitable transactions this year. The most recent unprofitable transaction for Orange Grove Residences occurred last year, while the most recent unprofitable transaction for The Solitaire was in 2021.

The lone unprofitable transaction for Orange Grove Residences that took place last year was for a three-bedroom unit on the first floor. The 1,948-sq ft unit features a private lift, a dry and wet kitchen, and two private enclosed spaces (see Floor Plan 3).

Source: EdgeProp Research

The seller sold the 1,948-sq ft unit for $2,207 psf after purchasing it in August 2007 for $2,317 psf, resulting in a loss of approximately $214,400. This loss is at the lower end of the loss spectrum for the development.

Stronger price growth for The Orange Grove compared to counterparts in same district

The average resale prices for The Orange Grove, Orange Grove Residences, and The Solitaire trend closely to each other. This year, the average prices are $2,276 psf for The Orange Grove and $2,334 psf for The Solitaire (see Chart 1). At the time of writing, no resale transactions have been recorded for Orange Grove Residences this year.

Last year, the average resale price for Orange Grove Residences was the highest at $2,260 psf, followed by The Orange Grove at $2,183 psf. The Solitaire brought up the rear with $2,074 psf.

Source: EdgeProp Buddy (as at 14 August 2024)

Additionally, the average resale price for The Orange Grove has grown at a faster pace compared to its freehold counterparts in District 10. Since 2017, the average resale price for The Orange Grove has grown by 19.5%, compared to a 15.3% increase for freehold condos in the same district (see Chart 2). Furthermore, the average resale price for The Orange Grove ($2,276 psf) is slightly higher than that for freehold condos in District 10 ($2,259 psf).

Source: EdgeProp Market Trends (as at 13 August 2024)

Conclusion

The Orange Grove is a boutique development with only 72 units. As such, it does not have many resale transactions each year. In 2022, there were no resale transactions for The Orange Grove. Only one resale transaction took place each year in 2023 and 2024. Buyers who value privacy and exclusivity would be drawn to The Orange Grove.

A quick check of EdgeProp’s sale listings indicates that there are only two listings for the exclusive development. Both listings are for three-bedroom units with asking prices above $5 million, which is higher than the $4.9 million paid by the buyer.

The average resale price for The Orange Grove trends very closely with Orange Grove Residences and The Solitaire, its most comparable developments. The average resale price for The Orange Grove has also increased at a stronger pace than its freehold counterparts in the same district. Nevertheless, investors might want to note that the freehold development has more unprofitable than profitable transactions. However, the majority of the unprofitable transactions have resulted in losses of under $1 million.

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

Check out the latest listings for The Orange Grove, Orange Grove Residences, The Solitaire properties