Earlier this month, a five-room flat at 72 Marine Drive was sold for $945,000 ($731 psf). The 1,292-sq ft flat is located on the 19th to 21st storey and has a remaining lease of approximately 51 years. We used our analytics tool, Is it a Good Deal?, to examine the transaction and determine whether the buyer of this flat secured a bargain.

Older flat surrounded by amenities

The flat at 72 Marine Drive is located in the Marine Parade Planning Area within District 15. It enjoys an excellent location, being a short walk from Marine Parade MRT Station, Katong Square, 112 Katong, Parkway Parade, and Marine Parade Central Market and Food Centre. Additionally, two primary schools are within walking distance, namely CHIJ (Katong) Primary and Tao Nan School (see Map 1). The flat is also a short drive from the East Coast Parkway.

The main drawback of the flat is its age. The lease for the flat began in 1977, meaning the 48-year-old flat has a remaining lease of approximately 51 years (see Screenshot 1). However, the shorter remaining lease of the flat could be offset by the convenience and connectivity of its location. Additionally, the flat is situated on a high storey.

Read also: Hidden Gems: Older HDB flats in Marine Parade

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Our tool also highlighted that the transacted price for the five-room flat at 72 Marine Drive is significantly below the average price for Marine Drive View, the HDB project that includes the subject flat. However, the transacted price is above the district’s average (see Screenshot 2).

Only three transactions for five-room flats in Marine Parade this month

Prior to 2022, no five-room flats in Marine Parade had fetched at least $1 million. Since then, there has been at least one million-dollar transaction per year for five-room flats in Marine Parade. However, the number of such deals has consistently remained below 10 transactions each year. Last year, there were only five million-dollar transactions for five-room flats in Marine Parade.

At the time of writing, only one five-room flat in Marine Parade has been sold for at least $1 million this year, representing 1.4% of the 71 million-dollar transactions islandwide. The sole million-dollar transaction in Marine Parade this month involved a five-room flat at 14 Marine Terrace that sold for $1.065 million ($811 psf). The 1,313-sq ft flat, located on the 25th to 27th storey, has a lease that began in 1975. The flat at 14 Marine Terrace is located approximately 1 km from the subject flat at 72 Marine Drive (see Map 2).

Notably, another five-room flat at 72 Marine Drive was sold this month. Despite being in the same block as the subject flat, it fetched a lower price of $833,333 ($645 psf). This could be because it is located on the first to third storey while the subject flat is located on a higher storey (see Table 1).

Last year, six transactions were recorded for five-room flats at Marine Drive View, with prices ranging from $838,000 to $975,000. The highest transacted price of $975,000 ($774 psf) involved a 1,259-sq ft flat at 78 Marine Drive that was sold in March last year. Meanwhile, a 1,292-sq ft flat at 79 Marine Drive fetched the lowest price of $838,000 ($649 psf) in May last year.

Price for old five-room flats in Marine Parade trending above central region and islandwide

The average resale price for five-room flats ($729 psf) in Marine Parade has consistently trended above that of their three-room ($634 psf) and four-room ($708 psf) counterparts (see Chart 1). This is despite five-room flats (21.7%) having the weakest price growth since 2020 compared to their three-room (27.8%) and four-room (37.5%) counterparts.

Read also: Five-room flat at Skyoasis @ Dawson sets new HDB resale record of $1.73 mil

The average resale price for five-room flats between 41 and 50 years old is the highest in Marine Parade ($729 psf) compared to the central region ($658 psf) and islandwide ($599 psf) (see Chart 2). Notably, the average price of $729 psf for such five-room flats in Marine Parade is slightly lower than the transacted price of $731 psf for the subject flat at 72 Marine Drive.

However, the average resale price for older five-room flats in Marine Parade has recorded the weakest price growth of 21.7% since 2020, compared to the central region (31.3%) and islandwide (42.3%).

Few 99-year leasehold condos nearby

The price difference between five-room flats and 99-year leasehold condo units, measuring 1,200 sq ft to 1,400 sq ft, in Marine Parade has widened considerably. The price difference was $643 psf in 2014 and $827 psf in 2020. Last year, the price difference reached a record high of $1,273 psf (see Chart 3).

From 2020 to last year, the average resale price for such condo units in Marine Parade surged by 39.3%, compared to the growth of 19% for five-room flats in the same neighbourhood. The significantly stronger price growth for the condos ($1,986 psf) could explain their significantly higher average resale price last year compared to that of HDB flats ($713 psf).

There are 22 condos, representing approximately 910 units, within a 500m radius of 72 Marine Drive. Of these 22 condos, 20 are freehold developments, and the remaining two have 999-year leases. However, if the distance is increased to 1 km, there are 144 nearby condos, representing approximately 7,600 units. Of the 144 condos, only three are 99-year leasehold developments, namely Cote D’Azur, Silversea, and The Red House (see Map 3).

Among the trio, Cote D’Azur is the oldest, having obtained its temporary occupation permit (TOP) in 2004, followed by Silversea (TOP in 2014) and The Red House (TOP in 2016). Cote D’Azur is also the largest development, with 612 units, followed by Silversea (383 units) and The Red House (42 units).

Read also: Is it a Good Deal?: $1.568 million for a HDB in Bishan

Among the three condos, Silversea ($2,099 psf) had the highest average resale price last year, followed by Cote D’Azur ($1,833 psf) and The Red House ($1,455 psf) (see Chart 4). The low resale price for The Red House could be due to its small size, leading to a lower transaction volume compared to the other two developments. Last year, there were 30 resale transactions for Silversea and 14 resale transactions for Cote D’Azur. The Red House managed to attract only seven transactions. Additionally, The Red House is located further from Marine Parade MRT Station and Parkway Parade compared to the other two condos.

Conclusion

Marine Parade has consistently been a popular residential neighbourhood because of its proximity to East Coast Park and several reputable schools. Demand for flats in this area increased after the completion of Stage 4 of the Thomson-East Coast Line last year, which connected the east region with the central and north regions. During the most recent build-to-order (BTO) exercise in December last year, the flats at nearby Bayshore were oversubscribed.

The main drawback of the subject flat at 72 Marine Drive is its age, but prospective buyers of HDB flats in Marine Parade may have to accept this, because the approximate average age of flats in Marine Parade is 49 years. Marine Parade is also one of the smaller HDB towns, with only 6,532 flats, representing just 0.6% of the total HDB stock in Singapore.

The popularity of Marine Parade, coupled with its limited supply of HDB flats, has boosted prices of flats in the neighbourhood. This year, the average resale price for five-room flats in Marine Parade is $729 psf, marginally higher than the transacted price of $731 psf for the subject flat at 79 Marine Drive. However, the transacted price is significantly lower than the average resale price of nearby 99-year leasehold condo whose average resale prices have all breached the $1,000 psf threshold.

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

Check out the latest listings for Cote D'azur, Silversea, The Red House properties

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