Buyers are back, real estate agents

/ The Edge Property |

May 11, 2015 12:00 PM SGT

Property agents have been seeing a revival of sorts in the bungalow segment, including the Rolls-Royce of detached houses, the Good Class Bungalows.

Most recently, a GCB on Gallop Road was sold for $25.8 million ($1,709 psf), a shade below the owner’s asking price of $29.8 million ($1,973 psf).

When the tender for the GCB parcel at 35 Ridout Road closed on April 8, there were 10 bids.

The original GCB sits on a sprawling elevated site of 73,277 sq ft and has the potential to be subdivided into four smaller plots of 18,300 sq ft each.

Given the number of bids — from a mix of individual owners and developers — some industry watchers are speculating that the winning bid price could be between $1,200 and $1,300 psf, which translates into an absolute price of $88 million to $95 million.

The tender for the GCB at 35 Ridout Road, which sits on a land area of 73,277 sq ft, closed on April 8. It drew 10 bids.

DTZ is the marketing agent.

KH Tan, managing director of Newsman Realty, brokered the sale of two GCBs earlier this year: A house on Gallop Road that was sold for $24 million ($1,565 psf) in January, and another at Mount Echo Park that fetched $22 million ($1,456 psf) in February.

“Since March, there’s been [renewed] interest in the GCB segment, with a lot of requests for viewings,” says Tan.

“Interestingly, in recent weeks, I have received many calls from Singaporeans based in Hong Kong who’re thinking of moving back, and are therefore looking to buy a GCB.” William Wong, managing director of RealStar Premire, concurs.

“Buyers are back,” he says.

Agents with RealStar, which specialises in marketing landed homes, sold three bungalows within the first fortnight of April, with more under negotiation.

“Although there are some buyers looking at GCBs, most are looking at bungalows with land sizes of up to 10,000 sq ft,” Wong adds.

Bungalows sold by RealStar include one on Kingsmead Road, which sits on a land area of 7,000 sq ft and fetched $10.5 million; another on Linden Drive, with a land area of close to 10,000 sq ft that changed hands for $13.88 million; and a GCB land parcel of about 15,000 sq ft on Swettenham Road that fetched $23.5 million.

One reason for the return of buyers is that sellers have become more realistic in their asking prices, which encourages more buyers to commit to a purchase, says Wong.

“I’ve noticed pent-up demand as some buyers have been on the hunt for a good deal since the start of the year.” These days, it is not uncommon for bungalows to be sold at prices of 10% to 15% below the original asking prices.

“A buyer may be able to secure a relatively good GCB plot at $25 million today compared with close to $30 million two years ago,” says Wong.

While Wong expects GCBs to see a marginal drop in prices of 2% to 3% from now until the end of the year, he foresees “a hefty jump” in transaction volume from 2Q2015.

“The second half of the year will be the best time for genuine home buyers to secure a good landed home as the gap between sellers’ and buyers’ asking prices is closing.” Meanwhile, Stefanie Wong, senior division director of SLP Realty, was involved in the sale of five landed homes in March.

They included the GCB on Gallop Road that was sold for $25.8 million last month.

Wong represented the buyer and an agent from Knight Frank represented the seller.

SLP Realty’s Wong is currently marketing a three-storey linked bungalow at Watten Estate that was developed by Far East Organization in the 1970s.

The bungalow is perched on a hilltop and sits on a freehold land area of 9,026 sq ft.

It can be demolished and redeveloped into a new bungalow with a basement car park big enough for 25 cars.

The house has a price tag of $12.888 million ($1,428 psf).

The living room of the detached house at Watten Estate

Wong attributes her recent success in selling a handful of landed homes in March to the fact that she provides “creative solutions” to help buyers restructure their portfolios.

“There are a few ways to do it, depending on the type of properties they hold,” she explains.

“We advise them on which properties to sell, and which to hold.

In some cases, they decouple in order to lower the additional buyer’s stamp duty on their house purchase.”

The façade of the three-storey detached house on the hilltop of Watten Estate that is on the market for $12.88 million.