OPINION: Housing demand for Bukit Merah to increase after transformation
By Elizabeth Choong
/ EdgeProp Singapore |
Resale HDB flats in Bukit Merah enjoys strong continued demand from buyers. (Photo: Samuel Isaac Chua/EdgeProp Singapore)
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Singapore (EDGEPROP) – The Singapore government has implemented a number of transformative changes for town centres and community spaces under the Remaking Our Heartland (ROH) programme. Since it was first introduced in 2007, 13 towns have gone through or are undergoing the programme.
Punggol, Dawson, and Yishun were in the pioneer batch, followed by East Coast, Hougang, and Jurong Lake in 2011, and Woodlands, Toa Payoh, and Pasir Ris in 2015. The most recent batch was announced in 2020 and comprises Bukit Merah, Ang Mo Kio, Queenstown, and Choa Chu Kang.
Bukit Merah has excellent locational attributes
Bukit Merah is located within the Central Region of Singapore and is very well-connected to the rest of the island via the Ayer Rajah and Central Expressways. Residents in Bukit Merah are a short drive away from Orchard Road and the CBD. They also have easy access to six operational MRT stations, namely Redhill, Tiong Bahru, Havelock, Labrador Park, Telok Blangah, and HarbourFront MRT Stations. Furthermore, HarbourFront MRT Station is an interchange station for the North-East Line and Circle Line (CCL). Residents can look forward to even more convenience when Keppel and Cantonment MRT Stations on the CCL are completed in 2026.
Source: EdgeProp LandLens
Other amenities in Bukit Merah include 10 schools, VivoCity, Tiong Bahru Plaza, Tan Boon Liat Building, IKEA Alexandra, Tiong Bahru Market and Food Centre, ABC Brickworks Market and Food Centre, Delta Sports Centre and Swimming Complex, SAFRA Clubhouse (Mount Faber), Singapore Cruise Centre, and Singapore General Hospital.
Planned transformation of Bukit Merah
The Bukit Merah Planning Area comprises several estates, namely Redhill, Telok Blangah, Tiong Bahru, Mount Faber, and a part of Tanjong Pagar. It also encompasses the Greater Southern Waterfront, which extends from Pasir Panjang to Marina East. Waterfront homes and amenities are expected to be developed over the next five to 10 years in the Greater Southern Waterfront.
As part of the ROH program for Bukit Merah, the existing sheltered stage in Bukit Merah Town Centre will be replaced with a new and larger sheltered event space. Additional seating and play areas will be installed near the pedestrian malls to encourage community bonding. To enhance access to the town centre from Redhill MRT Station, new landscaped pedestrian and cycling paths will be introduced.
Artist’s impression of the new sheltered Town Plaza at the Town Centre. (Image: HDB)
The common areas of Neighbourhood Centres will be upgraded with amenities such as seating, greenery, play facilities, and spaces for community events.
More than one-third of the residents in Bukit Merah are 60 years old or above, so senior-friendly amenities such as additional ramps and non-slip flooring will be installed. To encourage active aging among the elderly residents, therapeutic gardens, fitness trails or corners, and exercise equipment will be added to various parks in the neighbourhood.
To make wayfinding easier for senior citizens, signage with larger and more colourful fonts, and distinctive murals on building facades will be introduced. Some of the murals may incorporate historical elements that showcase the rich historical heritage of Bukit Merah.
There are several popular blue and green spaces in Bukit Merah, but some of these spaces need improvement. Access to the Rail Corridor will be enhanced with a new pocket park in Bukit Merah Central. Together with new cycling paths in the town centre, the future park will seamlessly connect Bukit Merah Town Centre to the Rail Corridor. Additionally, the pedestrian paths along Henderson Road that connect Alexandra Canal, the Southern Ridges, and Telok Blangah Estate to the future Greater Southern Waterfront will be enhanced with new landscaped rest points.
Furthermore, the fitness amenities at Telok Blangah Hill Park and Mount Faber Park will be upgraded. Access and wayfinding to both parks will also be improved. Alexandra Hill Park and Bukit Purmei Park will have more greenery, sheltered pavilions, and multi-generational facilities.
HDB flats in Bukit Merah are very popular with buyers
According to the latest annual report from HDB, 54,157 flats were managed by HDB as at end-March last year, which represents 4.9% of all HDB flats in Singapore that were managed by the government body. The same report also stated that there were about 130,480 residents living in HDB flats in Bukit Merah as at end-March last year, which represents about 4.2% of the population residing in HDB flats then.
Four Build-To-Order (BTO) projects were launched in Bukit Merah in recent years. Alexandra Vale, Havelock Hillside, and Bukit Merah Ridge were launched last year, while Telok Blangah Beacon was launched in 2021.
With the exception of Telok Blangah Beacon, the BTO projects were launched under the Prime Location Public Housing (PLH) model. This could be because Telok Blangah Beacon was launched in May 2021, before PLH was first introduced in November 2021. All four projects only feature three- and four-room flats, and all flat types in the four projects were oversubscribed.
Telok Blangah Beacon will be built with new community plaza, supermarket, market and hawker centre. It will also be integrated with the existing Telok Blangah Mall when it is completed in early 2027. (Image: HDB)
More BTO projects can be expected for Bukit Merah. According to HDB’s website, a BTO project in Bukit Merah will be launched in December. The project is bounded by Alexandra Canal and Alexandra Road and will consist of 900 units of two-room flex flats, as well as three and four-room flats. Nearby amenities include Redhill MRT Station, Redhill Market and Food Centre, Alexandra Primary School, and Gan Eng Seng Primary School.
Furthermore, about 9,000 homes, including 6,000 public housing flats, will be built on the former Keppel Club golf course as part of the plans for the Greater Southern Waterfront. The first BTO project in the Greater Southern Waterfront is expected to be launched within the next five years.
Future BTO projects in Bukit Merah are expected to be launched under the PLH model due to its central location and numerous amenities in the neighbourhood. PLH flats tend to be launched at higher prices than their non-PLH counterparts. Therefore, prices for new HDB flats in Bukit Merah are expected to remain high.
Artist impression of new park within the future Keppel housing area which forms part of the Greater Southern Waterfront (Image: HDB)
The price growth for resale HDB flats in Bukit Merah managed to keep pace with their counterparts islandwide. Since 2012, the average resale prices for HDB flats in Bukit Merah and islandwide have grown by 25%, while the average resale price for their counterparts in the Central Region grew at a slightly slower pace of 24%. It is noteworthy that the average resale price for HDB flats in Bukit Merah is consistently higher than the average prices for flats in the Central Region and islandwide.
Source: EdgeProp Market Trends (as at 6 October 2023)
Furthermore, the average price for resale HDB flats in Bukit Merah increased by 10.1% y-o-y to the current price of $740 psf. In comparison, resale HDB flats islandwide grew by 5.5% y-o-y to $561 psf, while their counterparts in the Central Region increased by 4.6% y-o-y to $680 psf.
The demand for resale flats in Bukit Merah could have received a boost from buyers who are keen to live in the neighbourhood but want to avoid the longer minimum occupation period required for PLH flats. Therefore, these buyers turned to the resale market to satisfy their housing needs. This demand could be the reason for the stronger price growth for the resale HDB flats in Bukit Merah.
The number of million-dollar sales transactions for HDB flats in Singapore has surged to more than 300 transactions since 2021. Flats in Bukit Merah accounted for 10.1% of such transactions in 2021 and have since increased to 13.5% last year and 11.8% this year, attesting to the continued robust demand for HDB flats in Bukit Merah despite their higher prices.
Source: EdgeProp Shortlist Projects & Transactions (as at 6 October 2023
Condos in Bukit Merah are snapped up quickly
There are approximately 47 condo developments with 13,959 units in Bukit Merah. Out of these 47 condos, seven are large developments with at least 500 units. Collectively, these seven developments comprise 5,883 units, accounting for 42.1% of the total number of condo units in Bukit Merah.
Source: EdgeProp LandLens (as at 10 October 2023)
There are condo projects in Bukit Merah that were launched but are still under construction. Sky Everton, located along Everton Road, consists of 262 units. The freehold condo was launched in June 2019 and is almost sold out. The development has an average price of $2,730 psf based on transactions over the past 12 months. Sky Everton is expected to obtain temporary occupation permit later this year.
Source: EdgeProp Research (as at 6 October 2023)
The other project is The Reef at King’s Dock, which is located along Harbourfront Avenue. The 99-year leasehold condo has 429 units and was launched in January last year. The project has a cumulative take-up rate of 96.7% and an average price of $2,563 psf based on transactions from the past 12 months.
Source: EdgeProp LandLens (as at 6 October 2023)
More condo developments can be expected in Bukit Merah because there are two upcoming government land sales (GLS) sites in the neighbourhood. The two sites are located next to each other along Zion Road.
Source: EdgeProp LandLens (as at 3 October 2023)
The Zion Road (Parcel A) site is on the confirmed list of the GLS programme for 2H2023. The land parcel is expected to be launched for tender in December. URA estimates that the site can yield approximately 955 residential units and 25,834 sq ft of commercial space.
The Zion Road (Parcel B) site will be made available in December, but it is on the reserve list for the GLS programme for 2H2023. Therefore, it will not be launched for tender until a developer submits an application to trigger the tender launch for the site. URA estimates that the site can yield approximately 605 residential units.
Zion Road (Parcel A) is expected to attract a robust number of bids, and Zion Road (Parcel B) is expected to be triggered for tender. Both sites are within walking distance of many amenities, including Great World MRT Station, Great World City, Robertson Quay, River Valley Primary School, and Zion Riverside Food Centre.
Furthermore, the stellar sales performance of the nearby Riviere is expected to encourage more developers to submit a bid. The condo is built on a 99-year leasehold GLS site that was awarded in December 2017. The site attracted keen interest from developers, as evident by the 10 bids submitted when the tender closed. The newly completed development was launched in May 2019 and was sold out by April this year. Based on sales transactions over the past 12 months, the condo has an average price of $3,023 psf.
Additionally, about 3,000 private housing units are slated to be built on the former Keppel Club site, which will form part of the Greater Southern Waterfront.
Since 2012, average resale price growth has been the strongest for condos in Bukit Merah (price growth of 39%), compared to the Central Region (29%) and islandwide (38%). However, the average price for condos in Bukit Merah (current average price of $1,873 psf) consistently trends below the average price for condos in the Central Region ($1,952 psf) but remains above their counterparts islandwide ($1,611 psf).
However, the price gap between condos in Bukit Merah and the Central Region is narrowing. The price gap is $79 psf for this year, lower than the difference of $88 psf and $120 psf in 2013 and 2018, respectively.
Source: EdgeProp Market Trends (as at 6 October 2023
The central location, numerous amenities, and easy connectivity of Bukit Merah ensure the continued popularity of this well-established residential enclave among buyers and developers. Housing demand in Bukit Merah is expected to be further enhanced by the planned improvements and upgrades under ROH. Prices for HDB flats and condos in Bukit Merah are expected to remain resilient on the back of continued demand from buyers.
Check out the latest listings for Riviere, Sky Everton properties
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