Is it a Good Deal?: A freehold three-bedroom in D9 sold for $3.27 million, making a $2.03 million profit
By Elizabeth Choong
/ EdgeProp Singapore |
The newly-opened Great World MRT Station gave a boost to resale price for Tiara. (Photo: Samuel Isaac Chua/EdgeProp Singapore)
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SINGAPORE (EDGEPROP) – Earlier this month, a three-bedroom unit at Tiara sold for $3.27 million ($2,430 psf), earning the seller a profit of $2.03 million. This marks the third-highest profit for the freehold condo. The seller had purchased the 1,346-sq ft unit in April 2002 for $1.24 million ($922 psf).
We used our analytics tool, “Is it a Good Deal?”, to determine whether the buyer of the three-bedroom unit at Tiara secured a good deal.
Located in in prime District 9
Tiara is located along Kim Seng Walk, just outside Orchard Road. However, the freehold condo remains within prime District 9 and the Core Central Region (CCR). Tiara has 264 units, comprising only two-bedroom and three-bedroom units, with sizes ranging from 893 sq ft to 1,561 sq ft.
The condo is within walking distance of Great World MRT Station, Great World City, Valley Point Shopping Centre, and Zion Riverside Food Centre (see Map 1).
Source: EdgeProp LandLens (as at 24 October 2024)
Major malls in Orchard, such as Wisma Atria, Ngee Ann City, and 111 Somerset, are within a 1km radius of Tiara. Alexandra Primary School and River Valley Primary School are also within this radius (see Screenshot 1).
Source: EdgeProp Is it a Good Deal (as at 24 October 2024)
The main drawback of the development is its age. The condo obtained its temporary occupation permit (TOP) in 1995, making it 29 years old. However, this is mitigated by the development's freehold tenure.
Our tool also highlighted that the transacted price is above the average price for both the development and the district (see Screenshot 2).
Source: EdgeProp Is it a Good Deal (as at 24 October 2024)
Three profitable transactions this year
At the time of writing, Tiara has achieved 153 profitable and 34 unprofitable transactions. Despite its age, there have been no unprofitable transactions at Tiara after 2011. The freehold condo has also seen three profitable transactions this year, with profits ranging from $1.1 million to $2.08 million (see Table 1). Notably, two out of the three transactions earned their sellers profits exceeding $2 million.
Source: EdgeProp Buddy (as at 24 October 2024)
The profitable transaction that took place earlier this month is the most recent one for Tiara. It involved a three-bedroom unit on the 20th storey. The 1,346-sq ft unit features a spacious living and dining area, an en-suite master bedroom, a utilities room, and a yard (see Floor Plan 1).
Interestingly, the unit on the 24th storey, which yielded a profit of $2.08 million (see Table 1), is also a three-bedroom unit with the same size as the unit on the 20th storey. Both units share similar layouts, except the layout for #24-XX is a mirror image of #20-XX (see Floor Plan 2).
Source: EdgeProp Research
The unit that generated a profit of $1.1 million is a larger three-bedroom unit on the 27th storey (see Table 1). The layout of this unit is similar to the previous two, except for the larger living and dining areas (see Floor Plan 3).
Source: EdgeProp Research
Three transactions yielded profits of over $2 million
The two transactions mentioned in Table 1, which earned their sellers profits of over $2 million, are the second and third most profitable transactions for Tiara (see Table 2). The most profitable transaction took place in September 2022, involving a three-bedroom unit that sold for $3.3 million ($2,190 psf). The seller had purchased the 1,507-sqft unit in May 2002 for $1.185 million ($786 psf), resulting in a profit of $2.115 million.
It is notable that the top three most profitable transactions at Tiara resulted in profits exceeding $2 million. They are also the only transactions to yield profits exceeding the benchmark.
Source: EdgeProp Buddy (as at 24 October 2024)
Most recent unprofitable transaction was in 2011
The three most recent unprofitable transactions at Tiara took place in either 2009 or 2011 (see Table 3), with losses ranging from $70,000 to $400,000.
Source: EdgeProp Buddy (as at 24 October 2024)
The most recent unprofitable transaction, which took place in June 2011, involved a three-bedroom unit measuring 1,281 sq ft, which is smaller than the three-bedroom units mentioned above. The unit on the 23rd storey has a more compact dining area (see Floor Plan 4). The three-bedroom unit on the 13th storey, which sold for a loss of $400,000 in June 2009, shares the same size and layout as the unit on the 23rd storey.
Source: EdgeProp Research
The unit sold in July 2009 for a loss of $180,000 is a two-bedroom unit measuring 893 sq ft. Like its three-bedroom counterparts, the two-bedroom unit features an en-suite master bedroom. However, it does not have a yard or a utilities room (see Floor Plan 5).
Source: EdgeProp Research
Prices given a boost by new MRT station
The average resale price for Tiara had been significantly lower than that of its counterparts in District 9 until last year (see Chart 1). In 2022, the average resale price for freehold condos in District 9 was $2,267 psf, which was $188 psf higher than Tiara ($2,079 psf).
Source: EdgeProp Market Trends (as at 24 October 2024)
The price difference narrowed significantly last year when the average price for Tiara rose sharply by 10.1% y-o-y to $2,288 psf. In contrast, the average resale price for freehold condos in District 9 inched up by only 0.7% y-o-y to $2,283 psf. The sharp increase in the resale price for Tiara could be attributed to the completion of Stage 3 of the Thomson-East Coast Line (TEL), which includes the Great World MRT Station, in November 2022.
The average resale price for freehold condos in District 9 rallied to $2,318 psf this year, slightly higher than that of Tiara at $2,314 psf.
Numerous freehold neighbours
There are 55 condos, representing approximately 6,100 units, within a 500m radius of Tiara. Notably, 43 of these condos have freehold tenures.
Tiara is bounded by Kim Seng Road and Zion Road. Its immediate neighbours include The Cosmopolitan, The Trillium, and Centennia Suites along Kim Seng Road, as well as Melrose Park, Mill Point, and Zenith near Zion Road. However, Melrose Park, Mill Point, and Zenith are not comparable to freehold Tiara because they have tenures of 999 years.
Similar to Tiara, The Cosmopolitan, The Trillium, and Centennia Suites have freehold tenures. However, these three neighbouring condos are at least 13 years younger than Tiara (TOP in 1995). Centennia Suites (TOP in 2013) is the newest development, compared to The Trillium (TOP in 2010) and The Cosmopolitan (TOP in 2008).
Older developments near Tiara include Valley Park and Leonie Gardens, but they are not comparable because they do not have a freehold tenure (see Table 4). On the other hand, the older freehold developments obtained their TOP significantly earlier than Tiara. Yong An Park (TOP in 1986) is an example. Some of the older freehold developments, like Mirage Tower, fall outside the 500m radius of Tiara.
Source: EdgeProp Is it a Good Deal (as at 24 October 2024)
The Cosmopolitan and The Trillium are freehold developments located along Kim Seng Road. Both developments are in District 9 and the CCR. They are also located across the road from Tiara (see Map 2). The Cosmopolitan features 228 units, while The Trillium has 231 units. Both developments are slightly smaller than the 264-unit Tiara.
Source: EdgeProp LandLens (as at 24 October 2024)
Profitability of The Cosmopolitan and The Trillium
At the time of writing, The Cosmopolitan has achieved 265 profitable and 24 unprofitable transactions. Profits range from approximately $34,000 to $2.976 million, while losses range from approximately $1,800 to $636,000. The Trillium has achieved 149 profitable transactions, with profits ranging from approximately $9,600 to $2.93 million. There have also been 20 unprofitable transactions for The Trillium, with losses ranging from approximately $26,000 to $2.02 million.
The record-high profitable transaction for The Cosmopolitan took place in February for a unit on the 9th storey. The 1,679-sq ft unit features an en-suite master bedroom and a balcony near the living and dining areas (see Floor Plan 6).
Source: EdgeProp Research
The seller purchased the four-bedroom unit in April 2005 for $967 psf and sold it for $2,739 psf, resulting in a profit of approximately $2.976 million. This transaction is also the only one that netted a profit of at least $2 million.
In contrast, there were three transactions for The Trillium that netted their sellers profits of at least $2 million. However, all three transactions took place in either 2011 or 2022 (see Table 5).
Source: EdgeProp Buddy (as at 24 October 2024)
The unit that generated the record-high profit of approximately $2.93 million was purchased in April 2007 for $1,745 psf and sold in December 2022 for $2,390 psf. The unit features four bedrooms, including a master bedroom with an attached bathroom and lounge. Located on Level 15, the unit also features an attached bathroom in Bedroom 3, a studio bedroom, a powder room, a private lift, and a yard (see Floor Plan 7).
Source: EdgeProp Research
The most recent profitable transaction for The Trillium took place in September when a four-bedroom unit was sold for $2,712 psf. The seller purchased the 2,390-sq ft unit in September 2021 for $2,574 psf, resulting in a profit of approximately $330,000. The unit on the 22nd storey shares the same size and layout as the unit on the 15th storey that generated the highest profit for the development.
The most recent profitable transaction for The Trillium took place in September when a four-bedroom unit was sold for $2,712 psf. The seller had purchased the 2,390-sq ft unit in September 2021 for $$2,574 psf, resulting in a profit of approximately $330,000. The unit on the 22rd storey shares the same size and layout as the unit that generated the highest profit for the development.
Great World MRT Station: a game changer for Tiara
Tiara has benefited greatly from the completion of Great World MRT Station. From 2022 to 2023, the average resale price for Tiara increased by 10.1% y-o-y, while the average resale prices for The Cosmopolitan and The Trillium increased by 4.8% y-o-y and 0.8% y-o-y, respectively.
Furthermore, the average resale price for Tiara has risen by 22.6% since 2020, which is higher than the increases for The Cosmopolitan (18.3%) and The Trillium (16.5%) over the same timeframe.
Despite having a stronger price growth, the average resale price for Tiara ($2,314 psf) is lower than that of The Cosmopolitan ($2,739 psf) and The Trillium ($2,578 psf) (see Chart 2). This could be because Tiara is significantly older than the other two developments.
Source: EdgeProp Market Trends (as at 24 October 2024)
Conclusion
The close proximity of Tiara to the recently opened Great World MRT Station has boosted the average resale price for the development. Additionally, the development’s location just outside Orchard allows the residents to benefit from being near the main shopping and hotel belt of Singapore, but avoid the traffic congestion and noise. The condo is also located near Great World City, Zion Riverside Food Centre, and two primary schools.
It is noteworthy that the buyer of the profitable unit on the 20th floor paid $2,430 psf, which is $116 psf higher than the current average resale price of $2,314 psf for Tiara. However, the transacted price is lower than the average resale prices for The Cosmopolitan ($2,739 psf) and The Trillium ($2,578 psf). This could indicate that Tiara may be the most affordable option for buyers keen on purchasing a property in the neighbourhood. Furthermore, the average resale price of Tiara is lower than that of its counterparts in District 9 ($2,318 psf).
The comparatively more affordable price and strong price growth could indicate that Tiara is still a worthwhile consideration for buyers, despite its age. Tiara’s freehold tenure could help to mitigate its age.
Prospective buyers might also want to note that two government land sale (GLS) sites near Tiara were awarded this year. The residential developments on these sites are expected to be launched in the next two years, with estimated asking prices ranging from approximately $2,300 psf to $2,500 psf (see Screenshot 3).
Source: EdgeProp Is it a Good Deal (as at 24 October 2024)
To learn more about this transaction, and whether it is a good deal, click here.
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