Is it a Good Deal?: Seller of a 3-bedder in D10 lost $417,000 on the 1,496-sq ft unit
By Elizabeth Choong
/ EdgeProp Singapore |
Mon Jervois has more unprofitable than profitable transactions. (Photo: Samuel Isaac Chua/EdgeProp Singapore)
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SINGAPORE (EDGEPROP) – In August, a three-bedroom unit in Mon Jervois was sold for $2.8 million ($1,871 psf), resulting in a loss of approximately $417,000. The seller had purchased the 1,496-sq-ft unit in July 2013 for $3.217 million ($2,150 psf).
At the time of writing, the low-rise development had more unprofitable than profitable transactions. The losses from the nine unprofitable transactions range from approximately $123,000 to $700,000, while the profits from the five profitable transactions range from approximately $20,000 to $124,000. It is noteworthy that the losses are significantly higher than the profits.
We used our analytics tool, "Is it a Good Deal?", to determine whether the buyer of the three-bedroom unit in Mon Jervois secured a good deal.
Located in prime District 10
Mon Jervois is located along Jervois Road, which is in District 10 and the Tanglin Planning Area. The 99-year leasehold condo obtained its temporary occupation permit (TOP) in 2016. The boutique development features 109 units comprising one-bedroom to four-bedroom units, with sizes ranging from 614 sq ft to 3,003 sq ft.
Mon Jervois is within walking distance of Alexandra Primary School, Crescent Girls’ School, Valley Point, and the Chatsworth Park Good Class Bungalow Area (GCBA) (see Map 1). The nearest MRT station is Redhill Station, but it is not within walking distance as it is approximately 740m away.
Amenities within a 1km radius include Gan Eng Seng School, Queenstown Secondary School, Redhill Market and Food Centre, Tiong Bahru Plaza, and Great World City.
Source: EdgeProp LandLens (as at 27 August 2024)
More pros than cons
Our "Is it a Good Deal?" analytics tool indicates that the transacted price is lower than the average prices for the district and for eight nearby projects (see Screenshot 1). Another plus point is the condo’s long remaining tenure.
Source: EdgeProp Is it a Good Deal (as at 27 August 2024)
Mon Jervois has more unprofitable than profitable transactions
At the time of writing, Mon Jervois has had five profitable and nine unprofitable transactions. Thus far this year, only one sale transaction has taken place for Mon Jervois. The lone transaction is the aforementioned sale that resulted in a loss of approximately $417,000 for the seller.
Last year, five unprofitable transactions and one profitable transaction took place for the condo. It is noteworthy that the lone profitable transaction was for a one-bedroom unit, while the unprofitable transactions were for larger units with at least two bedrooms (see Table 1).
Source: EdgeProp Buddy (as at 27 August 2024)
The unprofitable transaction that took place earlier this month was for a three-bedroom unit measuring 1,496 sq ft. The ground-floor unit features a private enclosed space (PES) that can be accessed via all three bedrooms and the living area (see Floor Plan 1). The sizable PES will appeal to buyers who want a small outdoor garden. Additionally, the spacious master bedroom suite has sufficient space for a walk-in wardrobe. There is also a cozy mezzanine space near the kitchen and dining area that can be used as a small home office.
Source: EdgeProp Research
Among the unprofitable transactions that took place last year, a three-bedroom unit on the third floor was sold in August 2023 for $2.6 million ($1,872 psf). The 1,389-sq-ft unit was purchased in November 2017 for $3.3 million ($2,377 psf). The seller suffered a loss of $700,000, which is the highest thus far for Mon Jervois.
The 1,389-sq-ft unit has a spacious master bedroom with a walk-in wardrobe and an en-suite bathroom. The unit has a balcony that is accessible only via the master bedroom, allowing it to be converted into a private breakfast nook for the occupants of the master bedroom. The unit has another balcony that is accessible via the living and dining area (see Floor Plan 2). Additionally, there is a mezzanine space near the kitchen.
Source: EdgeProp Research
The lone profitable transaction for Mon Jervois that took place last year was for a one-bedroom-plus-study unit measuring 624 sq ft. The ground-floor unit was sold for $1.25 million ($2,002 psf) and was purchased in February 2015 for $1.22 million ($1,954 psf), earning the seller a profit of $30,000. The unit has a PES and a mezzanine space above the study (see Floor Plan 3).
Source: EdgeProp Research
Resale price for Mon Jervois on a decline
Mon Jervois was launched for sale in 2013, but only 27 units were sold that year, translating to a cumulative take-up rate of 24.8%. Sales remained slow, with only 43 units sold (cumulative take-up rate of 39.4%) by the end of 2015. To boost sales, the developer introduced a discount in August 2016 when the development obtained TOP. From August to December 2016, 14 units were sold, pushing the cumulative take-up rate up to 52.3%.
The ground-floor unit that generated a loss of $417,000 was purchased in July 2013 for $2,150 psf, which is $80 psf higher than the overall average price of $2,075 psf for Mon Jervois that year (see Chart 1). The third-floor unit that generated a loss of $700,000 was purchased in November 2017 after the developer started offering discounts. However, the purchase price of $2,377 psf is still $285 psf higher than the overall average price of $2,092 psf for the condo that year. The higher-than-average purchase prices for both units could have contributed to their sellers’ losses.
Source: EdgeProp Market Trends (as at 27 August 2024)
Since 2017, the average resale price for Mon Jervois has slipped by 10.6% to $1,871 psf, contributing to the unprofitability of the development. In contrast, the average resale prices for 99-year leasehold condos in the Tanglin Planning Area have risen by 9.2% to $1,823 psf, while those for their counterparts islandwide have surged by 42.6% to $1,634 psf (see Chart 2).
Source: EdgeProp Market Trends (as at 27 August 2024)
Only five leasehold neighbours
There are 24 condos representing over 2,900 units within a 500m radius of Mon Jervois. Of these, only five have a 99-year leasehold tenure like Mon Jervois, namely Jervois Jade, Domain 21, The Crest, Alex Residences, and Principal Garden. Among these five developments, The Crest and Principal Garden are located nearest to Mon Jervois.
The Crest is a year younger than Mon Jervois, having obtained its TOP in 2017. Principal Garden obtained its TOP in 2018, making it two years younger than Mon Jervois. However, The Crest and Principal Garden are larger developments, featuring 469 units and 663 units, respectively. Despite being located across the road from Mon Jervois, both developments are in District 3 and within the Bukit Merah Planning Area (see Map 2).
Source: EdgeProp LandLens (as at 27 August 2024)
Neighbours have more profitable than unprofitable transactions
At the time of writing, The Crest has 40 profitable and 24 unprofitable transactions. Profits range from approximately $16,000 to $799,000, while losses range from approximately $7,000 to $399,000. Principal Garden has 177 profitable transactions, with profits ranging from approximately $4,000 to $1.207 million. The lone unprofitable transaction for Principal Garden took place in 2022 and yielded a loss of $36,000.
The Crest has had only two unprofitable transactions this year and four unprofitable transactions last year (see Table 2). The most recent unprofitable transaction was for a 1,292-sq-ft unit with three bedrooms, which was sold in August. The seller purchased the three-bedroom unit on Level 15 in April 2018 for $2.339 million ($1,811 psf) and sold it for $2.3 million ($1,781 psf), resulting in a loss of $39,000. The other unprofitable transaction took place in March for $2.189 million ($1,695 psf), resulting in a loss of approximately $160,000. The seller had purchased the unit on Level 17 in April 2018 for $2.349 million ($1,819 psf).
Source: EdgeProp Buddy (as at 27 August 2024)
Interestingly, both unprofitable transactions that took place this year for The Crest are from the same stack. Both units also share the same layout and size (see Floor Plan 4). Furthermore, both units were purchased in April 2018 for approximately $1,800 psf. The larger loss suffered by the seller of #17-XX could be attributed to its selling price, which was lower than that of #15-XX by $86 psf.
Source: EdgeProp Research
Average resale price for Mon Jervois fell below The Crest and Principal Garden
The Crest ($1,930 psf) and Principal Garden ($2,165 psf) have higher average resale prices compared to Mon Jervois ($1,871 psf) (see Chart 3). This is despite The Crest and Principal Garden being in the less prestigious District 3, compared to Mon Jervois, which is located in the prime District 10.
Principal Garden also achieved the strongest price growth of 13.7% since 2020. In contrast, the average resale price for Mon Jervois inched up by 2.5%, while the average resale price for The Crest dipped by 1.3% over the same timeframe.
Source: EdgeProp Market Trends (as at 27 August 2024)
Conclusion
Mon Jervois’ location in a prime district does not prevent its sellers from suffering losses. In contrast, The Crest and Principal Garden generated more profitable transactions despite being located in a less prestigious district. Both condos are located just across the road from Mon Jervois. However, buyers who value privacy and exclusiveness are likely to choose Mon Jervois over The Crest and Principal Garden because Mon Jervois is a smaller development with fewer units.
The Crest and Principal Garden command average resale prices that are higher than Mon Jervois. This allowed the buyer to secure a unit in a prime district at a price that is lower than the average prices of the two neighbours in District 3.
The average resale price for The Crest has declined marginally since 2020, while the average resale prices for Mon Jervois and Principal Garden have continued to rise. However, it is notable that the price growth for Mon Jervois is significantly weaker than Principal Garden.
To learn more about this transaction, and whether it is a good deal, click here.
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