New life revives Serangoon North Village

By Ruth Loh Xiu

/ EdgeProp Singapore |

June 7, 2019 6:00 PM SGT

Flanked by Serangoon Garden and Hougang, Serangoon North Village was originally a quiet, sleepy neighbourhood, best known for its flurry of pet shops. With no MRT station or bus interchange within walking distance, this segment of Serangoon seemed destined to stay under the radar of homebuyers and developers.

Then things changed.

Attraction of a renowned school

When nationally renowned school Rosyth Primary shifted from Parry Avenue to Serangoon North Avenue 4 in 2001, it added instant appeal to an otherwise typical heartland neighbourhood.

On July 22, 2017, Hoi Hup launched Hundred Palms Residences EC, an executive condominium development at Yio Chu Kang Road located between Serangoon North and Hougang. The developer sold every one of its 531 units in seven hours. More than a thousand would-be homeowners were left with unused ballot tickets, their eager enthusiasm evaporated into dull resignation. The EC is within a 1km radius of Rosyth Primary. As such, the project appeals to families who have children studying at Rosyth, or are planning to enrol their children at the school.

The exceptional success of Hundred Palm Residences EC’s launch boosted developer confidence in the area's potential. A week after the launch, 16 developers bid bullishly for a 1.72 ha, 99-year leasehold site at Serangoon North Avenue 1. Keppel Land and Wing Tai Asia jointly submitted the top bid of $446.28 million, or $965 psf per plot ratio (ppr).

The Garden Residences showflat along Yio Chu Kang Road. Photo credit: Ruth Loh Xiu

It was later announced that the 613-unit, 99-year leasehold The Garden Residences would be built on the Serangoon North Avenue 1 site. The Garden Residences preview weekend of May 19-20 in 2018 attracted more than 3,000 visitors and was launched in June that year, whereupon it promptly hit $1,770 psf for a 614 sq ft apartment.

During the same period, Oxley Holdings previewed the 99-year leasehold Affinity at Serangoon, a 1,052-unit residential project also along Serangoon North Avenue 1, just 15 minutes’ walk from The Garden Residences. Oxley Holdings paid $499 million (or $835 psf ppr) for the site formerly known as Serangoon Ville. Both The Garden Residences and Affinity at Serangoon were the first Serangoon private condo launches in almost a decade, generating buzz in a staid part of Serangoon.

According to Edmund Tie & Co (ET&Co), higher launch prices have spilled over to the private resale market, pumping up both new sales and resale prices in the area. The median psf price over a 10-year compound annual growth rate (CAGR) averaged 8.4% for both leasehold and freehold new non-landed sales, and 7.25% for leasehold and freehold resale units, says ET&Co.

With so much activity in the private property sphere, how has this affected the neighbourhood's HDB prices?

The clock tower is a recognisable stalwart of Serangoon North Village. Photo credit: Ruth Loh Xiu

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HDB prices in Serangoon North

There are about 105 HDB blocks at Serangoon North. At Block 536 Serangoon North Avenue 4, a middle-floor four-room flat was transacted at $456,000 ($415 psf) in April 2013; another middle-floor four-room flat was sold for $418,000 ($377 psf) in August 2016. In the most recent transaction at that block, a high-floor four-room flat changed hands for $450,000 ($406 psf) in October 2018. Similarly, at Block 510 Serangoon North Avenue 4, a middle-floor four-room flat was transacted at $428,000 ($394 psf) in April 2013. This compares to a transaction for a high-floor four-room flat at $418,000 ($385 psf) in February 2019 at the same block.

In contrast, executive maisonettes on the first to third floor at 148 Serangoon North Avenue 1 transacted at $500,000 and below in 2010, but broke the $600,000 ceiling in 2015; they are still transacting around that level today. Likewise, executive apartments at 516 Serangoon North Avenue 4 were transacting below $600,000 in 2010, but have sold for $640,000 and above in the last two years.

What are the possible reasons for such price movements?

“Some en bloc beneficiaries, such as retirees, are unable to take on new loans,” says Ong Choon Fah, CEO and head of research & consulting at ET&Co. “This limits their choices in purchasing a replacement home. This is especially the case when a development is in a less prime location.”

For Affinity at Serangoon, Ong explains, the developer’s purchase price was $835 psf ppr; this means en bloc beneficiaries were restrained to a markedly narrower stream of replacement properties to buy, given residential prices are generally higher now compared to their en bloc sale prices.

“Those unable to take a loan face even more constraints,” Ong says. “Many en bloc beneficiaries who have lived in their residences for a long time are already accustomed to the neighbourhood and typically prefer to live within a kilometre or two of their old homes.”

Given the smaller budgets, an en bloc beneficiary from Serangoon North might choose to buy a large HDB flat that ticks all the boxes in terms of affordability, accessibility, and amenities, instead of a condo unit.

Effect of Cross Island Line

Earlier this year, the LTA announced the upcoming Cross Island Line, which included Serangoon North MRT Station. Price directions are unlikely to shift in relation to the announcement until a physical station is in place – in fact, prices may slump during the construction period – but the upcoming station is set to improve connectivity and transport options in Serangoon North.

With a top primary school, upcoming MRT station, and three new developments on the horizon, Serangoon North is shaping up to hold its own against its more mature siblings, Serangoon Central and Serangoon Garden.

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