By Reico Wong
The record $39-million sale of a Sentosa Cove seafront bungalow to a buyer from India, which made headlines earlier this month, may have raised many eyebrows.
But it is far from being the most expensive prestige landed home on the Singapore property market - in terms of absolute price - at the moment.
Sources told my paper that one of the priciest residential landed properties up for grabs is a five-bedroom good-class bungalow (GCB) in Ridout Road, off Holland Road.
It looks set to eclipse last year's top transaction, a 69,546 sq ft bungalow at 23 Yarwood Avenue which was sold for $59.5 million, or $856 psf.
The asking price for the Ridout property also rivals the psf price of most of the 57 GCBs sold last year, hovering slightly higher than that of the top-five highest transactions.
There are only about 2,400 GCBs in 39 gazetted areas islandwide. GCBs, by definition, span at least 15,000 sq ft of land and have to fall within designated zones to be so classified.
Also on the market now is a six-bedroom modern-contemporary-design GCB in Belmont Road - also off Holland Road - which comprises an 11,000 sq ft house and an additional 26,400 sq ft of land. It could go for about $50 million, property agent Savills said.
Still, it is areas such as Nassim Road, Chatsworth Park and Cluny Hill which remain the favoured residential addresses of the ultra-rich and famous here.
The record psf price for a GCB in mainland Singapore is held by 6 Chatsworth Road, which went for $2,081 psf in July last year.
When it comes to such high-end luxury properties, it is the sheer exclusivity of the neighbourhood and the size of the land which the property sits on that draw the high-profile and high-net-worth buyers.
Property experts specialising in such prestige homes shared that the built-up area of the house itself usually has limited influence on buyers' decision.
This is because the majority of such buyers have almost infinite cash to spare and have no qualms about re-building the house from scratch.
The value of the house itself is typically only about 25 to 30 per cent of that of the entire property, with the land being the key price determinant, said Mr Douglas Wong, director of luxury homes at property firm CBRE, who specialises in GCBs.
Savills' director of prestige homes, Mr Samuel Eyo, said: "GCBs, as a property type, are in a class by themselves. It's something which tells immediately of the owners' status, and most buyers purchase such properties for their own use."
The profile of GCB buyers tends to be highly mixed, even as most of them belong to the top 5 to 10 per cent income brackets in Singapore society.
Mr Eyo added that individuals keen on buying a high-end GCB, such as the ones in Ridout Road and Belmont Road, would probably need to have a net worth of at least $500 million.
At least nine out of 10 mainland GCB buyers are Singaporeans, since buyers of landed residential properties must be locals or at least permanent residents.
On the outlook of this particular housing segment, Mr Wong said GCB prices may ease by between 3 and 5 per cent this year.
He added that the number of GCB transactions is likely to slip by 20 to 30 per cent from the 57 deals struck last year. The value of transactions is also likely to fall from last year's $1.16 billion to between $800 million and $900 million this year.
Mr Ong Kah Seng, director of R'ST Research, said that the longer-term market outlook remains positive, given that land in Singapore is scarce and GCBs are an exclusive type of housing.
"Prices have the potential to rebound from 2013... high-end landed property prices are expected to see at least a 5 per cent rise by 2014," he said.