19-11-2012: Hot in the suburbs

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Esther Teo
The Straits Times
Monday, Nov 19, 2012

CITY fringe and eastern suburban estates have broken new home price records in the past six months as clear pricing hot spots emerge across Singapore.

Once considered sky-high outside upscale precincts, the $1,500 per sq ft (psf) mark is fast becoming the norm in some hot spots - most dominant in the east.

Many new mass market projects eclipsing the $1,500 psf mark are tied to "titillating new lifestyle concepts" to attract buyer interest, experts say.

The hotter areas include a ring just outside the city and waterfront estates, both on the east coast and north-east coast, said Mr Colin Tan, research head at Chesterton Suntec International.

But the eastern suburban estates, with their ample, appealing lifestyle amenities, have surged ahead of the western districts in terms of prices.

One reason could be that the east was one of the first parts of Singapore outside the city centre to be developed, experts add.

That means many of the commercial and residential developments there have some history behind them, said Savills Singapore research head Alan Cheong.

"In fact, before Bukit Timah took off as a prime residential address, Katong and Siglap were addresses where the rich would reside," he added.

"Owing to an already established density of development there, it has a natural draw for people wishing to reside in such an agglomerated area."

Another factor is the substantial number of government land sale sites in eastern towns where developers have launched new projects at benchmark prices.

This has driven up other prices in the vicinity in tandem.

R'ST Research director Ong Kah Seng noted that freehold homes on the city fringe and suburban planning areas of Bukit Timah, Geylang, Marine Parade and Bedok have recorded the most transactions surpassing $1,500 psf so far this year.

This includes The Seawind project in Bedok, with a median price of $1,520 psf, and The Sound, at $1,650 psf.

Developments in the Marine Parade planning area, such as The Seafront on Meyer and Aalto, have also easily eclipsed the $1,500 psf mark.

For 99-year leasehold homes, Bukit Batok, Bukit Merah, Bishan and Kallang areas saw the most number of homes topping the price chart, said Mr Ong.

For instance, Citylights had a median price of $1,550 psf, while Southbank was sold at $1,590 psf. Both projects can be found in the Kallang planning area.

While homes in the east have been popular with expatriates and proved themselves to be good investments, said Mr Ong, price gains are set to moderate.

This is due to the increase in supply of completed homes from new residential hot spots such as Hillview, Kovan and Sengkang.

When Punggol's development becomes more established in the years ahead, it will also siphon some interest away from homes in the east, he added.

Experts note that home prices in western districts such as Jurong Gateway and one-north in Buona Vista are also expected to catch up when they are fully developed.

Moreover, the improvement of transport links across the island will also change the landscape of suburban living, they add.

The completion of Downtown Line 2, for instance, will boost the Bukit Panjang and Upper Bukit Timah areas, and Housing Board upgraders are likely to review their many housing options.

Suburban home prices have inched up 2.7 per cent in the first nine months of this year, according to the Urban Redevelopment Authority.

This is more than the 0.7 per cent rise for city fringe areas and the 0.1 per cent gain for city centre homes.

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