Why ‘proximity’ is key to choosing a condo

By iProperty.com Singapore – November 1st, 2010

 

Condominiums near East Coast Parkway are more likely to be of interest to investors. (Photograph: William Cho)

While HDB housing is the by far the largest form of housing in Singapore, with over 80% of Singapore’s population staying in HDB apartments, condominium ownership remains an aspiration for many home owners.

As part of iProperty.com Singapore’s series on how, where and why to choosing your home in Singapore, we look at why “proximity” is key when deciding to invest in a property.

Facilities increase value

While location will always be one of, if not, the key factor in determining price, the proximity to the development of a variety of services and facilities is also hugely important in a development’s value.

The recent news that the top bid for a condominium site in Yishun was tabled at $165 million, in the process setting a new benchmark for condominium land in Singapore, was largely based on the selling point of its proximity to Orchid Country Club Golf Course and its uninterrupted view of Lower Seletar Reservoir.

“This location will appeal to people who prefer a quiet neighbourhood, lots of greenery and a serene environment,” said Leonard Tay, director of commercial real estate firm CBRE Research.

While the property lacks a nearby MRT station, Tay thinks that it is close enough to Yishun HDB new town for property owners to enjoy the various conveniences and amenities there. The probable low-rise condominium that will be developed there could, estimates CBRE, sell above $800 psf.

HDBs important

This proximity to a HDB estate is an important consideration for some purchasers of condominiums.

Town planning ensures that HBD developments are built around a central hub, usually containing food stalls, supermarkets, medical clinics, and other facilities, sometimes even including childcare or educational facilities.

Nearby condominium residents can take advantage of all of these, while, for example, those who stay at developments along Upper Bukit Timah road, although some of the most exclusive in Singapore, do suffer from a lack of services within walking distance.

View from a house of Astoria Park Condominium housing estate over the swimming pool towards the Kembangan MRT station. (Photograph: Timo Sippala)

Transport is key

Which development you buy is naturally driven by what you prioritise. Proximity to work is always a factor, while families tend to buy homes close to schools and other educational facilities.

Transport too plays an important part in any decision. Property developer Frasers Centrepoint Homes reported units were sold in properties along Bedok Reservoir Road within days of the government announcing that an MRT station would be built nearby, despite the estimated completion date of the Downtown Line, on which the Bukit Reservoir Station is located, being 2017.

Savills Residential Director, Phylicia Ang, was quoted in The Straits Times, as advising caution before investing in this area, as, with such a long timeline, “investors will have to wait a few years for the line to be ready in order to reap the benefits” and “developers and individual sellers may raise their prices.”

Similarly, the upsurge in prices on residential condominiums (and nearby HDB apartments) in the Serangoon and Lorong Chuan areas is attributed to the dual factors of the proximity of the newly expanded Circle Line, and Serangoon MRT’s position as the interchange station for the North-East line, as well as the expected 2011 completion of the massive NEX shopping centre above it.

 

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iTip: Draw up a list of what is important to you. Does the development have good shopping and other services close by? Do you need to be close to a school or kindergarten? Are leisure activities within or adjacent to the compound? By working out what you prioritise, you can assess whether a particular development for you.

If you have your own transport, or your work is not on an MRT line, then your condominium’s proximity to one may not be a high priority. Some developments, such as apartments in Sentosa Cove, sacrifice accessibility for exclusivity, and buyers should be aware of the pros and cons of living in relatively remote locations.