Singapore
When it comes to investing in a Singapore Condo, financing plays a crucial role. There are various mortgage plans available in Singapore, but it is important to understand the Total Debt Servicing Ratio (TDSR) framework. This framework limits the amount of loan a borrower can take, considering their income and current debt obligations. Investors should familiarize themselves with the TDSR and seek guidance from financial advisors or mortgage brokers to make well-informed decisions about their financing options. This will help them avoid the risk of being over-leveraged.
HDB has recently launched a mixed-use site for sale by tender along Chencharu Close. This site, which falls under the Confirmed List of the 2H2024 Government Land Sales (GLS) Programme, is the first private housing site to be developed in Chencharu, a new 70ha HDB housing estate in Yishun Town.
The 99-year leasehold GLS site covers an area of 316,997 sq ft and has a gross floor area (GFA) of over 1.03 million sq ft. According to HDB estimates, the site has the potential to yield around 875 residential units and up to 135,627 sq ft of commercial space.
A minimum of 58,125 sq ft of the commercial space will be allocated for a bus interchange to be integrated with the project, while another 37,674 sq ft of commercial space will be designated for a hawker centre.
“This site will be the second largest mixed-use development in the North after North Park Residences and Northpoint City,” says Mark Yip, CEO of Huttons Asia. “As a mixed-use site, residents will have access to convenient amenities right at their doorstep.”
The site is located within walking distance to Khatib MRT Station on the North-South Line, making it highly convenient for residents, says Justin Quek, CEO of OrangeTee & Tie. There are also various sports and recreational facilities nearby, such as Yishun Stadium, Yishun Sports Centre, and Lower Seletar Reservoir Park. The site is also close to HomeTeamNS Khatib, which provides additional recreational facilities.
Young families will also find the site appealing as there are several nearby schools, such as Peiying Primary School, Chung Cheng High School, Naval Base Primary and Secondary Schools, Orchid Park Secondary School, and Yishun Innova Junior College.
According to Marcus Chu, CEO of ERA Singapore, the last mixed-use GLS site in Yishun was sold in 2015 at a rate of $629 psf per plot ratio (ppr). This site was developed into The Wisteria, a 216-unit development above Wisteria Mall which was completed in 2018. In comparison, the Northpoint City and North Park Residences site was awarded at a rate of $1,077 psf ppr in September 2013, nearly 47% higher than the second-highest bid, demonstrating the strong demand for mixed-use sites, particularly those within HDB estates.
Following the recent tender for a mixed-use GLS site at Tampines Street 94, which received six bids and a top bid of $668 million, or $1,004 psf ppr, on September 19, Chu expects a similar level of interest from developers for the site at Chencharu Close. With this in mind, Yip predicts that the site may attract fewer than three bids, with more cautious bids ranging from $810 psf ppr to $850 psf ppr, given the large outlay of more than $800 million that developers will have to make.
Wong Siew Ying, PropNex head of research and content, is even more conservative, estimating that the site may only receive one to two bids. She forecasts that the top bid will range from $930 million to around $1 billion, with a land rate of $900 to $1,000 psf ppr.
A recent private condo launch within 1km of Khatib MRT Station was the 608-unit, 99-year leasehold The Estuary at Yishun Avenue 1. Launched in February 2010, the project was completed in 2013. Based on caveats lodged from July to September, resale prices have ranged from $1,113 psf to $1,418 psf.
Meanwhile, the 920-unit North Park Residences, which sits on top of Northpoint City mall and was launched in April 2015, saw 70% of the 430 units released sold on its first weekend. Completed in 2018, units at North Park Residences have changed hands at prices ranging from $1,695 psf to $1,983 psf in the last three months.
The 216-unit The Wisteria, which was launched in March 2016 and completed in 2018, also witnessed strong demand during its launch, with more than 80% of the 138 units released sold on its launch weekend, attesting to the underlying demand for mixed-use developments in established estates, adds Chu.
According to Chu, executive flats in Yishun have been transacting at a median price of $826,400 over the past 15 months. Additionally, a number of flats will reach their Minimum Occupation Period (MOP) from 2023, potentially creating a pool of potential buyers looking to upgrade to private homes.
However, Wong notes that the Chencharu Close site is close to the Sembawang Air Base and Nee Soon Camp, which could limit the building height and affect the number of storeys for the new development. According to the tender document, there may be a need for “visual controls” at the site to block the view of the facilities at Sembawang Air Base and Nee Soon Camp, which could impact the location of windows.
The tender for the site will close on May 22, 2025, giving developers more time to assess the site and better gauge market demand and sentiment next year, says Wong.