Sold: 26 Good Class Bungalows. Value: $588m

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Sold: 26 Good Class Bungalows. Value: $588m











Sunday, Dec 21, 2014


Rennie Whang


The Straits Times




Demand for homes in Singapore may have fallen steeply this year but business has been humming in the Good Class Bungalow (GCB) market.


An analysis by CBRE showed that 26 GCBs have been sold this year with a total value of $587.75 million, comparable with last year's 29 deals worth $682 million. Even so, it is a hefty drop from 2012, when 54 GCBs changed hands for $1.17 billion - and a far cry from a record 133 deals at $2.38 billion in 2010.


GCBs typically have a land size of 1,400 sq m, or about 15,069 sq ft. But when GCB areas were gazetted in the 1980s, they included some smaller existing sites that are still considered GCBs as they would be bound by other GCB planning rules if redeveloped. There are about 2,700 GCBs here in 39 designated estates.


Transactions have fallen in recent times owing to the imposition of the total debt servicing ratio (TDSR) and additional buyers' stamp duty (ABSD), experts say.


"Most GCB buyers already have a property and are unwilling to pay ABSD if they are buying for investment. This could be quite hefty given the high quantum," said Mr K. H. Tan, managing director of Newsman Realty.


But prices appear to have held up this year. The average price of GCBs this year is $1,454 per sq ft (psf) based on transactions so far this year, 9 per cent higher than $1,388 psf last year, said Mr Douglas Wong, CBRE head of luxury homes. However, the average price is only a ballpark indicator of GCB prices and does not fully account for factors including location, size, age, design, terrain and frontage, he added.







26 Good Class Bungalows sold for $588 million

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"GCBs are expected to perform at a similar level next year as current sentiments will likely spill over... About 20 to 30 GCBs will probably be sold for the whole of 2015," said Mr Wong.


GCB areas which saw more deals this year were Belmont Park, Chatsworth Park, Chestnut Avenue, Dalvey Estate, Raffles Park and White House Park.


In terms of total price, the most expensive was 27 Ridout Road, which went for $35 million or $1,039 psf in July. The costliest on a psf basis was 22 Margoliouth Road which sold for $14.8 million or $2,051 psf in October. Also notable was 65 Holland Park, which Frasers Centrepoint sold for $30 million or $1,991 psf last month. All are freehold properties.


Neighbouring 67 Holland Park, also freehold, is for sale with a negotiable asking price of $35 million, the company said. While cooling measures have dampened volume and prices, the outlook for GCBs remains positive. They are expected to offer strong capital preservation given their rarity, said Dr Chua Yang Liang, head of South-east Asia research at JLL.







Best World president's massive bungalow fits all under one roof

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Indeed, GCBs have appreciated at a faster rate than landed and non-landed assets over the past 10 years. A JLL analysis showed that the average price of GCBs rose from $395 psf in 2004 to $1,548 psf in the year to date. This works out to a 292 per cent increase, or a compound annual growth rate (CAGR) of about 14.6 per cent per year.


Landed home prices went up 203 per cent over the same period, with a CAGR of 7 per cent a year while non-landed home prices rose 180 per cent, with a CAGR of 6 per cent a year. But in the short term, the price increase is expected to be "moderate to stable", said Dr Chua.


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This article was first published on Dec 19, 2014.
Get a copy of The Straits Times or go to straitstimes.com for more stories.







All-white interior for sleek bungalow

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Copyright © 2014 Singapore Press Holdings Ltd . Co. Regn. No. 198402868E. All rights reserved.








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