Singapore’s Good Class Bungalows are still highly sought after for not only their size but also exclusivity. Here are the top five deals of the year so far.
Market upheavals, natural disasters and pandemics notwithstanding, Singapore Good Class Bungalows (GCB) have always been an interesting prospect for property buyers looking for something that has heritage, history, uniqueness, and not to mention, offer much-needed space.
Last year, while the country was still reeling from the pandemic, the landed housing market in general and the GCBs in particular had a bumper year, observes Nicholas Keong, head of private office at Knight Frank. The bulk of these sales over the last two years have been thanks to various high-profile CEOs, he adds.
“Young Singaporeans who have made money in tech and/or pharmaceutical sectors—notably, CEOs of TikTok, Secretlab, Stamped.io—have been buying and taking up more space to build homes for their families.”
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A slight downward spiral was however noticed towards the end of 2021—the first part of 2022 recorded a sales value of $343.4 million, which was a 55.3 per cent half-yearly decline from the second part of 2021. To put things in perspective, according to statistics released by the Urban Redevelopment Authority (URA) Realis, 28 bungalows were sold in the first part of 2022, slowing down from 35 deals in the second part of 2021 and 55 deals in the first part of 2021.
Huan Mei Han, director at List Sotheby’s International Research puts the dampened investor confidence towards “sticky inflation, interest rates hikes, recession risks and uncertainties from geopolitical fronts”. Keong agrees, adding: “A weaker macroeconomic outlook toned down sentiments, with some price resistance starting to set into the market as most sellers remained unwilling to budge on price expectations,” he adds.
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There has also been a change in what buyers are looking for, says Han. During the pandemic, buyers were looking for older properties that required major renovations. In fact, buyers were open to a total reconstruction as it gave them an opportunity to customise it to their needs. “Their intention was to design and develop a home with large living spaces that suited their needs, anticipating more time will be spent at home for working adults and home-based learning for children,” explains Han.
Whereas, now, buyers are increasingly looking for turnkey properties or homes that require minor renovations so they can move in quickly. “This change could be attributed to the repercussions from the pandemic and the war in Ukraine such as labour shortage and rising costs of construction materials, which translates to longer construction period,” speculates Han. “Also, younger GCB buyers who are more aware of environmental issues tend to be attracted to newer bungalows with the biophilic design concept and energy-saving features, such as the rainwater harvester, solar panels, and electric charging stations.”
Regardless, the sale prices this year have been balancing out in terms of per square foot value. “The total transaction value of $691.42 million reflects a per square foot rate of $1,760, which is 3.6 per cent higher than the $1,698 per square foot (psf) in the second half of 2021 and 4.2 per cent higher than the $1,689 psf in the first half of 2021,” explains Han. This average rate is still much lower when looking at the top GCB sales of the year.
Here, we list five of the biggest GCB deals closed so far in 2022.
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