Dream Homes: The Tatler Guide to Buying a Shophouse in Singapore
Shophouses have always held their own, but making one a home requires a few careful considerations. Here’s what you need to know before investing in one of these heritage buildings in Singapore.
Shophouses are existing remnants of the urban fabric of pre-World War II Singapore, built for the dual purposes of commercial and residential use. The Oxford dictionary explains that in simple terms as “a shop that opens onto the street and is used as the owner’s home”.
Although not unique to Singapore—there are other iterations of the same in other historic cities of Southeast Asia—it is but natural to want to stop and take a second glance at these fascinating structures. Constructed between the 1840s and the 1960s, these have been gazetted conservation status by the Urban Development Authority (URA) of Singapore, as part of a cultural preservation initiative kickstarted from the ’70s and ’80s. There are now over 6,500 conserved shophouses in Singapore, comprised of all various architectural styles, from traditional to transitional, boasting art deco, art nouveau, and modern details.
Aside from their visual splendour, this elevated status they enjoy makes them an attractive prospect for property buyers, which has also lent to the spike in their prices, says John Tan, senior associate in the banking, finance & property segment at law firm Withers KhattarWong. “The conservation shophouse is the cornerstone of Singapore's architectural and cultural heritage. If you add its rarity to the mix plus the robust demand for Singapore real estate, one would likely be able to rationalise the exponential increase in prices for conservation shophouses in the last 20 years.”
According to Clive Chng, associate director of Redbrick Mortgage Advisory, 135 shophouses were sold in 2020 amidst the pandemic, “which was a 10 per cent increase from the 123 shophouses that were sold in 2019”. With the sales steadily rising towards the end of 2020, this percentage went up by 29.9 per cent in mid 2021.
While the allure is understandable, buyers looking to make a shophouse property their home have to distil through a lot of information on the conservation guidelines on URA’s website.
“There is frankly, a lot to digest,” quips Fang Low, CEO and co-founder of Figment. His company that has revived many of these heritage gems to be co-living spaces, galleries and more; these shophouse units boast stylish interiors designed by homegrown brands and firms such as Farm, Ministry of Design, Scene Shang and Studio Juju.
Here are some important points to remember if you are considering a shophouse as your new home.
Know the Classifications
One of the most striking things about shophouses, besides their ornate embellishments, are their exuberant colours which may well look out of place in any other kind of property. They are zoning markers according to URA’s Master Plan, says Low.
“Blue is for full commercial or mixed commercial and residential shophouses, which can be purchased by a foreigner, pink is for residential with first floor commercial, and orange, which is full residential, can only be purchased by locals. Foreigners would need to get prior approval from the Land Dealings Approval Unit (LDAU),” says Low. While restrictions apply for property buys, none apply to foreigners looking to rent shophouses.
Aside from these and equally important are the three district zonings set by the URA, advises Jeremy Tay, director of interior design firm, Prestige Global Designs; the local studio's current office is situated in a shophouse. “The conservation areas in Singapore fall into four distinct categories and the conservation guidelines vary for each of these categories, of which the first three are related to shophouses: historic districts, residential historic districts, secondary settlements, and bungalows,” says Tay.
The historic district includes Chinatown, Boat Quay, Kampong Glam, and Little India areas, while the residential historic district covers Blair Plain, Cairnhill, and Emerald Hill. Secondary settlements include a slew: Balestier, Beach Road, Geylang, Jalan Jurong Kechil, Joo Chiat, Mount Sophia, River Valley, Tanjong Katong, Upper Circular Road, and Tiong Bahru.
These conservation zones each come with their own set of rules and regulations, and will influence the planning and renovation process of a residential buy, adds Diong Fuhan, principal of architecture and design firm Quod Architects x QED Design.
See also: Home Tour: A Chic Apartment with Monochromatic Spaces and Industrial Details
Evaluate Transaction Taxes
One other aspect uniquely related to shophouses is their tenures—which range from 99 years to 999 years and freehold. While this may seem like a positive factor in many ways, it also means that the number of remaining lease years of your shophouse buy could impact the bank loan amounts offered.
“With the various zonings, there are always transaction taxes such as Additional Buyers Stamp Duty (ABSD) and Seller’s Stamp Duty (SSD) to consider on residential properties which affects your investment return,” adds Low, citing another common oversight.
Jo’An Tan, associate director of Redbrick Mortgage Advisory agrees. “Other than the Buyer’s Stamp Duty (BSD) of the house value, investors need to take not that there is ABSD if there is a residential component in the shophouse,” says Tan.
For instance, a Singaporean who owns a landed property, looking to buy a residential shophouse, will have to pay both BSD and ABSD. The same goes for a local condominium owner purchasing a mixed-commercial-residential shophouse, however, the ABSD will be charged on the component of the property which is attributable for residential use only, she adds.
Renovation Rules to Know
The conservation guidelines of shophouses depend on the gazetted district—primary heritage districts tend to be stricter. But “one main guideline [across all districts] is that the external front facade has to be retained and painted in recommended pastel colours”, says Low. When it comes to constructing rear extensions to further increase the Gross Floor Area, they are usually allowed only within the secondary settlements, he adds.
Diong agrees, adding that this includes height restrictions. “For example, residential shophouse units at Blair Plain within the residential historic district can have rear extensions that do not exceed three storeys and the main roof level, while shophouses at Joo Chiat can have rear extensions that are up to five storeys,” she says.
“Accordingly, conservation shophouse owners have to seek written approval from the URA and the Building and Construction Authority of Singapore (BCA) prior to commencing any internal and external renovations, additions and/or alterations to the conservation shophouses. This may range from the placement and installation of signage and air-conditioning units, to the external painting of the building,” says Tan.
Low adds that since some of the conservation guidelines have been implemented relatively recently, it is imperative to do due diligence before purchasing one. “Find out if there are existing works or improvements to the shophouse that are non-guidelines approved,” he adds.
Work with an Experienced Design Team
While the character and historical value are the biggest pulls in a shophouse purchase, most buyers tend to underestimate the amount of renovation and restoration work that comes with conservation shophouses, says Diong. This can range anywhere from the challenge of maintaining original materials, as required by conservation guidelines, to having to deal with existing issues such as leakages, according to Low and Tay.
While maintaining the original materials may not sound like much of an issue—when considering the fact that it’s the easiest way to elevate its personality and historical character. But the reality is a bit more challenging.
“Timber flooring and staircases tend to be less soundproof and require treatment for fireproofing as opposed to simple modern concrete floors,” says Low. The same goes for the unglazed terracotta roof tiles—characteristic of shophouse from the 1900s—which can be a sourcing nightmare. “The terracotta tiles on the roof can look strikingly traditional, but it can be frustrating to procure tiles from a mere couple of manufacturers,” he adds.
The quaint layouts of some of the older ones can pose certain aesthetic and functional challenges, according to Diong. “Some conservation shophouses, which come in their original state do come with some inconveniences such as upper floor bedrooms looking into the bedrooms below, and lack of attached bathrooms, which can be overcome with intelligent design intervention and some work.”
Besides getting the conservation guidelines down pat, it is important to engage an architect who has the know-how and able to manipulate the nuances of the interiors. While some of the shophouses can have a large floor area, the amount of light coming in can be limited, cautions Tay. “It is necessary to clearly understand the pros and cons of the layout so as to allocate the right spaces to the right zones and creatively design the space such that it is functional yet has lots of character,” adds the interior designer.
Be Creative with Your Home Design
“I would recommend going all out to reimagine the space as a place to call home,” says Low. “In condo-fied Singapore, shophouses are some of the few buildings left standing with a soul and the beautiful limestone facades you see from the street are just the tip of the iceberg. There is still so much left to do with the interiors, be it through engaging local architects who are informed by the context of the vibrant neighbourhood outside, or through commissioning artworks by local artists to provide you with much-needed inspiration.
Low himself pulled all the stops when renovating his childhood shophouse home at Blair Road, with the help of Colin Seah, design director at Ministry of Design. The recently renovated shophouse, pictured above, is painted all white, which threw the spotlight more on the home’s heritage elements such as the Peranakan tiles and brick walls through various intentional cut-outs.
Diong admits to having a tendency to play around with layers, textures and local accents in the shophouses she has designed as well. “Some materials I like to use to complement the character of the building are rattan, timber, terrazzo, Peranakan tiles, fluted glass, and the like,” she says. She also recommends boldly integrating pre-loved vintage furniture pieces to elevate the character and authenticity.
“Once you start to get your feet wet, you can start to learn more about constructing rear extensions to intensify the land use—people don’t realise this but shophouses are actually pretty huge on the inside, reaching up to 7,000sqft at times,” says Low.
So, once you have done due diligence and take that bold step, he says, “go all out to reimagine the space you want to call home”.