Despite several rounds of cooling measures, land prices have continued to rise resulting in most suburban condominiums exceeding the $1,200 per sq ft (psf) price threshold.
Most suburban residential sites under the Government Land Sales programme that have not been officially launched are expected to go beyond the $1,200 psf price tag. 2 of which have already been marketed
The site at Sengkang West Way is the only site that is expected to launch close to $1,000 psf. On the opposite end, the most expensive launches are scheduled to launch at New Upper Changi Road, Yishun Ring Road and Ang Mo Kio Avenue 2, all of which are expected to cost more than $1,400 psf. These developments are in sync with the trend of recent suburban launches that hit above the $1,200 psf on average, some of which include the J Gateway in Jurong which launched at a median price of $1,486 psf and Urban Vista that was launched at a median price of $1,503 psf.
Analysts predict that the market is able to withstand a threshold of $1,500 psf if total prices remain relatively affordable. Tightening credit may dampen sales volumes in the medium-term, but suburban condominium prices should remain at an affordable price of up to $1.5 million.
Research experts say that prices are increasing because developers are building smaller units with higher psf prices and the demand for suburban condos come mostly from buyers upgrading from their Housing Board flats.
The increase in suburban condo prices alternatively boost the popularity of executive condos (ECs), making them significantly more affordable than suburban condos, but this may not be for long as even EC prices are set to go beyond $800 psf soon.
Source – iProperty.com, URA