Is Land Cost Coming Down = Lower Property Prices?

Today, I am going to talk about recent development in the land sales market in the Lentor area. This is after a government land sales site in Lentor Garden received a sole bid of $486.8 million or $985psf. This is one of the lowest land bids in recent months. Does this mean land cost is coming down and will property prices be coming down too? Before we jump to any conclusion. Let us study the details first. Let go! 

Development of Lentor Area

In this video, we will be mainly talking about land sales in the Lentor area. Lentor area had seen a flurry of land sales activities since the launch of Lentor Central site in July 2021. Currently, this development is known as Lentor Modern with a retail mall at the lower level. It is also directly connected to the Lentor MRT station along the Thomson-East Coast Line. This site was sold to GuocoLand at $784 million or $1,205psf after outbidding 8 other bidders. This is a mixed-used development so the land cost will usually be higher. If you are still keen on this project. There are 70 units still available. Prices start from $1,952psf. 3 bedrooms start from $2.1 million and 4 bedrooms from $ 3 million. 

Lentor Hill Road (Parcel A) - Lentor Hills Residences

The second site sold in Lentor is previously known as Lentor Hill Road (Parcel A). This GLS site was sold to a joint venture between Hong Leong Holding, GuocoLand, and TID. They secure this site at $586.6 million or $1,060psf after outbidding 3 other bidders. This upcoming new launch is now known as Lentor Hills Residences. There will be 598 units of 1 to 4 bedrooms with dual key units. The target preview is end of April or early May. If you are keen on this project. You can contact me as my company is the appointed marketing agency for Lentor Hills Residences.

Lentor Central

The third Lentor site which is known as Lentor Central was sold to a consortium of China Communication Construction, Soilbuild, United Engineers, and Yanlord Land. They secure this site for $481 million or $1,108psf after outbidding 2 other bidders. Take note, the land cost is 4.5% higher than the Parcel A site. 

Lentor Hill Road (Parcel B)

The fourth Lentor site which is known as Lentor Hill Road (Parcel B) is slightly smaller and away from the MRT station, was sold to TID Residential which is part of the Hong Leong Group. They secure this site for $276.4 million or $1,130psf after outbidding 1 other bidder. The land cost is 6.6% higher than the Parcel A site. If we look into the land bids. The other bidder is Soildbuild and partners that bid only $950psf. The difference between the 2 bids is 19%. Did TID Residential overpay for this site?

Lentor Gardens

Interestingly, let’s come back to the most recent development. Lentor Gardens is the fifth site for sale in the Lentor area. This site received only a sole bid by GuocoLand and Intrepid Investment at $486.8 million or $985psf. This is a record-low bid in recent months. Why such a low bid? I can only assume 3 reasons. Firstly, they could have learned something from Soildbuild and the partners’ bids that came in at $950psf in the earlier GLS tender. Will Soildbuild and partners bid for this site again and try to cement their presence after their Lentor Central win? If that is the case, it makes sense for TID to offer a little higher to secure it and yet not overbid like their earlier tender.

Secondly, the developers know that the number of tenderers begin to decline with each tender since Lentor Morden GLS site. The number of competitors gets fewer and fewer. There could be an oversupply situation in this area with a more cautious market outlook and a high-interest rate environment. Hence, if there are fewer competitors. Why bother to bid so high? 

Thirdly, TID would want to protect and defend its prices for its other projects in the Lentor area. They do not want others to come in with a low bid and sell at a lower cost. This will have an impact on its other projects. 

Having said that. It will be interesting to see if URA awards this tender as this is 15% lower than the earlier GLS tender. I think the planners will also compare it against the Lentor Hill Road (Parcel A) which was sold in Jan 2022 at $1,060psf. The land cost has depreciated by 7.6% in just 14 months in the Lentor area. Therefore, it is justifiable to award this piece of land as it is deemed to be the market valuation now. 

Impact on Property Prices in Lentor

The most important question will be. Since land cost goes down. Will property prices go down in the Lentor area? On this question. It is very hard to say. It depends on the take-up rate and the ultimate selling prices. In this case, GuocoLand and Hong Leong Holding have a big say in the selling prices in this area. In Cantonese. It is called 紧握. They have deep pockets, strong track record, a vast network of clients, and most importantly, they have a good 5 years to sell all these new homes. They still have a long runway to go. You no worry. I am very sure by then all will be fully sold. Once again in property-obsessed Singapore. 

Lentor Garden (Confirm List)

Hold on. We are not done with Lentor yet. There is another upcoming GLS site in the confirm list that is going to be launched soon. This site measures 1.47 hectares and can build up to 475 units. What kind of prices are we looking at? Will TID, GuoccoLand, and Hong Leong come in with a mid $950psf bid? Or will it be a dark horse developer that wants to bid low and sell high? How will this affect the pricing in the Lentor area? This will be interesting to watch. 

Lentor Garden (Reserve List)

Next, there is also another GLS site in the reserve list. This site measures 2.06 hectares and can build up to 500 units. I doubt it will be triggered for sale unless some developer wants to test the market and buy low. In addition, there are another 3 pieces of land zoned for residential uses. Seriously, why is URA so kan chiong to launch so many sites for sale in this area? They scare residents put a white elephant sign near Lentor MRT? But Lentor MRT is already in operation leh…

Launch More EC sites

In my opinion, they should launch EC sites in this location. There is a pent-up demand from HDB upgraders. Most if not, all are already priced out of the private property segment. If the authority scares EC owners will make a windfall like BTO flats. Which likely will be. Then please follow the Prime Location Public Housing (PLH) model for HDB flats in prime locations. Just copy and paste the rules such as longer MOP, capital gain tax, and priority for those with 2 or more children. I am very sure our birth rate will go up the roof.

For developers, please copy BTO layout as they are the most practical design. Don’t need to overthink. Just use the same architects that designed HDB flats. I realize this architectural firm designed some of the best HDB flats around. You can go to their website to find out more. By the way, I am not affiliated in any way with them nor am I been paid to promote them. To top it off, just incorporated IKEA furniture into EC. I think they are a perfect match for HDB upgrades. Going forward, I wouldn’t be surprised if someone will use my proposal. 


In conclusion, the lower bid for Lentor Gardens site is still early days if future GLS land prices will decline down the road. New homes are still selling well and the take-up rate is still healthy. Although the momentum has been losing steam in the past few months. It will be interesting to observe future GLS sites that are sold in the confirmed list. 

That all. Please like, share, and subscribe to my YouTube channel if you find them useful. See you around soon in Lentor. Thank you. 



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