Hi, my name is Alan from AlanWeeProperty. Welcome back to my YouTube channel. In this video, I did my usual morning run in the town of Toa Payoh. Toa Payoh is one of the oldest towns in Singapore. It is well known for its central location, HDB Hub, hawker centers, wet market, and most importantly highly sourced after primary schools.
Today, I am going to do a review of the performance of condominiums in Toa Payoh. There are only a handful of condos in the first place. They are Oleander Towers, Trellis Towers, Sky@Eleven, Trevista, The Peak @ Toa Payoh which is a DBSS, and Gem Residences. Which condo has underperformed and which condo has performed well over the years? Without further ado. Let’s jump straight into it.
The first condo that we are going to discuss is Oleander Towers. Oleander Towers is a 99 years leasehold condo completed in 1998. Back then, it was the first condo in Toa Payoh. The average launch price back in 1995 was $780psf or $900,000 for a typical 3 bedrooms apartment. Today, the average price is about $1,300psf or $1,600,000 for a 3 bedrooms apartment. In terms of the capital appreciation based on per square feet, the return is 67% over the last 28 years or a 2.4% annualized return. In terms of capital appreciation based on price wise. The return is 74% or a 2.6% annualized return.
Take note, there will be some variation between the capital appreciation in terms of per square feet and the overall prices as a different set of data are been averaged out. The purpose of showing you the overall prices is to give you a better understanding in terms of how much prices have increased over time rather than looking from a per square feet basic, which will most likely make no sense to you. Anyway, for the ease of this discussion. We will mainly be comparing in terms of overall prices point.
Next, we have Trellis Towers which comprises 384 units and completed in 2000. This is a rare freehold condo near the heart of Toa Payoh Central. I am always puzzled why the land Trellis Towers seat on is freehold land where the surrounding is 99 years leasehold HDB flats.
After much research. This piece of land which is owned by CDL used to be a light industrial building back in 1992. It was only in 1996 that written permission was obtained from URA to redevelop this freehold land into a 30-story condominium which presently is Trellis Towers.
The average launch price back in 1996 was $900psf or $1,200,000 for a 3 bedrooms apartment. Today, the average price is about $1,800psf or $2,300,000. This means the price has appreciated by 88% or a 3.3% annualized return. Not too bad in my opinion.
Sky@Eleven is another rare freehold condo. The land it seats on is previously occupied by a factory owned by Singapore Press Holding. SPH developed it into a 384-luxury condo comprising 3 to 5 bedrooms. The majority of the units are 4 bedrooms that measure 2,713sqf. The average launch price back in 1996 was $1,000psf or $2,600,000 for a typical 4 bedrooms apartment. Today, the average price is about $2,100psf or $5,700,000. This means that prices has appreciated by 116% or a 7.2% annualized return. Impressive return! Just take a look at the historical price trend. Except for the US subprime crisis is 2008 to 2009 and the 2017 slow down. Otherwise, Sky@Eleven’s performance is a good barometer of Singapore’s economic progress.
Trevista is a 99 years leasehold condo with 590 units. It is within walking distance to many popular schools such as CHIJ Primary and Pei Chun Public School. The average launch price in 2009 was $950psf or $1,000,000 for 3 bedrooms. Today, the average price is $1,700psf or $2,000,000. This means that price has appreciated by 91% or a 6.5% annualized return in just 14 years. Equally impressive return!
The Peak @ Toa Payoh
On a side note. Let’s compare the performance of The Peak @ Toa Payoh which is a DBSS with 1,203 units. DBSS is a hybrid between a HDB flat and a condo. Based on online blog. The initial selling prices for 5 bedrooms range from $539,000 to $698,000 with 24 “exclusive” five-room units costing from $700,000 to $722,000. Let’s assume these are the top 2 floor units. Based on the latest transaction. A 39-story 5-room was sold for a cool $1,300,000 or $1,100psf. This means the sellers have to make a 92% return or an 11.5% annualized return. This means that most owners would have double their value in just 8 years. Anyway, DBSS scheme has already been scrapped after poor workmanship and public outcry over the high prices. On hindsight, those that took the leap of faith and bought directly from the developers make massive profit.
Lastly, let’s compare Gem Residences. Gem Residences is a 578 units condo with 1 to 6 bedrooms apartments. The average launch price in 2016 was $1,400psf or $1,400,000 for a typical 3 bedrooms. This is considering high back then. Today, the average price is $1,860psf or $1,800,000. This means that prices have appreciated by 29% or a 4.1% annualized return. Pretty impressive in my opinion. On this note, I am curious if Gem Residences’ performance is due to the popularity of Toa Payoh or if is it due to other reasons. Let’s find out.
Timing of market
Here, I decide to use two other condos that are launched at the same time in 2016. This will help us determine if timing plays an important role in a condo’s performance. I used Sturdee Residences which is located in Jalan Besar. In this case, I will use the 2 bedrooms transaction as there are very few 3 bedrooms transactions for this condo. The average return is 26% or a 3.7% annualized return. On the other hand, Queens Peak which is in Queenstown achieved a 34% or a 4.8% annualized return. Both results are almost on par with Gem Residences’ performance. This means that as long as you have a long-term horizon and buy a project that has a unique selling point. In this case, Sturdee Residences is located near the city fringe, and Queens Peak is next to Queenstown MRT station. There is a high chance of taking profit.
Toa Payoh Town
Toa Payoh is generally a nice place to stay. There is a mixture of very old HDB flats that have high architectural value. There are also HDB flats that are built in the late 1990s that are highly sourced after for their spaces such as these executives’ flats. Toa Payoh is a town that is well-maintained and built for seniors. The most amazing part is there is even a public water theme park and a big playground for everyone living in Toa Payoh. Whether you are staying in public or private flats. Everyone has access to the growth of the nation. For those that are from lower income family. There are even scholarship programs to give you a leg up. The best part. I think everyone has access to their MP for help if needed. Cannot complain already. 不闲不错了.
Most private condominiums in Toa Payoh are performing well mainly because of their location, markets, and schools. There are also a limited number of condos in this area. This could be another reason why prices are holding so well. The freehold Sky@Eleven has outperformed in the private segment. Whereas, the Peak @ Toa Payoh had achieved an equally impressive return. Oleander Towers may not have performed as well as the rest, but it’s still affordable from a $1,300psf entry point. For those that have a lower budget. You can consider any of the resale HDB flats in Toa Payoh. It’s a town that offers a wide variety of homes for everyone with different financial needs.
That’s all and if you enjoy this video. Please help me to like and share. If you have plans to sell your Toa Payoh condo or HDB flats. You are most welcome to contact me. That all. Thank you for watching and see you soon in Toa Payoh.