Comparing Similar Projects
Updated: Mar 10, 2021
Sky Vue first owners who bought at $1431.19 PSF will profit $317.86 PSF if they sell today at $1749.05 PSF. Sky Habitat first owners however, will make a loss of $128.71 PSF if they sell today.
Both development are only 1 year apart and within 500 meters to Bishan MRT and Junction 8 Shopping Mall.
What factors caused the prices of these 2 projects to differ even though they are side by side?
Sky Habitat was launched in 2012 when the property market is like hotcakes and there is a shortage of new launches. It is also the first project just a few steps away from Bishan MRT. Sky Habitat is viewed as an architecturally distinctive development right at the heart of Bishan. The building is designed by famous architect Moshe Safdie, who also designed Singapore’s iconic Marina Bay Sands. There was a big hype about this project at that time and prices were rather steep.
Sky Vue on the other hand, was launched in 2013 where there was an oversupply of new launches in the market. Cooling measures like Additional Buyers Stamp Duty (ABSD) and Total Debt Servicing Ratio (TDSR) by government was also implemented in an effort to slow down the growth of the property market in Singapore. The TDSR has deterred many borrowers from getting sufficient loan for their property. This means more cash is needed upfront when purchasing a private property. This has drastic effect on the private property market, causing potential buyers to sit on the fence due to uncertainty and fear. Developers slashed their prices in desperation to sell off their units.
In just 1 year, property prices dropped drastically due to government intervention and economic down turn. Sky Habitat owners bought at the peak of the property market whereas Sky Vue owners paid on average $200 PSF lower for the same location.
Kingsford first owners who bought at $1111.45 PSF will profit$191.37 PSF if they sell today at $1302.82 PSF. Boathouse first owners however, will make a loss of $7.99 PSF
if they sell today.
Both developments are 3 years apart and Kingsford is actually further away from Kangkar LRT.
Again, why is Kingsford more profitable than Boathouse even though they are just across the street?
Why is the price increase higher for the project that is further away
from the MRT?
Projects that are side by side can have a huge price difference in just a year. Those nearer to MRT might be cheaper than those further away from the MRT. It is important to fully understand the market sentiments and district demographics before committing to a purchase.
For example, when purchasing a private property for rental in heartland areas like Tampines or Chua Chu Kang, will you choose to buy a 1 bedroom unit or a 3 bedroom unit? The tenants that rent in heartland areas are usually family with kids, hence buying a 3 bedroom unit for rental will be more favourable.
On the other hand, if you are investing in Orchard Road or Shenton Way, getting a 1 or 2 bedroom unit will command higher demand when it comes to rental. This is because the tenants that are renting in these areas are usually highly paid professionals that work around that area, and don’t mind paying more for the convenience.
Hence, it is important to fully understand the area that you are investing your money in. Every district has its own unique characteristics and the choice you make will either make or break your investments. We have compared many similar projects in Singapore and found that what makes a development profitable depends on a few factors. If you are keen to know more, or would like us to analyze your home for you, feel free to contact us for a non-obligatory sharing session. You might be surprised that some of your neighbors might be paying a few hundred grand higher or lower for the same unit as you!