Chuan Park condo hits a high of $800 psf

A Singaporean who only wants to be known as Mr Tan put his three-bedroom, 1,528 sq ft unit at Chuan Park condominium on Lorong Chuan for sale a month ago. Within a day, he found a buyer who was willing to pay his asking price of $980,000, or $641 psf.

“We sold because the price reached our expectations,” he says in a phone interview. “The property may be old, but it is well-maintained. Rental demand is healthy, given the proximity to good schools and the Australian International School. There is potential for en-bloc sale and the location is wonderful — right next door to the MRT station.”

For the period from Jan 4 to 8, there were three transactions at the 452-unit Chuan Park, at prices from $690 to $800 psf. On Jan 5, a 710 sq ft studio apartment on the second floor was sold for $568,000, or $800 psf. The owner had purchased it for $450,000 in 2007, thus enjoying a 26% price appreciation in just two years.

Another studio apartment on the fourth floor went for $520,000, or $732 psf. The owner had purchased it for $458,000, or $645 psf, in 1995. This represents a gain of 13.5%. The previous owner had bought it for $395,000 in the same year, thus enjoying a gain of 16%.

Excitement is mounting in the Serangoon Gardens Estate in the vicinity of Lorong Chuan and Serangoon Avenue 3 as the Circle Line nears completion and another 11 new MRT stations from Tai Seng to Dhoby Ghaut open in April. The Lorong Chuan MRT station opened last May.

Good schools like Nanyang Junior College and St Gabriel’s Primary School as well as the Australian International School have also attracted families with schoolgoing children and investors to Chuan Park. The condo is a short distance from the New Tech Park and one stop away from the Serangoon MRT station, where a new mall called nex is coming up.

What’s also fuelling optimism among investors and owners of existing condos looking to sell is Hong Leong Holdings’ 400-unit condo that is expected to be launched in the coming months. Hong Leong was awarded the 99-year leasehold site on Serangoon Avenue 3 last October with a top bid of $221 million, or $529 psf of gross floor area, which was 164% above the reserve price. Property consultants have estimated that the breakeven price for the project is likely to be $900 to $950 psf. They expect the new condo to be priced above $1,000 psf.

Fred Teo, a property agent at Knight Frank, says these two factors are the main reasons driving increased demand at Chuan Park. He notes that prices in the 26-year-old, 99-year leasehold condo have risen from around $500 psf last April to $700 psf in recent months. The launch of the new project by Hong Leong would probably lift prices higher, says Teo.

Opposite Chuan Park are two 99-year leasehold condos: 372-unit, 11-year-old The Springbloom and 500-unit 15-year-old Chiltern Park. Prices in those two projects have also been creeping up. On Jan 6, an 893 sq ft unit at The Springbloom was sold for $650,000, or $728 psf.

At Chiltern Park, a 915 sq ft unit was sold for $660,000, or $721 psf, according to a caveat lodged with URA Realis on Jan 6. At the Jones Lang LaSalle property auction on Jan 20, a second-floor, 1,518 sq ft apartment at Chiltern Park was put up for mortgagee sale with an opening price of $980,000. A few parties bid for the property, which was sold for $1.015 million, or $669 psf.

With the Circle Line nearing completion and Hong Leong’s new condo launch in the offing, it looks like interest in condos in the Lorong Chuan and Serangoon Avenue 3 neighbourhood will intensify in the coming months.

Source : The Edge – 25 Jan 2010

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