Prices, popularity of shoebox units set to increase

Shoebox units outperformed other condos as an investment last month, according to website iProperty.com.

Prices for the minute flats, normally measuring less than 500 square feet, rose 14 per cent to an average S$1,549 per square foot (psf) in August 2011 from a year ago.

In contrast, psf prices increased 4.9 per cent for condominiums measuring between 501 to 1,500 square feet; and rose 9.9 per cent for condos of more than 1,500 square feet.

The hotspot for shoebox units was District 15 with 513 apartments transacted, while the lowest was in the non-prime area District 21 with only 11 of the total 197 deals crossed in August.

Shaun Di Gregorio, iProperty Group CEO, said the shoebox “present attractive investment opportunities,” despite the steep pricing and market uncertainties posed by European and US debt crises.

Some analysts such as Mr Ku Swee Yong, the CEO of International Property Advisor Pte Ltd, speculate the rise demand for shoebox apartments in August may be due to the spike in such properties being developed during that period.

“We cannot assume that the strong take up of shoebox units is due to the popularity of investors because it is a relatively new market,” said Mr Ku.

Source : Channel NewsAsia – 26 Sep 2011

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