Unit at Palm Gardens hits $633 psf

Upgraders are now betting on the West Coast of Singapore, where competitive pricing continues to drive strong demand for private condominiums. One such example is Palm Gardens, a 694-unit development at Hong San Walk, off Choa Chu Kang Avenue 1, which saw three transactions at prices ranging from $564 to $633 psf in the period of Sept 14 to 21. Early last month, a 958 sq ft, two-bedroom unit on the third floor sold for $680,000 ($710 psf). However, the highest psf price achieved so far is $817 psf, or a quantum of $1.18 million, for a 1,442 sq ft unit on the 17th floor.

Developed by Keppel Land, the 99- year leasehold development is located across the road from the Keat Hong LRT Station, which is along the Bukit Panjang line. It is two bus stops — but a mere 15-minute walk — from Choa Chu Kang MRT station.

Completed in 2000, the condo offers two- to four-bedroom units ranging from 958 to 2,131 sq ft. Despite soft market conditions during its launch in March 1997, units sold at $500 to $600 psf. However, as the Asian financial crisis set in, psf prices dipped to $300 to $400 psf from October 1998, before recovering to $500 to $600 psf in January of this year.

“Most buyers are upgraders who are buying to stay and they are moving [inland] to the West, where property prices are cheaper. Furthermore, Palm Gardens is also situated away from the road traffic and conveniently located near two railway transit stations,” says Constance Tan, assistant associate marketing director at PropNex, who specialises in Palm Gardens.

The latest asking prices for a two bedroom unit at Palm Gardens range from $680 to $700 psf, while three-bedroom condos command $650 to $723 psf; four bedroom apartments, $631 psf; and penthouses, $603 psf.

Of the three transactions under review, one was for a 1,216 sq ft, three-bedroom, seventh-floor unit that was sold for $770,000 ($633 psf), representing a marginal 4.5% gain for the seller, who bought the unit for $737,100 ($606 psf) from the developer in May 1997.

In a neighbouring block, the owner of a 1,206 sq ft, three-bedroom unit on the second floor made a hefty 46.5% gain on a $680,000 ($564 psf) sale. He bought the unit for $464,400 ($385 psf) from the developer during the earlier financial crisis in December 1998.

In the final transaction, a 1,206 sq ft, three-bedroom unit on the fourth floor of another block went for $750,000 ($622 psf). This represents an 80% capital gain for the seller, who bought the place for $416,000 ($345 psf) from the resale market in April 2007. The first owner bought the unit for $443,700 ($368 psf) from the developer in December 2008.

At the 694-unit Palm Gardens, three transactions at $564 to $633 psf were recorded from Sept 14 to 21

Compared with MCL Land’s The Warren condo at Choa Chu Kang Loop, prices at Palm Gardens are generally lower by as much as $100 psf. Completed in 2004, The Warren is a 99-year leasehold development comprising 699 units.

Meanwhile, CapitaLand’s Northvale, also at Choa Chu Kang Loop, is priced slightly closer to Palm Gardens. However, because it is nearer to the Choa Chu Kang MRT station — being a five- to eight-minute walk — some units fetch higher prices, despite it being an older development. Completed in 1998, Northvale has 762 units and is located nearer to the Choa Chu Kang Sports Stadium on the loop.

Tan observes that the rental rate for a three-bedroom unit at Palm Gardens is catching up with The Warren’s, despite the latter’s higher transacted prices. Hence, investors “could buy cheap” and yet, get similar rental returns from their investments in terms of psf price, she says.

According to Tan, the monthly rental rate for a three-bedroom unit at Palm Gardens is about $3,000. A two-bedroom unit could easily fetch $2,300 to $2,500, and a four-bedroom apartment, $3,200 to $3,500. Based on that, rental yields at Palm Gardens work out to be 4.5% to 5%.

Located near Keat Hong shopping centre and Lot 1 Shoppers Mall, Palm Gardens is within walking distance of amenities such as supermarkets, restaurants and eating establishments. It is also a 25 minute drive to the city via Ayer Rajah Expressway and Pan Island Expressway and is accessible via the nearby Kranji Expressway and Bukit Timah Expressway.

The condo is also within driving distance of nearby schools, such as South View Primary School, Choa Chu Kang Primary School and ITE College West, as well as the prestigious Swiss Cottage Secondary School and Bukit Panjang Government High School.

Source : The Edge – 11 Oct 2010

Join The Discussion

Compare listings