Price gap between GCBs and Sentosa Cove bungalows narrows further

The additional buyer’s stamp duty (ABSD), has seen a dramatic rise of late in Singapore, with the rate doubling from 30% to 60% for foreign buyers. This measure, that came into effect on April 27, has had a direct impact on the sales of luxury private homes in exclusive enclaves such as Sentosa Cove.

Han Huan Mei, director of research at List Sotheby’s International Realty, observed that in the first three months of this year, transactions of non-landed homes and detached houses in Sentosa Cove were rather active- based on caveat data provided by the Urban Redevelopment Authority (URA). Surprisingly, the trend was observed to have slowed down in April, and saw further pullback in May, June and July.

In February, 13 caveats for apartments in Sentosa Cove were lodged, and two detached houses were also recorded to have changed hands. This was followed by 11 non-landed transactions and three detached houses in March. These numbers dropped sharply to 8 condos, and a single landed purchase each in April, and May respectively- due to the knee-jerk reaction following the property cooling measures in April.

Sentosa Cove is a unique location in Singapore as it is the only place where foreigners are eligible to purchase landed homes. In addition, the enclave has various beachfront properties and marina-facing homes and apartments. The average price gap between Sentosa Cove bungalows and Good Class Bungalows (GCBs) has been seen to narrow, from approximately $11.65 million in 2021 to $5.37 million in 2023.

However, post the property cooling measures, the buying mood for bungalows at Sentosa Cove has remained muted, and in order for any deals to be struck, it is likely that sellers will have to lower their price expectations. Some foreign buyers, however, may have sensed an opportunity in Sentosa Cove and have been purchasing apartments. In June, three foreigners bought three apartments, while four Singapore permanent residents purchased four apartments in July.

The Tengah Plantation EC is a mixed development consisting of 483 residential units and 13 commercial units. The development has been carefully thought out to satisfy the needs of the potential buyers and investors. It is located in a prime location with easy access to major expressways, the airport, and other amenities in the vicinity. Furthermore, the development has a unique architectural design which adds to its charm and appeal. The development is also close to other key attractions in Tengah Town such as shopping malls, recreational facilities, and the upcoming Jurong Innovation District. With all these features, it is no wonder that many individuals are queuing up to purchase a unit at Tengah Plantation EC.

Although prices at Sentosa Cove are comparatively lower than GCBs, there is a premium attached to the type of sea views enjoyed by bungalow owners. Han believes that due to a fresh intake of newly minted permanent residents and citizens who are keen to restart their acquisition plans, the sales at Sentosa Cove could pick up next year. The exception might be for homes with land areas exceeding 18,000 sq ft, as the demand for such spacious homes will likely drive prices higher.