5 reasons why the upcoming 2019 Punggol EC on Sumang Walk will be another sell-out

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Sumang Link EC is near the Punggol Waterway
Sumang Link EC is near the Punggol Waterway

Background

Sumang Link EC Land Parcel details
Sumang Link EC Land Parcel details

The top bid of S$509.37 million for the Sumang Walk EC site was won by City Development (CDL) and TID Residential. This works out to a record S$583 per square foot per plot ratio, which translates to a selling price of above S$1,000 per square foot.

Launching in 2019, it is likely to be the only executive condominium (EC) to be launching in 2019. We explain the 5 reasons why it will be another sell-out like Rivercove Residences, which was fully sold out in a mere 5 months after its launch in March 2018.

Project name New EC at Sumang Walk (Punggol district)
Developer City Development (CDL) and TID Residential
Address Sumang Walk
District 19 D19
Tenure 99 year leasehold
TOP 2022 – 2023
Total number of units 820
Unit mix 3 – 5 bedrooms (sizes to be confirmed)
Facilities 13 blocks in total

Full fledged gymnasium

50 lap pool and children’s pool

BBQ pits and gourmet pavilion for residents

 

In this article, let’s analyse the 5 reasons why our analysts at PropertyInvestSG believes it will be another sell out.

1) High demand but limited supply of executive condominium units

As of October 2018, there are no available EC units in the market except for bounced out units. These units are “returned” to the developer should there be a disqualification in family nucleus eg divorce or annulment of marriage that happens.

Below are the latest status as of October 2018 for the ECs launched since 2013.

MOP refers to Minimum Occupancy Period which residents have to fulfil after collecting their keys before they are allowed to sell their units in the open market, except for special cases that have been granted pre-approval by HDB.

Name District Address TOP date Number of units Status
Prive Punggol Punggol Field 17-Jul-13 680 Just MOP
Esparina Residences Woodlands Buangkok Drive / Compassvale Bow 11-Sep-13 573 Just MOP
The Canopy Yishun Yishun Avenue 11 14-Jan-14 406 MOP up in 2019
Austville Residences Sengkang Sengkang East Avenue / Buangkok Drive 22-Apr-14 540 MOP up in 2019
Belysa Pasir Ris Pasir Ris Drive 1 / Elias Road 28-May-14 315 MOP up in 2019
RiverParc Residence Punggol Punggol Drive / Punggol East 19-Jun-14 504 MOP up in 2019
Arc @Tampines Tampines Tampines Avenue 8 5-Aug-14 574 MOP up in 2019
Blossom Residences Bukit Panjang Segar Road 5 Sep 2014 602 MOP up in 2019
Watercolours Pasir Ris Pasir Ris Drive 3 / Pasir Ris Link 31-Dec-14 416 MOP up in 2019
The Tampines Trilliant Tampines Tampines Central 7 6-Feb-15 670 MOP up in 2020
The Rainforest Choa Chu Kang Choa Chu Kang Drive 6-Mar-15 466 MOP up in 2020
Twin Waterfalls Punggol Punggol Way / Punggol Field 2-Jun-15 728 MOP up in 2020
One Canberra Yishun Yishun Avenue 7 / Canberra Drive 19-Sep-15 665 MOP up in 2020
Heron Bay Hougang Upper Serangoon View / 7-Oct-15 394 MOP up in 2020
Upper Serangoon Road
Waterwoods Punggol Punggol Field Walk / Punggol East 1-Dec-15 373 MOP up in 2020
Waterbay Punggol Punggol Central / Edgefield Plains 27-Jan-16 383 MOP up in 2021
[email protected] Tampines Tampines Central 7 / Tampines 3-Feb-16 514 MOP up in 2021
Avenue 7 / Tampines Avenue 9
Twin Fountains Woodlands Woodlands Avenue 6 / 14-Mar-16 418 MOP up in 2021
Woodlands Drive 16
The Topiary Sengkang Fernvale Lane 22-Mar-16 700 MOP up in 2021
Forestville Woodlands Woodlands Avenue 5 / Woodlands Drive 16 1-Apr-16 653 MOP up in 2021
Lush Acres Sengkang Sengkang West Way / Fernvale Link 30-Jun-16 380 MOP up in 2021
SkyPark Residences Sembawang Sembawang Crescent / Sembawang Drive 10-Aug-16 502 MOP up in 2021
Ecopolitan Punggol Punggol Way / Punggol Walk 29-Aug-16 512 MOP up in 2021
Sea Horizon Pasir Ris Pasir Ris Drive 3 / Pasir Ris Rise 7-Oct-16 495 MOP up in 2021
The Amore Punggol Punggol Central / Edgedale Plains 28-Nov-16 378 MOP up in 2021
Lake Life Jurong West Yuan Ching Road / Tao Ching Road 30-Dec-16 546 MOP up in 2021
Bellewoods Woodlands Woodlands Avenue 5 / Woodlands Avenue 6 16-Mar-17 561 MOP up in 2022
The Vales Sengkang Anchorvale Crescent 2-May-17 517 MOP up in 2022
Bellewaters Sengkang Anchorvale Crescent 3-May-17 656 MOP up in 2022
The Terrace Punggol Punggol Drive / Edgedale Plains 25-May-17 747 Just collected keys
Signature at Yishun Yishun Yishun Street 51 14-Jul-17 525 Just collected keys
Westwood Residences Jurong West Westwood Avenue 24-Oct-17 480 Just collected keys
The Brownstone Sembawang Canberra Drive 30-Oct-17 638 Just collected keys
The Criterion Yishun Yishun Street 51 26-Feb-18 525 Just collected keys
Wandervale Choa Chu Kang Choa Chu Kang Drive 14-Mar-18 534 Just collected keys
Parc Life Sembawang Sembawang Avenue 29-Mar-18 628 Just collected keys
Sol Acres Choa Chu Kang Choa Chu Kang Grove 12 Mar 2018 * 1237 Just collected keys
26 Apr 2018 * Just collected keys
The Visionaire Sembawang Sembawang Road / Canberra Link 14-Jun-18 632 Collecting keys soon
Treasure Crest Sengkang Anchorvale Crescent 14-Sep-18 504 Collecting keys soon
Under construction EC Location Street address Estimated Units
completion
Northwave Woodlands Woodlands Avenue 12 Feb-19 358 Fully sold

Under construction

iNz Residence Choa Chu Kang Choa Chu Kang Avenue 5 Aug-19 497 Fully sold

Under construction

Hundred Palms Residences Hougang Yio Chu Kang Road 2020 Fully sold

Under construction

Rivercove Residences Sengkang Anchorvale Lane 2020 628 Fully sold

Under construction

Sumang Link EC Punggol Sumang Walk 2022 to 2023 Launching in 2019

 

From the list above, we see there the government had slowed down sales sites for ECs since 2015 and in the recent years.

It had always been an average of 6-7 ECs launched every year, except in 2012 where a bumper crop of 11 ECs were released for sale by developers.

With the increasing affluence of young Singaporean couples and families, the income ceiling cap for an EC was raised from S$12,000 to S$14,000 a month. An EC is hence a viable choice for young families who wish to live in a condominium.

2) The big boom in District 19

Price trend in D19
Price trend in D19

District 19 encompasses Punggol, Sengkang, Serangoon Gardens and Hougang.

The price trend in D19 has been rising since 2011. In October 2010 it was transacting around S$822 psf and in September 2018 it has risen to an average of S$1,268 psf. That’s a 55% rise over the past 8 years, translating to an average rise of 6.7% annually.

Recent transactions in D19
Recent transactions in D19

Rivercove Residences and Treasure Crest are the only 2 ECs in Punggol in the above sales chart and as we see above, some units were transacted above 1,000 psf.

Over on the secondary market, we see projects near the Sumang Link EC transacting between S$945 and S$1,192 psf.

Is Sumang Link EC’s estimated selling price of $1,000 psf still competitive? Compared with the new launches of private condos in D19, naturally S$1,000 psf appears competitive.

When ranked next to resale condos in the secondary market, we see that most of the resale condos in the area have an average median price of S$1,100 to S$1,400psf, except for Prive and The Quartz.

3) Government masterplan of Punggol

Developments in Punggol district
Developments in Punggol district

There has been extensive plans for the next chapter of Punggol’s development in the next five to 15 years and beyond which shall include seafront public housing, an expanded town centre, more green parks and corridors, as well as a pedestrian-friendly heritage trail.

The Punggol Digital District has also been identified as a key element in the government’s plan in Singapore to build a Smart Nation.

In the near term, the government is expecting to relocate cyber security, data analytics, artificial intelligence firms and other digital technologies and key growth industries to Punggol. This is expected to create another 28,000 jobs in the region.

4) And who can resist waterfront living?

Sumang Link EC site view
Sumang Link EC site view

Who can resist affordable waterfront living? Imagine a nice stroll along the serene Punggol Waterway in the evenings or bringing your family to cycle or have a picnic on the weekend.

5) Huge upside in ECs after the 5 year mark

Recent transactions in D19
Recent transactions in D19

For buyers who want to know the capital appreciation of an EC, Prive is an excellent recent example. It is an EC launched in 2010, and TOP in 2013. It had recently attained its minimum 5 year occupancy fulfillment (MOP), which means it can now be sold in the open market to Singaporeans and Singapore Permanent Residents (SPRs).

For perspective, it was previously sold for $660 per sq ft to $690 per sq ft (psf) in 2010 when it was launched.

Assuming the median price at launch for Prive to be S$675 psf, this is an estimated S$270 psf gain for an average unit sold, hence translating to a 40% gain for the first buyer. This means a profit of S$270,000 for the first owner of Prive for an average 3 bedder 1,000 square feet unit!

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