Apart from a home’s physical attributes, some other factors we look for when buying a property are location (near MRT stations), safe entry price, and potential upsides.
Out of the factors listed, two very important points in determining a good project to enter are:
Safe entry price & Price gap
Let’s take a look at this freehold new launch Terra Hill as a case study.
Taking a look at 99-year leasehold properties, the benchmark pricing for properties in the OCR and CCR starts from $2,1XX psf and $2,8XX psf respectively. In the case of RCR properties, its average price for a 99-year leasehold is $2,4XX. Considering the fact that a Freehold project like Terra Hill is going for $2,5XX, doesn’t it make sense that it is a safe buy?
Not convinced? Let’s go into more detailed figures:
Figure 1
As we can see from Figure 1, the average price of a 99-year leasehold in RCR for 4Q 2022 is $2,659 psf, and given that Terra Hill is a Freehold development selling below an average price of a 99-year leasehold at $2,5XX – it is quite easy to realise that the price gap makes it absolutely favourable.
Figure 2
Furthermore, in Figure 2, we can see the average price of new launch projects in the RCR with the range going from $2,526 psf to $2,882 psf. This is a bigger reason to determine that the entry price for Terra Hill is sound and makes it a safe buy.
Summary of what makes Terra Hill a great buy in 3 key points:
1) Freehold property at leasehold price
2) Near the MRT station without paying a premium
3) Price Gap between Freehold & 99 is very narrowed, that make it attractive entry price.