The best investment opportunities this year are on the East Coast
Mar 14, 2023
By   Shicheng
  • City News
  • Singapore East Coast
  • Singapore Investment
  • Singapore Property
  • Property Investment
Abstract: This year, the East Coast triangle has seen the opening of three major projects with a total of nearly 2,500 units.

If you want to draw an analogy, Kam Tai Mendi, Parc Esta and Jadescape are three of the most profitable projects in Singapore recently.


In terms of supply, a lot of supply has been launched in a small area in the short term. It is unlikely that projects like the previous ones, which sold 70% of their openings, sold out of one and two bedrooms outright and could not be snapped up by bad luck in the ballot, will play out here. This is a special buyer's market in the context of the current overall seller's market in Singapore.


In terms of demand, the East Coast has always been a popular place to live, but with all three projects expected to have completion dates around 2027, the long waiting period can filter out a large percentage of demand and competition is far less than in the secondary market. Coupled with the immediate sell-out of Amber Park and Liv@MB in the vicinity, a lot of the previous demand for homes has already been absorbed.


With supply outstripping demand, developers' pricing strategies are more buyer friendly.


In the current resale market, resale owners are often asking prices that are considerably higher than the market price. This is because resale owners only have one unit to sell and it is in their interest to price it as high as possible given the current trend of rising prices.


This is not the case for developers. On the one hand, because of the large stock and the government's restrictions on the timing of sales, the pressure to sell is far greater than for the average homeowner, who will have a huge ABSD to pay to the government if they do not sell all their flats within five years.


On the other hand, buyers' upfront payment is an important supplement to the developer's subsequent construction funds, which can reduce bank loans and lower operating leverage. In the current high interest rate environment, it is rather more cost-effective to sell early and cheaply than to sell later with a price increase.


To reduce competition, the three projects will also try to differentiate themselves in terms of their positioning.


Tembusu Grand is a value-for-money development, with quality assurance from a reputable developer, a compact floor plan to control the total price, and no private lifts even for the larger units.


The Continuum is positioned as a high-end residential development with freehold, a high proportion of large units and a spacious living experience.


Dunman Grand is positioned as large and comprehensive, as it occupies the widest area, with a compact design for smaller homes and a zoning plan for larger, high-end owner-occupied homes, with grand communal facilities and distinctive landscaping.


The three projects are suitable for a comparative look and this is the best investment opportunity of the year.