Property investors who have a longer term perspective towards property acquisitions but have a lower budget may consider properties located in suburban areas rather than in prime locations.
Prices in new coming suburban areas remain within reach and units there also have upside potential, which make them good investment opportunities, say analysts.
Among the areas that buyers can consider include Jurong Lake District, Punggol Waterfront Town and Serangoon.
“Investors should identify areas with future potential and enter early to secure a pricing more reasonable than some of the developed areas. In the long term, say about five years, the price may rise 20 to 30 percent,” said Mr. Colin Tan, research and consultancy director at Chesterton Suntec International.
Mr. Tan also noted that since the launch of the Integrated Resorts, suburban areas have seen a sharp increase in property prices from between $400 psf and $450 psf to approximately $800 psf.
Experts said some projects in suburban areas have gained in popularity due to their proximity to the less heavily-used Circle Line.
They also observed that an increasing number of expatriates are moving away from prime areas, providing unit owners with more rental opportunities. “Expatriates are increasingly moving into suburban areas to save on the housing allowances. Meanwhile, a greater proportion of foreign and permanent resident Chinese and Indian buyers are also doing so because of their preference,” said Ms. Chua Chor Hoon, senior research director at property consultancy firm DTZ.
Upcoming areas that are likely to see a vibrant community when completely developed include Jurong Lakeside District, which will be developed into a key regional centre with commercial hub and leisure destinations for tourists and locals, and Kallang Riverside, which will feature 3,000 hotel rooms, nearly 400,000 sq m of commercial space and a new Sports Hub.
“The overall development in these areas can give an uplift to prices in the region,” added Ms. Chua.
However, industry experts noted that developers may develop smaller units to keep the selling price palatable.
Mr. Tan also warned that, “because these new sites need at least three to four years to develop fully, investors should be careful about timing the market and be prepared to hold the units.”
