Property prices to ride high on Thomson Line

Business Times: Fri, Aug 31

[SINGAPORE] Residents in the northern region of Singapore can expect the announcement of the upcoming Thomson MRT Line to boost property prices almost immediately, say consultants, although they differ on the extent of the rise. Savills research head, Alan Cheong expects residents living in the Springleaf, Seletar, and Lentor area to see the most benefit from the Thomson Line given that they are currently underserved by the public transport system. "Homes in the Springleaf/Springside area will see prices rise by 10 per cent at least. Prices will move, starting now; we do not have to wait until the line is completed before prices go up. They will usually move for a few months and then stabilise," said Mr Cheong. Broadly speaking, consultants BT spoke with expect home prices to spike closer to the completion of the line. According to HSR's senior manager for investment sales, Gabriel Goh, properties near the planned MRT stations might see a gradual increase of 3-5 per cent in the short term, and later enjoy a 20-30 per cent premium over properties that are not as close to the stations. Senior manager for training, research and consultancy at DWG, Lee Sze Teck expects a near term price increase of 5-10 per cent, with a price appreciation in the range of 20-30 per cent when the MRT line is completed. That being said, prices of properties close to major construction work sites may take a momentary dip to the tune of 5-15 per cent, said DTZ's head of Asia Pacific research Chua Chor Hoon. "Otherwise, we do not expect any adverse impact on prices on other properties along the route. Even if there is road diversion... owners will (likely) hold out for better prices later," she said. Ms Chua said she expects the area spanning Woodlands to Upper Thomson to see the largest increase in price given that they benefit most from the reduction in travelling time to town. The Thomson MRT Line will be launched progressively in three stages from the north to the south, with three stations from Woodlands North to Woodlands South ready by 2019, six stations from Springleaf to Caldecott ready in 2020, and 13 stations from Mount Pleasant to the Gardens by the Bay fully operational by 2021. Ong Teck Hui, executive director of Credo Real Estate, which will be part of Jones Lang LaSalle (JLL) on Sept 1, noted that while properties impacted by the construction may suffer in the short term, owners of properties in the vicinity not affected on the other hand, may leverage on future proximity to the MRT as a selling point, and ask for a premium for their properties. Indeed, properties and projects near train stations tend to do fairly well in terms of rental opportunities, pointed out JLL's head of South-east Asia research, Chua Yang Liang. "By and large, the difference in value between homes located near train stations, and those located further away tend to differ by between 5-10 per cent, although a lot also depends on the property itself - the kind of property we are talking about for instance, and the amenities in the area," said Dr Chua. However, there may eventually be less disparity in prices in different parts of Singapore as the transport network improves connectivity and reduces travelling time, said DTZ's Ms Chua. "The uplift on prices will progressively be less pronounced compared with in the past when there were much fewer properties that enjoy proximity to MRT stations," she said. Source: Business Times