Kovan Melody sees buyer interest at $1,113 psf

The 99-year leasehold Kovan Melody saw three units change hands recently

| BY AMY TAN |THE EDGE SINGAPORE APRIL 22, 2013

Located next to the Kovan MRT station on the North East Line, the 99-year leasehold Kovan Melody saw three units changing hands on April 1 and 2. Prices achieved were in the range of$1,039 to $1,113 psf. Developed by Wing Tai Holdings in a joint venture with NTUC Choice Homes and Great Earth Developments, the condominium was completed in 2006. The 778-unit project comprises 12 blocks, each 17 storeys high, with a mix of two- to four-bedroom homes.

 

Most recently, a 1,227 sq ft, three-bedroom unit on the fourth floor was transacted at $1.28 million or $1,039 psf. The original owner purchased the unit in June 2007 for $688,200 or $561 psf. The unit thus saw capital appreciation of 85.2% in six years. A 1,302 sq ft three-bedroom unit on the tenth floor was also sold for $1.45 million or $1,113 psf. This is the third time the unit changed hands. The last time it

was sold was in April 2010 for $1.15 million or $883 psf. The first owner paid $655,100 or $503 psf when the project was launched in 2004. The unit thus saw capital appreciation of 121.3% since the first transaction.

Elsewhere at Kovan Melody, a 1,216 sq ft, three bedroom unit on the sixth floor changed hands at $1.3 million or $1,069 psf — the third time the unit was transacted. The last time it was sold was in January 2007 for $638,000 or $525 psf. The first owner paid $582,300 or $479 psf for it when the development was launched in 2004. The unit thus saw capital appreciation of 123.2% since the first transaction.

Buyers at Kovan Melody like its location next to the Kovan MRT station, and amenities in the area such as the Heartland Mall shopping centre, Kovan Hougang Food Centre, as well as primary schools such as Paya Lebar Methodist Girls and Xinghua Primary. International schools such as The Australian International School and Lycée Français de Singapour are also within a short driving distance. Shelly Koh, senior associate director of OrangeTee notes that prices at Kovan Melodyhave been holding up quite well as there is a shortage in supply of units located right next to MRT stations. According to her, buyers at Kovan Melody are mostly local owner-occupiers.

However, there are investors as well, and based on the prevailing selling prices, rental yield for the property is likely to be 3.5% to 3.8%, says Koh, who specialises in marketing units in Kovan Melody. Many of those who are selling today enjoy high capital appreciation owing to its location next to the MRT station as well as the fact that they are either the first or second owners who had either bought the project at launch in 2004, or in a sub-sale around the time when the project obtained its temporary occupation permit in 2006. “The values at which these owners bought their units were therefore much lower compared with the selling prices of recent launches in the area, which are now hovering at $1,200 to $1,300 psf,” explains Koh.
Kovan Residences

Next to Kovan Melody is the 512-unit Kovan Residences, which was completed in 2011. The project was developed jointly by Centurion Properties, the majority stakeholder, and construction group Lian Beng, which held a 19% stake. There is a mix of unit sizes in the 99-year leasehold project, with the smallest being two-bedroom apartments of 883 sq ft, three-bedroom apartments from 1,259 sq ft, four-bedroom units from 1,173 sq ft and penthouses from 2,400 sq ft. The main difference between Kovan Melody and Kovan Residences is that the latter is a newer project and consisting of larger unit sizes and bigger balconies.
Kovan Regency

Over at Kovan Rise, off Simon Road is Hoi Hup’s Kovan Regency made up of 393 mixed condo and strata-landed housing units. The 99-year leasehold project comprises one-bedroom units from 506 sq ft, two-bedroom units from 624 sq ft, three-bedroom units from 893 sq ft, four-bedroom units from 1,281 sq ft, penthouses of up to 2,260 sq ft and strata terraces from 3,692 sq ft. Only eight units were available for sale as at end-March, according to URA data. The rest were sold at a median price of $895 psf. The development will be completed in 2016.
Spazio@Kovan
Further along Upper Serangoon Road, previews started on April 10 for  Spazio@Kovan. Developed by Teambuild Land, the freehold mixed-used development comprises 48 residential units and 34 commercial units. The project has one-bedroom units from 420 sq ft, two-bedroom units from 474 sq ft, three-bedroom units from 646 sq ft and penthouses from 1,001 sq ft. Prices start from $598,000 for a one-bedroom unit. The development is located within a short walk to nex Shopping Mall and the Serangoon MRT and Kovan MRT stations. The project is expected to be completed in 2018. Despite the number of new developments, OrangeTee’s Koh believes that existing developments, such as Kovan Melody and Kovan Residences’ location right next to a MRT station, will be a key consideration for both buyers and tenants.