Is Penrose Condo A Good Property Investment? (Updated Sept 2020)
Updated: Nov 12, 2020
Just received the latest news that Singapore's condo resale volume for the month of August hits 2 years high!
This is in tandem with the performance of other segments of the real estate market. New home sales for the month of July recorded a consecutively third month of growth, and demand of HDB resale flats remained strong in August pushing prices to grow at the fastest monthly rate since February.
Before we go into a deep analysis of the upcoming new launch - Penrose condo at District 14, let's take a look at the pulse of the real estate market in Singapore now.
Developer Monthly Sales Analysis For July
According to URA, new home sales continue to increase in the month of July. Developers sold 1,080 private homes, up 8.2% from the 998 units sold in the month of June, which itself was a 104.9% jump from the month of May (refer to the graph below).
There are many reasons for the strong take-up rates.
Firstly, public confidence continues to recover with the gradual opening of the economy since Phase 2. Community cases remained low, signaling that the spread of the Covid-19 virus was coming under control.
Secondly, investors were seeking a safe haven in property amidst the growing economies uncertainties and turbulent in the equity market.
Thirdly, there was a huge pent-up demand from home buyers that had built up during the 2 months partial lockdown in April and May. These buyers continue their search aggressively into the months of July and August.
Lastly, interest rates continue to be low and many are looking to lock in their mortgages for future years.
Sales of higher quantum homes priced above $2million
Sales of higher quantum non-landed homes priced above $2million hit a seven-year high in July. These are typically bought by investors and higher-income Singaporeans, and transactions take place mostly in the Core Central Region (CCR).
150 non-landed units above the $2million price tag were sold last month. Of these 150 units sold, 69 were in the Rest of Central Region (RCR) while 34 units were from Outside of Central Region (OCR). 47 units were sold in the CCR.
It is significant to note that there were two private homes sold above the $10million price tag. The first one is a 527sqm freehold condo in Meyerhouse, located on Meyer Road in the RCR. This was transacted at $13.8million or $2,434psf!
The other one is a 462sqm freehold apartment at 15 Holland Hill, located in CCR. This was sold for $13.4million or $2,700psf!
The increasing demand for such luxurious homes attests to the resilience and attractiveness of residential properties in Singapore.
According to URA Realis data, non-landed private homes (excluding ECs) in RCR above $2million rose from 12.8% in June to 16.8% in July 2020. The number of transactions increased by 27.8% m-o-m from 54 units to 69 units over the same period (refer to chart below). This was the highest number recorded since September 2019 (85 units).
With the encouraging numbers, let us now dive into Penrose condo in District 14 to see if this project is a good investment.
About Penrose Condo
Location : 20 - 30 Sims Drive
Site Area : Approx 174,600sqf
Developer : Hong Leong Holdings, Intrepid Investments & City Developments Ltd
Tenure : 99 years
Expected TOP : Estimated 2024
No. of Blocks : 5 blocks
Blocks Height : 18 storeys
Total units : 566
Unit types Sizes No. of Units Percentage
1 bedroom 474 - 517sqf 57 units 10.07%
1 bedroom + study 560 - 570sqf 2 units 0.35%
2 bedroom 646sqf 69 units 12.19%
2 bedroom premium 700 - 710sqf 68 units 12.01%
2 bedroom + study 797 - 807sqf 34 units 6%
3 bedroom 936 - 980sqf 105 units 18.55%
3 bedroom premium 1044 - 1098sqf 123 units 21.73%
3 bedroom + study 1173 - 1184sqf 54 units 9.55%
4 bedroom 1389 - 1399sqf 54 units 9.55%
Penrose condo is located in the city-fringe RCR region. It is conveniently located within 6 minutes walk to Aljunied MRT station.
For those who drive, Penrose condo is well connected to the various highways like Pan Island Expressway (PIE) and Kallang-Paya Lebar Expressway (KPE). It takes only 15mins to reach the Central Business District (CBD) and Orchard Road shopping belt.
The condo is surrounded by educational institutions. It is located within 1 to 2km from primary schools like Geylang Methodist, Cedar Primary, Canossa Catholic, Bendemeer Primary and Kong Hwa Primary.
Proximity to primary schools will appeal to young families with school-going children. Under the Ministry of Education (MOE) Primary 1 registration guidelines, proximity to the school gives the child priority to register for a spot in the school.
For more information, please refer to https://beta.moe.gov.sg/primary/p1-registration.
Higher educational institutions like Nexus International School and James Cook University are also nearby. This will appeal to foreigners who are looking to buy or rent a unit nearby.
Penrose Condo is close to many commercial hubs. It is only one MRT station away from Paya Lebar Quarter, 5 MRT stations away from the CBD, and 6 MRT stations away from Changi Business Park. There will be plenty of demand for rental units in Penrose Condo.
Facilities for Penrose are spread over 3 areas - 1st storey, roof of multi-storey carpark and 18th storey of Blk 30.
Penrose is truly a family-oriented condominium. Besides the 50m swimming pool, there is also a stream pool, as well as a lap pool. There is a kid's adventure park consisting of kid's aqua play, jumping water jet, zipline and adventure playground. Sounds so fun simply looking at this!
There are plenty of interaction places. 2 club-houses, pavilions with bbq pit, different lawns, lounges, tennis court, bicycle parks etc. There is also a childcare centre in the condo itself and this will greatly appeal to families with young kids.
The developers bought the land from Government Land Sale at a price of $383.5mil. This works out to be $732 psf per plot ratio. According to EdgeProp, the breakeven price for Penrose Condo is $1,264psf.
We have just received the indicative price guide from the developer as below:
- 1 bedroom starting from $788,000 (473sqf) from $1,666psf
- 2 bedroom starting from $943,000 (645sqf) from $1,462psf
- 3 bedroom starting from $1,326,000 (936sqf) from $1,417psf
- 4 bedroom starting from $2,110,000 (1388sqf) from $1,521psf
Let us look at the prices of the new launches nearby, as well as the resale properties around Penrose. This will help us evaluate if Penrose condo is a good buy based on the indicative price guide.
The comparable new launches in District 14 are The Antares and Parc Esta. Both are 99 years leasehold property.
The Antares is located next to Mattar MRT station and has a total of 265 units, whereas Parc Esta is located opposite Eunos MRT station and is a massive 1399 units condo.
From the chart below, we can see the average price of units sold in Parc Esta for the past 12 months is $1,692, and The Antares is $1,750. Parc Esta is one of the top-selling projects in Singapore for the past few months as the location and pricing are attractive.
I breakdown the prices further to find out the average transacted prices for the past 12 months by 1 bedroom, 2 bedroom, 3 bedroom and above types.
From the chart below, we can see the average transacted price for 1 bedroom units in Parc Esta is $1,834psf as compared to $1,761psf for The Antares.
The average transacted price for 2 bedrooms unit in Parc Esta is $1,701psf as compared to $1,752 for The Antares.
From the chart below, we can see that for 3 bedrooms and above units, the average transacted price (PSF) for Parc Esta is $1,634psf vs The Antares at $1,671psf.
The immediate neighbor for Penrose Condo is Sims Urban Oasis, which was completed in 2017. Other nearby comparable condos include Tre Residences located near to Aljunied MRT station and Park Place Residences next to Paya Lebar MRT.
The average price for units transacted in Sims Urban Oasis is $1,578psf. This is for a 3 years old condominium. The average price for Tre Residences is $1,715psf, whereas Park Place Residences transact at an average of $1,744psf. Do note that Park Place Residences is a mixed development and thus there is a premium that buyers are willing to pay.
Penrose condo is one of the rare bigger residential site located in the city fringe area. The connectivity to various public transport and expressway, as well as the proximity to good schools will appeal to many homeowners.
Also, Penrose condo is near to many commercial hubs like Paya Lebar Quarter, CBD and Changi Business Park. This means that there will be rental demand for the units. Investors will be interested in the limited 1 and 2 bedders.
Lastly, the developers managed to bid the plot at a relatively low price. They will thus be able to price the units competitively. This will be a huge draw to buyers as it means more room for price increase in the future.
If you would like to explore investing in a unit here, or need professional views on which unit is the best for investment or own-stay, I will be most willing to share my views.
Hope to see you soon!
About The Author
Vivian is a highly experienced real estate agent who has been in the industry for 18 years.
Over the years, she has transacted numerous property deals including HDB and private properties. She is well-versed in policies and regulations involving the sale and purchase of residential properties. She has also handled many transactions involving complicated situations like contra, divorce, administration/probate cases, and decoupling / part-share purchase.
Vivian is also a mother to 2 boys. Being a real estate mom allows her to spend more time with her children as they were growing up. Both boys are avid footballers representing their schools and clubs. She loves watching their games and hardly misses a game whenever they play.
Vivian is an active real estate salesperson and team leader. Call her at 98577714 for your real estate matters, or if you are looking to join the real estate industry.