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  Adrian Lim

• Nov. 10, 2019

Upside for property near MRT

Met up with Mohd for a short catch-up. He was my investment classmate and we always discuss about the how economic situation shape Singapore property market's sentiment. 

Toay, he asked for my opinion about his friend like to buy a 2-bedroom Condo for investment. He only wants the development near MRT station because it is an assurance of price growth and available of tenants. 

Is this very common among buyers' mind . Property next to MRT = Pirce increase ? 

I recall In May 2016, there were two developments launched. Stars of Kovan (SOK) and Gem Residences. SOK is in District 19 and Gem in District 12, RCR. Though both are from different planning areas, but I just use them for illustration about the "MRT effect." 

SOK was launched about  $1,430 psf. The uniqueness of this 99 years development is very near to kovan mrt station.  About 150 meters away is a freehold property Tambusu, $1,425 psf. At the Same time, Gem Residences, a RCR development located in toa payoh was launched at $1,450 psf.

Today, gem residences price has increased by 30% to $1,852 psf and SOK barely increased by 3.24%.

Why two developments, both are 99 years, launched same time, yet the fate is so different.  Imagine if the floor is 1,000 sqft. The quantum increase is $431,000 vs $47,000. 

I told Mohd to share with his friend:  MRT station is just one of the Many factors to consider when come to property investment. There are many others we should focus on like entry price, transformation, risk, rental, rare, supply and demand.....