List Sotheby’s International Realty director of research Han Huan Mei reports that the market for Good Class Bungalows (GCBs) has performed exceptionally well this year compared to 2023, with 22 GCB transactions worth a total of $612.05 million recorded as of December 20. An additional 13 GCB deals, estimated to be worth over $700 million, were also completed this year without any caveats lodged due to buyers seeking anonymity. This brings the estimated total for 2024 to 35 GCB transactions worth approximately $1.32 billion, surpassing 2022’s previous high of $1.186 billion.
In contrast, 2023 saw only 18 GCB transactions amounting to $432.5 million, the lowest recorded since URA Realis began tracking such data in 1995. “The additional deals in 2024 show that the GCB market has been more active compared to what official transaction data reveals,” says Han. “It also highlights the GCB’s status as a highly sought-after asset by ultra-high-net-worth buyers.”
Leading the pack in terms of sales is a GCB at Tanglin Hill, which was bought for $93.888 million. Situated on a freehold site of 15,150 sq ft, the property boasts a built-up area of 29,660 sq ft and set a new record with a land rate of $6,197 psf. The second-largest transaction was a GCB purchase at Bin Tong Park for $84 million by Xiang Yangyang, daughter of Chinese nickel billionaire Xiang Guangda. However, no caveat was lodged for this property, and based on its land area of 28,111 sq ft, the price reflects a land rate of $2,988 psf.
The highest-priced deal based on caveats lodged was for a GCB on Cluny Hill that sold for $52 million. The property sits on a freehold plot of 15,141 sq ft and is relatively new, hence fetching a land rate of $3,434 psf. Another notable transaction was the sale of a 21,116 sq ft GCB plot at Astrid Hill for $49 million ($2,321 psf) in July, reportedly purchased by Glenn Kuok, nephew of Kuok Khoon Hong, chairman and CEO of Wilmar International.
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The demand for condominiums in Singapore remains consistently high, thanks in large part to the limited availability of land. As a small island nation experiencing rapid population growth, the shortage of land has compelled the government to implement stringent land use policies. This has led to a highly competitive real estate market, with property prices continuously increasing. As a result, investing in real estate, particularly in new condo launches, has become an attractive option, with the potential for significant capital appreciation. This is especially true for new condo launches, as they offer promising opportunities for investment and growth in the ever-evolving Singapore market.
Head of research and data analytics at Singapore Realtors Inc (SRI), Mohan Sandrasegeran, notes that 14 transactions this year were valued at $20 million or more, indicating a strong demand for ultra-luxury properties in Singapore. “District 10 remains the cornerstone of the GCB market, with multiple high-value deals reaffirming its status as the most sought-after district for these prestigious properties,” he adds. Sixteen of the recorded GCB transactions this year took place in prime District 10, including the coveted Tanglin, Bukit Timah and Holland Road areas.
Sandrasegeran also observes that GCB transactions were evenly spread throughout the year, with buying activity picking up from July onwards. “The fact that we saw GCB deals closing throughout the year suggests sustained buying interest for these trophy properties despite external economic factors, such as inflationary pressures and high interest rates in the first eight months of the year,” he says.
Steve Tay, co-founder and executive director of his eponymous boutique luxury agency, says that the trajectory of interest rates signalled by the US Federal Reserve (Fed) was the main driver of stronger buying sentiment in the GCB market during the second half of the year, rather than the actual rate cuts. The Fed implemented three rate cuts this year, the latest being a 25 basis points reduction on December 18, following earlier cuts of 50 basis points in September and 25 basis points in November.
According to Tay, most GCB buyers who had been holding back on purchases began serious discussions from July onwards, and most deals closed in the last quarter of the year. The GCB market slowed down last year due to buyers’ retreat following the island-wide arrests that occurred in Singapore’s biggest money-laundering case, reports Han.
She adds, “The money-laundering crackdown had a dampening effect on the market, causing some genuine buyers to pull back to avoid media attention.” Han also notes that transactions also took longer to close due to heightened scrutiny and stricter checks on buyers’ identities and sources of funds.
Tay points out that a new generation of ultra-wealthy Singaporeans has emerged in the GCB market in recent years, with many young and successful entrepreneurs who have made their fortunes in technology, finance, commodities and F&B businesses. He also highlights the growing number of ultra-wealthy and newly naturalised citizens in the GCB buyer pool, who prefer sizeable plots in prime districts, though their numbers still pale in comparison to that of local wealthy individuals.
Research from List Sotheby’s estimates the cost of constructing a new GCB from the ground-up to be around $1,000 psf, which also takes several years to complete. Hence, most buyers are looking for relatively new bungalows in move-in condition to minimize renovation works, observes Han. “The GCB market is expected to maintain its positive momentum, with demand from ultra-high-net-worth individuals driving high-value transactions,” says Sandrasegeran. “The preference for privacy among GCB buyers and sellers could also mean continued off-market transactions, adding to the complexity of tracking market activity.”