Yishun properties are set to become the main beneficiary of government efforts to develop the northern region, which aims to decentralise commercial activities to regional centres outside the city.
Residential properties located within estates in the North are currently known for being more affordable due to their distance away from the Core Central Region (CCR). However, there has been speculation in the market about the area’s strong growth potential, given efforts by the government to develop the area further.
This issue was highlighted in August 2016 by industry leader Thomas Tan, Executive Director at Real Estate Training and Consultancy, who went on to speak about the government’s Master Plan for the North, and how it could affect property values in the area.
On the URA’s Master Plan for the north and four key goals of this plan, Tan said that one of the focus areas of the plan is to, “de-centralise jobs to the North and shorten the travel time between the home and the workplace. With job de-centralisation, jobs will be distributed, and ideally residents won’t need to travel together to the same place at the same time. Opportunities are also present for new businesses or commercial hubs that come with the development of the high speed rail (HSR) and the transfer of knowledge expertise and skills from abroad.”
With numerous estates in the North, Tan provided an analysis of price trends in those areas that are set to benefit from future growth plans. He noted that prices in Woodlands have plateaued, while those in Yishun and Sembawang are witnessing an upward trend.
Tan went on to compare the rental yield potential of properties within Yishun and Sembawang, highlighting that Yishun properties are likely see higher yields. This is because there are fewer properties within the vicinity of Yishun MRT station, giving landlords more bargaining power.
“Let’s look at amenities such as MRT stations and developmental projects within 0.5km from the Yishun and Sembawang MRT stations. The distance between the developmental projects and amenities in these two locations may be similar. However, the rules are simple – the fewer the project choices, the better the rental yields. In this case, Yishun is a better choice,” shared Tan.
He cited how rentals in Yishun performed better, with average monthly rental prices in the range of about $2.50 psf to $2.60 psf.
Aside from having a well-connected MRT network and expressways, easy access to shopping, dining and entertainment options at Northpoint Shopping Mall, educational institutions, and medical facilities such as Khoo Teck Puat Hospital, plans are underway for improved connectivity in the form of the North-South Corridor (to be completed by 2026) and Springleaf MRT station (by 2020).
Integrated versus mixed developments
In addition, due to land scarcity in Singapore, the government plans to release more land for integrated developments, which incorporate amenities such as shops, MRT stations, bus interchanges and community clubs, hence, optimising land use.
This article was created from a report made by PropertyGuru in August 2016.