Activity in Singapore's Good Class Bungalow (GCB) Areas perked up in the second quarter after an initial knee-jerk slowdown in Q1 in reaction to the additional buyer's stamp duty (ABSD) introduced last December.
A caveats analysis from CBRE shows that the number of deals in GCB Areas has doubled from nine in Q1 to 18 in Q2. The value of transactions has also risen by around 60 per cent - from Q1's $224 million to $359 million in Q2.
And the momentum seems to be continuing into the third quarter.
An option is said to have been exercised earlier this month for a two-storey bungalow on elevated grounds at Oei Tiong Ham Park off Holland Road at $17.5 million, which works out to $1,614 per square foot (psf) on freehold land area of about 10,844 sq ft.
A few days ago, a deal is said to have been entered into for a bungalow at Olive Road at $30 million or $1,185 psf.
On the nearly 25,320-sq-ft site, in the Caldecott Hill Estate GCB Area, is a two-storey bungalow with a pool and an outhouse.
The buyer is expected to tear down the existing property and redevelop the site. RealStar Premier is said to be brokering both transactions.
A bungalow on Peirce Hill could also be changing hands at around $25 million, which would work out to $1,650 psf.
The land area is about 15,150 sq ft and the property is part of City Developments' Peirce Villas project, which was completed in 2000.
The two-storey bungalow on site is said to have spacious rooms with a front garden and a pool at the back.
June's GCB transactions include a property at Old Holland Road which was sold for $20.8 million or $959 psf and a White House Park Road bungalow that sold for $24.8 million ($1,649 psf).
RealStar Premier managing director William Wong notes the pick-up in deals in GCBAs in Q2 is against a backdrop of improving sentiment following efforts to defuse the Greek crisis.
As well, the higher GCB volume in April-June this year was from Q1's low base, when the GCB cooled after the introduction of the ABSD.
Mr Wong also highlights that traditionally, the second quarter is the strongest for GCB transactions due to pent-up demand from Q1, when activity typically slows down amid Chinese New Year festivities.
"I would say GCB prices have stabilised; they may have increased marginally," said Mr Wong.
CBRE's analysis shows that the average price of transactions in GCB Areas in first-half 2012 was $1,370 psf, up about 7 per cent from the $1,276 psf average for full-year 2011's transactions.
CBRE director, luxury homes, Douglas Wong, who specialises in GCBs, predicts 2012 will end with 50-55 deals totalling around $1-1.1 billion - similar to last year's tally of 57 deals adding up to $1.16 billion. The record year was 2010, with 133 transactions totalling $2.4 billion.
GCBs typically have a minimum plot size of 15,069.46 sq ft, but when GCB Areas were gazetted in 1980, they included some smaller existing sites.
These are still considered GCBs as they would be bound by other GCB planning rules if they were to be redeveloped. For instance, such plots cannot be further subdivided.
Meanwhile, in the upscale waterfront housing locale of Sentosa Cove, the bungalow market has been quiet. A caveat was lodged for a bungalow on Treasure Island for $20.2 million or $1,790 psf in June but later withdrawn.
This article was first published in The Business Times.