The property in Geylang offers some of the most value-for-money buys in Singapore, say analysts.
Never mind its proximity to the red-light district, sleazy hotels and registered brothels, the area is becoming a popular spot for homeowners looking for a home in a central location - without the sky-high prices.
Ms Christine Li, head of research and consultancy at property consultancy firm Orange Tee, says the attraction of these private properties located in District 14 - which covers Geylang, Eunos, Kembangan and Paya Lebar - lies in how they are a mix of 99-year leasehold and freehold projects.
Geylang - which is home to shophouses and low-rise condominiums - is also within reach of train stations on the East-West and Circle lines, say analysts.
The small size and lower entry prices - with prices going from $1,500 per sq ft (psf) - make units in the area investor-friendly, adds PropNex chief executive Mohamed Ismail Gafoor.
Rental yields are also high - between 3.6 per cent to 4.9 per cent - because there is a healthy demand for these units, especially from foreigners working in the area.
Agreeing, Mr Donald Han, managing director of property consultancy firm Chesterton Singapore, adds: "There has been interest in property located in the city fringes like Geylang, because the rental value of homes there is also strong compared to condominiums located in Sengkang, for example," says Mr Han.
Ms Li notes that interest in the area is growing partly because of the slew of new launches in the district.
But she says "Geylang units are not usually for owner occupation, but for investment and renting out".
"It is harder to attract families because of the area's proximity to the red-light district," says Ms Li.
But development in Geylang continues, perhaps driven by investment demand.
According to a 2012 Straits Times report, there are at least 40 projects, comprising 2,190 units, that will be launched or completed in the next three years or so.
Demand for apartments in Geylang began around 2009.
Then, a 300 sq ft unit would cost about $1,200 per sq ft, says Ms Li.
Prices for such units have since rocketed, but they remain affordable to investors and homeowners concerned over the price quantum of landed properties.
For example, a 1,227 sq ft three-bedroom apartment at The Waterina - located at Lorong 40 Geylang - goes for about $1.6 million. At The Waterina, an apartment of the same size cost $3,700 a month to rent.
In comparison, a 1,722 sq ft three-bedroom apartment at Boon Teck Towers - located near Balestier, another district on the city fringes - goes for $1.9 million.
At Boon Teck Towers, an apartment of the same size cost $4,100 a month to rent.
It is this low entry price that prompted Mr James Lim, 42, to buy a 500 sq ft two-bedroom apartment at Lorong 26 Geylang for about $500,000 last year.
"I bought it because the price is affordable and it is close to the city," said the bachelor.
"I wouldn't buy this place if I was married, but I don't mind the red-light district. The people there don't bother you if you don't bother them."New Paper for more stories.
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