We analysed 87 en bloc condos. Here’s what we learnt.
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Druce
- October 7, 2019
- 5 min read
5 min read
En bloc condos were all the rage in 2017 and 2018, which isn’t surprising at all given that you could potentially make double what your property was actually worth. With the exception of certain en bloc sagas (Gillman Heights comes to mind), most people walk away from an en bloc sale flushed with cash and feeling on top of the world! So naturally one of the questions that we get asked most on Stacked Homes is: How do you spot en bloc potential?
To help answer this question, we analysed all 87 en bloc condos from 2016 to 2019 to find out are what are the similarities between all the developments and if there any characteristics which we can glean from the information. While we can say that there isn’t a magical formula, it is quite clear that there are some common attributes that we can learn that will result in a condo having a higher en bloc potential.
Note: Some of the data for the older condos TOP date cannot be found, and even though we can do a guesstimate, we decided it was best to exclude and leave it as unknown.
The Ideal En Bloc Condos Location Are Districts 9, 10, and 15.
After analysing the 87 condos that have gone en bloc between 2016 to 2019, these districts were the most common in terms of location.
From here you can see that the districts that developers were most concentrated on were the higher-end districts, namely District 9 (11.5%), District 10 (24.1%) and District 15 (11.5%). District 10 took home the prize of the most popular district, garnering nearly a quarter of all the en bloc condos in the timeframe. The results here are unsurprising for two reasons. Firstly, as these are the more mature districts, they have a greater density of private developments and hence the bigger number of condominiums which would mean a bigger choice for developers to choose from. The second reason is that as these are traditionally the premium districts, they are obviously more in demand by people as well.
Does that mean you should ignore other districts if you are looking for an en bloc potential property? Not at all. As the popular districts get filled up with newer developments, during the next cycle developers might start looking at other districts too.
Developers Prefer Freehold Condos
Seeing how Singaporeans hold freehold properties in such high regard, it was expected that developers chose to look at more freehold properties as compared to leasehold. What was really surprising here was the gulf between the two, with freehold properties garnering a massive 80% of all the en bloc condos so far! One reason could be that Government Land Sales (GLS) no longer release freehold plots, hence the need for developers to resort to collective sales to top up their freehold land bank.
On the flip side, this data does not paint the complete picture as it is segregated by individual developments. If you were to further delve down into units, it could be a different story as many of the en bloc developments were larger leasehold sites like Eunosville and Tampines Court. Former HUDC (Housing and Urban Development Company) estates were really popular in this en bloc cycle as they are large and comparatively cheaper in terms of land rate on a per square foot per plot ratio basis as compared to other sites. Whereas many of the freehold sites are much smaller in size in terms of units.
The Most Ideal Age Range is 30 Years and Above
Another huge factor that you have to consider for en bloc potential is the age of the condo. From here you can see that it is very clear that for “newer” condos which we classified as 10 years and above, the chances of an en bloc happening is very slim. In this case, only 1 managed to get through to a collective sale. The main bulk of the en bloc condos were between 20 – 30 (17%) and 30 – 40 (56%) years old. Generally, you can expect the older developments to have a much higher chance of achieving an en bloc success.
There is a Significant Preference for Smaller Developments with less than 100 units
From our analysis, it is very apparent that in this en bloc cycle, most developers favoured smaller developments. Again, this conclusion is not surprising at all given the recent ruling in 2018 which raised the development charge for developers. Not to mention, the non-remissible 5 per cent ABSD plus remissible ABSD of 25 per cent. This has led to smaller estates being more popular because of the lower price and hence, lower risks.
Distance to MRT Can Be A Factor, But Not As Much As You’d Think
The distance to MRT is always a big factor for most people when they are considering a condo. As a result, it wasn’t surprising that a higher proportion of developments that had gone en bloc was within a 10 minute or less walk to the MRT. What was surprising to us was that of the 35% that was more than 10 minutes walk away from the MRT, a good percentage of those were 20 minutes and above! Which in our books it basically means the development isn’t considered to be near an MRT at all. So is the distance to MRT important? Yes, but it really isn’t as crucial as you might think judging from the data!
So how can you use this to analyse a condo’s potential for en bloc?
Now, we really aren’t saying that there is a magical formula for determining a condo’s potential for an en bloc scenario to happen. However, if you take all the most common attributes from the data: District 10, freehold, aged 30 years and above, less than 100 units, and 10 minutes or less walk to the MRT, you should be on the right path! If you have any questions on the data, feel free to reach out to us at hello@stackedhomes.com.
Hi Druce
Great article. My daughter wants to look for a small 2 bedrm condo with budget of 1.3m or less with en bloc potential. She is thinking of novena/ district 10/11/. is it a great idea. any recommendtaion.
Hi Lyn, thank you for the kind words will drop you an email!
Hi Druce,
Good read ad I’m keen to learn more. Looking to move to suitable sized 3 bedroom Apartment freehold in district 03, 09 or 15 with future potential enbloc possibilities. Please advise.
Hi Reza, sure let me drop you an email!
Hi Druce,
Thanks very much for the insights.
I ‘m looking for a condo unit with en bloc potential. Any recommendation please?
Hi Kim,
Thanks, will drop you an email!
Hi Bruce,
Really great article. It is very methodological in your analysis.
I am looking for a freehold condo with enbloc potential in clementi, pasir panjang, novena and district 10 area.
Can you advise?
Hi Mike, thanks for reaching out will drop you an email!
Hi Druce, this is a very helpful article. I’m looking at FH properties with en bloc potential in District 3 & 15, do you have anything to recommend? Thank you.
Hi Andy, thank you for your kind comments. Let me drop you an email for easier correspondence. Thanks!
Hi Druce, thanks for the helpful article. We are looking to buy our first property and it would be great to find one with en bloc potential in D3, D11, D12, D13. Do you have any recommendations? Thanks.
Hi Justin, thanks! Let me drop you an email
Hi Druce,
Great analysis in the article. My aunt made a windfall in Pacific Mansion, but that was a fortuitous buy on her part. Looking for some insights on getting a value 2/3 bedder in district 9/10 (may even consider 15 but less inclined to) with reasonable en bloc potential in the next cycle but more importantly, livable till whenever that happens!
Hi Shandy, thanks for the compliments! Great, will drop you an email.
Hi Druce,
Nicely written article!
Do you think Pasir Ris as a location would have a higher chance of enbloc once the Cross Island MRT is built and once Pasir Ris is being rejuvenated say ~2030? Also, what do you think of Eastvale Condo’s enbloc potential?
Thanks so much!
Hi Darius,
Thank you! I think Pasir Ris should definitely have some upside given the upcoming rejuvenation plans and also how the launch of the Ryse Residences will play out. Eastvale is quite well placed as it is the closest by site that a developer can en bloc, but bear in mind there are quite a few reserved sites around the area too which depending on what they will be used for in the future, can affect any en bloc potential.
Thanks Druce for the great insight!
Reason I’m curious is because Eastvale units are selling at about $600+ psf as compared to newer developments within range such as Coco Palms which are going at $1300 psf. Do you think the 20 year difference in age warrants such a drastic difference in psf (Almost more than double)? Or is it a normal affair? Looking forward to your response.
Also, in the event that there isn’t any enbloc of Eastvale past 30 years of age, would you recommend selling the unit in Eastvale then? Saying this because of the lease decay someone in the replies section mentioned as well as the fact that most enblocs happen when they reach 30 years old.
Thanks so much!
Hi Darius,
Apologies for the late reply. I think to make it a fairer comparison, you will need to pro rate Eastvale’s psf to something close to Coco Palms age. So at about $800+ psf as compared to the $1,200+ at Coco Palms would be a better gauge. You’d also have to note here that an EC and condo will usually have a price gap even though they are essentially the same product, and also to take into account the much newer building and facilities at Coco Palms.
As to if an en bloc of Eastvale past 30 years doesn’t happen, of course if you see at that point that prices are on a decline and there aren’t any surrounding factors in the future that would change anything then perhaps it would be time to let go. That said, from the Master Plan of the immediate area, it does seem that quite a bit will be happening in that space, Ryse Residences, upcoming residential sites and the huge reserve site just opposite etc.
Hello Druce
It is really great article! I am keen to learn more. I was looking for a 2-3 bedroom condo with a budget of 1.25m in district 03, 09, 13, 15, 18. When I search near the Green, Circle, and Thompson-EastCost line, could see some condos like 1995-2000 built with 99 tenure. I am thinking to sell it after 10-15 years later. Will it riskier than focusing on a bit newer one? Could you share insight on this? Thanks!
Hi Alex, thank you for your question. Generally, we’d avoid leasehold properties past their 21-year mark due to the accelerating depreciation that these condos would be facing. If you are considering buying such a condo, then there needs to be a good reason why prices can be sustained over the holding period you mentioned, such as an area improvement.
Hi Alex,
So sorry for the late reply, missed this out! Other than the usual lease decay issue that old leasehold condos face, you will also have to watch out for potential maintenance costs as this could escalate depending on management plus how well the unit was kept in the first place. Also, banks will not finance properties with 30 years or less on the lease – while this doesn’t seem to affect the condos you are looking at the moment, this ruling might possibly change in the future so it is something that you should look out for given that it would be harder to find buyers for the property if that ever does happen.
Hi Druce, great article indeed. We are looking for a 2-3 bedroom condo with en-bloc potential near NUS, preferably quite area, yet accessible by MRT. Around 1.25M. Appreciate your reply!
Thank you.
Hi Vashi,
Appreciate the kind words! Will drop you an email.
Given the economic uncertainties from CV19 and the previously implemented cooling measures to-date (e.g. 30% ABSD), in your opinion, what is the potential of Ivory Heights, situated in a prime western “Lake District” area, going en bloc in the near future (e.g. 2021/2022)?
Hey! We think the odds are low. Last time they tried, they could not get enough consensus for it to go through. We think 2021/2022 is too near for this consensus to change.
A equally interested to buy enbloc potential . Can u pls share your advise ?
Hi Rithu, thank you for sharing your thoughts with us! This article merely details the characteristics of properties that went en bloc in the last cycle. It’s by no means a definite guide to en bloc potential, and so we cannot pinpoint developments either as it’s always not a guarantee that it would go en bloc. However, these are just some of the traits to look out for if it’s one of your buying criteria. We must add though, that en bloc must be seen as a bonus, a lucky means of exit on an old property, rather than a given. If you are not prepared to hold or live there for the long-term, then it would be a risky venture. We would rather you find a condo that meets your objectives in other ways first, then consider the en bloc potential the cherry on top.
HI Druce, nice work! I did a similar work with geospatial info and other driving factors. Maybe we can have work something out together
Hi Alex, sounds interesting! drop me an email about it at druce@Stacked.com would love to hear more!
Hi Druce, i am considering something in district 15, just wondering what is your thoughts of it and the timing now. Please drop me an email. Thanks.
Hi Marv, will do!
HI Druce
just read yr article, good. am interested in novena , bukit timah, Lor chuan areas for investment. any suggestions appreciated. would like to read yr replies to those below tks.
Hi Tiong lk, will reach out to you over email thanks!
Hi Druce
I find your article quite intriguing. I’ve been living in district 9 for the past 18 years. My wife and I are thinking of buying a 4 bedder. We’ve sort of narrowed down to the Mirage at district 9 (as it is next to the river), or The Caribbean @ Keppel. For The Caribbean, we really enjoy the fact that it’s next to the Marina. Which would you seriously consider, with Mirage at around $1750psf, FH and Caribbean at around $1600psf, LH with less than 80 years to go?
Also, wouldn’t you think Cavenagh House has great en-bloc potential, since it’s FH and been built in the 70s?
I thank you in advance.
Hi Jeffrey, If I had to choose between the 2, Mirage would probably be the easier bet given it is much smaller as compared to the nearly 1k number of units over at Caribbean. Its neighbours, Reflections and Corals haven’t sold out completely yet so I think there will be hesitation to even consider taking on such a big project for now.
As for Cavenagh House, I’ve heard that there could be complications over any future redevelopment as it is located right next to the CTE tunnel, so any en bloc deal could be tricky.
Totally agree with Drue on Cavenagh house. Do note that it is also has a height limitation due to proximity to Istana
Hi Druce,
Very helpful article and shared many good insights.
What are your thoughts on the en bloc potential of International Plaza?
Hi, thanks for the great article. May I know where the data was taken from? Thank you!
Hey Lloyd! The data was taken from URA REALIS.
Hi Druce, very good analysis on enbloc profile. Please advise a few good potential for D9, D10,D11, D15, D14, D14, D5. Budget below 2.2mil
Hi will drop you an email thanks!
Hi Druce,
Thank you for your articles. I am looking to purchase a freehold condo within 10 mins walking distance from MRT, 2 or 3 bedrooms in the East area with enbloc potential. I don’t require amenities like swimming pool etc as I don’t use them. My budget is below S$1.3mil. Thanking you in advance
Hi Sam, will drop you an email, thanks!
Hi Druce do you think Sin Ming Plaza has en bloc potential?
Hi there, interesting stats. Would you be able to share the only enbloc that was done for a “new” 10+ year old condo? Which development was this?
Hi Druce,
Nice article! Do you have any recommendations for condo with enbloc potential yet rental yield is decent while waiting for the opportunity?
Hi there. What do you think about the en-bloc potential of Heritage View in Dover?
Hey! Thanks for your question! Just a disclaimer – for en bloc potential, there is no guarantee, and if you purchase for this reason, you’ll need to be prepared to stay for the long-term as an en bloc may never occur.
That being said, our main concern with Heritage View is that there are still 2 GLS plots for sale which developers would prefer since it’s much simpler and straightforward than having to deal with many sellers and potentially uncover obstacles underneath the building.
However, we do think that Heritage View and Dover Parkview is interesting in that there’s not a lot of supply in this area. Past the GLS, there really isn’t much more options for developers to build in this vicinity, so these 2 older developments could be potential for redevelopment in the future if there’s strong demand for the area due to the business hubs and schools.
From what we can see on the Master Plan, there are no other restrictions here (e.g. landed zones, height restrictions and so on).
So if there’s any en bloc potential, it would simply be because there just isn’t a lot of options around, and there aren’t many restrictions too! But until the 2 GLS sites are sold and developed, we wouldn’t see Heritage View or Dover Parkview going any time yet, in our opinion!
Thanks for your reply!
great info. looking to buy one. any recommendation
Hey there! This really depends on your needs and priorities as these developments differ from each other in different ways
Hi Druce, what are your thoughts on the en bloc potential of Kovan Residence?
I am looking to buy a unit there for own stay but hesitant as it is 99-yr lease starting from 2007 – aging has kicked in. The prices are fairly steep so I am afraid the value is on the decline and I would be going in at peak pricing now. If an en bloc is on the horizon say 20 years down the road, then that would make the purchase decision easier.
Thank you! Look forward to hearing your expert views.
Thank you for writing in to us and thanks for sharing your intended purchase. Kovan Residences has seen price appreciation over the years and has stabilised at $1300psf with 25 units transacted this year till date as compared to only 17 units transacted for whole of 2020; hence indicating healthy demand.
Located right across the street to Kovan MRT station and Heartland mall; it ticks most of the boxes for convenience to amenities and transport node.
In addition, there isn’t any big plot left in close proximity to Kovan Central, the last plot will be developed to BTO (launched Aug 2021). Hence those that value space and convenience will likely zoom into resale developments like Kovan Melody, Kovan Residences and Stars @Kovan. With limited supply in close proximity, it will likely bring up the demand and indirectly push up the resale prices as well. Of cause, it also depends on overall market sentiments.
Kovan residences offers squarish and spacious unit sizes which is in high demand currently with WFH being a new norm and more upgraders looking for larger space are entering the market as well. All in all; great for family own stay especially for those that value space and convenience at affordable price point.
Just our 2 cents!
NEPTUNE COURT potential of En Bloc?
Residents there seem to have mixed feelings about the en bloc from past newspaper articles. Site is big (more expensive to build, more to sell and harder to meet the 5-year ABSD deadline), land is owned by the Ministry of Finance. We think the odds aren’t fantastic. But it’s always hard to predict en bloc!
Hello Druce,
Thank you for an interesting write-up.
What is your take on mega plots like Pine Grove, Laguna Park and Braddell View succeeding in an en-bloc sale?
Would appreciate your thoughts on this.
Hi Sherry, apologies for the late reply. Thanks for the kind words! It’s tough now in this climate given the ABSD deadline that developers face. As you can see from the last few en-bloc deals the preference has been for mid-sized plots. Mega plots such as these will need a much bigger risk appetite to take on, and also owners there will have to be more realistic should they want to push for a collective sale.
Hi Druce,
Would like to seek your professional help to provide insight on this condo Sunglade in Serangoon.
– As a buyer what are the pros and cons of this condo. Is there any upside such as enbloc potentials or capital
appreciation.
– As a seller is it time to swap for another freehold condo…
Awaiting your reply. Thanks.
Hey Ivy!
In regards to Serangoon Central vicinity, there have not been any new launches in the past 4 years. The last is Forestwoods which recently TOP-ed. With the lack of land in the Serangoon vicinity, there has not been any new GLS land since then. En-bloc potential for Sunglade will highly depend on the current stakeholders as a common consensus of 80% has to be agreed prior for it to be put up for sale.
However, we do foresee the en-bloc market to be muted with the new cooling measure effective 16 December 2021 which affect Developers. Developers will remain prudent when it comes to buying en-bloc development for redevelopment.
Here are some of our thoughts on Sunglade as a whole.
Located in close proximity to Dual-line Serangoon MRT station and amenities, Sunglade offers great convenience added with decent facilities though slightly dated.
From the graph attached, we can see that prices have remained flat stable in recent years. This year a total of 29 units transacted at an average PSF of $11xxpsf; indicating healthy demand for a medium-size development.
Pros:
– Minutes walk to NEX and dual-line Serangoon station.
– Ample educational institution within 1km range
– Full fledge condo facilities though slightly dated
– Medium size development
– Spacious unit sizes
Cons:
– Road noise from major roads and viaducts.
– Dated facilities
– Cost of upkeep may increase over the years.
– Lease decay
All in all, Sunglade is great especially for those that value convenience to public transportation and amenities and would not mind the lease decay. Decent psf$ for a spacious unit size, price appreciation will likely depend on overall market sentiments. Freehold development would be for value retention in the long run.
Hi Druce, just saw this article. useful statistic as reference. May I know the impact of plot ratio? We have a unit at the Meadows @ Peirce. We are weighting the option of cashing out on this unit and buy another cheaper leasehold property for rental investment. Any advice? Thanks.