Rewritten:
In the highly exclusive world of the ultra-rich, the Good Class Bungalows (GCBs) market has had a remarkable performance this year when compared to the previous year, according to Han Huan Mei, the Director of Research at List Sotheby’s International Realty.
Based on the caveats lodged with URA Realis as of December 20th, there have been 22 GCB transactions totaling an impressive $612.05 million. Furthermore, another 13 GCB deals, estimated to be worth over $700 million, were completed this year without caveats lodged, as buyers preferred to maintain their anonymity. This brings the total number of GCB transactions in 2024 to 35, with an estimated value of $1.32 billion, surpassing the previous record of $1.186 billion set in 2022.
In comparison, 2023 had only 18 GCB transactions, with a total value of $432.5 million. This was the lowest number of deals recorded since URA Realis began tracking this data in January 1995.
“This increase in deals during 2024 demonstrates the strong activity in the GCB market, which goes beyond what is shown in the official transaction data,” says Han. “It also solidifies the coveted status of GCBs as highly sought-after assets among the ultra-high-net-worth buyers.”
Notable GCB Deals
The top spot goes to the sale of a GCB at Tanglin Hill for a staggering $93.888 million. The property, situated on a freehold land measuring 15,150 sq ft, boasts a built-up area of 29,660 sq ft. This transaction sets a new record with a land rate of $6,197 psf.
The second-highest GCB transaction was a purchase at Bin Tong Park for $84 million by Xiang Yangyang, daughter of Chinese nickel billionaire Xiang Guangda, according to a document search. No caveat was lodged for this property, but based on the land area of 28,111 sq ft, the price equates to a land rate of $2,988 psf.
The highest-priced deal, based on caveats lodged, was for a GCB on Cluny Hill that was sold for $52 million. The property sits on a freehold plot of 15,141 sq ft and is relatively new, which contributed to the high land rate of $3,434 psf.
Another significant transaction was the sale of a 21,116 sq ft GCB plot at Astrid Hill for $49 million ($2,321 psf) in July. The property was reportedly purchased by Glenn Kuok, nephew of Kuok Khoon Hong, chairman and CEO of Wilmar International. The purchase price translates to a land rate of $2,321 psf.
Mohan Sandrasegeran, head of research and data analytics at Singapore Realtors Inc (SRI), points out that at least 14 transactions this year were valued at $20 million or more, highlighting the strong demand for ultra-luxury properties in Singapore.
District 10 Remains Top Choice
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According to Sandrasegeran, District 10 continues to be the most sought-after district for GCBs, with 16 out of the 35 recorded transactions taking place there. This includes prime areas such as Tanglin, Bukit Timah, and Holland Road.
Consistent Buying Activity
Sandrasegeran notes that GCB transactions were evenly spread throughout the year, with buying activity picking up from July onwards. “Overall, the fact that we saw GCB deals closing throughout the year suggests sustained interest in these prestigious properties, despite external economic factors such as high inflation and interest rates in the first eight months of the year,” he says.
Steve Tay, the co-founder and executive director of his boutique luxury agency in Singapore, says that the trajectory of interest rates, signaled by the US Federal Reserve (Fed), rather than the actual rate cuts, was the main driver of the increased buying sentiment in the GCB market during the second half of the year.
The Fed reduced the rates three times this year, with the most recent being a 25 basis point (bp) cut on December 18th, following earlier cuts of 50 bp in September and 25 bp in November.
Tay notes that most GCB buyers who had been hesitant about their purchases became more serious from July onwards, and most deals were closed in the last quarter of the year.
Market Slowdown in 2023
The GCB market experienced a slowdown last year as buyers pulled back following the island-wide arrests of suspects in Singapore’s biggest money-laundering case, according to Han of List Sotheby’s.
“The crackdown on money laundering had a dampening effect on the market, causing some genuine buyers to hold back to avoid media attention,” she adds. “Transactions also took longer to close due to increased scrutiny and stricter checks on buyers’ identities and sources of funds.”
Emerging Wealthy Buyers
In recent years, a new generation of ultra-wealthy Singaporeans has emerged in the GCB market, with a significant number of young and successful entrepreneurs who have made their fortunes in technology, finance, commodities, and F&B businesses, says Tay.
He adds that both the ultra-wealthy and newly naturalized Singaporeans contribute to the exclusive pool of GCB buyers who prefer large plots in prime districts. However, the number of naturalized citizens buying GCBs remains low compared to wealthy locals, according to Tay.
According to research by List Sotheby’s, the cost of building a new GCB from scratch is estimated to be around $1,000 psf, and it takes several years to complete. Therefore, most buyers prefer relatively new bungalows in move-in condition to minimize renovation works, observes Han.
“The GCB market is expected to maintain its positive momentum, driven by demand from ultra-high-net-worth individuals,” says Sandrasegeran of SRI. “The preference for privacy among GCB buyers and sellers could result in more off-market transactions, making it more challenging to track market activity.”