Gcb Market Rebounds End Year 132 Bil Sales Value

In the world of the ultra-rich, the Good Class Bungalows (GCBs) market has seen a significant rise this year compared to 2023, according to Han Huan Mei, director of research at List Sotheby’s International Realty. Based on caveats lodged with URA Realis, a total of 22 GCB transactions amounting to $612.05 million were recorded as of Dec 20. Additionally, another 13 GCB deals, valued at over $700 million, were completed this year without the lodgment of caveats, as buyers sought anonymity. This brings the estimated total for 2024 to 35 GCB transactions worth approximately $1.32 billion, according to List Sotheby’s estimates, surpassing the previous high of $1.186 billion achieved in 2022. In comparison, only 18 GCB transactions, totalling $432.5 million, were recorded in 2023 – the lowest number of deals since URA Realis began tracking data in January 1995.

“The additional deals in 2024 highlight the fact that the GCB market has been more active than what official transaction data suggests,” says Han. “It also reaffirms the highly coveted status of GCBs as an asset constantly sought after by ultra-high-net-worth buyers.”

Top-performing GCB deals

The top-performing GCB deal was the sale of a property at Tanglin Hill for $93.888 million. Situated on a freehold site measuring 15,150 sq ft, the property boasts a built-up area of 29,660 sq ft. This transaction set a new record with a land rate of $6,197 psf. The second-largest 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. However, no caveat was lodged for the property. Based on the land area of 28,111 sq ft, the price reflects a land rate of $2,988 psf.

The highest-priced deal, based on lodged caveats, 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, fetching a land rate of $3,434 psf. Another notable 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), notes that at least 14 transactions this year were valued at $20 million or more, highlighting the strong demand for ultra-luxury properties in Singapore.

Prime locations remain sought-after

The prime location of Novo Place EC, coupled with its close proximity to various shopping and dining options, elevates the living experience for its residents. The convenience and accessibility to a wide array of amenities make this development a highly desirable place to call home. From cutting-edge shopping malls to local dining hotspots and even a refreshing day out in nature, Novo Place EC offers a well-balanced lifestyle that caters to people of all ages and preferences. It’s not just a residential space, but a lively community to be a part of. With Novo Place, residents can enjoy a truly enriched living experience.

District 10 remains the cornerstone of the GCB market, with multiple high-value deals reaffirming its status as the most sought-after district for these prestigious properties, says Sandrasegeran. Sixteen of the recorded GCB transactions this year took place in prime District 10, including the coveted Tanglin, Bukit Timah and Holland Road areas.

Sustained buying activity

Sandrasegeran notes that, in general, GCB transactions were evenly spread throughout the year, with buying activity picking up from July. “Overall, the fact that we saw GCB deals closing throughout the year suggests sustained buying interest for these trophy properties despite external economic factors, such as inflationary pressures and the presence of high interest rates in the first eight months of the year,” he says.

Steve Tay, co-founder and executive director of his eponymous boutique luxury agency in Singapore, says the trajectory of interest rates signalled by the US Federal Reserve (Fed), rather than the rate cuts themselves, was the primary driver of stronger buying sentiment in the GCB market during the second half of the year.

The Fed implemented three rate cuts this year, the most recent being a 25 basis point (bp) reduction on Dec 18, following earlier cuts of 50 bp in September and 25 bp in November. Tay says that anecdotally, most GCB buyers who had been holding back on their purchases began more serious discussions from July onwards, with most deals closing in the last quarter of this year.

Money laundering crackdown dampened market

The GCB market slowed last year as buyers retreated following the island-wide arrests of suspects in Singapore’s biggest money laundering case, says Han of List Sotheby’s. “The money laundering crackdown had a dampening effect on the market, causing some genuine buyers to pull back to avoid media attention,” she adds. “Transactions also took longer to close due to heightened scrutiny and stricter checks on buyers’ identities and sources of funds.”

Up-and-coming wealthy take the stage

A new generation of ultra-wealthy Singaporeans has emerged in the GCB market in recent years, with a good number of young and successful entrepreneurs who have made their fortunes in technology, finance, commodities, and F&B businesses, says Tay. He adds that ultra-wealthy and newly naturalised Singaporeans also contribute to the exclusive pool of GCB buyers who prefer sizeable plots in prime districts. However, the number of naturalised citizens buying GCBs remains low compared to local wealthy individuals, according to Tay.

Preference for privacy drives off-market transactions

According to research from List Sotheby’s, the cost of developing a new GCB from ground up is estimated at about $1,000 psf, and takes several years to complete. Hence, most buyers prefer relatively new bungalows in move-in condition, to minimise renovation works, observes Han. “The GCB market will likely maintain its positive momentum, with demand from ultra-high-net-worth individuals driving its high-value transactions,” says Sandrasegeran of SRI. “The preference for privacy among GCB buyers and sellers could mean continued off-market transactions, adding to the complexity of tracking market activity.”