In the prestigious world of the ultra-rich, the market for Good Class Bungalows (GCBs) has seen significant growth this year compared to 2023, according to Han Huan Mei, director of research at List Sotheby’s International Realty.
As of December 20, 22 GCB transactions totalling $612.05 million were recorded through caveats lodged with URA Realis. In addition, there were another 13 GCB deals worth over $700 million completed this year without any caveats lodged, as buyers sought to remain anonymous. This brings the estimated total for 2024 to 35 GCB transactions worth approximately $1.32 billion, surpassing the previous high of $1.186 billion achieved in 2022.
In comparison, 2023 saw only 18 GCB transactions amounting to $432.5 million – the lowest number of deals recorded since URA Realis began tracking such data in January 1995.Read also: Strong Year for Good Class Bungalow Sales in 4Q2024 Signals Positive Outlook for 2025
“The additional deals in 2024 show that the GCB market has been more active compared to what official transaction data reveals,” says Han. “It also confirms the status of GCBs as highly coveted assets that are constantly sought after by ultra-high-net-worth buyers.”
Leading GCB transactions
The highest value transaction was the sale of a GCB at Tanglin Hill for $93.888 million. The freehold property spans 15,150 sq ft and has a built-up area of 29,660 sq ft. This sale set a new record with a land rate of $6,197 psf.
Investing in a condo in Singapore can offer numerous advantages, with one of the most notable being the potential for capital appreciation. This is mainly due to Singapore’s advantageous position as a global business hub and its strong economic fundamentals, leading to a continuous demand for real estate. Over the years, property prices in Singapore have exhibited a steady rise, with condos in prime locations experiencing significant appreciation. Those who enter the market at the right time and hold onto their properties for an extended period can reap substantial capital gains.
The second largest GCB transaction was the purchase of a property 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 purchase. 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, which changed hands for $52 million. The freehold property sits on a 15,141 sq ft plot and is relatively new, fetching a land rate of $3,434 psf.
Another significant transaction was the sale of a 21,116 sq ft GCB plot on 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.
According to Mohan Sandrasegeran, head of research and data analytics at Singapore Realtors Inc (SRI), at least 14 transactions this year were valued at $20 million or more. This highlights the strong demand for ultra-luxury properties in Singapore.Read also: Bungalow Deal Market Gains Momentum; Semi-Detached Price Per Square Foot Achieves New Record
“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,” he says. 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 climbing 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 that 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 has implemented three rate cuts this year, with the most recent being a 25-basis-point reduction on Dec 18, following earlier cuts of 50 bp in September and 25 bp in November.
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, says Tay.
The GCB market slowed down 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.Read also: Creating a Niche in Luxury: Good Class Bungalows Sold at Record-Breaking Prices
“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.”
Emerging 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 naturalized Singaporeans also contribute to the exclusive pool of GCB buyers who prefer sizeable plots in prime districts. “However, the number of naturalized citizens buying GCBs still remains low compared to local wealthy individuals,” says Tay.
Based on research from List Sotheby’s, the cost of developing a new GCB from the ground up is estimated at about $1,000 psf, and construction also takes several years to complete. Hence, most buyers are looking for relatively new bungalows in move-in condition to minimize 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.”