The Rest of Central Region (RCR) is one of the most popular zones for Singapore property. It’s close to central Singapore, but without the high prices one would find at Orchard or Robinson Road. This is also where you would find one of the most diverse mixes of property assets – from luxury boutique developments, to no-frills projects built for cost-efficiency. Have a look at how much developments here cost and rent for, as of 2021:
Defining the RCR
The Rest of Central Region (RCR) is made up of the following districts:
Note that for the following, I have used data from Square Foot Research. The latest rental data is only up till August 2020, although price data is up till February of this year.
The average price of a D3 condo is currently around $1,627 psf. The spike in November was due to the launch of The Landmark, which sold out around 90 per cent of its units on launch weekend. As a knock-on effect, average prices for the district have remained high over the past four months.
The average rental rate in D3 is about $4.25 psf, a notable improvement over 2019, when it seldom crossed the $4.02 psf mark.
District 4 was quiet for most of 2020, with a recent flurry of transactions from The Reef @ King’s Dock. This has caused average price for the district to spike from $1,505 psf in end-2020, to $2,147 psf as of February 2021.
Rental in D4 averages $3.66 psf by last known transactions.
Demand for D5 stems mainly from the launch of a new mega-development, Normanton Park. This is one of the best selling condos to date, as it’s close to the One-North office hub. The launch of Clavon, one of the most competitively priced condos to date, will also help to sustain the momentum. Prices have continued to climb, averaging $1,589 psf as of February.
D5 rental rates took a sharp hit at around the time of the Circuit Breaker, and haven’t yet recovered. They currently average at $3.02 psf. With the arrival of Normanton Park, there’s also significantly more supply in the One-North area.
The only district to have beaten the Orchard area in recent history, D7 prices average around $2,513 psf. However, note that transaction volumes are not high; what you see is headlined by The M, which had a very low quantum (units starting from below $1 million), but high price psf (reaching up to $3,000 psf).
I would expect another spike this year, once Midtown Modern is up and selling.
D7 rental rates average $4.32 psf. This is one of the more resilient districts in terms of rental; many working expats see D7 as an affordable alternative to areas such as Orchard or Robinson Road, so D7 can see spikes in demand during downturns (as some companies slash the housing allowances of working expats).
This district is famous for its price resilience. Even during the worst downturns, such as the last financial crisis in 2008, D8 tends to somehow maintain their prices or bounce back faster. And as you can see, prices have more or less sprung back from the Circuit Breaker period, now averaging $1,507 psf.
D8 rental rates average around $3.40 psf, making it affordable for many tenants to live near central areas.
The price average has been pulled up by the launch of Verticus in 2020, although resale condos continue to make up the bulk of transactions for D12. Current prices average at $1,441 psf.
Like D7, there are areas in D12 – such as around Novena – which have resilient rental demand. Properties in these areas are often the next favourite alternative, for tenants who need to be close to the CBD, but are too price-sensitive for a Raffles or Orchard area condo. The current recorded rental average is $3.47 psf.
Prices in D13 are currently being uplifted by the launch of Myra back in 2020. Other than that, Potong Pasir tends to be underrated, as it was once an oddity (until the arrival of The Poiz, for instance, there had been no shopping mall in Potong Pasir for almost 50 years). Today more buyers have become alert to Potong Pasir’s true potential. Prices average $1,687 psf as of February.
Rental rates in D13 have mostly recovered from the Circuit Breaker period, reaching $3.39 psf.
The spike in transactions was from the launch of Penrose, which headlined District 14 for the year. Prices became a bit volatile following the new launch, but seem to be settling at around $1,469 psf. Prices in District 14 are likely to keep rising over the next few years by the way; mainly thanks to Paya Lebar being a new commercial hub.
D14 is famed for having some of the lowest vacancy rates in Singapore, especially Geylang-area properties rented to foreign workers. With Paya Lebar contributing Grade A office space, it’s no wonder rental in this area has exploded. Rates were at $3.63 psf last year, and I would be surprised if they didn’t keep climbing for a while more.
The uptick in D15 prices was foreseeable, with the launch of luxury condos around Meyer Road area (Meyer Mansion, Meyer House). Prices here average at $1,661 psf, as this district constitutes one of the main luxury enclaves in the east.
D15 includes the expat enclave of Katong, so a Covid-19 downturn is bound to worry landlords. Rental rates are at $2.73 psf, but can go either way given the current economic situation.
D20 prices are still riding high from the momentum set by JadeScape, which launched in September 2018. This was a mega development with over 1,200 units, close to the Marymount MRT – and this has helped to push up prices here (but note that JadeScape is almost 93 per cent sold at the time of writing). Prices currently average around $1,522 psf.
Prices average $2.1 psf in D20, having remained more or less resilient throughout the worst of Covid-19.
The key trend to note is that the RCR tends to be quite resilient, during economic downturns. We previously saw this during the last Global Financial Crisis in ’08, when the RCR managed to sustain rental rates and lower vacancies better than its prime region counterparts.
The reason, as I touched on above, is how companies react during downturns: many large corporations tend to replace expats with local workers, or give out less generous housing allowances. This can make prime region properties too pricey as accommodation.
But many RCR properties can put you within a 10-minute drive, or just four or five train stops, from areas like Raffles Place. As such, we tend to see more expats moving into the RCR as the next nearest alternative.
There are two other key trends to note:
First, 2020 was the first year in which District 7 beats District 9 in terms of pure price psf. Granted, this was partly due to smaller condos like The M, which had low prices but a high price psf; but read in context, the momentum has been growing since South Beach Residences in 2018.
The Ophir-Rochor Corridor, along with continued decentralisation of the CBD, may one day see the centre of gravity shift to the Beach Road area.
Second, also related to decentralisation, is the emergence of new hubs like One-North and Paya Lebar. Whether it’s launch pads for tech companies, or prime office space away from central Singapore, the RCR is rising to challenge prime region properties. Over the next few decades, the slow trickle of tenants moving from CCR to RCR could become a deluge; a fact that landlords will have to consider before buying.
If you have any queries about this, feel free to contact me directly. Otherwise, follow me on RonChongProperty.sg as I move on to examine the fringe OCR condos.