In the world of the ultra-rich, the market for Good Class Bungalows (GCBs) has shown remarkable performance this year compared to 2023, according to Han Huan Mei, director of research at List Sotheby’s International Realty. As of December 20, URA Realis has recorded 22 GCB transactions totaling $612.05 million. In addition, 13 more GCB deals were completed this year without any caveats lodged, amounting to over $700 million as buyers sought anonymity. This brings the estimated total of GCB transactions for 2024 to 35, with a value of approximately $1.32 billion, according to List Sotheby’s estimates. This surpasses the previous high of $1.186 billion achieved in 2022. In comparison, 2023 only saw 18 GCB transactions, amounting to $432.5 million – the lowest number of deals recorded since URA Realis began tracking such data in January 1995.
“This year’s additional transactions in the GCB market indicate a higher level of activity compared to official transaction data,” says Han. “It also highlights the GCB’s status as a highly coveted asset that continues to attract ultra-high-net-worth buyers.”
Leading the pack in GCB deals is the sale of a property at Tanglin Hill for $93.888 million. The freehold site is 15,150 sq ft with a built-up area of 29,660 sq ft, setting a new record with a land rate of $6,197 psf. The second-largest transaction was the $84 million purchase of a property at Bin Tong Park by Xiang Yangyang, daughter of Chinese nickel billionaire Xiang Guangda. However, no caveat was lodged for this property. Based on the land area of 28,111 sq ft, the price translates to a land rate of $2,988 psf. The highest-priced deal recorded through caveats was for a GCB at Cluny Hill, which sold for $52 million. Sitting on a freehold land of 15,141 sq ft, the relatively new property fetched a 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 Wilmar International’s chairman and CEO, Kuok Khoon Hong. This 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. “District 10 remains the top choice for GCB buyers, with several high-value deals reaffirming its position 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 Tanglin, Bukit Timah, and Holland Road areas.
The buying activity for GCBs was evenly spread out throughout the year, with an increase in July, according to Sandrasegeran. “Overall, the fact that GCB deals were closed throughout the year suggests a sustained interest in these trophy properties despite external economic factors, such as inflationary pressures and 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, 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 US Federal Reserve implemented three rate cuts this year, with the most recent being a 25 basis point (bp) reduction on December 18, following earlier cuts of 50 bp in September and 25 bp in November.
According to Tay, most GCB buyers who had been holding back on their purchases started more serious discussions from July onwards, with most deals closing in the last quarter of this year. The GCB market had slowed down last year as buyers pulled back following the island-wide arrests of suspects in Singapore’s largest money laundering case, says Han of List Sotheby’s.
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“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.”
A new generation of ultra-wealthy Singaporeans has emerged in the GCB market in recent years, with a significant number of young and successful entrepreneurs who have made fortunes in technology, finance, commodities, and F&B businesses, says Tay. He adds that 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. According to research from List Sotheby’s, it costs approximately $1,000 psf to develop a new GCB from the ground up, and the construction process takes several years to complete. Therefore, most buyers are looking for relatively new bungalows in move-in condition to minimize renovation work, observes Han. “The GCB market is expected to maintain its positive momentum with demand from ultra-high-net-worth individuals driving high-value transactions,” says Sandrasegeran of SRI. “The preference for privacy among GCB buyers and sellers could result in more off-market transactions, adding complexity to track market activity.”