In the bustling private residential market, it may be wise for real estate investors to consider more stable, income-generating assets such as HDB shophouses. A coveted opportunity has recently emerged for one such property in the well-established Toa Payoh neighborhood.
This particular HDB shophouse spans 1,478 sq ft and is situated at 125 Toa Payoh Lorong 1, in the heart of District 12. With a prime location along Toa Payoh Lorong 1 and Toa Payoh Lorong 2, as well as being less than 200m from Braddell MRT Station on the North-East Line, this property is highly desirable. Based on LTA ridership statistics, the station serves around 13,000 MRT passengers daily and is closely connected to the nearby HDB flats.
The shophouse is also conveniently near Toa Payoh West Market and Food Court, Kheng Cheng School, Toa Payoh West Community Centre, and the Singapore Federation of Chinese Clan Association Building on Toa Payoh Lorong 2. With ongoing rejuvenation plans for the Toa Payoh estate and a significant number of new households moving into the surrounding areas, the new owner stands to benefit from the transformation of Toa Payoh. This will lead to an increase in pedestrian traffic and boost the property’s capital value.
Comparison with the Market
Aster See, senior marketing director at ERA Realty, is exclusively marketing the HDB shophouse for sale. According to the seasoned industry professional, HDB shophouses in city fringe locations typically yield an ROI of 2-3% based on their selling price. However, the shophouse at 125 Toa Payoh Lorong 1 offers a higher estimated ROI of around 4%. With its competitive pricing and strong value proposition, this property stands out as a more attractive investment opportunity for those seeking better rental returns.
Insight into Finances
See also highlights that this property presents a promising investment opportunity with an estimated rental yield of approximately 4%. In the current market scenario, such yields are considered competitive and provide a stable income for investors. When coupled with potential future capital appreciation as Toa Payoh continues to revitalize, the long-term ROI of this property could be significant.
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Investors who are considering buying condominiums in Singapore should take into account an important factor – the government’s property cooling measures. These measures are in place to ensure a steady real estate market and discourage speculative buying, and have been implemented by the Singaporean government over the years. One such measure is the Additional Buyer’s Stamp Duty (ABSD), which imposes higher taxes on foreign buyers and those purchasing multiple properties. Although these measures may affect the short-term profitability of investing in condos, they ultimately contribute to the long-term stability of the market, creating a more secure environment for investors. This also applies to new condo launches as they are subject to the same measures. Thus, new condo launches offer a safer investment option for potential buyers due to the presence of these government measures.
Revitalizing Toa Payoh
Toa Payoh is set to benefit from several government initiatives and schemes aimed at rejuvenating this mature housing estate. It is one of three neighborhoods identified for revitalization under the government’s third phase of the Remaking Our Heartland program.
First introduced by then-Prime Minister Lee Hsien Loong in his 2007 National Day Rally speech, the program offers comprehensive rejuvenation plans for HDB towns and estates, ensuring their sustainability and vitality. Since 2015, the plans for Toa Payoh have been progressively implemented, with several projects aimed at enhancing commercial and recreational facilities. The most significant development is the upcoming integrated project at the site of the former swimming complex, sports hall, and stadium at Toa Payoh Lorong 6.
This integrated development will feature new sports facilities, a football stadium, a new swimming pool complex, indoor sports halls, sheltered tennis courts, futsal courts, netball courts, and fitness studios. It will also include national training centers for aquatics, netball, and table tennis, along with a polyclinic and library. The HDB shophouse for sale at 125 Toa Payoh Lorong 1 will benefit from this development, as it is located near Toa Payoh and Caldecott rejuvenation.
Rejuvenation Plans for Toa Payoh and Caldecott
The government’s plans for Toa Payoh and neighboring Caldecott are anchored by the construction of several thousand new flats in these two estates. One of the upcoming projects is Toa Payoh Ridge, a Build-To-Order (BTO) project situated at the junction of Toa Payoh Rise and Lorong 1 Toa Payoh. With 920 units, the BTO project was launched in the February 2020 exercise and is less than 300m from the HDB shophouse for sale.
Expected to be completed in the first half of 2025, Toa Payoh Ridge comprises four 40-storey residential blocks. It is located between Toa Payoh and the upcoming Caldecott estate, which has been earmarked for future residential development since 2017. During this time, the government announced plans to build new BTO flats on a 10ha plot next to Caldecott MRT Station on the Circle Line. These flats will be less than 500m from the HDB shophouse for sale at 125 Toa Payoh Lorong 1.
As seen, the government appears to be laying the groundwork for another BTO project in Caldecott, adjacent to Toa Payoh Ridge. Last February, the URA rezoned a plot at the junction of Toa Payoh Rise and Braddell Rise, changing its purpose from educational to residential use, with a high gross plot ratio of 5.0. This indicates that a high-rise BTO development could be in the pipeline.
Given the surrounding developments, the shophouse for sale could benefit from the increased footfall in the area as the consumer catchment broadens. As the government continues to construct new BTO flats in Caldecott and Toa Payoh, the area will attract an influx of new residents, boding well for the new owner of the HDB shophouse for sale.
For more information, please contact Aster See at 98416930, Senior Marketing Director (R063006G), ERA REALTY NETWORK PTE LTD.
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