The demand for shophouses is expected to remain stable for the rest of 2018. And understandably so.
Their rarity is comparable to that of landed properties and perhaps even more so as they are an integral part of local heritage.
Shophouses, Koon Seng Road. Picture: iProperty
Shopping shophouses, buying into local heritage
Shophouses in Singapore are scarce, hence the demand for them is almost always consistently high and they can also be rather lucrative.
These properties hold their value well even during market downturns and while they make charming residential properties, shophouses zoned for food and beverage, hospitality or retail uses fetch even more.
Units which have been upgraded or possess the potential for further enhancements can often attract investors further.
URA data showed that the transaction value of shophouses hit a record high in Q1 this year, coming in higher even than the peak in H1 of 2013. Long-term investors often favour these property types as they appreciate well over the years.
There is a preference for adjoining units as they translate well into rental properties or further property conversions.
See more: Rare Shophouses in Little India and Chinatown launched for Sale by Expression of Interest
Shophouses are cultural icons and future-proof
Shophouse, Jurong East Town Centre. Picture: iproperty.com.sg/sale
There have been recent trends of families who have owned shophouses for generations putting them up for sale as they look to redistribute funds.
Some transactions have stood out as they traded at high prices, in particular, those sold in a series of adjoining units. However, single-storey units have also been picked up quickly as they have a more affordable total quantum.
Shophouses in the central prime districts continue to be popular with buyers while those in the city fringes such as Jalan Besar, Kampong Glam, Little India, Joo Chiat Road and East Coast Road may be underrated and have greater growth potential.
A pair of adjoining four-storey conservation houses on Amoy Street for example with a total floor area of 14,641 sq ft was recently launched at $3,415 psf.
External factors such as office rental market performance, interest rates and economic circumstances may, however, steer demand off-kilter albeit slightly.
See more: Golden Wall Centre – prime freehold commercial site for sale
