Estimated reading time: 8 minutes
Heard of developments like Ardor Residence, The Hillshore, or Straits at Joo Chiat? Then, you might already be familiar with some of the newest boutique condos on the market.
Consisting of 100 units or less, boutique condominiums (or condos) are small yet sophisticated. And though they possess smaller site areas and fewer amenities than their larger counterparts, boutique condos deserve to be on your radar – even if you are home-hunting in a bigger development.
Due to their unique selling points, boutique condos represent a distinct but nonetheless compelling value proposition for buyers.
In this article, we break down boutique condos’ benefits and potential drawbacks so you can easily determine whether these small but mighty developments are the right choice!
Boutique condos are private and exclusive
Boutique condos appeal to a different crowd than larger developments, attracting buyers seeking exclusivity and serenity. This includes couples without children or empty nesters whose children have moved out.
Empty nesters will likely find smaller developments more appealing as they may no longer need the wider range of large condo facilities. Instead, boutique condos – with their smaller but curated selection of amenities – can provide them with a more personalized living experience.
Coupled with a smaller resident community, they are a more intimate choice of residence for the aforementioned buyer groups. One striking example of this can be found in District 15, where both Grand Dunman (a 1,008-unit mega-development) and Straits of Joo Chiat (a 16-unit boutique development) are located.
Boutique condos offer greater flexibility in their layouts
Exclusivity aside, another benefit of choosing smaller condos is their added flexibility in layouts.
Smaller condos often arise from the collective (or en-bloc) sales of older condos, exempting them from the requirement imposed on residential developments on Government Land Sales (GLS) sites to use a 65% Prefabricated Prefinished Volumetric Construction (PPVC) method. This exemption occurs because smaller condos redevelop existing properties rather than starting anew on GLS sites, where such construction methods are mandatory.
This construction method involves creating free-standing 3D modules with internal finishes, fixtures, and fittings at an off-site fabrication facility. These modules are then delivered and installed on-site.
This requirement, mandated by the Building and Construction Authority, ensures that condos built on GLS sites have faster construction times and better quality control. However, the PPVC method has the downside that it offers less flexibility in knocking down or merging rooms unless the unit configuration and layout include flexi rooms.
Developers of boutique condos might not opt to utilize the PPVC method in building construction – as they are not mandated to do so. With their smaller size, it might be faster or more affordable to construct boutique developments the traditional way.
Boutique condos, constructed traditionally, let homebuyers freely modify rooms. Condos built with the PPVC method enforce stricter renovation guidelines. This enhanced layer of flexibility appeals to homebuyers who are looking for a condo for their own stay.
New Launch Freehold boutique condos are value for money
Since the government has stopped selling freehold land as part of the GLS program, new freehold projects have become a rare commodity.
Of 132 freehold condos launched in the last decade, 101 (or 77%) of them were boutique condos.
The reason why there is such a large number of freehold boutique condos is that they are often built on en-bloc sites. These smaller plots of land are easier and cheaper for smaller developers to buy and develop, presenting less risk than developing a larger project.
Freehold property offers perpetual ownership, which is a rare commodity in land-scarce Singapore. It offers a secure way to hold and pass down wealth to future generations.
As freehold properties are not subject to lease decay, they perpetually hold their value. They are unlikely to net a loss when owners eventually transact them many years or even decades down the road.
Given a quiet en-bloc market and a scarcity of new freehold condos, boutique condos offer buyers in the market a new freehold condo with invaluable options.
The aforementioned factors culminate in making boutique freehold condos a treasured legacy asset to be passed on to future generations. They make great homes for older parents to invest in – as their children leave the nest to start their own families. For them, owning a boutique freehold condo is a great way to preserve their wealth and ensure a more secure future for their loved ones
Some boutique condos might have a lower entry price
Boutique condos are built on smaller plots of land, which are often purchased as part of an en-bloc sale by developers. Due to their small size, developers are able to purchase and redevelop the land more affordable. This results in lower launch prices compared to larger projects built on GLS sites.
Table 1: Comparison between boutique and large-sized condos in District 15
| Project | Units | Tenure | From ($PSF) |
|---|---|---|---|
| Straits at Joo Chiat | 16 | FH | $2,080 |
| Ardor Residence | 35 | FH | $2,114 |
| The Continuum | 816 | FH | $2,592 |
| Grand Dunman | 1,006 | LH | $2,041 |
By comparing two new boutique condos with two larger projects within District 15, we can see that boutique condos generally have a lower entry price.
Additionally, boutique condos are often located in private and exclusive locations, such as within landed enclaves. These locations are less convenient than larger condos, which are closer to transport nodes, amenities, and schools, making them more prominent.
While these factors contribute to a lower entry price for boutique condos, that doesn’t necessarily equate to a low exit price.
Let’s compare the price growth
Comparing the price growth of boutiques with medium-large sized condos island-wide, we can see that larger condos see an overall more robust price growth.
Chart 1: Average transacted price $psf of leasehold (LH) and freehold (FH) boutique and mid-sized condos
Source: URA as of 12th June 2024, ERA Research and Market Intelligence
Boutique leasehold condo prices have grown by 24.1% since 2010, compared to mid-sized leasehold condos, which saw 93.6% growth.
The freehold market showed less disparity, with boutique condo prices growing by 41.5% compared to mid-sized condos, which grew by 74.6%.
Investors expect larger developments to achieve faster price growth. Larger projects, especially mega-developments, possess the “sales” volume required to drive transaction prices. As a result, they generally see a faster price growth due to frequent transaction activity.
However, this does not mean that boutique condos are poor investment choices. Owners of boutique condos are still able to make a profit when they do decide to sell, albeit at a lower rate.
Final Considerations
To sum it all up, boutique condos might not be for everyone.
Owners of boutique condos often experience extended unit selling times, particularly in smaller developments with fewer units.
Investors seeking high liquidity and rapid capital appreciation should choose larger condos appealing to mass-market buyers.
Families with young children favor larger condos for accessibility, diverse facilities, and a lively environment beneficial for child development.
However, if these concerns are not of priority, you might find the prospect of living in a boutique condo alluring. They offer a level of privacy and exclusivity that only landed property, which falls within an entirely different price bracket, can best.
Additionally, living in a smaller condo allows residents to foster a strong sense of community. With a fewer number of occupants, residents are able to build closer and more meaningful relationships with their neighbors.
Buyers seeking freehold properties face limited options in the current market, often turning to smaller condos. These properties tend to retain their value and provide enduring investment potential across generations.
Table 3: New launch boutique condos available (as of 18th June 2024).
| Project | Total Units | District | Tenure |
|---|---|---|---|
| Hill House | 72 | D09 | 999 |
| Orchard Sophia | 78 | D09 | FH |
| Sophia Regency | 38 | D09 | FH |
| Grange 1866 | 60 | D10 | FH |
| 10 Evelyn | 56 | D11 | FH |
| 32 Gilstead | 14 | D11 | FH |
| The Hillshore | 59 | D05 | FH |
| Ardor Residence | 35 | D15 | FH |
| Claydence | 28 | D15 | FH |
| Straits at Joo Chiat | 16 | D15 | FH |
| K Suites | 19 | D15 | FH |
| The Shorefront | 23 | D17 | 999 |
| Gems Ville | 24 | D14 | FH |
| Mattar Residences | 26 | D14 | FH |
Contact me if you want to learn more about these exciting new boutique projects.
