Home Prices Increase With DTL2 Completion
Downtown Line 2 (DTL2) started operation on 27 Dec 2015. Since then, homes near the stations have seen an increase in rents and sales volumes.
This is the so called MRT effect. When a new station is completed and starts its operation, price typically adjusts upwards.
Looking at the caveats lodged for private homes along the DTL2 major roads such as Sungei , Rochor Canal, Bukit Timah and Upper Bukit Timah Roads have witnessed an increase of 4.5% on average in the 3rd Q to $1,592 per square foot in the 4th Q of 2015.
The average prices increase 3.58% in 2014 till end Dec 2015 along the major roads of the DTL2 while the Urban Redevelopment Authority’s (URA) property price index (PPI) registered an overall drop of 7.6%. This shows that the presence of the DTL2 has supported home prices along the DTL2 stations.
Even volume of home sales has risen according to the new launch projects along the DTL2 as seen below:
|Development||% Sold in Dec 2014||% Sold in Nov 2015|
|Kingsford Hillview Peak||33||46|
|The Skywoods in Dairy Farm Heights||43||85|
According to Nicholas Mak, SLP International Executive Director, new project Robin Residences at Stevens MRT station in district 10 Core Central Region (CCR) has its median price rise by 0.3% year-on-year to $2,378 psf in 2nd half 2015 even though the overall CCR price index fell by 2.6%. Sales prominently rose from 15 units sold in the 1st half of 2015 to 29 units sold in the 2nd half of the year.
According to Ong Kah Seng, R’ST Research director, leasing contracts rose significantly in the King Albert Park station area from 38% in the 2nd Q of 2015 to 358 in the 3rd Q. On top of the increase in the volume of rental contracts, even the median rent also rose from $3.15 psf per month in the 1st Q of 2015 to $3.23 psf per month in the ensuing two quarters, that is, 2nd and 3rd Q of 2015.
Mr Mak commented that commercial developments along the DTL2 will also benefit from the MRT effect.