I have seen many real estate agents promoting Tembusu Grand Condo in the Katong area.
According to news reports, Tembusu Grand Condo sold 53% of its units during its launch weekend and the average price per square foot (psf) came up to be about $2,423.
The abundance of condominiums in the area around Tembusu Grand makes it tempting to draw price comparisons. Let’s take a closer look at how it compares to other developments in the area without going into the details of the layout or fengshui.
37% premium over other leasehold properties
It’s worth noting that the majority of private properties in the vicinity of Tembusu Grand are freehold. However, there are a few notable leasehold properties, such as The Shore Residences and Silversea, that offer comparable features and amenities.
The Shore Residences and Silversea, for example, were sold at around $1,771 and $1,764 per square foot in recent transactions, respectively.
In contrast, Tembusu Grand’s launch price of $2,423 per square foot represents a 37% premium over these properties.
| Condo | PSF | Number of Units | Lease | Completion Year | Age |
| Tembusu Grand | $2,423 | 638 | 99 | 2027 | -4 |
| The Shore Residences | $1,771 | 408 | 103 | 2013 | 10 |
| Silversea | $1,764 | 383 | 99 | 2014 | 9 |
While the pricing difference between Tembusu Grand and other leasehold properties like The Shore Residences and Silversea may seem significant, it’s important to consider that Tembusu Grand is a brand new development, while the other properties are 10 and 9 years old, respectively. New development should fetch a premium.
Ultimately, whether the 37% premium for Tembusu Grand is worth it depends on individual buyer preferences and priorities. While some buyers may place a higher value on modern amenities and features, others may prioritize location or affordability.
Another consideration is that new developments typically require minimal to no renovations, whereas older properties may require significant updates or renovations. As a result, the purchase price of a new development like Tembusu Grand may include some of the costs that would otherwise be required for renovations in an older property. Additionally, homebuyers can take out a housing loan against the purchase of a new development, rather than paying for renovations in cash.
Tembusu Grand’s nearest MRT station would be the future Tanjong Katong station along the Thomson East Coast Line. It is a 700m walk for about 10 minutes.
But the same can be said for The Shore Residences so distance to a train station could not explain the price difference.
It’s worth noting that Silversea is actually located between the Tanjong Katong MRT station and the Marine Parade MRT station, making it closer to the latter at just 550m away and a 7-minute walk. This further underscores the fact that proximity to an MRT station alone cannot fully account for the price difference between Tembusu Grand and the other properties in the area.
It’s also worth noting that some units in Silversea offer an unobstructed sea view, which can be a highly sought-after feature for some homebuyers, unless you are concern about corrosion due to exposure to seawater.
As expensive as the new freehold properties
Despite being a leasehold property, Tembusu Grand is selling at prices comparable to the newer freehold properties in the vicinity.
The relevant comparisons would be Amber 45, Coastline Residences and Amber Park. Tembusu Grand was priced just below them, with a difference of only $152 per square foot compared to the most expensive option, Amber 45. These condos are freehold and aged 2 years and below.
| Condo | PSF | Number of units | Lease | Completion Year | Age |
| Amber 45 | $2,575 | 139 | Freehold | 2021 | 2 |
| Coastline Residences | $2,521 | 144 | Freehold | 2022 | 1 |
| Amber Park | $2,448 | 592 | Freehold | 2023 | 0 |
| Tembusu Grand | $2,423 | 638 | 99 | 2027 | -4 |
You may argue that Amber 45 and Coastline Residences are smaller projects and would incur higher maintenance fees. But that doesn’t really justify for a leasehold property to sell at freehold prices. And how do we explain Amber Park, which is almost the same size as Tembusu Grand, is selling around the same price despite it being a freehold?
It is true that some buyers may not care about the freehold status, particularly for those who intend to sell the property before the lease runs out or before the rate of depreciation accelerates.
For those who plan to leave the property as a legacy for their children or future generations, the freehold status may provide more assurance that the value would retain better than a leasehold property.
Nonetheless, freehold properties have always been commanding a premium over leasehold properties. Tembusu Grand should not be an exception.
Enjoy a 47% discount across the road?
Opposite Tembusu Grand is a small freehold project called Chelsea Lodge. It features 78 units of American townhome-styled homes, which were built 23 years ago. However, from the outside, it does not seem to have any lifts or amenities. Nonetheless, if you appreciate the “ang moh” feel and prefer a freehold property or happen to be a Chelsea fan, then Chelsea Lodge might be worth considering.
Here’s the kicker: The recent transacted price for a unit in Chelsea Lodge was at $1,296 psf, which is a 47% discount from the price of Tembusu Grand!
Tembusu Grand Condo is overpriced
In my opinion, Tembusu Grand is overpriced based on the comparison of recent sales in the vicinity.
But well, most new launches are overpriced anyway and it is a case of ‘willing seller willing buyer’.
New launches are typically priced at a premium due to their newness and the developer’s marketing efforts. However, they may still appreciate in value over time. It’s just that the potential returns may not be as high as those of resale properties. Also, holding onto a new launch property for a longer period may be necessary to reap the benefits of capital appreciation.