A Review of Shoebox Apartments

Shoebox or “mickey mouse” flats as they’re also understood in Singapore has found a rise in popularity in the past couple of years. Generally, these flats are 500 sq ft or less. Sales amounts have seen a jump from 300 units at the conclusion of last year to 1,900 units. They account for 12 per cent of overall revenues of new private flats for 2010. About are Singaporeans. From this group, units were purchased by 50% below 1,000 sq ft and had HDB (Housing Development Board) addresses. This can be according to caveats lodged by June 28.

a review of shoebox apartments
Why are these shoe box flats popular?

The are cheaper and form a smaller overall quantum outlay, usually less. They’re popular with expatriate professionals and the young singles who spend more hours on the job as well as in their own free time, are rarely. With respect to the job, rental returns are not unattractive. With a yield of 3 it’s not worse than placing it inside the rear where the rates of interest are less.

So are great investments made by shoebox flats?

They are sometimes rather rewarding depending on time and place. Popular places contain, Anson, Raffles Place, Little India, Chinatown and Tanjong Pagar places. These places are appealing due to their close proximity to habitat and the business district. Buyers who flip the property and purchase directly in the developers often make more gain. Flipping or sub-sale occurs when the brand-new apartment’s buyer sells the property before the job is finished.

This is quite common among those who suppose. The most recent Government cooling measures of 16 percent stamp duty levied on properties sold within four years of purchase and tighter fiscal controls of 60% borrowing limitation (loan-to-worth ratio) on the second and following mortgage for homebuyers with a current loan has set a damper on speculators. Resale costs were found dipping from 1.9 percent in September after increasing 3 percent in August according to the National University of Singapore’s Singapore Residential Price Index (SRPI).

With all these measures, speculators find that it is best to hold onto the properties until the job is finished. Once finished, speculators sell when market conditions are favourable and look for renters. Ultimately, although the absolute quantum are lower, the per square foot costs are higher compared to standard bigger units. Buyers must take into account how much higher they can sell and consider the risk-return ratio.