The Continuum Review: Don’t Buy Until You Read This!

Date: 03 September 2023

Updated: 12 November 2023

In this review, we are going to evaluate six parameters to determine whether The Continuum, a newly launched residential project, located at Thiam Siew Avenue is worth buying from the angles of both homeowners and investors. A rating of 1 to 5 for each parameter will be allocated. 5 being the highest and 1 being the lowest. Each of these ratings will constitute an overall rating.

1. Developer

Established developers with a strong track record in Singapore

The Continuum is jointly developed by Hoi Hup Realty and Sunway Developments. Both developers collaborated on their first joint venture (JV) project back in 2007. Since then, the JV partners have developed 17 projects with more than 9,0000 residential units under their belt. Some of their most recent joint venture projects are Ki Residences at Brookvale and Terra Hill.

CONQUAS Band 1

Since 25 March 2023, the Building and Construction Authority (BCA) has come up with a new way to help people looking to buy a home in terms of workmanship quality. They created a Quality Housing Portal that rates how well developers and builders have done on their last six years of private residential projects. This will make it easier for homebuyers to see which developer has a good track record. Both Hoi Hup Realty and Sunway Property were accorded the Construction Quality Assessment System (CONQUAS) Band 1 (very low incidence of major defects) under the new system.

Fairly Good Sales Rate

There are five ongoing projects which are still under construction. Of these, Parc Canberra EC and Parc Central Residences EC have already achieved 100% sold status while Ki Residences at Brookvale sold more than 98% of 660 units. At the point of writing, both Terra Hill and The Continuum which was launched in the first half of the year, have attained close to 40% (108 / 270 units) and 35% (287 / 816 units) respectively. The current sales result is considered fairly good in view of the high-interest rate environment and cooling measures put in place to arrest the rising demand from foreigners and second-time home buyers.

Developer Rating of 5/5

Solid history and track record of delivering quality products. The CONQUAS Band 1 rating further cemented their workmanship quality standards. The slower sale rates in 2023 are due to external factors such as market conditions and policy tightening. Knowing that the external forces are not within the control of the developers, a full score rating is given for their commitment to bringing quality residential projects to home buyers on the back of a remarkable proven track record.

2. Location

Accessibility and Convenience

Accessibility to transport nodes is the top housing consideration among home buyers not just because of the shorter traveling time but also the potential windfall from the new MRT line. In these circumstances, The Continuum is near the existing Paya Lebar MRT Interchange (EW8/CC9) and Dakota MRT station (CC8), and the upcoming Tanjong Katong MRT (TE 25). The nearest is Dakota MRT, about 11 mins walk from the development.

For those owners who drive, the Kallang-Paya Lebar Expressway (KPE), Pan Island Expressway (PIE), and Nicoll Highway are easily accessible by private vehicle. The Continuum is also about a 15-minute drive from Changi Airport and a 12-minute drive from Singapore’s CBD.

Accessibility and convenience go together. Grocery, dining, shopping, leisure, and entertainment are part of day-in and day-out activities for city dwellers. The residents are spoilt for choices with Kinex, Paya Lebar Quarter, Paya Lebar Square, East Coast Park, Joo Chait, and Katong just a stone’s throw away. The approximate driving time to the place of interest can be found on the location map page.

Primary Schools within 1KM

Proximity to renowned primary schools is one of the housing consideration factors, especially for young families with small kids. The Continuum is within 1km of three primary schools, namely, Haig Girl’s School, Kong Hwa School, and Tanjong Katong School which offers families more options for their child’s primary school admission. With the number of reserved places doubling in Phase 2C, getting a house within 1km or 2km proximity tends to have a higher chance of securing a place for children without prior connection to the school.

Location Rating of 4/5

Kong Hwa School is one of the 15 Special Assistance Plan (SAP) schools in Singapore that is highly sought after among parents. There are many primary schools in the radius of 1km and 2km. Having said that, proximity to primary schools will garner interest from young couples and families to grow and nurture their offspring at The Continuum. Unfortunately, some buyers may opt for residential developments that are nearer to the MRT station, specifically for those who commute using public transport.

3. Development

Freehold

Generally, collective sales and private treaties are the two approaches to acquiring freehold sites in the open market. En-bloc sales are hard to come by these days as both developers and sellers are hit by recent rounds of cooling measures. It boils down to the risks involved that the developer would need to undertake and the sellers’ steep replacement costs especially if they own more than one property given the high Additional Buyer’s Stamp Duty (ABSD) environment (See the ABSD table below). Higher construction costs and recent revisions in the definitions of gross floor area may further hold back developers’ appetite for collective sales, cited by the analysts as per AsiaOne article. Bearing this in mind, acquiring freehold land is tough and results in freehold projects being a scarce product.

Source: IRAS

Freehold properties are not affected by lease decay, unlike 99-year leaseholds. Freehold property prices tend to hold and appreciate better in the long run. Additionally, freehold property can be passed down through multiple generations as a legacy. A detailed price comparison is provided in the price analysis section below.

Facilities and Estimated Monthly Maintenance Fee

To give an insightful review, we delve into other sizable recent new launches such as Grand Dunman and Tembusu Grand in District 15. All three developments come with a full-fledged condo facility including a tennis court, swimming pool, gym, etc. The Continuum has the highest landscape ratio of 70:30 excluding the Sky Garden, setting aside more landscape and facilities space for the residents. Examples of two clubhouses, two sky gardens, and two gyms (Sky Fitness and Sky Gym). In our perspective, Sky Garden is an add-on bonus and allows the low-floor owners to enjoy the view from the rooftop without stretching their wallets for high-floor units with good facing. The site plan and facilities details can be found on our internal page.

The Continuum scores well when it comes to the provision of parking lots. With the 1-1 carpark ratio and direct lift access on both basements 1 and 2, it certainly wins the heart of the homebuyers who commute using private vehicles and the convenience of parking below the blocks. Though The Continuum has more facilities and landscape space, the estimated monthly maintenance fee is competitively comparable to Grand Dunman and Tembusu Grand.

*Exclude GST

View

For the view, we will examine both internal and external facings. Internal facing refers to those stacks that face inwards and overlooking the facilities. As the two land plots are separated by Thiam Siew Avenue which acts as a good setback for generous stack-to-stack distance. The closer stacks 6 and 25 between two opposite blocks 1 and 2 are about 46 meters apart and some stacks can be as far as 59 meters away. Privacy can be assured with such generous distance. The architect and developer are very thoughtful in designing the premium blocks to be protruded out such that the 5-bedroom units, stacks 19 and 25, can capture a wider landscape and facilities views.

External facing refers to those stacks facing outwards. The site itself is flanked by two rows of high-rise residential developments along Ipoh Lane and Dunman Road. Hence, the views are somehow obstructed. However, stacks 28 and 29 can capture the downtown view thanks to the balcony setting. 360-degree drone view of the surroundings can be found on our internal page.

Development Rating of 4.5/5

Most freehold sites are usually boutique developments with less than 50 units. At this juncture, Royal Hallmark and Claydence are some examples of boutique developments in District 15. Large freehold land plot with over 200,000 square feet is rare in the market. Going forward, it will be even harder to see large developments to be successfully sold for redevelopments against the backdrop of tighter cooling measures.

The beauty of having the Sky Gardens (which can double up as viewing decks), higher landscape ratio (70:30), and 1-to-1 carpark ratio with direct lift access from the basement carpark are strong product attributes that make The Continuum a better living community for the residents. Given its location, the view is never a selling point for The Continuum at the very onset. Based on the site orientation and architectural design, the development team has optimized the facing to its best efforts in our opinion.

4. Unit Layout

Before reviewing the unit layout, here is some pertinent information on the unit features. In general, each units have a North-South orientation, allowing for plenty of natural light and indoor airflow. The Continuum is not subject to prefabricated prefinished volumetric construction (PPVC) requirement and thus non-structural walls can be hacked to combine the bedrooms or enlarge the living area. Each unit includes a storage space for convenient household storage.

In this section, we will review The Continuum floor plan and give our take on each bedroom type. Most residential developments tend to have jack-and-jill bathroom layouts for 1-bedroom and 2-bedroom units due to space constraints as well as allow the occupants to enjoy the privacy of the attached bedroom when someone visits the house. Some buyers may find the design practical. However, the downside of this layout is that one of the doors commonly faces the dining area and may not be pleasant to some people.

Good to note that both 1-bedroom + Study (Types A) and 2-bedroom (Types B1, B2) bathrooms only have one opening. Our 2-bedroom and 2-bedroom + Study (Types B3, B4) adopt efficient dumbbell layouts that do away with the hallway. The study area of both 1-bedroom + Study and 2-bedroom + Study can be doubled up as a walking closet by re-configuring the master bedroom door if the built-in wardrobe is not adequate.

The dumbbell layout is extended to a 3-bedroom (Typer C1). Though there is no long hallway, the foyer space is compromised. This layout with a size of 872 square feet is suitable for smaller young families who require 3 bedrooms yet with a tight budget to work with. It’s the most wallet-friendly among the 3-bedroom units but not suitable for heavy cooking as the kitchen does not come with a window.

3-bedroom (Types C2, C3) are the ideal layout that comes with a huge master bedroom and enclosed kitchen for families with more budget. Building on from the above, the 3-bedroom Premier (Types C4, C5, C6, C7) features an additional household shelter, water closet, yard, and bigger kitchen space. 3-bedroom + Study (Types C8, C9) inherits the above attributes and boasts a private lift. This layout is rare in the market with a bigger balcony adjoining the living hall and kitchen. It does have its supporters especially those who love outdoor space. Interestingly, there is no wall to mount the television unless using the study area wall. Can leave it to the interior designer to do the magic.

Bigger families can go for 4-bedroom units (Types D1, D2) that boast a dry and wet kitchen. The island countertop in the dry kitchen is perfect for hosting big parties. One of the bedrooms can only fit a super-single bed. A slight variation is that type D2 has a longer foyer than type D1. For homebuyers who prefer all common rooms to fit a double-sized bed then type D3 is a better choice than D2.

The Type D4 is a luxurious 4-bedroom unit that comes with a private lift, a junior master bedroom, a walk-in wardrobe in the master bedroom, and dry and wet kitchens. Type E, on the other hand, is a 5-bedroom unit with a larger walk-in wardrobe in the master bedroom and the same amenities. Both layouts are suitable for 3-generational families or landed owners who wish to change their lifestyles.

Unit Layout Rating of 4/5

It’s important to note that no layout is perfect for everyone in a household. Each layout has its own advantages and disadvantages. The 1-bedroom + study to 2-bedroom + study layout is well optimized and doesn’t waste space partly thanks to the dumbbell layout. The television wall length and bathroom door placement are also well thought out. Small units benefit from having a store to hide unsightly items, which is rare in many developments. While these may seem like small details, they are worth considering.

The larger units in this development, specifically the 3-bedroom type C2 and above to 5-bedroom, have a spacious master bedroom that justifies their price for paymaster. Families can choose from a variety of options, such as having a study room, open-concept or enclosed kitchens with or without a household shelter, water closets, and yard space. The private lift adds to the exclusivity and privacy that the development offers. Additionally, families can reconfigure the layout of their unit to suit their preferences. With a wide range of unit types, this project caters to individuals and families at different stages of life.

5. Price Analysis

Cost Analysis

Source: URA, EdgeProp, and Developer (*Breakeven cost based on EdgeProp figures)

The EdgeProp’s estimated breakeven cost was used to analyse the profit margin of three property developments. At a glance, it appeared that Hoi Hup Sunway was creaming the most profit margin at nearly 19%, but a deeper examination of the numbers showed that this assumption may or may not be accurate.

EdgeProp conducted a detailed analysis of three projects, comparing their land cost to their breakeven cost. The study revealed that Grand Dunman had the highest construction cost and related expenses, at $942 per square foot (PSF), followed by Tembusu Grand at $828 PSF, and The Continuum at $808 PSF.

The Continuum has the highest landscape ratio of 70:30 excluding the Sky Garden, setting aside more landscape and facilities space. Hoi Hup Sunway can choose to maximise profits by building more units and utilise the Sky Garden space to build more penthouses.

In addition, The Continuum is the only development that offers two full basement carpark which costs more to build than a multi-storey carpark. The unit provision of fixtures, fittings, and finishings are comparable among the three developments. In our opinion, The Continuum’s construction cost is underestimated which makes up the bulk of breakeven cost computation.

District 15 – Leasehold Versus Freehold

Source: URA

Parkshore (FH, 1995), Sanctuary Green (LH, 1997) and Water Place (LH, 1998) are nestled along Tanjong Rhu Road. All these three developments were built around the same period. Parkshore a freehold development outperformed Sanctuary Green and Water Place (both leasehold) over time. Apparently, the price PSF gap started to widen in 2017 during the property upturn. It may seem to be a long wait to see the price PSF disparity. Parkshore is smaller development in relation to the other two counterparts, with 152 units. In our opinion, the land size and number of units of Parkshore have downplayed its overall price performance. Otherwise, the price PSF gap would take place much earlier.

Comparative Market Analysis

Source: Streetdiretory and Square Foot Research

The residential developments surrounding The Continuum are not a good comparison. Most of them are small-scale or boutique developments and were built more than 9 years ago. As such, it’s not meaningful to take their price per square foot (PSF) to compare against The Continuum.

District 15 new launches are better candidates for comparison. However, these three projects, K-Suites, Atlassia and Royal Hallmark are boutique developments and are excluded for comparison. LIV @ MB, Tembusu Grand and Grand Dunman are 99-year leasehold, average price PSF is between $2,446 and $2,535 and are in line with their respective land cost per square foot per plot ratio (PSF PPR) of $1,280, $1,302, and $1,350. The Continuum constitutes a freehold premium of 7.7% to 11.6% vis-à-vis with these three leasehold projects.

*Breakeven cost based on EdgeProp figures and **Assume developer profit margin of 15%

Future launches in district 15 are also considered in the price analysis. However, future launches are all boutique and small-scale residential developments and may not be a good comparable. Noted that the estimated breakeven cost of La Ville and Meyer Park is much higher than The Continuum at $2,296 PSF.

Price Rating of 4/5

There are many factors that need to be considered when analysing the price. Land cost, construction cost, marketing cost, and loan interest rate are some of the cost factors. Lease tenure and location are already priced into the land cost. The developer’s profit margin determines the price above the cost that a developer wants to make for undertaking the development risk.

The risk-free interest rate is above 3% in today’s market. A developer will need at least a decent profit margin of 15% for them to take the plunge. Otherwise, they can park their funds elsewhere such as investment properties with lesser risk. With the high labour cost, material costs, and interest rate, the average price PSF of The Continuum is in tune with the market conditions. A freehold premium of 7.7% to 11.6% seems a good deal compared to the leasehold counterparts in the long run.

The Continuum price list for various unit types is accessible on our internal page.

6. Rental Analysis

District 15 has always been a popular location for expatriates to settle down and rent accommodation, despite the lack of an MRT line. Its unique attributes include the East Coast lifestyle, mesmerizing sea views, and rich heritage neighborhoods like Katong and Joo Chiat, which set it apart from other districts. In the first half of 2023, District 15 recorded the third-highest number of rental contracts among the 28 districts and the highest in in the rest of the central region.

Source: URA

The smooth and short drive to the central business district via the East Coast Park expressway, along with the vibrant commercial hub at Paya Lebar Central and the presence of several international schools such as EtonHouse International, Canadian International, and GIIS East Coast, make this location highly attractive for expatriate families, thereby spurring a greater demand for rentals in the area.

Rental Rating of 4.5/5

With the opening of the Thomson-East Coast Line stage 4 in 2024, the connectivity to the city center will be enhanced, leading to an increase in the potential for rentability in the near future. The development of Kallang Alive and the future projects in Kampong Bugis and Kallang Riverside will further amplify the demand for rental properties in District 15. As a result, the real estate market in the area is expected to grow substantially.

Overall Review 4/5

Based on the assessment, The Continuum condo did extremely well on all fronts. A huge freehold development at District 15 is hard to come by going forward, making it a scarce product. It is worth increasing your budget given the relatively low freehold premium as compared to the recent launches. To gain more insights, please contact our sales team at 61008585 or secure your appointment to witness yourself.