Tuesday, August 11, 2009

Should not pay more if the house is near the MRT

With all the different MRT lines coming up in Singapore (e.g. Circle line, Downtown line, etc), it just makes me wonder. Does it make any difference if your house is near the MRT now?

Anyone who tries to rent/buy a house knows that there is a premium to be paid when you get a house near the MRT. I myself wanted to get a flat near the MRT because of the convenience.

The future for the MRT lines in Singapore should still be based on the hub and spoke model. This may translate to every housing estate having at least one MRT station as the hub. If this is true, that means in the future, the premium paid for flats near the MRT will be almost non-existent because if every flat is near the MRT, why pay the premium unless your flat is right next to the MRT station (underground)?

In fact, any premium that you pay for the flat should be relative to the distance to the main town centre, or city. That kind of premium will stay throughout the years.

Paying a premium for a flat near an MRT may "depreciate" over the years, so beware of paying too much for such a flat. Why did I suddenly think of this? That's because of the news recently where developers put "planned" MRT stations (which may not even be true, according to URA) near their development.

Why did they do that? So that they can charge buyers higher lah. So buyers beware.

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