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Keith chill

Does increasing your built up area increase your house value in the Long term?

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Hi, just purchased a 2 storey inter terrace with a built up of 2500sf.  The unit is in a 3 storey mixed zone.  Would doing A and A to increase it to 3800 sf built up and 2.5 storey allow this unit to have a higher resale value in the Long run?  Appreciate some advice.

 

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if you want to maximize resale value, you should have bought an old single storey house, tear it down and build up to maximum possible. then stay until the MOP (when you no longer need to pay SSD) is up and then sell the house.

if you are planning to do A&A then stay in the house for 10 years and sell it, whatever your put into the A&A is negligible since by then the original house would be like 20+ or 30 years old? Valuers will not put much value into the house itself and only the piece of land (assuming it's freehold) is valuable.

 

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Unfortunately,  the price of land with a single storey house does not come cheap nowadays as in so far did not come across anything less or around 2mill.  After viewing numerous houses for 9 months, we ended up with a 2 storey one.  I was thinking the built up matters in the valuation as normally they ask for both land size and built up.   Just thinking whether increasing my built up from 2500 to 3500 would help in the future?

 

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9 hours ago, Keith chill said:

Unfortunately,  the price of land with a single storey house does not come cheap nowadays as in so far did not come across anything less or around 2mill.  After viewing numerous houses for 9 months, we ended up with a 2 storey one.  I was thinking the built up matters in the valuation as normally they ask for both land size and built up.   Just thinking whether increasing my built up from 2500 to 3500 would help in the future?

depends on which region you are looking at. there are some old freehold ones which are still priced just below 2M. however, with the upturn of the property market last year, these below 2M houses are lesser and lesser as most sellers increased their asking price by about 10%.

normally when buying freehold landed houses, one would look at the land size rather than the built up. built up area is more for strata landed housing.

valuers ask for land size and built up area since they need these data to do a comparison against similar houses in the same area.

I think you should be focusing on whether the 2500sqf is enough for your family's needs or not rather than focusing on how much increasing the GFA will increase the value. With A&A to increase the GFA, the returns in future value won't be as great as doing a full reconstruction or redevelopment of the house.

 

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On 3/22/2018 at 10:35 PM, Keith chill said:

Hi, just purchased a 2 storey inter terrace with a built up of 2500sf.  The unit is in a 3 storey mixed zone.  Would doing A and A to increase it to 3800 sf built up and 2.5 storey allow this unit to have a higher resale value in the Long run?  Appreciate some advice.

Having a higher build in will definitely increase your overall value of your house due to the increase in GFA, but you will have to check with your architect and consultants whether your existing house structure will be able to take the loading of have another. Alternatively, you can check look around from your neighbour whether there are exisiting A&A are done without a full rebuilt.

 

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On ‎28‎/‎03‎/‎2018 at 9:50 PM, snoozee said:

depends on which region you are looking at. there are some old freehold ones which are still priced just below 2M. however, with the upturn of the property market last year, these below 2M houses are lesser and lesser as most sellers increased their asking price by about 10%.

normally when buying freehold landed houses, one would look at the land size rather than the built up. built up area is more for strata landed housing.

valuers ask for land size and built up area since they need these data to do a comparison against similar houses in the same area.

I think you should be focusing on whether the 2500sqf is enough for your family's needs or not rather than focusing on how much increasing the GFA will increase the value. With A&A to increase the GFA, the returns in future value won't be as great as doing a full reconstruction or redevelopment of the house.

For the old single storey ones lesser than $2mil, probably are those with small plots like in Gembira Macpherson, Jalan Usaha or Opera Estate area.... they are all less than 1500sqft land. Which is rather small for landed.

 

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42 minutes ago, fastfatdude said:

For the old single storey ones lesser than $2mil, probably are those with small plots like in Gembira Macpherson, Jalan Usaha or Opera Estate area.... they are all less than 1500sqft land. Which is rather small for landed.

macpherson area have those 88x sqf landed houses which are still below 2M. opera estate don't have any listed below 2M anymore as of today. even for those units of land size of about 1300/1400sqf in opera estate are listed at 2M and up.

the only "consolation" for those 1300/1400sqf units at opera estate is that usually they have more relax setback rules which allow for the house to be built on a slightly bigger footprint. as these units usually have a backlane at the back of the house, the house is allowed to be built until the rear boundary for 1st storey and setback of 1m (instead of usual 2m) for 2nd storey and the front setback is also more relaxed at 5m instead of the usual 7.5m.

 

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20 hours ago, snoozee said:

macpherson area have those 88x sqf landed houses which are still below 2M. opera estate don't have any listed below 2M anymore as of today. even for those units of land size of about 1300/1400sqf in opera estate are listed at 2M and up.

the only "consolation" for those 1300/1400sqf units at opera estate is that usually they have more relax setback rules which allow for the house to be built on a slightly bigger footprint. as these units usually have a backlane at the back of the house, the house is allowed to be built until the rear boundary for 1st storey and setback of 1m (instead of usual 2m) for 2nd storey and the front setback is also more relaxed at 5m instead of the usual 7.5m.

And I reckon prices for these old single storey ones are continuing  to go up also as supply is diminishing. 

 

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If everything is exactly as you wrote, then there is a good chance to sell the house for a good price. In recent years, it has become fashionable to have a small courtyard, terrace, or something similar. For example, my friend recently bought a  house and land packages. When he was looking for a house, his primary condition was that it had its own plot. He wanted to have a small courtyard that would decorate the exterior of the house. Plants give the house an aesthetic appearance, which makes it look presentable. So, don't worry about the price.

 

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