What Is A Cluster House in Singapore? 3 Disadvantages of cluster housing (Photo Pexels Expect Best)

Longing for a landed home, but wish it could have enticing condo-style facilities such as swimming pools, gyms, well-maintained gardens and 24-hour security?

A cluster house might be your dream come true.

Once rather exotic hybrids, cluster houses are getting popular, with more projects coming on the market.

What Is A Cluster House in Singapore?

Basically landed homes with a strata title, a cluster development can comprise terraces, semi-Ds, bungalows or a mix of these, but they all share facilities within the development.

Cluster house example in Singapore: Illoura

Take the landed project, Illoura, for example. Located within the prestigious Old Holland Road area amongst an enclave of Good Class bungalows, the freehold Illoura comprises 30 four-storey detached and semi-detached cluster houses that overlook a 25m long lap pool, water features and lushly landscaped recreation areas.

The asking price for a home in Illoura is around $4.5 million to $5.3 million (about $1,219 psf) for sizes ranging from a spacious 4,176 to 4,563sqf.

While $5 million may seem steep for a strata home, cluster houses are in demand.

Cluster house example in Singapore: Hillcrest Villa

Semi-Ds at Hillcrest Villa, a 99-year cluster project at Hillcrest Road which launched in 2009 at $850psf, are being snapped up for $950 – $1,000psf.

The 163-unit Hillcrest Villa enjoys a prime location fronting leafy Watten Estate. It’s a short walk from elite Nanyang Girls School, Raffles Girls Primary School and National Junior College and the upcoming Tan Kah Kee MRT Station.

Cluster house example in Singapore: The Greenwood

Also, Far East Organization’s The Greenwood at Greenwood Avenue nestled in premium Watten Estate, is also selling well. Prices cost around $3.2m for an approximately 3,000sqf two-storey terrace house (about $1,000psf ), with a 103-year lease starting from 2008.

What Is A Cluster House in Singapore? 3 Disadvantages of cluster housing (Photo Pexels The Lazy Artist)

Cluster House vs Landed Houses

To the uninitiated, cluster homes look exactly like regular landed homes. Both are usually at least two storeys high and located within zoned landed or mixed landed estates so they blend in.

However, property pros warn that some bullish developers are charging a stiff “bungalow premium” by pricing cluster and landed homes in the same location similarly, even though they don’t have the same property rights.

These developers use the skyrocketing per-square-foot price of land in premium estates to calculate their project’s psf price.

“Because their property rights are inferior to normal bungalows, in theory they should fetch lower prices. If they are priced higher, ask why,” warns Colin Tan, Director of Research, Suntec Chesterton.

Indeed, there is an important difference between a cluster bungalow and a Good Class Bungalow (GCB) next door.

Strata title vs Land title

With a conventional bungalow, you own the land on which your property sits. With a cluster bungalow, you are accorded a strata title, which entitles you to a share of the whole estate – meaning you have joint ownership of the land as well as of the common areas like walkways and gardens.

Unlike individually owned landed properties, strata-titled properties are normally priced calculated based on built-in area or floor area.

Comparison of prices of normal landed properties is usually on a psf basis on the land area.

Land titles are calculated based on land area with some premium for the house – the older the house, the less premium it commands.

Strata Title: Pay monthly maintenance fees

Owning a strata title means you’ll need to pay a monthly maintenance fee for upkeep purposes.

For instance, owners of the 163 homes at Hillcrest Villa pay about $200 a month. But residents of the much smaller Illoura pay about $1,400-$1,500 as the costs are shared amongst just 30 units.

You will also be bound by condominium rules.

Larger strata value, pay more in maintenance

If you buy a bungalow or semi-D in a mixed development, you’ll find yourself paying a great deal more towards any upgrading than your apartment-owning neighbours as you own more share value units. If there is a need to repaint the tower block or replace the lifts, you, as an owner of a “very large apartment”, will have to fork out a larger amount for a facility you don’t use.

Strata titles don’t get to rebuild or alter facades

Another implication is that, unlike owners of conventional landed homes, owners of cluster houses do not have the flexibility of rebuilding their properties, or making changes to the external facade, without the approval of the condominium’s management committee.

What Is A Cluster House in Singapore? 3 Disadvantages of cluster housing (Photo Pexels Almada Studio)

Cluster Houses Advantages

Despite these caveats, cluster houses have their admirers. To this group of buyers, they are still more attractive than individual landed homes as they are new, well-situated and more stylishly packaged.

You also do not have the costs and headaches of renovating a rundown house.

Prime location cluster houses

Developments such as The Teneriffe and Binjai Crest, which are nestled in super-prime areas, are sought after by a niche group of locals and expatriates, says Tay Huey Ying, Collier International’s Director of Research & Advisory.

“They marry the status and appeal of landed properties with the convenience and perks of condominium living, with communal facilities such as swimming pools, saunas and playgrounds.”

Another big draw is the high rentals they can fetch – between $11,000-$14,500. Agents report that a house in newer projects such as Hillcrest Villa and The Teneriffe can command rentals of between $11,000-$13,000, while older ones like Binjai Crest fetch about $8,000. The rental yields can be about four per cent.

For those who value privacy, another appeal is the 24-hour security and seclusion from the main road. “They are usually found within a gated development,” says Tay. “The basement carparks also remove the ills of congested roadside parking often associated with conventional landed estates,” she adds.

“A responsible agent or developer of a cluster bungalow development should highlight the differences between such a development and a conventional bungalow to prospective purchasers,” she adds.

As with all big-ticket purchases and investments, it is up to the buyer to weigh the financial outlay and potential rental yield along with the intangibles of exclusivity, good design and stylish environment.