Shophouses exude an air of nostalgia. They’re unique properties packed with culture, tradition, and authenticity.
It’s no wonder they’re so in vogue today.
Most people buying shophouses either rent them to businesses, make them their family homes, or keep them as assets. In fact, there are shophouses in Singapore that’s converted to co-living spaces!
Regardless of your reasons for buying one, you’re making the right choice.
We’ll tell you why below and also how to ensure converting a shophouse doesn’t spoil its value.
1. Shophouses Have Excellent Property Value In Singapore
The early Chinese immigrants arriving in Singapore with blueprints for their bamboo houses didn’t imagine the value their homes would have so many years later. The most famous of these expensive shophouses is one in Tanjong Pagar, whose value increased by almost $3 million between 2013 and 2017.
Here’s why that happens:
Firstly, the location. Most shophouses are near or in the Central Business District (CBD), so they’re where life happens in Singapore. That’s essential if you want to buy or rent such a shophouse for your startup.
And here’s another advantage:
Colliers International says that shophouses rental yield can reach 2.7%, an excellent figure for investors. Data shows you won’t have any problems finding yourself a tenant because shophouses have specific personalities. Unlike modern malls that look the same wherever you are in the civilised world, shophouses have unique characters.
That’s precisely what companies want: to showcase their uniqueness.
For example, Chye Seng Huat Hardware would have looked – and also possibly been named – like your average café, was it to be in a mall. Shophouses’ value is also high because they’re architectural gems. You’ll see different shophouse styles and designs throughout Singapore.
These unique designs increase your property value because:
- They exude a particular atmosphere that can attract more customers
- The person or business renting the property doesn’t have to do a lot of alterations to create a specific style
2. Shophouses Will Keep That Value
Many investors don’t care about traditions and architecture. They’re not even that interested in a property’s current price if they think that price will plummet soon.
But here’s the thing:
Shophouses hold value over time because they represent cultural landmarks. Much like the famous Renaissance buildings in Europe, these shophouses in Singapore have rich histories and awe-inspiring designs.
Shophouses remind of the old Babas and immigrants arriving in Singapore: hardworking, simple, and with an acute sense of beauty. So these features outline Singapore’s specific spirit – from its beginning until today.
And, of course, rare cultural landmarks have scarcity value. But we’ll discuss that in the next section.
Here’s what that means:
You can be reasonably sure these shophouses won’t go out of style and won’t devalue in a weak market. The best example is Spanish tycoon Ricardo Portabella Peralta paying $2,600 PSF for two shophouses in 2015 when property prices were 3.7% lower.
3. Shophouses Are Rare
There are 6,500 conserved shophouses in Singapore in districts like:
- Boat Quay
- Emerald Hill
- Kampong Glam
- Little India
Of course, that means you’ll have some restrictions regarding how you renovate them. For example, you might not like having to ask for permission, even for something as banal as installing an AC.
But these tedious formalities are worth it if you consider these advantages:
Properties that have the conservation status:
- Are left untouched by the government when building new things, like roads
- Have scarcity value, just like gold or collectors’ items. That means the rarer something is, the more it costs. And since you can’t make any more new shophouses, the existing ones’ value will only increase.
4. Shophouses Are Much Larger Than Other Property
Shophouses have more room than landed property or mall spaces. So even though you’ll find shophouses in Singapore in congested areas like CBD or Chinatown, these properties are broad.
- They were built before these areas existed. When shophouses were built, Singapore wasn’t teeming with life as it is now, so people had a lot of space for their plans.
- Shophouses have a lot of space outdoors. Many of them feature open fronts or yards in the back, which translates into extra space. For example, a restaurant can set up a playground for guests’ kids outside, or a bridal boutique can boast a garden café.
- Shophouses feature air wells. These air wells allow more air circulation and natural light, but you can also use them to your advantage design-wise. For example, imagine how well an indoor garden would complement a spa.
5. Shophouses Have A Rich History
We already mentioned the Babas and early Chinese immigrants who used to live in these bamboo houses. Their lifestyles are perfectly reflected in these two-centuries-old buildings.
For example, the first shophouses are no-frills, basic buildings with lowly materials like clay-tiled roofs. The transitional style sees more ceramic or porcelain mosaics because the original settlers made Singapore their home. During that particular time, people knew they’re going to remain in Singapore.
Besides, the mix of electric colours and unique imagery is entirely astounding.
These rich Chinese decorations are based on lucky charms like animals, plants, and even Sikh guards. The overall design looks almost schizophrenic, though you can see newer shophouses built in the Art Deco style if you’re a fan of straight lines and geometric patterns.
Shophouses are a treasure trove of culture, mystery, and uniqueness. Anybody residing in a converted shophouse today will breathe in that atmosphere day after day. Conversely, any business that operates from a shophouse exudes an air of authenticity and showcases its unique values.
The Assembly Place has a successful track record of converting shophouses into co-living spaces. Not only are more people able to enjoy the culture and architecture of the shophouses, they are able to find a home as well!
Why not take a walk around Singapore to experience the beauty of shophouses over the weekend?