5 misconceptions people already have about Tengah

Tengah Forest Town is all over the news, and already the misconceptions have begun. Whenever a big project like this is announced, some hype is inevitable. But while it’s great that something is finally being done with Tengah, (in our opinion, a patch of land with as much development as the Sahara desert) we should hold on before rushing into it. Here are the common misconceptions we’re hearing:

1. It will be a business hub, comparable to Jurong or Paya Lebar

Not quite. Tengah Forest Town is going to be primarily a residential area. There will be some non-residential spaces, but nothing close to the dense cluster of office buildings we’ll see in Jurong Gateway or Paya Lebar Central. If you’re under the impression that this is meant to be “another Central Business District (CBD)”, you’re mistaken.

In fact, we’re quite certain that the area will be extremely light on non-residential spaces (barring shopping and eateries). From what we understand, significant effort has been made to hide the more urban elements. For example, roadways for vehicles will be built underneath a pedestrian friendly park. We wouldn’t expect an abundance of offices and factories here.

This is most relevant to landlords, who might be hoping for rental yields. If you’re one of them, we can tell you now your sights should still be locked on Jurong or Paya Lebar – Tengah is very much for the home owner type.

2. Tengah’s accessibility issues will be fixed

This may be true in the long run, but from what we’ve seen so far, it will still be quite out of the way. For starters, Tengah Forest Town is around the Jurong West / Choa Chu Kang area – this is far from central. Now if there were more MRT stations or bus routes, that could obviate the issue; but we notice there is no plan to connect Tengah to the MRT lines anytime soon.

If residents have to use the Jurong or Choa Chu Kang MRT stations, it could be quite inconvenient to get to and from home. On top of that, we’ll have to see how the “car light” plan pans out: not admitting vehicles onto the street (even if they are underground) could mean a double whammy – restricted private transport, plus limited public transport.

Most of the plans explain how Tengah will be more self-sustaining, with its own parks, recreation, and other amenities. But there’s nothing addressing the accessibility issue, which is going to remain a bugbear.

3. The area is set to become a property hotspot in 2018

The money hunters are already murmuring about this. No, no, no. The first few flats will be built in Tengah by 2018 – that’s the announcement that’s out. There hasn’t been any actual word on which of the amenities will be ready by then.

The Urban Redevelopment Authority has pointed out that Tengah is going to be developed over 20 years, eventually capping out at around 42,000 new homes. It’s likely that prices in Tengah, even in 2023, will probably be equivalent to those in non-central areas like Punggol.

Now we’re not saying that’s bad; over a home owner’s long staying period (say 25 to 30 years), they will almost certainly see significant appreciation. Just like Jurong in the past, the first movers into the Tengah area are buying with prices “at the ground floor” (cheap in comparison to how much they can grow).

But thinking Tengah property will heat up in 2018, or just beyond, is a gross overestimation. If you’re a young couple eager to upgrade in under 10 years, you could be disappointed by buying your first flat here. We wouldn’t count on it appreciating so much, quite so soon.

4. Jurong Innovation District will put tenants and residents in Tengah

This has been been cited quite often. While it’s true the Jurong Innovation District is within the proximity of Tengah, we doubt if this will necessarily benefit Tengah. This is the type of speculation that seems to makes sense in theory, but may not play out in reality.

For example, we have seen little sign of prices or rental in Kallang or Kembangan rising, even with the development of Paya Lebar Central this year. But what about rising prices in Clementi, which is close to Jurong Gateway?

Well, it’s difficult to ascertain if there will be spillover from Jurong. In fact, it’s more probable that prices are rising because amenities in Clementi are being built up. Appreciation is more likely due to Clementi Mall going up in 2011, rather than Jurong having more offices.

Anyway, Jurong Innovation District is set to be complete in 2022 – that’s too far away to start making predictions of how it will affect Tengah. Prospective landlords would be making a lot of assumptions, if they count on Jurong to drive up demand.

5. It will be packed and prices will rise with demand

Tengah is huge. We mean really huge; with 700 hectares it’s almost on par with Bishan. And most of Tengah is open space right now. There may come a time when Tengah is packed with homes and demand runs high, but by then you’ll probably need bifocals to read this.

Even with the development plans and the “cool” factor of being the first car-free town centre, we wouldn’t count on high demand. Ultimately, the first batch of residents (and tenants) in Tengah will have a lot of open space to choose from. 42,000 new homes is a lot of supply to be soaked up, so don’t hold your breath waiting for a profit.

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Will you buy a property in Tengah? Let us know in comments section below.

If you found this article helpful, 99.co recommends Tengah to be a forest town – but is there enough appeal? and 7 things to know about Tengah BTO.