Living in a tiny apartment might be a claustrophobic nightmare for some, but the prospect of a home, however small, that is affordable and centrally located is a hard combination to beat. The smallest types, the so-called shoebox apartments - they are less than 500 sq ft - have certainly proved popular, particularly with young singles and expatriate professionals. Consultants say they offer healthy yields of 3 to 4% depending on the project, while residential yields in general hover around 3%. Earlier this year, a 474 sq ft unit at Robertson Edge went for $858,000. Assuming a monthly rental of $3,000, the yield works out to 4%. While there were inconveniences, including clearly the lack of storage space, the ease of upkeep was a big plus. Tenants agreed the city-fringe location of most newly built shoebox developments - but without the sky-high rents - appealed most. Developers use measures such as higher ceilings, more windows and a more squarish layout to make the space seem larger. Experts say shoebox units are fetching healthy rents now as there are not many of such completed projects. Some of the smallest ones, such as Suites@Guillemard with units under 300 sq ft, are not ready yet. But ERA Realty key executive Eugene Lim said the test will be to see if rents hold even when thousands of completed shoebox units enter the market over the next few years.
- The Straits Times, B16
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