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Tue, September 08, 2020 – 11:31 am
UPDATED Tue, Sep 08, 2020 – 12:45 pm
Resale volume of private ungrounded homes in Singapore hit a two-year high in August 2020, with an estimated 1,052 units resold in the month, up 7 percent from the 983 units resold in July 2020.
Overall resale prices were up 0.4 percent month-over-month and year-over-year, according to advance figures from real estate portal SRX Property on Tuesday.
This occurs as the housing market recovers from the slowdown experienced during Singapore’s “blackout” period, benefiting from pent-up demand.
Christine Sun, Head of Research and Consulting at OrangeTee & Tie, said the August 2020 “stellar sales” for the private resale market appear to be in tandem with the positive sales trends seen in other market segments.
These market segments include the HDB resale market and make-to-order sales, which have shown similarly strong demand levels. Citing URA warning data, Ms. Sun said that new home sales, excluding executive condos, reached more than 1,200 units in August during Hungry Ghost Month. These were the highest sales achieved in the last 12 months.
By region, SRX said 59.5 percent of the units sold came from sales abroad of the central region (OCR), 20.8 percent from the central central region (CCR) and 19.7 percent from the rest of the region central (RCR) or periphery of the city.
Condo prices in CCR and RCR decreased year-over-year by 3.1 percent and 1.7 percent respectively, while OCR prices increased by 2.8 percent.
Nicholas Mak, head of research and consulting at ERA Realty, said the stable price index and the expansion in resale volume in August indicated that sellers weren’t cutting prices significantly to sell their properties.
“At the same time, some home buyers were defying the Month of the Hungry Ghost to seal the real estate deals,” he added.
Hilltops had the highest transaction price for a resale unit in the month, with one unit sold for S $ 8.4 million. On the RCR, the highest transaction price was S $ 5.1 million for a unit in Amber Skye, while the OCR The highest transaction price was for a unit at Grand Duchess in St Patrick’s, resold for S $ 3.6 million.
In August, SRX’s general transaction on value X (TOX) had a negative value of S $ 3,000, an increase of S $ 7,000 from the negative of S $ 10,000 in July 2020.
District 1 (Boat Quay, Raffles Place, Marina) posted the highest mean TOX with S $ 22,600 positive, while District 10 (Tanglin, Netherlands, Bukit Timah) posted the lowest mean TOX with S $ 33,5000 negative .
TOX measures how much a buyer pays more (positive value) or less (negative value) for a property based on SRX’s computer generated market value. The data includes only districts with more than 10 resale transactions.
Wong Siew Ying, head of research and content at PropNex, said the spike in sales in recent months likely indicates that the worst is over, paving the way for resale market activities to return to normal.
“We would expect resale prices to remain relatively flat in the coming months as the bleak economic outlook and low sentiment weigh on the ability of sellers to increase sales prices substantially,” he said.
Ms Wong added that buyers are likely to be cautious and prudent in their purchases, aware of the potential downside risks ahead, including the weaker contracting market.
Ms Sun said that for many Singaporeans, residential properties can remain a “safer bet”, especially for investors seeking stable returns in uncertain times.
“The exuberance of the primary market market may have extended to the secondary market as well, as opportunistic buyers are currently looking for undervalued resale properties in the market,” he said.
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