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Singapore: Number of condo units resold falls by 17.9% in April as prices go up by 1.2%
SINGAPORE – Fewer resale condominium units changed hands in April, while prices inched up by 1.2 per cent, according to flash data released by real-estate portals 99.co and SRX on Tuesday.
An estimated 919 units were resold, a 17.9 per cent decrease from the 1,119 units resold in March.
Prices of resale condo units in central Singapore rose 2.3 per cent, and by 1.7 per cent for those in the city fringes. On the other hand, prices of units in the suburbs fell marginally by 0.3 per cent.
On a year-on-year basis, overall condo resale prices were up by 8.7 per cent.
Property analysts attributed the lower resale demand to some buyers turning to private home launches, as well as high borrowing costs and limited condo resale stock.
Some expect the resale market to continue slowing down in the coming months due to the economic uncertainty brought about by the United States Federal Reserve’s interest rate hikes.
ERA Realty Network key executive officer Eugene Lim noted that private home developers’ sales rose by 80.3 per cent to 887 units in April, setting the record for the highest sales volume in the past seven months.
“Home buyers may have likely diverted their attention to new launches rather than resale as developers are launching a wide spectrum of new projects that cater to both owner-occupiers and investors,” he said.
Mogul.sg chief research officer Nicholas Mak said some buyers may have opted to buy new condo units as payment is spread out over three to four years while the project is being constructed. This could lighten the financial burden on home buyers, especially given the high interest rates now, he noted.
In comparison, a buyer of a resale unit would have to fork out the full sum of the property price and other related costs like stamp duties within weeks after the property is acquired, he said.
PropNex head of research and content Wong Siew Ying said some prospective buyers may be taking more time to review their options amid the high interest rate environment, which tends to weigh more on the resale market than new home sales.
She also expects the stock of resale units to remain limited. Some condo owners are reluctant to sell their homes because of policy-related reasons such as the 15-month wait-out period before private home owners who sell their units can buy an HDB resale flat.
The recent increase in additional buyer’s stamp duty (ABSD) rates may also have prompted some owners of multiple properties to hold onto the investment units that they bought when rates were lower as they will have to pay a much higher ABSD if they decide to buy another residential property down the road, Ms Wong said.
With the rental market still healthy, many of such owners have opted to lease out their units instead, she added.
The latest ABSD rate hikes, which took effect on April 27, include the doubling of stamp duty rates from 30 per cent to 60 per cent for foreigners buying residential properties.
While the impact of the higher ABSD has yet to be felt, foreign demand for condo resales may dampen in the coming months, said 99.co chief data and analytics officer Luqman Hakim.
Huttons Asia chief executive Mark Yip said the overall impact of the ABSD rate hikes is still manageable as locals and permanent residents make up around 95 per cent of resale condo buyers.
Looking ahead, ERA Realty Network’s Mr Lim said condo resale prices could continue to rise as new projects are sold at benchmark prices.
“Resale home owners are likely to increase their selling prices in tandem as they would need to price their units higher in order to purchase a replacement home,” he added.
The highest transacted price for a resale condo unit in April was $18 million at Sculptura Ardmore, a freehold development in the Tanglin/Holland area.
In the city fringes, the highest transacted price was $7.9 million for a 99-year leasehold unit at Reflections at Keppel Bay in the HarbourFront area.
In the suburbs, a freehold unit at Ocean Park in the East Coast/Marine Parade area was resold for $3.68 million.
Source: https://www.straitstimes.com/singapore/condo-units-resold-fell-by-179-in-april-prices-up-12