SINGAPORE’S condominium resale prices rose for the 22nd straight month in May 2022, rising 1.6 per cent month on month and 8.4 per cent when compared to the same month the previous year.
In a flash report released on Tuesday (Jun 14), SRX Property and 99.co said growth was led by resale price increases in the outside central region (OCR) and the rest of central region (RCR), where prices rose 0.7 per cent and 0.5 per cent, respectively.
Both regions experienced on-year growth of 5.4 per cent and 10.7 per cent.
While resale prices in the core central region (CCR) fell 1.2 per cent month on month, they remained up by 6.2 per cent when compared to the previous year.
The highest transacted price for a resale unit in the month was S$20 million for a unit at The Nassim (CCR). Within the RCR, a unit Silversea resold for the highest price at S$4.85 million during May 2022 – while the highest transacted price in the OCR was a unit at Clementi Park, which resold for S$6.5 million.
According to ERA Realty Network’s head of research and consultancy Nicholas Mak, the uninterrupted 22-month growth streak for condominium resale prices is the longest since the index was made available about 9 years ago.
He partially attributes the continued price growth and sales recovery to the strong take-up of successful and major launches such as Piccadilly Grand and Liv @ MB, which had a “positive impact on the sentiments in the overall property market and the prices in the resale market”, in his view.
About 1,572 units were estimated to have been resold over May 2022, which is 40.2 per cent higher than the 5-year average volumes for the month of May.
While volumes were 11 per cent lower than that of May 2021, this represented a 1.6 per cent increase from the actual 1,547 resale units recorded the previous month - which exceeded SRX and 99.co’s previous flash estimate of 1,368 units for April 2022.
The majority 60.2 per cent of resale volumes came from OCR, while 24.7 per cent and 15.1 per cent of volumes were transacted from RCR and CCR, respectively.
Wong Siew Ying, head of research and content at PropNex Realty, noted that average selling prices of new projects in the OCR region are expected to remain firm despite upcoming project launches slated for Q3 of 2022.
This may have potentially led certain price-sensitive homebuyers to explore resale options in the OCR region, she said, adding that the “dearth of new mass-market launches” could have also funneled some buyers to the resale segment in May.
Huttons Asia chief executive Mark Yip believes May’s resale market demand was mainly driven by the depleting level of unsold stock in both the OCR and RCR, as the successful launch of 2 projects in the latter region resulted in spillover demand and helped to boost prices in both regions.
Overall median capital gain for May stood at S$280,000, up S$30,000 from the month before.
District 10 (Tanglin / Holland / Bukit Timah) posted the highest median capital gain for the month at S$530,000. On the other hand, District 2 (Chinatown / Tanjong Pagar) recorded the lowest median capital gain at US$97,000.
Commenting on the rise in resale volumes over recent months, OrangeTee & Tie’s Christine Sun believes the market seems to have bottomed out and may be on the road to recovery after property cooling measures were implemented in December 2021.
The senior vice-president of research and analytics noted a general improvement in buying sentiment across different housing segments including new homes - and may pick up further in the coming months amid growing macroeconomic uncertainty as investors turn to safe-haven assets such as properties.
Citing low supply particularly in the suburbs, Sun is expecting more buyers to turn to the resale market going forward, especially those seeking to upgrade from HDB (Housing Board) homes.
“Many buyers have returned to the market after reopening our borders and substantially relaxing the safe management measures. Viewing restrictions were mostly removed, and more potential buyers could view homes,” observed Sun.
Yip of Huttons Asia also expects the return of foreigners to Singapore’s property market will support further growth in condo resale prices for the rest of 2022. He however anticipates a “quiet” market in June, in view of the school holidays and no new planned project launches.