APPD Market Report Article

Singapore

August 26, 2022

Ong Teck Hui, Senior Director - Research, Singapore

14.2%

SGD 5.46

Rents
Rising

Prime new home sales surge despite lack of fresh launches

  • Primary market sales volume surged 64.9% q-o-q in 2Q22, although there were no new prime projects launched. Top-performing projects during the quarter include Leedon Green, which sold 50 units at a median price of SGD 2,791 per sq ft, and Irwell Hill Residences, which sold 49 units at a median price of SGD 2,821 per sq ft.
  • Over in the prime resale market, sales volume was 42.0% higher q-o-q with better demand for prime resale homes. Overall, total prime sales volume rose 52.3%, as buyers gradually regained confidence in the market. Market sentiments have largely recovered since cooling measures were imposed in December 2021.

Completed supply to rise from 2022 onwards

  • In 2Q22, a condominium development known as The Hyde completed construction for its 117 units. 8 Hullet, a 44-unit residential development also received its Temporary Occupation Permit (TOP) during the quarter. Limited completions during the quarter contributed to a drop in vacancy rates.
  • Completed supply is expected to rise in 2022 partly due to construction delays carried forward from 2021. It is also expected to rise further in 2023 as new developments arising from the 2017 and 1H18 land sales complete their construction.

Stronger increases in prime prices and rents

  • Prime prices rose at a faster pace in 2Q22 compared to the previous quarter, supported by stronger buyer demand amid declining unsold stock.
  • Rents of luxury prime and typical prime properties also strengthened in the quarter. Improved hiring by businesses and limited new completions supported growth in the leasing market.

Outlook: Macroeconomic uncertainties could slow demand in 2H22

  • Rising inflation and interest rates, coupled with forecasted slower economic growth, could temper buyer demand in the second half of the year. That said, prices are expected to continue rising at a more moderate pace, supported by declining unsold stock.
  • Prime rentals are expected to continue increasing in the second half of the year as leasing demand is likely to exceed the supply of units available for rental.

Note: Singapore Residential refers to Singapore's overall prime and luxury residential markets.

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