Luxury non-landed residential sales fall 43.7% in 1H2022: Knight Frank
By Hailey Yu
/ EdgeProp Singapore |
Draycott Eight, where 22 luxury apartments was sold to an Indonesian family for a total estimated value of $168 million (Credit: Samuel Isaac Chua)
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SINGAPORE (EDGEPROP) - Luxury non-landed residential sales reached $1.1 billion in the first half of this year, sliding by 43.7% from the second half of last year, according to a Knight Frank report released today (July 12).
The first quarter recorded a sharp decline of 50.6% q-o-q in prime non-landed residential sales, due to additional buyer’s stamp duty hikes for foreign buyers imposed in December last year. In the second quarter, prime non-landed residential sales recovered by 29.4% q-o-q as business sentiments improved and investors looked to Singapore as a safe haven in the midst of global uncertainty.
“Nevertheless, a lack of saleable stock in family-sized units continued to limit sales,” says Nicholas Keong, head of private office at Knight Frank. “Foreign buyers’ interest included the sale of 22 luxury apartments in Draycott Eight to an Indonesian family for a total estimated value of $168 million.”
Top quantum sales continued to come from new projects like Les Maisons, which clocked the top three highest transactions in value for 1H2022. Unit prices ranged from $4,953 to $5,461 psf (or $34.6 million to $59.8 million). The fourth highest transaction in value for 1H2022 was a resale unit at The Nassim which was sold for $20 million, indicating “demand for luxury-sized units in pristine ready to move-in condition”, says Keong.
Keong anticipates demand for luxury non-landed homes, especially fully-furnished larger-sized units ready for immediate occupancy, to remain strong in 2022, as international travel returns to pre-pandemic levels.
Based on URA data, prices for landed homes continued to increase in the second quarter by 2.9%, bringing the price growth to 7.3% for 1H2022. The half-yearly growth was steeper than 6.3% in 1H2021, despite cooling measures enacted in December last year.
“Transaction value for landed homes reached a total of $2.9 billion in 1H2022, a 46.9% decline from $5.4 billion recorded in 2H2021,” states the Knight Frank report.
Incongruity between the expectations of buyers and sellers, as well as spikes in premiums for landed homes, led to slower sales in 1H2022, explains Keong. Average unit prices rose by 14.5% over the past two years as the pandemic heightened demand for bigger living spaces.
42 Chancery Lane (Credit: Samuel Isaac Chua)
Lacklustre sales in the Good Class Bungalow (GCB) segment continued from last year, declining by 55.3% in 1H2022 from 2H2021, caused by weaker economic conditions and price resistance from sellers who were unwilling to reduce price expectations. However, prime sites with attractive plot sizes were still being transacted. Recently, a GCB with a land size of 34,216 sq ft on 42 Chancery Lane was bought by the daughter-in-law of Filipino tycoon Andrew Tan for $66.1 million, according to Keong.
Keong expects transaction activity to moderate due to a weaker global outlook, with landed home prices increasing by 10% in 2022.
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