Growth in private residential property prices slows to 0.7% q-o-q in 1Q2022
/ EdgeProp Singapore |
Private residential property prices in Singapore rose 0.7% q-o-q in 1Q2022, largely supported by the landed property market (Photo: Samuel Isaac Chua/The Edge Singapore)
SINGAPORE (EDGEPROP) - Private residential property prices in Singapore rose 0.7% q-o-q in 1Q2022, a marked decrease compared to the 5% growth logged in the previous quarter, according to data released by the URA on April 22.
Source: URA
The slower pace of growth comes on the back of property cooling measures announced last December. “Last quarter's price growth was the slowest price increment since 2Q2020 when prices rose by 0.3%,” notes Christine Sun, senior vice-president of research & analytics at OrangeTee & Tie.
Prices for non-landed residential properties contracted for the first time after seven consecutive quarters of expansion, declining 0.3% q-o-q in 1Q2022, underpinned by prices in the Core Central Region (CCR) and Rest of Central Region (RCR) which fell by 0.1% and 2.7% respectively.
However, prices of non-landed properties in the Outside Central Region (OCR) grew 2.2% q-o-q in 1Q2022, points out Nicholas Mak, head of research & consultancy at ERA Realty. He believes prices there have remained resilient thanks to strong demand from upgraders which outstripped the supply of private homes in the suburbs.
The landed property market continued to rake in a strong performance, growing by 4.2% q-o-q in 1Q2022. “The fact that the URA All Residential Price Index even showed an increment in 1Q2022 at all, was contributed by the landed market which appears to be impervious to the cooling measures,” remarks Leonard Tay, head of research at Knight Frank Singapore.
Landed property prices were supported by strong demand, coupled with low levels of unsold stock. “The level of unsold stock in the market at 14,362 units in 1Q2022 is at one of the lowest points in recent years,” comments Lee Sze Teck, senior director (research) at Huttons Asia.
Overall, a total of 5,343 private homes excluding executive condominiums (ECs) were sold in 1Q2022, dropping 32.6% q-o-q from the 7,925 units transacted in 4Q2021. Sun notes this is the first time sales transactions fell below 6,000 units since 2Q2020 when 2,664 private properties changed hands, during the “circuit breaker”.
Consultants also highlight that the proportion of resale transactions in 1Q2022 stood at 63.2% of total transactions, higher than the 59.9% in the previous quarter, as developers remained tentative on new launches, prompting more buyers to opt for the secondary market. Only 613 units launched for sale in 1Q2022, which is a 19-year low, according to Huttons’ Lee.
Source: URA
In the rental market, private property rents grew 4.2% q-o-q in 1Q2022, faster than the 2.6% increase seen in 4Q2021. Tricia Song, head of research, Southeast Asia, at CBRE, attributes the faster pace to construction delays and higher demand as foreign arrivals have increased.
Looking ahead, consultants expect the market to pick up as uncertainty over the cooling measures dissipates and more launches take place. The 616-unit North Gaia EC project recently opened for public preview on April 7, while other upcoming launches include Piccadilly Grand, LIV @ MB and Atlassia.
Private property prices are expected to remain supported by strong upgrading demand low unsold inventory, though the pace of increase this year will moderate compared to last year, when prices surged 10.6%. A number of consultants, including Huttons’ Lee, CBRE’s Song, and ERA’s Mak anticipate prices to expand at a range between 2% to 5% in 2022.
In the rental market, rents are also poised to rise further, driven by new homeowners seeking interim housing while waiting for their houses to be completed, as well as demand from expatriates and foreigners as Singapore reopens its borders.
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