Demand for Luxury Property Pick Up Pace

Private home prices in Singapore increased for the third quarter in a row, defying the Covid-19 pandemic and a slowdown.

According to flash estimates released by the Urban Redevelopment Authority (URA) on Monday, the overall price index for private residential properties rose 2.1 percent in the fourth quarter of 2020, faster than the 0.8 percent increase in the third quarter.

This is the most significant quarterly rise since the second quarter of 2018, when private home prices increased by 3.4% until property calming policies were implemented in July of that year.

Hyll on Holland Living Room

Private home values, on the other hand, rose by 2.2 percent in 2020, less than the 2.7 percent rise in 2019.

Prices of private homes in the remainder of Rest of Central Region (RCR) and core central region (CCR) increased by 4.8 percent and 3.3 percent quarter-on-quarter, respectively, driving the price surge in the fourth quarter.

Outside the central area (OCR), prices increased by 1.7 percent, the same as the previous portion.

RCR and OCR prices rose the most in 2020, by 5.1 percent and 3.1 percent, respectively, while CCR prices declined by 0.2 percent.

Hyll on Holland

According to Ms Christine Sun, head of analysis and consulting at OrangeTee & Tie, several new ventures unveiled in the fourth quarter of 2020 could have sent prices up.

The Landmark had a median price of $2,137 per square foot (psf) in the RCR, while The Linq @ Beauty World in Upper Bukit Timah had a median price of $2,171 psf, both higher than the $1,813 psf median price for all new condo units in the area in 2020.

The median price of new units in the OCR was $1,637 psf at Clavon in Clementi, $1,766 psf at Ki Residences in Brookvale, and $1,624 psf at Midwood in Hillview.

In 2020, all of these projects sold for more than the $1,547 psf median price for all new condo units in the region. Many recently launched condo developments have also seen price increases, according to Ms Sun.

The median price of Fourth Avenue Residences in Bukit Timah, for example, increased from $2,258 psf in the third quarter of 2020 to $2,296 psf in the fourth quarter of 2020 in CCR. Over the same time frame, prices at Kopar at Newton have risen from $2,384 psf to $2,433 psf.

Other projects, such as Treasure at Tampines, Jadescape, and Forett at Bukit Timah, have seen similar price increases, according to Ms Sun.

Ms Sun expects home prices to rise by 1 to 4 per cent this year for private property, while projects launched by developers could see faster price rises of 2 to 5 per cent.

Les Maisons Nassim, a Freehold Luxury condo by Shun Tak Holdings set to launch in 2021 as demand for luxury condos pick up pace as more Work From Home (WFHM) in this post covid-19 pandemic

“The growing vaccine excitement and the reopening of Phase 3 could boost buyer sentiment even further. A variety of blockbuster releases may be launched in the luxury and city fringe areas which could uplift the overall price index,” she added.

She mentioned that there has been “renew demand” in resale private homes in recent months, and that she expects resale prices to rise by 1 to 4% in 2021.