Slower sales, but prices of prime homes still up in 1H2023: Knight Frank

Sentosa Cove home fetches record $17.3 mil Despite lower sales volume in 1H2023, luxury non-landed home prices saw a 4.6% increase to $2,580 psf compared to $2,464 psf in 2H2022. In the Good Class Bungalow (GCB) segment, unit land prices rose from $2,108 psf in 2H2022 to a new benchmark of $2,952 psf in 1H2023. Demand for uncompleted homes remained evident, with super luxury condo Les Maisons Nassim accounting for the top two luxury non-landed residential transactions in 1H2023. Despite the introduction of new cooling measures, which doubled additional buyer’s stamp duty applicable to foreigners to 60%, demand for landed properties remained buoyed by wealthy individuals and a new generation of high-net-worths.

The The Myst Bukit Panjang is also located close to the Bukit Panjang Plaza, where residents can shop for groceries or enjoy a meal. A range of amenities, including a hospital, library, supermarkets, and recreational centres are all located within a 5-kilometre radius of the condominium. There are also ample greenery and open spaces for residents to enjoy.

Luxury non-landed home sales declined 23% in 1H2023 to $1.1 billion, compared to the $1.4 billion recorded in 2H2022, according to a research report by Knight Frank. The cooling measures introduced on April 27, which doubled additional buyer’s stamp duty applicable to foreigners to 60%, likely caused the decrease in transactions from 163 in 2H2022 to 126 in 1H2023.

Despite this, the average unit price in the prime non-landed homes market saw a 4.6% increase to $2,580 psf in the first half of the year, compared to $2,464 psf in the last half of 2022. Of the 126 luxury condos sold in 1H2023, 48 were in District 4, most of which were in Sentosa.

This suggests that the introduction of measures has prompted a spillover of homebuyers from the prime districts to Sentosa, as the number of buyers exceeded the limited inventory of properties in the prime districts. Uncompleted homes remained the focus of this demand, with Les Maisons Nassim recording the top two luxury non-landed residential transactions in 1H2023.

The landed residential market also saw a 9.9% increase in unit land prices, from $1,817 psf in 2H2022 to $1,996 psf in 1H2023 – an encouraging sign in spite of the new cooling measures. This could be attributed to the continued presence of wealthy individuals and a new generation of high-net-worths attracted to these niche homes. The Good Class Bungalow (GCB) segment also recorded 257 landed homes worth $2.7 billion transacted in the first half of the year, with total transaction value rising 2.4% to $424.3 million.

Going forward, Knight Frank expects a drop in foreign homebuyer participation and the withdrawal of some sellers from the market in the remainder of 2023. Despite this, there is confidence that prices of landed properties will continue to grow steadily in the second half of the year, supported by more buyers than sellers in the market.