Huttons’ comments on Jan 2023 developer’s sales
The property market received a boost in sales and confidence in January 2023. Developer sales jumped 130% to 391 units in January 2023 from 170 units in December 2022. On a year-on-year basis, sales were 42.8% lower.
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Sceneca Residence, the first launch in 2023 sold 157 units at a median price of $2,083 psf, accounting for 40.2% of January’s sales. Even without the launch of Sceneca Residence, sales volume in January was higher than December’s, proving that the record low sales in December was a blip.
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Sales in the Core Central Region (CCR) accounted for 158 units or 40.4% of total volume in January 2023. This is almost double the sales volume of 86 units in December 2022. The Outside Central Region sales proportion made up 47.3% due to the launch of Sceneca Residence. The Rest of Central Region rounded up the remaining 12.3%.
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Foreigners are also back in force in January. They picked up 57 units in January, 58.3% higher than a month ago. The relaxation of border controls by China on 8 Jan 2023 saw the return of the super wealthy Chinese to Singapore.
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Purchases by Residential Status and Price Range in January
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The super wealthy Chinese were said to be behind some of the purchases in Klimt Cairnhill in January, pushing the project to become the number three bestselling project in January. 14 out of 17 units at Klimt Cairnhill were sold to foreigners. One of the reasons why the Chinese zoomed in on Klimt Cairnhill was the availability of large units which were more than 2,000 sq ft. 15 of the 17 units sold at Klimt Cairnhill were above 2,000 sq ft.
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Terra Hill, a 270-unit freehold project along Yew Siang Road will be launched for sale in February. The project is at the doorstep to the future Greater Southern Waterfront, possibly the biggest transformation plan for Singapore after Marina Bay. Terra Hill is surrounded by low density developments and lush greenery. It has direct access to Kent Ridge Park that will bring residents to Hort Park and the Southern Ridges. When the Circle Line MRT closes the loop, getting to the CBD is a short train ride away.
After Terra Hill, The Botany at Dairy Farm and Blossoms By The Park may be launched in March. This is likely to be followed by Tembusu Grand and The Continuum in April.
2023 could be the year where the luxury market sees more high-profile deals with the return of super wealthy Chinese. This may not be fully reflected in caveats as it is not compulsory to lodge a caveat. Some of these deals may have a different deal structure or be purchased under a non-China passport. The super wealthy are looking at large format units for their own stay. There is limited supply of large format units in the market.
The increase in buyer stamp duty is unlikely to dent the attractiveness of Singapore’s residential properties in the eyes of buyers. Foreigners are likely to view the increase in property tax as a transaction cost and a safe haven premium on properties in Singapore. Most HDB upgraders buy below $2 million and should be able to pay this marginal increase in property tax. Overall sales could be between 9,000 and 10,000 units while prices may increase up to 5% in 2023.
