Chart of the day: See the stunning 81% plunge in the sales volume of retail properties for 1H14

It’s the lowest transaction volume since 2009.

Strata-titled retail properties weren’t such hot commodities in the first half of 2014, as the total strata-titled retail property transaction volume decreased by 68 per cent from 388 transactions in 2H 2013 to 124 transactions in 1H 2014.

According to Knight Frank, sentiment in the strata-titled retail market has been adversely affected by the TDSR ruling, rising operating costs due to the tight labour supply conditions, and growing competition from online retailing

Here’s more from Knight Frank:

The average price of new sale freehold retail properties inched up slightly to $4,824 per sq ft in 1H 2014 with only 22 transactions compared to 104 transactions in 2H 2013. Transactions of new freehold shops were mostly attributed by Macpherson Mall, Novena Regency, Prestige Point, and TRIO. The average transacted price of the most popular freehold project was Macpherson Mall at $4,951 per sq ft.

As for the resale market, top three projects in terms of sales volume were Bukit Timah Shopping Centre, Roxy Square and Katong Shopping Centre. Average resale price of freehold retail properties fell to $2,916 per sq ft in 1H 2014 from $3,209 per sq ft in 2H 2013.

Sales volume of new leasehold strata-titled retail properties plunged 81 per cent in 1H 2014 with 30 per cent decrease in average price (Exhibit 7). The Hillford at 60-year leasehold accounted for majority of new sale transactions in 1H 2014, as compared to Junction Nine at 99-year leasehold as the main
contributor in 1H 2013.

Leasehold Strata-titled Retail Properties – Resale: Resale leasehold market also quietened with 37.7 per cent fall in transaction volume in 1H 2014, albeit with marginal price increase of 1.6 per cent to $2,361 per square feet.