Shophouse market sales to moderate to $1.3b-$1.5b in 2023

In 2022, the market recorded $1.6b in sales.

The shophouse market will see a slowdown in transaction activity in 2023, with expected full-year sales of around $1.3b to $1.5b.

The range is lower than the sales level in 2022 of $1.6b and 2021 when the market reached $1.9b.

According to Knight Frank, more shophouse owners are “becoming increasingly cognisant that holding the asset over a longer investment horizon very probably leads to exponential price appreciation.”

“As such, some prospective sellers could also have dropped out of the market, especially after the high volume of transactions in the last two years,” the expert said.

On the flip side, Knight Frank still believes that there will be sustained demand in the market, particularly from high-net-worth investors and family offices from around the region.

Amongst sub-markets, Knight Frank said Districts 7 and 8 will likely be attractive to investors in 2023, given that they can find value purchases at more affordable levels in these areas when compared to higher overall prices in Districts 1 and 2.