Auction listings soar by 47.5% QoQ to 118 in Q2

Almost half of the listings were recorded following the Fed’s interest rate hike in June.

Auction listings, including repeat listings, soared by 47.5% QoQ to 118 in Q2, data from Knight Frank showed.

According to the property expert, the overall growth was on the back of an uptick in both landed and non-landed residential listings, and an increase in the inventory of retail and industrial owner sale listings.

Residential and industrial owner sale listings rose to 22 from seven and 13 from four, respectively, in Q2.

Overall, owner sale listings more than doubled in Q2, expanding 121.4% QoQ to 62 from 28 in Q12022.

“While some owners previously chose to sell their properties independently, the expectation of further domestic interest rate hikes and the prospect of better closing prices in a healthy market, has led others to explore the auction route,” said Knight Frank.

Mortgagee sales listings likewise rose during the quarter, albeit lower than owner sale listings.

There were 50 Mortgagee sales listings in Q2; of which, 29 (+38.1% QoQ) were residential listings. The success rate for the quarter was also high (11.0%) due to mortgagee sales listing, with 10 sold properties in Q2.

A total of 13 properties were sold via auction in Q2 for a gross sales value of $30.2m.

“While all-time high rents (based on URA residential rental indices) have cushioned mortgage installments, a combination of rising interest rates, individual financial stress and business failures also contributed to existing listings,” Knight Frank commented.

Looking ahead, Knight Frank said  the “stress on mortgage payments brought about by the ongoing rise of interest rates throughout 2022 can lead to more listings in the coming months.”

In Q2, 42.9% (50 out of 118) of the listings were recorded in June when the Federal Reserve announced its most aggressive benchmark interest rate hike since 1994 at 0.75 percentage points.

“Coupled with looming economic uncertainties, the number of mortgagee listings is expected to increase in the remaining quarters of the year, after dropping to a trough in Q1 2022. Likewise, the number of owner listings is also likely to grow as more become open to the reach and the transparency of the auction process and might wish to take advantage of the healthy private residential to divest, especially with growing overall success rates,” Knight Frank commented.