Posh home prices up 22% in January-February

The average price for a luxury home rose to $2,049 psf in Jan-Feb 2018.

Singapore’s real estate sector opens the year on stable footing as residential property prices expanded across most segments in the first two months of 2018 with luxury homes prices rising 22% YoY in January to February and new sale prices in the mid-tier market increasing 8%, according to property research firm OrangeTee.

The average price for a luxury home rose to $2,049 psf in Jan-Feb 2018 with the sale of Le Nouvel Ardmore for $4,098 sqf scoring the highest per sq foot recorded so far this year. 

Property values also surged in mid-tier markets but a housing bubble is unlikely, said OrangeTee.

The sale of two units in The Nassim for $19.6m and $17m respectively also sets a positive tone for the luxury residential market this year.

Property prices for mid-tier homes also rose but was more moderate than the luxury segment at 4.7% YoY to $1,488 psf with new sales, resales and sub-sales hitting record-highs at $1,703 psf, $1,287 psf and $1,715 psf respectively.

However, prices for mass market home segment dipped slightly by 2.4% YoY to $1,117 psdf in Jan-Feb. 

Despite rising property prices amidst higher land costs and strong demand, a housing bubble is unlikely, said Orange Tee, as overall transaction volume is still significantly lower than previously recorded peaks and various pre-emptive measures like the Seller’s Stamp Duty and Total Debt Servicing Ratio are in place to cool the market. 

“For instance, whilst the overall prices have escalated in recent months, the number of transactions remained low as compared to the high volume seen in 2007 and 2010-2013. 2,357 caveats were lodged in the first two months of 2018,lower than the last 10-year average of 2,542,” the report added.

Photo from The Nassim