Prices of resale homes rocket to historic high $1,222 psf

As monthly rents dive 1%.

According to SRX Residential Property Flash Report, overall, prices of resale non-landed private residential continue to climb to a new historic high of $1,222 psf in the first two months of Q4, up 5.4% from Q3's average of $1,159 psf.

Here's more from SRX:

All regions have outperformed the previous quarter. Outside Central Region (OCR) led the gain with a 4.5% increase over Q3, followed by Rest of Central Region (RCR), which saw a 3.3% increase.

The Core Central Region (CCR) gained 2.8%. This quarter, CCR transactions, which have higher PSF than that of other regions, represent a bigger proportion of total transactions than seen in previous quarters.

Transaction volume continues to increase. Comparing the first 2 months of Q3 and Q4, transaction volume rose by 6% in Q4 to hit 2,483 resale transactions in the Oct-Nov period.

Unlike the resale market, the rental market showed a reverse trend. Average unit monthly rent dropped by 1.0%, from $3.88 psf in Q3 to $3.84 in the first two months of Q4.

Leading the drop is in the Rest of Central Region (RCR) where prices are moderating after rising for the first 3 consecutive quarters in this year. RCR rental prices fell by 2.5% to end at $3.91. The other regions remained relatively stable compared to the previous quarter.

Due to strong price gains and weaker rental prices, overall gross rental yield dropped to a 6-year historic low of 3.77% in the first two months of Q4.

The number of resales for shoebox units (<50sqm), remained relatively small at 198 units year to date. 

In contrast, demand for rentals of shoebox units is relatively high with 1,328 rental contracts signed this year. This represents 6.7 times more rentals than resales for shoebox units YTD. In contrast, the average is 2.4 times more rentals than resales for other types of units.

As a result, shoebox units continue to draw higher rental offers in 4Q, to achieve average unit monthly rental of $6.65 psf. This is 0.6% higher than the average rental price of $6.61 psf in Q3.