Private resale volume drops 23.8% MoM in January

Experts attribute the decline to the government cooling measures.

The private condo resale volume dropped 23.8% month-on-month (MoM) and 23.1% year-on-year (YoY) to 1,118 units in January 2022, data from 99.co and SRX showed.
 
Experts from PropNex and OrangeTee said the volume decline was due to the cooling measures implemented by the government last 16 December 2021.

“Foreigners and investors seem to be taking a wait-and-see approach as they were more affected by the new cooling measures. Foreigners and buyers who own multiple properties were hit by higher ABSD rates,” OrangeTee said.

PropNex said the measures possibly led to “some buyers temporarily putting off their decision to purchase a residential property, taking a watch-and-wait approach to assess the impact of the new measures on the resale market."

This was echoed by OrgangeTee, adding that foreigners and buyers with multiple properties were hit by higher additional buyer's stamp duty (ABSD) rates which were part of the property curbs.

Resale volumes, however, are expected to pick up after the lunar New Year festivities as buyers come to terms with the new cooling measures, PropNex said.

Of the total volume, 64.2% were from the outside central region (OCR), 21.2% from the rest of the central region (RCR), and 14.5%  from the core central region (CCR).

The high demand in the OCR was due to the “owing to demand from owner-occupiers and HDB upgraders,” real estate portal, PropNex, said.

“HDB upgraders will be a key demand driver for the private resale housing market, particularly for homes priced under $1.5m,” PropNex added.

Whilst the private condo resale volume declined in January, prices continued to rise, increasing by 0.4% MoM and 9.2% YoY.

By regions, the increase in prices were 9.7% in CCR, 7.5% in RCR, and 10.0% in OCR.

The highest transacted price unit in the OCR and RCR was a unit at Elliot At The East Coast resold for $4.0m, and a unit at Reflections At Keppel Bay resold for $11.0m, respectively.

The rising prices have likewise affected the buying moment in the price resale condo market, according to OangeTee.

Looking forward, OrangeTee said around 15,000 to 17,000 resale homes could be transacted this year, which is higher than the 10-year average of over 9,000 units.

Resale prices for condos, meanwhile, may rise at a slower rate of around 3% to 6% in 2022, the expert added.