What you need to know about Singapore’s amazingly resilient luxury property market

The last round of property cooling measures was rolled out in January this year and the half‐year mark seems as good a time as any to take stock of the residential market. Our review here would also paint in broad strokes how the market has weathered the policy changes. The luxury segment, it turns out, was the star performer in 1H11, being the most resilient to the new measures.

In the new sale market, the transaction volume for units under $1,000 psf remained strong with the developers selling 2,225 units. This was just a slight 4.3% decline from 2,325 units sold a year ago. The total transaction value, however, slid by a larger 15.4% from $2.41b to $2.04b, suggesting that the average unit size sold during 1H11 was smaller. Indeed, according to caveat data, the unit size has shrunk by 11% from 119 sq m a year ago to 106 sq m. A similar trend was observed in the mid‐to‐high‐end segments. The luxury segment, defined here as units priced at more $3,000 psf, saw quite the opposite. Volume merely dipped from 46 units to 43 units, but transaction value jumped from $305m to $340m. In addition, while the average price per unit in all the other segments declined, in the luxury segment, it rose nearly 20% from $6.6m to $7.9m.

In the resale market, the transaction volume for units under $1,000 psf took a heavy beating, tumbling by 38.5% to 3,440 units in 1H11 from 5,593 units a year ago. The transaction value decreased by 30%. The under‐$2,000‐psf segment saw a more moderate 2.8% drop in transaction volume from 2,433 units to 2,364 units. The high‐end and luxury segments saw volume rising by 23‐27%. The average price per unit rose with the luxury segment leading the increase with 20.6%.