At MortgageWise, we try to provide our property investor clients with a snapshot of the performance of Singapore residential property market regularly through our own basket of condos which will provide supplementary insights in amore meaningful and personal manner than just a broad-based index from URA. Properties are not created equal and some will rise or fall more than the rest.
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The condos selected in the basket are deemed iconic enough to be representative of prices in a particular precinct that is smaller than a whole central region or outside central region as defined by URA. For areas outside central region we also tend to pick condos either right at or nearest MRT stations as these tend to be well sought after by investors. Our basket would allow those looking to buy Singapore condos to see the actual variation in prices over time for a particular group of condos that are fairly well-known in Singapore. However our illustration is nothing more than simple averages of all transactions done over 6-month periods and in cases where there are less than 5 transactions (marked with an asterisk) do take the reading with a pinch of salt. We also highlight the highest psf achieved in the period.
Prima facie it seems prices are still under correction for resale completed condos in most of prime districts especially in the luxury segment of Orchard Road and investment zones of Marina Bay. Outside central region is where you see more price appreciation rather than correction. In terms of average psf prices over 6-month periods, condos with high double-digit drops are The Cosmopolitan at Kim Seng Road, Soleil@Sinaran at Novena, and Marina Bay Suites. Two condos stand out in terms of reversing this trend with almost a near 10% increase in psf transacted are Sky@Eleven condo at Thomson Road and The Centris at Boon Lay MRT.
We show the difference in the highest psf clocked over two consecutive 6-month periods to showcase which condos in our basket have the highest propensity to “surprise on the upside” and for 1st half of 2016 there are two condos with near 10% jump – Sky@Eleven and Caribbean@Keppel Bay. At the opposite end once again you have condos at Marina Bay registering the steepest drop in terms of highest psf achieved.
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Putting the numbers above in the context of recent news on the state of property market in Singapore as well as what we observed on the ground, there is definitely more buyers in the market in 1sthalf of 2016 and we do see this trend continuing for the rest of the year. We believe there is still some more downside to resale property prices but it appears to be bottoming out as the rate of price decline has slowed. From what we know, the slight recovery in the luxury segment in recent months are more in new sales where developers are forced to cut prices to clear out units. This might explain why there is still no significant pickup for luxury properties in resale as activites centre on new TOP luxury condos. Foreigners might perceive a bigger drop in price of more than 15% to offset against ABSD in new launch sales rather than in resale, as launch prices are more transparent and easier to track over the various phases of release.
On mass market resale outside central region the narrow width of our data is unable to give any conclusive evidence yet on a rebound, however the decline in prices seem to have stopped at least for most of the 6 condos that we are tracking all over the island. The only caveat we give here is that our condos are situated near MRT stations and will be more resilient in prices than others in the same area. Hence we believe resale prices are generally still more on a plateau at the moment.
At MortgageWise.sg, we seek to provide thought leadership in the area of mortgage planning in Singapore, taking deep dive into developments and news on mortgages & helping clients track interest rate movements. We do not just go for one-time business with clients but rather choose to build long trusting relationships by giving truly independent advice to the extent of losing the deal. We strive to become the first-choice mortgage partner for homeowners and the creditable distributor of home loan Singapore.