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 a more meaningful and personal way than a mere broad-based index from URA. Properties are not created equal and some will rise or fall more than others.
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MORTGAGEWISE’S BASKET OF CONDOS
Let’s take a look at the performance of investment condos in our own basket of study. Note our comparison is based on on 6-month period which differs from URA’s quarterly measure.
The condos selected in our 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 property investors 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.
We will look at the performance of the basket of condos in the most recent 6-month period, and contrast that with the preceding 6-month. Percentage variation of more than 8% will deemed significant enough to be highlighted (in blue for increase and in red for decline).
When compared to the performance 6 month’s ago, we noticed volume of transactions have come down quite significantly. And when that happens, it usually means sellers who need to sell become more eager to negotiate on prices leading to a general price decline. This is in keeping with the trend on mortgages where we arrange a lot less for purchases compared to 2018.
Some of the “star performers” in the previous 6 months – the likes of Cosmopolitan in River Valley (record average prices of $2,400 psf in 2018) and One-North Residences (record average prices almost hitting $1,600 psf) have both slided back in terms of prices done this year. The uptrend cannot be sustained in the absence of more buyers. The slide for latter was almost 10 percent down.
However, the worst performer in our basket is Cote D’Azur in the east where average transacted prices went down by almost $300 psf (23% drop). Still, this must be seen in the context of fewer transactions where only 5 units changed hands in 2019 1H and the high base recorded in 2018 2H came from only 2 transactions, which could have distorted the picture. Given its superior location right next to Parkway Parade shopping mall and the future MRT station ready in the next couple of years, this looks like an interesting property for investment albeit it lies in the low-lying area flagged out by PM in his national day rally speech.
Generally, in the 1sthalf of 2019, luxury or prime district property prices have come off by more than those in the outskirts (near MRT stations) which is a mixed bag. The only luxury property that bucked this trend is Ardmore Park in prime district 10 which explains why it continues to be the “benchmark” for luxury-class real estate in Singapore with resilient prices and decent volume of 6 transactions in a luxury market almost at a stand-still. The only two other properties in our basket that have registered growth in prices is Ascentia Sky in redhill and D’ Leedon along farrer road. The latter did exceptionally well I thought with an almost 10% pick up in transacted prices and considering it is such a large-scale development of over 1,700 units with many sellers.
So, speak to our consultants today!
Since 2014, MortgageWise.sg has provided thought leadership in the mortgage planning space in Singapore, taking deep dives into the latest developments in the industry, providing useful mortgage tips, and making sense of rate movements. We seek to build trust with clients over the longer term instead of doing product-peddling for quick one-time deals. That’s why we always present “whole-of-market” perspective including home loan packages that some banks do not pay us. Read our clients’ testimonials.