New Reporter
10-02-23, 09:29
Luxury property deals take a dip in Q4, but 2023 outlook remains strong: Huttons
Feb 07, 2023
SALES for both luxury condominiums and Good Class Bungalows (GCBs) waned in the fourth quarter of 2022, amid a year of aggressive tightening by the US Federal Reserve to rein in inflation.
According to Huttons, Asia’s latest report on the luxury market released Monday (Feb 6), an estimated 73 non-landed luxury homes were sold in Q4, down 33.6 per cent from the previous quarter.
Based on caveats lodged, the total value of non-landed luxury homes was S$684 million, some 31.9 per cent lower than the value of S$1 billion in Q3 of 2022.
The latest quarterly data brings total transactions in the luxury non-landed market for the full year to 359, which is 19.1 per cent lower than that of 2021. Total quantum invested for 2022 stood at S$3.2 billion, down 28 per cent from the previous year.
The top three selling luxury condominium projects over the year were Les Maisons Nassim, Tomlinson Heights and Le Nouvel Ardmore. By quantum, units at these projects sold at the highest per square foot (psf) prices of S$6,057, S$4,645 and S$5,800, respectively.
The top foreign nationalities buying luxury properties were from China, the US, Indonesia and Malaysia.
Only six bungalows were sold in the GCB areas in Q4 of 2022 at a total value of S$217.5 million – down 53.1 per cent from the previous quarter, and 45.9 per cent lower on a year-on-year basis.
While Huttons said concerns about the US economy tipping into recession prompted some non-landed luxury buyers to hold back their purchases, the agency noted that GCB buyers are “holding back unless a very rare GCB plot comes along”.
Sellers on the other hand appear to be asking for higher prices, said Huttons, which could have led to the lower GCB sales in Q4 of 2022.
For the full year, Huttons estimates a total of 48 GCBs have been sold, representing just half the volume of 2021 transactions. The total quantum is estimated to be S$1.4 billion, which is 51.6 per cent lower than 2021’s transacted value.
Leading the deals for 2022 is the sale of a GCB at Chancery Lane, which was reported to have been bought by Filipino billionaire Andrew Tan’s daughter-in-law, Kelsey Cheng Tan, for S$66.1 million. This marks the highest price paid for a GCB in the Bukit Tunggal GCB area on both a quantum and a psf-on-land basis, said Huttons.
Citing data from URA Realis, the agency noted the highest rent achieved for a GCB in 2022 was S$150,000 in the Dalvey Estate and Fourth/Sixth Avenue GCB area.
Rents in the GCB areas have appeared to hit a plateau at this level as fewer GCBs are rented out for record rents in Q4 of 2022, it added.
Despite the decline in luxury property transactions over Q4, Huttons sees the market benefiting from the lifting of border measures by China this year.
“This could be the year where the luxury market sees more high-profile deals with the return of super wealthy Chinese,” said the agency, highlighting an increase in enquiries and purchases by Chinese buyers in January 2023.
It added that recent purchases of luxury properties by Chinese buyers may not have been fully reflected in caveats as it is not compulsory to lodge one, and some of these deals could have used different deal structures or been purchased under a non-China passport.
“The super wealthy are looking at large format units for their own stay. There is limited supply of large format units in the market,” observed Huttons.
The agency expects the GCB market to remain in the normalised range of 40-50 transactions in 2023, with some demand possibly spilling over to District 15 Wilkinson, Branksome and the Goodman roads locale where large land plots are available.
In Huttons’ view, sellers are holding out for their ideal price, while some buyers may be waiting for their citizenship before buying a GCB.
https://www.businesstimes.com.sg/property/luxury-property-deals-take-dip-q4-2023-outlook-remains-strong-huttons
Feb 07, 2023
SALES for both luxury condominiums and Good Class Bungalows (GCBs) waned in the fourth quarter of 2022, amid a year of aggressive tightening by the US Federal Reserve to rein in inflation.
According to Huttons, Asia’s latest report on the luxury market released Monday (Feb 6), an estimated 73 non-landed luxury homes were sold in Q4, down 33.6 per cent from the previous quarter.
Based on caveats lodged, the total value of non-landed luxury homes was S$684 million, some 31.9 per cent lower than the value of S$1 billion in Q3 of 2022.
The latest quarterly data brings total transactions in the luxury non-landed market for the full year to 359, which is 19.1 per cent lower than that of 2021. Total quantum invested for 2022 stood at S$3.2 billion, down 28 per cent from the previous year.
The top three selling luxury condominium projects over the year were Les Maisons Nassim, Tomlinson Heights and Le Nouvel Ardmore. By quantum, units at these projects sold at the highest per square foot (psf) prices of S$6,057, S$4,645 and S$5,800, respectively.
The top foreign nationalities buying luxury properties were from China, the US, Indonesia and Malaysia.
Only six bungalows were sold in the GCB areas in Q4 of 2022 at a total value of S$217.5 million – down 53.1 per cent from the previous quarter, and 45.9 per cent lower on a year-on-year basis.
While Huttons said concerns about the US economy tipping into recession prompted some non-landed luxury buyers to hold back their purchases, the agency noted that GCB buyers are “holding back unless a very rare GCB plot comes along”.
Sellers on the other hand appear to be asking for higher prices, said Huttons, which could have led to the lower GCB sales in Q4 of 2022.
For the full year, Huttons estimates a total of 48 GCBs have been sold, representing just half the volume of 2021 transactions. The total quantum is estimated to be S$1.4 billion, which is 51.6 per cent lower than 2021’s transacted value.
Leading the deals for 2022 is the sale of a GCB at Chancery Lane, which was reported to have been bought by Filipino billionaire Andrew Tan’s daughter-in-law, Kelsey Cheng Tan, for S$66.1 million. This marks the highest price paid for a GCB in the Bukit Tunggal GCB area on both a quantum and a psf-on-land basis, said Huttons.
Citing data from URA Realis, the agency noted the highest rent achieved for a GCB in 2022 was S$150,000 in the Dalvey Estate and Fourth/Sixth Avenue GCB area.
Rents in the GCB areas have appeared to hit a plateau at this level as fewer GCBs are rented out for record rents in Q4 of 2022, it added.
Despite the decline in luxury property transactions over Q4, Huttons sees the market benefiting from the lifting of border measures by China this year.
“This could be the year where the luxury market sees more high-profile deals with the return of super wealthy Chinese,” said the agency, highlighting an increase in enquiries and purchases by Chinese buyers in January 2023.
It added that recent purchases of luxury properties by Chinese buyers may not have been fully reflected in caveats as it is not compulsory to lodge one, and some of these deals could have used different deal structures or been purchased under a non-China passport.
“The super wealthy are looking at large format units for their own stay. There is limited supply of large format units in the market,” observed Huttons.
The agency expects the GCB market to remain in the normalised range of 40-50 transactions in 2023, with some demand possibly spilling over to District 15 Wilkinson, Branksome and the Goodman roads locale where large land plots are available.
In Huttons’ view, sellers are holding out for their ideal price, while some buyers may be waiting for their citizenship before buying a GCB.
https://www.businesstimes.com.sg/property/luxury-property-deals-take-dip-q4-2023-outlook-remains-strong-huttons