Condo resales up as more HDB upgraders priced out by new launch prices

The highest transacted resale price in September was at $17.6 million for a unit at Reflections at Keppel Bay. ST PHOTO: ALPHONSUS CHERN

SINGAPORE – Condominium resale volumes picked up in September, snapping four straight months of decline as limited new private home stock and escalating new launch prices drove Housing Board upgraders to the resale market.

Flash data from real estate portals 99.co and SRX released on Oct 11 showed that an estimated 1,331 units changed hands in September, a 1.1 per cent increase from the 1,317 units resold in August, but is down 22.8 per cent from September 2021.

Condo resale prices maintained their ascent for the 26th straight month, gaining 1.7 per cent in September due to robust demand for suburban private homes – a segment supported largely by HDB upgraders.

This segment accounted for 60.9 per cent of total sales volume in September.

Compared with September 2021, prices were up 11.1 per cent, data showed.

Buoyant HDB upgrader demand sent resale price growth in the suburbs or outside central region (OCR) up 12.9 per cent for the year, surpassing a 10.1 per cent price gain in the city fringe and a 7 per cent gain in the prime district.

“Over the past three months, OCR resale prices rose faster than the rest of the regions by 1.1 per cent in July, 1.3 per cent in August and 2.2 per cent in September,” OrangeTee and Tie senior vice-president of research and analytics Christine Sun noted.

This as buyers who have been priced out by new suburban launches Sky [email protected], AMO Residence and Lentor Modern transacting at above the median price of $2,000 per sq ft (psf) – a price level more commonly seen in the prime and city fringe condo markets – switched to the resale market instead.

But the Sept 30 cooling measures could throw a wrench in the works, some analysts say.

Mr Pow Ying Khuan, head of research, 99 Group, sees the pool of HDB upgraders shrinking if the latest cooling measures succeed in slowing HDB resale price growth.

Ms Sun sees a temporary pullback from HDB upgraders, in particular, large flat owners who will likely take longer to sell as private home owners must now wait 15 months after the sale of their current home before they can buy a non-subsidised HDB resale flat.

But the slowdown could be mitigated by private home owners switching to the private resale market and tight new home supply, she added.

PropNex realty’s head of research and content Wong Siew Ying expects resale condo stock to tighten as prospective downgraders may now be reluctant to sell because of the 15-month wait-out period, while investment condo owners will likely hold on to their property to take advantage of strong leasing demand.

Also buoying resale condo prices in September was an increase in the number of deals exceeding $10 million, One Global Group senior analyst Mohan Sandrasegeran said.

The highest transacted resale price in September was at $17.6 million for a unit at Reflections at Keppel Bay.

Preliminary data from URA Realis showed that at least nine resale condo purchases exceeded the $10 million mark in September, up from five in August, Mr Sandrasegeran said.

“The buzz around the relaunched Cape Royale likely stimulated interest in properties near the Sentosa area,” he added.

“Source:[Condo resales up as more HDB upgraders priced out by new launch prices] © Singapore Press Holdings Limited. Permission required for reproduction”

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