Sales of high-end private landed homes above $5 million slowed, falling 33.8 percent to $1 billion in the first half of 2019 from the previous period, revealed a Knight Frank report.
On an annual basis, sales of such homes declined 53.51 percent.
URA flash estimates showed that the landed residential property price index (PPI) climbed 0.2 percent quarter-on-quarter in Q2 2019 after rising 1.1 percent quarter-on-quarter in Q1 2019.
With the drop in sales, Knight Frank attributed the increase in PPI to buyers paying a premium for properties of their choice – pushing up prices. This likely points to an increasing price gap between sellers and buyers, which caused the sales of luxury homes to drop in 1H 2019.
“While the overall market remains soft and Good Class Bungalows (GCB) may take a longer time to transact, recent sales showed that the buyers are willing to pay more for landed homes that meet their needs and requirements,” said Linda Chern, head of residential (prime sales & corporate leasing) at Knight Frank.
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The report noted that sales of GCBs also decreased 45.3 percent to $211.9 million in 1H 2019 from 2H 2018.
“The fall in sales is on the back of the release of weaker Singapore economic data, which dampened market sentiments,” it said.
Nonetheless, some GCBs were still transacted at a high land price during the period. Knight Frank cited the $30.2 million sale of 16 Jervois Hill as a case in point.
Looking ahead, the property consultancy expects the transaction volume for luxury homes to be muted this year, on the back of the trade war tensions and sluggish economy.
“While interest persists, the price gap between buyers and sellers is likely to widen,” it said.
Fiona Ho, Digital Content Manager at PropertyGuru, edited this story. To contact her about this or other stories, email firstname.lastname@example.org