As market keep changing due to economic, geographic and on-going pandemic, this has created some trend on the residential property in Singapore.
- We all know the price of private residential property is increasing since Year 2015 (HDB price started to move up in Year 2020) till now base base on the URA and HDB statistics. Following are the compiled average price for different region/property types in Singapore.
2. We are also aware most companies are cutting office space in coming months due to Covid-19, you can refer to the article reported by Straits Times on 5 July 2021 below. As office space gets smaller, what is the impact to residential home size at the same time?
Before buying a property especially if you plan to sell or rent in the coming years, it is important to note what are the popular size of residential property purchased in recent years. Developer will also take the cue to build home that most buyers wanted. We did a study of the purchase done for resale private residential properties in CCR, RCR and OCR and found that the popular unit size is between 1000-1500 sqft. Below are the non-landed private home sales for Year 2019-2021 for OCR and RCR.
While it is true that purchasing a property is dependent on the budget you have, knowing the popular unit size will facilitate rental or sales in the years to come as there is likely a demand for it. If you are trying to buy a new home especially first time (no need to pay for ABSD), it is good to purchase one of the unit size that is popular and in demand. Taking the Government Land Sale for OCR (Outside Central Region), we know that private property price is going to increase in the short term due to increase in the land price sale last few years (see chart below) for private property. The land price increase is also supported by the reduced supply till Year 2023 due to the demand-supply cycle. So for those who is waiting to buy a residential property, it will definitely be better to buy now than in Year 2023.
3. The next trend is the demand and supply of new home sales. Currently the supply of new home is generally diminishing base on the demand needed over the recent years. From the statistics, we can also see that the supply of OCR is much less than the demand as of Sep 2021 (Sale of 4123 units in Jan – Sep 2021 but supply remaining is only 3760). Unless more new OCR is put onto the market soon, there will be a supply gap in current months.
4. Last but not least, there is a shift of purchase of property from Year 2010 to Year 2020. From the update from Straits Times article, it clearly show an increase of % of purchaser towards condominium & other apartments category (16% jump in Year 2020). At the same time there is a decrease of purchase for HDB dwellings and landed properties
Do drop me a note or contact me if you need more info regarding the residential property outlook or have concern of sale/rental of property.