Cooling measures effective in quelling property price growth: analyst

Monthly price growth was down 1% since the property measures were enforced.

After the latest cooling measures were put in place in September last year, price growth was tamed, with a monthly price increase of below 1% in the past three months, OrangeTee said.

It slowed in December when prices soared by a marginal 0.2%. This showed that the cooling measures may have been effective in putting the brakes on “the red hot housing market and there are signs that prices may be cooling.”

With the slower price growth, more deals were being sealed as volumes rebounded gradually in the last two months.

“Despite the year-end holidays, 2,242 resale flats were sold in December, higher than the number sold in November,” said OrangeTee.

Million-dollar flats buyers

But some buyers of million-dollar deals will still be unfazed by the cooling measures in 2023, OneGlobalGroup said. These are homeowners who want larger living spaces such as loft and maisonette properties.

“Location, floor level, size, and the remaining lease term of the property will continue to influence resale prices. In 2022, there was high demand for the 23,000 BTO flats that were released, with over 100,000 applicants competing for them,” the property expert said.

For Huttons Asia, the number of million-dollar flat transactions may have stabilised. In 2022, the number of million-dollar flats is 370 which is around 1.3% of total transaction volume.

It added that the transaction volume may increase slightly in January 2023 as buyers have returned from the holiday season.

“Resale flat prices are likely to trend towards stabilisation and see not more than 5% increase in 2023,” it said.