Lack of new launches boosts condo resale prices

In August, prices rose by 1.0% YoY.

The lack of new housing options in the primary market has led buyers to the resale market, pushing up prices by 1.0% YoY in August.

“Although five new projects were launched last month, all were small or mid-sized projects with less than 500 units. Moreover, the biggest project launch was an executive condominium, Altura, which most buyers may not be eligible to buy,” OrangeTee said.

Huttons echoed this, saying the “absence of new launches led to some demand spilling over to the resale market in August.”

Apart from the lack of new launches, Huttons also attributed the increase in resale prices to the robust HDB market.

“Moving forward, the robust HDB market may continue to support the resale condo market. New PRs and citizens may also contribute to the demand,” Huttons added.

PropNex noted that the proportion of resale condo transactions by foreign buyers remained low in August, accounting for just 1.9% of the total.

“In absolute terms, only 15 non-landed resale private homes were bought by foreigners in August, with 13 of the units purchased by buyers from the US, and one each from Indonesia and Myanmar,” PropNex added.

Looking ahead, OrangeTee does not expect resale volume to increase too significantly “as many homeowners may keep their units for occupation or rental income.”

“Moreover, new home prices remain elevated. Therefore, with higher replacement costs, more homeowners may continue to hold onto their units,” OrangeTee added.