In January, two Park Nova apartments sold for almost record prices, with one penthous

In January, two Park Nova apartments sold for almost record prices, with one penthouse selling for S$6,593 per square foot

According to URA's Realis database, a foreign national and a permanent resident are purchasing the two freehold units.

January 31, 2025

CONDOsingapore.com

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According to caveats data, two recent transactions at Singapore's Park Nova project, developed by Hong Kong developer Shun Tak, have surfaced at levels that are almost record high. The second-highest price per square foot (psf) ever recorded in the market was S$6,593 for one unit.

In the midst of the downturn that has gripped the upscale residential market since steep stamp duty increases in April 2023 turned off wealthy foreign investors, the two Park Nova sales, both completed in January 2025, stood out.

The two freehold units were purchased by a foreigner and a permanent resident (PR), according to data from the Urban Redevelopment Authority's (URA) Realis database. Both transactions were new sales, meaning the developer sold them.

On January 21, a penthouse unit on the 20th floor sold for S$6,593 per square foot, or S$38.9 million, for a 5,899-square-foot (sq ft) apartment. On January 17, the other apartment, a 2,906-square-foot apartment on the 19th floor, sold for S$5,708 per square foot, or S$16.6 million.

Additionally, the recent Park Nova sales were significantly higher than those of the other luxury condominiums. When it first opened in May 2021, the 54-unit freehold condo on Tomlinson Road had a median price of S$4,979 per square foot.

The highest price paid on a per square foot basis before this month's transaction was S$5,784 for a 4,499 square foot unit at S$26 million in May 2021.

In the last six months, the median price of units in the Orchard planning area—where Park Nova is situated—was S$2,906 per square foot, according to caveats data.

When purchasing their first residential property in Singapore, PRs are required to pay 5% Additional Buyer's Stamp Duty (ABSD). 30% ABSD is applied to the purchase of a second property, and 35% ABSD is applied to the purchase of a third and subsequent properties.

In contrast, foreigners who are not permanent residents must pay 60% ABSD on any residential property purchase, which doubled from 30% previously.

In November 2011, a unit at The Marq on Paterson Hill sold for the highest price per square foot. The 3,089 square foot, 20th-floor apartment sold for S$20.5 million, or S$6,650 per square foot.

Since 1995, the URA's Realis database shows that only seven private residential sales have exceeded the S$6,000 psf cap.

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Since the government doubled the ABSD rates for foreigners in 2023, Singapore's luxury home market has been muted. As a result, demand from foreigners, who normally make up a larger share of sales of prime residential real estate, vanished and hasn't fully recovered.

In the second half of 2024, there were only 80 prime non-landed home transactions totalling S$573.7 million, which is a 27.1% decrease from the S$787.4 million recorded in the first half of the year, according to a Knight Frank market report. Prices averaged S$2,237 per square foot.

There were 184 of these home sales in 2024, totalling S$1.4 billion, a 22.1% decrease from S$1.7 billion in 2023. Since Knight Frank started keeping track of these properties in 2009, there have been fewer prime non-landed transactions than this. According to Knight Frank's analysis, homes in Districts 1, 2, 4, 9, 10, and 11 that have a floor area of at least 2,500 square feet are considered prime non-landed homes.

The sale of the two Park Nova units, according to Alan Cheong, executive director of research and consulting at Savills Singapore, is not always a sign that foreign wealth is returning.

Cheong remarked, "One swallow does not make a summer." He claimed that the 60% ABSD rate for overseas purchasers is still "excessive" and will keep discouraging the majority of them from joining the market.

According to Cheong, lowering ABSD rates to 30% might not have much of an impact, but it would "send a message that the government is listening" and give buyers and developers hope.

According to Knight Frank's report released on January 8, unless the "more prohibitive measures are eased," the prime non-landed market will continue to be soft in 2025, with prices either declining by 1% or slightly increasing by 2%.

"With rents no longer rising and in some cases easing, foreign professionals and expatriates who have resorted to the leasing market because of the prohibitive ABSD are unlikely to return to the buying market anytime soon," the report continued.

According to Knight Frank, local homebuyers looking for their dream house or an investment property are therefore more likely to be the source of demand for premium non-landed homes.