Luxury condo and GCB deals leapt 90% q-o-q in 4Q2023: More than a year-end rally?

February 8, 2024

For a project that hasn't been officially launched, the freehold Watten House has sold 118 (66%) of the 180 units in the freehold luxury condo on Shelford Road since its private preview in mid-November. The average price achieved to date is $3,242 psf. At least 96% of the buyers were Singaporeans and permanent residents (PRs).

Of the 118 units sold, based on caveats lodged as of Feb 7, about 35 (30%) are large-format units, says Mark Yip, CEO of Huttons Asia, in Huttons Asia's Prestige Report published on Feb 7. These large-format units range from 2,368 sq ft, five-bedrooms to seven-bedroom penthouses of 4,080 sq ft. Units were sold at prices from $7.43 million ($3,136 psf).

At Watten House, 100 units (56%) are three-bedders, ranging from 990 sq ft to 1,539 sq ft. Four-bedders of 1,851 sq ft and five-bedders of 2,368 sq ft comprise 36 units each. Eight units are six- and seven-bedroom penthouses of 3,412 to 4,080 sq ft. Six of the eight penthouses have been sold at prices from $11.75 million ($3,432 psf) to $14.5 million ($3,545 psf).

According to Huttons, Watten House accounted for 33 units or nearly 50% of the 70 luxury, non-landed property transactions in 4Q2023. Hence, Watten House contributed significantly to the 90% jump in such transactions from the previous quarter.

Based on caveats lodged, the total value of luxury non-landed homes transacted was $578.8 million, 95.7% more than 3Q2023's $295.8 million. For 2023, luxury non-landed homes worth $2.3 billion were sold, 24.9% fewer than in 2022, notes Huttons.

Among the top 10 biggest non-landed luxury condo deals of 2023, Les Maisons Nassim accounted for five of them, with two from Nassim Park Residences, while Goodwood Residence, Klimt Cairnhill, Bishopsgate Residences and Skyline @ Orchard Boulevard made up the remainder.

Due to the seasonal year-end lull, the luxury non-landed rental market saw fewer leasing transactions in 4Q2023. Based on Huttons Data Analytics' basket of luxury non-landed homes, 549 leasing deals were transacted in 4Q2023, down 21.7% from 3Q2023. Average rents of such homes contracted 15.2% over the same period.

The Good Class Bungalow (GCB) segment saw six deals in 4Q2023, including the sale of the GCB at 20 Third Avenue, owned by Hin Leong founder OK Lim, which was sold for just below $26.5 million. Total deals in 4Q2023 were $132.4 million, 90.4% higher than the previous quarter.

"Buyers remained cautious due to the economic uncertainties and high interest rates," remarks Yip.

About 20 GCBs were sold last year, 58.3% fewer than in 2022. In terms of sales value, the GCBs that changed hands totalled $727.2 million in 2023, 47.9% lower y-o-y. Most of the GCBs that changed hands were in the $20 million to $30 million range, as buyers stayed prudent, unwilling to pay "over-the-top prices" for a GCB, notes Yip.

The top GCB deal was in the Nassim Road Good Class Bungalow area, with the three GCBs purchased by the Fangiono family behind Singapore-listed palm oil producer First Resources from Cuscaden Peak Investments.

Rental transactions in the GCB area also contracted by 55.6%, "as some owners were wary of renting to foreigners of certain nationalities", says Yip. The highest transacted rent was $112,000 per month for a detached house in the Ridgout Park GCB area.

"Interest in Singapore's luxury non-landed homes appears to be going up," according to Yip. Based on recent caveats, two units at The Ritz-Carlton Residences Singapore Cairnhill were sold for $5,397 psf in January 2024. A Chinese PR couple bought both units.

"The number of enquiries from Chinese buyers has increased in January 2024, and many of them have made appointments to view properties during the Chinese New Year period," he notes.

Huttons believes that the GCB market in 2024 will be similar to 2023 as sellers continue to hold firm on their asking prices. "Interest may pick up in 2H2024 if there are cuts to interest rates," says Yip.

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