Homebuying demand to remain buoyant

In Q3 2021, overall transaction volume for private homes increased by 7.5% from the previous quarter to 9,083 units; this is a 28.9% year-on-year growth.

Homebuying demand in Singapore is expected to remain buoyant, particularly in suburban areas where pricing quanta are lower and relatively more affordable, said Lam Chern Woon, Head of Research and Consulting at Edmund Tie.

“Given the improving economic fundamentals and a buoyant public resale housing market, we expect the residential market to remain on sound footing as we move into the final quarter of the year,” he said.

In Q3 2021, Singapore witnessed an increase in sales activity for non-landed private homes, with primary sales expanding 19.7% quarter-on-quarter to 3,550 units while secondary sales grew 0.9% quarter-on-quarter to 5,533 units.

Edmund Tie attributed the increased sales to the easing of COVID-19 safety measures, opening of borders as well as improved buyer confidence.

Notably, overall transaction volume rose 7.5% quarter-on-quarter and 28.9% year-on-year to 9,083 units in Q3 2021.

The Outside Central Region (OCR) registered the highest quarterly growth of 28.3% in overall transaction volume, with quarterly growths of 97.7% in primary sales and 4% in secondary sales.

Related article: RCR vs OCR Resale Condos in Singapore: Which Makes a Better Home or Investment? 7 Factors to Consider

“The OCR’s strong growth in primary sales volume for the quarter was accounted for by its sizeable 81.4% quarter-on-quarter growth in new launches, which at 1,319 units was the most out of the market segments,” said Edmund Tie.

The Core Central Region (CCR), on the other hand, saw overall transaction volume decline 24.9% quarter-on-quarter. Secondary sales dipped 9.8%, while primary sales dropped 45.5% quarter-on-quarter, corresponding to the 59.8% quarter-on-quarter fall in new launches within the region in Q3 2021.

Overall transaction volume in the Rest of Central Region (RCR) remained relatively unchanged, slipping by just 0.4% in Q3 2021 from the previous quarter. Primary sales declined 4.6% quarter-on-quarter, while secondary sales rose 3% quarter-on-quarter.

“The quarter’s strong take-up rate for new OCR launches attests to the sustained demand for suburban homes due to continued work-from-home culture and lower price quanta,” said Lam.

Over at the non-landed primary market, units between 700 sq ft and 1,000 sq ft accounted for the highest proportions of transactions at 39.4% of the total primary sales in Q3 2021.

Comparatively, the largest proportion of transactions in Q2 2021 were for units between 500 sq ft and 700 sq ft.

Moreover, the proportion of transactions for larger units above 1,000 sq ft increased to 33.5% of primary sales in Q3 2021 from 27.3% in the previous quarter, marking the third consecutive quarterly increase.

Conversely, the proportion of transactions for smaller units below 500 sq ft declined to 3.3% in Q3 2021, from 9.4% in Q2 2021, or its third consecutive quarterly decline.

“These trends reflect a shift in preference to the larger units with more bedrooms away from studio apartments, which may have lost some appeal amongst buyers despite their lower price quanta,” said Lam.

Nonetheless, the proportion of transactions for units priced below $1 million increased to 9% in Q3 2021 from 5.4% in the previous quarter.

“This suggests robust availability and mass-market demand for units that were priced at a lower quantum,” said Edmund Tie.

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Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email: cheryl@propertyguru.com.sg

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