Condo resale market in December 2023: An analysis

The December 2023 condo resale flash report offers vital insights into the resale market of condominiums and apartments. This article delves into the report’s key findings, shedding light on the dynamics of resale prices and volumes, which are pivotal for buyers, sellers, and investors alike.

Condo resale prices trend

December 2023 witnessed a nuanced shift in the condo resale market, with prices showing a modest increase of 0.5% compared to the previous month and a significant 7.5% rise year-on-year. This trend underscores a robust demand in the market, reflecting both short-term growth and sustained yearly appreciation.

We first take a look at the price trends:

Regionally, the Core Central Region (CCR) saw a remarkable 4.0% increase, whereas the Rest of Central Region (RCR) and Outside Central Region (OCR) experienced increases of 8.3% and 8.2%, respectively. These variations highlight the diverse market dynamics at play across different areas of the city. We can see all these in the table below:

Resale volume

The volume of resale transactions in December 2023 presented a contrasting picture. With 743 units resold, there was a 10.4% decrease from November 2023. Despite this monthly dip, the volume was still 7.1% higher compared to December 2022, indicating a year-over-year growth. However, it was 11.7% lower than the five-year average for December, suggesting a nuanced long-term trend.

Below we can see the resale volume trends:



And the difference by month:

Sub-sale transactions

Sub-sale transactions, and resales of units bought from developers before completion, accounted for 13.0% of the sales in December 2023. This marked a 1.0% point increase from the previous month. The rising percentage of sub-sale transactions could indicate a growing investor interest in the market or a shift in buyer preferences, as seen in the chart below:

Highest transacted prices

In terms of high-value transactions, December 2023 set remarkable benchmarks. The highest transacted price was an impressive $12,500,000 at Four Seasons Park. Region-wise, Corals at Keppel Bay in RCR topped with a sale of S$8,400,000, and The Trilinq in OCR saw a peak transaction at $4,000,000. These figures exemplify the luxury segment’s robustness and point to specific areas drawing premium valuations.

Additional reading: December 2023 condo and HDB rental market: A comprehensive analysis

Median capital gain and unlevered returns

The median capital gain for resale condos was $314,000 in December 2023, though this was a slight decrease from November. The highest median capital gain was recorded in District 26 (Mandai/Upper Thomson) at S$748,000, while District 8 (Farrer Park/Serangoon Rd) had the lowest at S$100,000. The overall median unlevered return stood at 28.6%, with the highest in District 26 at 55.7% and the lowest in District 2 (Chinatown/Tanjong Pagar) at 10.4%. These figures are crucial for understanding the investment potential across different districts.

We can see the differences in the median in the chart below:

And the differences between districts:

Next, we look at the unlevered returns for the condo resales:

And the differences between districts:

Secondary findings

December’s market also showed some intriguing secondary trends. Price changes by region saw a decrease in CCR and OCR by 0.5% and 1.2%, respectively, while RCR increased by 0.6%. The volume distribution was predominantly in OCR (51.0%), followed by RCR (31.7%) and CCR (17.3%). These trends offer deeper insights into the shifting market dynamics across various regions.

Conclusion

December 2023 saw a modest increase in resale prices by 0.5% month-on-month and a significant 7.5% year-on-year, with notable regional variations. The CCR experienced a 4.0% increase, while the RCR and OCR saw increases of 8.3% and 8.2%, respectively. However, resale volume decreased by 10.4% from November 2023, though it was higher than December 2022 by 7.1%. Sub-sale transactions made up 13.0% of the sales, indicating a growing trend in this area.

The report also highlighted significant transactions, including a peak sale of S$12,500,000 at Four Seasons Park. Median capital gains for resale condos stood at S$314,000, with District 26 (Mandai/Upper Thomson) witnessing the highest gain. These findings provide a comprehensive understanding of the condo resale market, reflecting both the short-term fluctuations and long-term trends that are crucial for market participants.