Singapore private condo resale volume up 8.6% to 1,461 units in January
It’s the seventh straight month of resale volumes surpassing the 1,000-unit mark.
The private condo resale market continued to strengthen in January 2021, with sales volume rising by 8.6% to 1,587 units from 1,461 units sold in the previous month, according to estimates by the SRX. This is the seventh straight month where resale volume crossed the 1,000-unit mark as per SRX’s data.
OrangeTee Research believes one of the key drivers of activity in the secondary market lies in the relatively more affordable resale properties compared to new launches. Based on caveats lodged on URA Realis (as at 9 Feb 2021), the median price of new non-landed private homes (ex. ECs) was about 41% higher than that of their counterparts in the resale market in Q4 2020. This was up from the price gap of 36.3% in Q3 2020. In January 2021, caveat data showed that the median transacted price of new non-landed private homes (ex. ECs) was 35.5% higher than that of the resale units sold during the month.
Given the firm new launch prices, buyers who are price sensitive or more financially prudent – being mindful of the potential challenges from a protracted COVID-19 pandemic - will be attracted to the more affordable homes in the resale market. In addition, those who have more immediate housing needs or do not want the hassle of finding interim housing (in the case of many HDB upgraders) before their new condo is built will also consider resale units.
Meanwhile, the robust sales in January has also pushed resale prices up slightly. SRX said the overall condo resale prices climbed by 1.2% month-on-month (MoM) in January, supported by the price increase across all three sub-markets: CCR (+0.4% MoM); RCR (+1.9% MoM); and OCR (+1.1% MoM).
OrangeTee expects resale volume to remain healthy in 2021, owing to sustained demand from local buyers. To this end, it’s expected that more than 10,000 resale private homes could be sold this year. In view of the underlying demand, OrangeTee anticipates that resale prices could continue to inch up, but likely at a slower pace compared with new launches. However, any government intervention in the form of fresh cooling measures will likely snap the growth momentum in the resale market.