Singapore’s 2021 prime residential price growth ‘modest’ at 3.5%: Knight Frank

In comparison, overall private home prices increased 10.6% in the same period.

Despite the city-state’s excellent track record of renowned property developers in building world-class luxury properties, Knight Frank says prime home prices in Singapore increased by a relatively modest 3.5% in 2021, coming in at the 70th position out of a hundred locations tracked by the analyst’s Prime International Residential Index 100 (PIRI 100). 

“Prime prices lagged behind the overall sizeable growth of 10.6% for all Singapore private residential properties in 2021, and behind an average increase of 8.2% across residential cities.”

Here’s more from Knight Frank:

One key reason Singapore’s prime home prices have not escalated as fast as other cities can be attributed to the government’s conscious efforts in reining in runaway prices. A decade’s worth of watchful measures have kept prices from overheating beyond the pace of economic performance and household incomes. And while not as spectacular as other cities, this has kept Singapore’s private residential market steady in the face of external upheavals. 

Leonard Tay, Head of Research at Knight Frank Singapore added, “The Singapore Government had announced recent cooling measures in December 2021 to temper the beginnings of a house-hunting boom that happened amid a pandemic. More recently, they have also announced the increase in property taxes that are targeted at higher-end assets which might potentially rein in some property investors’ interest.” 

On top of these measures, prolonged and recurring travel restrictions have also inhibited foreign investors’ interest in purchasing homes in Singapore, resulting in a decline in the number of units bought by foreign buyers at 3.6% in 2020 and 3.4% in 2021. To further exacerbate matters on the supply side, there was a lack of new launches in the top-tier class of homes in Singapore for much of 2021. 

Tay elaborated, “This presents a unique and compelling value opportunity, especially for investors priced out from the rocketing luxury home prices in other cities. For the year 2022, prime residential prices are expected to rebound by a milder 2.0% as buyers adjust to the newly imposed cooling measures. Interested investors can look into the pool of luxury properties in Singapore before prices start to rise more substantially.”

Click here to read the full Wealth Report 2022.