Luxury homes here have seen only minimal price growth in the last quarter.
UPDATED: Singapore’s luxury home prices grew by only 0.5 percent quarter-on-quarter in Q3 2016, according to a Knight Frank report.
The city-state joins 17 other cities tracked by Knight Frank, which saw their rate of price growth decline from the previous quarter. These cities include Vancouver, Toronto, London, Sydney and Melbourne — all of which saw new taxes imposed within the last 12 months, either in the form of higher stamp duty, additional taxes for foreign buyers, or the closing of tax loopholes for non-residents.
House prices in Vancouver, for instance, increased by only 1.5 percent quarter-on-quarter in Q3 2016, down from its quarterly average of 8.1 percent over the last four quarters. This comes as a new 15 percent tax for foreign buyers, as well as talk of a further tax on vacant homes in 2017, are slowing sales there, said Knight Frank.
Prime prices in London, on the other hand, dropped by 2.1 percent year-on-year, with stamp duty remaining a bigger influence on the prime London market than Brexit. In some instances, the uncertainty surrounding Brexit also served as a catalyst for overdue price reductions.
But despite the prevailing muted sentiment across the Singapore private homes market, amid property cooling measures and a weak economy, the annual price recovery of Singapore’s ultra-luxury homes has been steady for the past three quarters this year, said Alice Tan, Director and Head of Consultancy and Research, Knight Frank Singapore.
The revival in demand for ultra-luxury homes was mainly supported by the search for safe-haven property investment destinations, as well as the increased value proposition compared to elevated home prices in other global gateway cities, she said.
“However, growing headwinds, such as the prospect of a slow economy and possibly lack of an uplift in private home sales, could limit (the) price growth of ultra-luxury homes going forward in the next six months or so,” she added.
Cheryl Marie Tay, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email cheryl@propertyguru.com.sg.
