Prices in Singapore are on the rise again. (Photo: Cheryl Marie Tay)
Singapore recorded the eighth largest growth in luxury home prices in Knight Frank’s latest Prime Global Cities Index, with values rising 5.4 percent in Q1 2016 from a year ago.
“The annual price increase signals ‘green shoots of recovery’ for the ultra-luxury segment, as high-net worth individuals see rising value proposition for Singapore luxury homes after a prolonged two-year period of price declines,” said Alice Tan, Research Head at Knight Frank Singapore.
In fact, a number of these prime units were sold at prices surpassing market expectations in the first quarter, she noted.
Tan explained that the return of wealthy buyers shows their preference for Singapore homes and their confidence in the country’s long-term outlook. This is on the back of its safe haven status, stable economic fundamentals and growing importance as a key gateway city in Asia. Another plus factor is the premium quality of high-end homes here, which now offer greater value compared to most gateway cities.
Similarly, data from the Urban Redevelopment Authority (URA) shows that luxury home prices in Singapore’s Core Central Region (CCR) edged up by 0.3 percent quarter-on-quarter, driven by healthy sales in well-located projects in the prime districts.
However, it remains unclear if the price recovery in the high-end residential segment can continue over the next three quarters as volatility in the global economy persists.
“With the Singapore economy facing strong headwinds, businesses could see weakening earnings which can possibly impact the buying appetite of entrepreneurs and high-net worth individuals for (expensive) homes going forward into end-2016,” Tan added.
Meanwhile, Vancouver topped Knight Frank’s global index with a 26.3 percent surge in luxury home prices, followed by Shanghai (20.3 percent) and Sydney (12.3 percent).
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
