Image by Cedric Yong from Pixabay

Prices and demand for shophouses to pick up in the coming months

The ABSD rate hike will help drive demand in the market.

Despite shophouse transactions dropping by 12.1% QoQ and 44.2% YoY in 1Q23, real estate experts believe demand for the building type will eventually pick up.

Lee Sze Teck, head of research at Huttons, said the market's slow start was mainly due to Chinese New Year (CNY) festivities.

"There were only five shophouse transactions in January 2023. Enquiries and transactions started to pick up after CNY. Sales improved to nine in February and 15 in March 2023," Lee explained.

Lee believes demand for shophouses will pick up in the coming months, especially after the government raised the Additional Buyer’s Stamp Duty to 60% for foreigners buying a residential property.

"[The ABSD hike] may divert some demand to the shophouse market as there is no wealth tax," Lee added.

With demand likely to increase, Lee also expects prices to trend upward.

"The value of shophouses will continue to rise over time due to its limited supply, thus providing good wealth preservation for Ultra-High-Net-Worth Individuals and family offices," Lee said.

In Q1, the market recorded a total transaction value of $281.8m and whilst the value was 5.7% lower QoQ, the average transacted value per shophouse during the quarter was $9.7m, 8.1% higher than the average value per shophouse in 4Q22.

Follow the links for more news on

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!