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Condo resale volume drops 9.5% MoM in February

The decline can be attributed to three factors, according to an expert.

Condo resale volume fell 9.5% month-on-month MoM to 1,013 units in February 2022, marking the sixth consecutive month of decline for the market, data from 99.co and SRX showed.

On a year-on-year comparison, the volume fell by 23.9%.

By region, 63.9% of the volumes were from the Outside Central Region (OCR), 22.3% from the Rest of Central Region (RCR), and 13.8% from Core Central Region (CCR).

According to OrangeTee, the drop can be attributed to three factors: the triple whammy of property cooling measures, seasonal slowdown during the Chinese New Year period, and geopolitical uncertainties arising from the Russia-Ukraine conflict.

“Housing demand is commonly driven by market sentiment. Therefore, some buyers may have taken a temporary backseat in light of the growing global uncertainties. The recent Russia-Ukraine conflict has rattled global supply chains and led to higher oil and natural gas prices worldwide which have roiled commodity markets,” OrangeTee said.

Despite the easing of buying momentum, PropNex said they remain “positive about the resale market.”

“The limited project launches, dwindling unsold new homes, and potentially more HDB upgraders looking to buy a private property will help to underpin demand for resale condos this year,” the expert said.

“An estimated 31,325 flats will exit the 5-year Minimum Occupation Period in 2022, which could see more flats being sold and families likely upgrading to a private home,” they added.

Whilst volume declined, prices continued to increase in February 2022, rising by 0.6% MoM and 8.6% year-on-year (YoY).

Across regions, the highest YoY price increase was seen at OCR (9.6%), followed by RCR (7.6%), and CCR (7.1%). On a month-on-month comparison, however, prices decreased for CCR by 0.3%, while prices climbed 0.6% and 1.1%, respectively.

For the month, the highest transacted price for a resale unit was at $10.5m at Ardmore Park.

“We expect resale condo prices to stay relatively resilient, particularly those in the RCR and OCR, which are supported by a larger pool of buyers compared to the CCR. Furthermore, the firm prices at new launches – partly fuelled by high land prices – will also help to support resale values of nearby properties,” PropNex said.

PropNex, for its part, said, buyers may not see significant price markdowns in the coming months “until there is greater market clarity, and the geopolitical situation stabilises.”

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