Singapore's ultra-luxury home prices slowed down in 3Q

It is ranked 12th fastest in terms of price growth.

Luxury homes in some of the world's top cities saw a slowdown in price growth in the last quarter as new taxes, elections, referendums and economic jitters took hold.

Data from Knight Frank show that the index increased by 3.8% in the year to September 2016, down from 4.6% last quarter.

Despite an average annual growth rate of 3.8%, 18 of the 37 cities tracked by KF index saw their rate of price growth slide compared with last quarter. It is ranked 12th fastest in terms of price growth.

Luxury homes in some of the world's top cities saw a slowdown in price growth in the last quarter as new taxes, elections, referendums and economic jitters took hold.

Data from Knight Frank show that the index increased by 3.8% in the year to September 2016, down from 4.6% last quarter.

Despite an average annual growth rate of 3.8%, 18 of the 37 cities tracked by KF index saw their rate of price growth slide compared with last quarter.

Among them were Vancouver, Toronto, London, Sydney and Melbourne; all cities where new taxes have been imposed in the last 12 months; either in the form of higher stamp duty, additional taxes for foreign buyers or the closing of tax loop holes for non-residents.

Singapore also reported slowdown in prices but recovery was sustained in the recent quarters.

Alice Tan, Director and Head of Consultancy & Research, Knight Frank Singapore, comments, "Despite the prevailing muted sentiment across the Singapore private homes market, amid economic weakness and property cooling measures, annual price recovery of Singapore's ultra-luxury homes has been continuing for the past 3 quarters this year.

Prices in SIngapore rose 6.2% YoY in September, but 0.5% QoQ. It occupied the 12th spot in terms of annual price growth led by Vancouver.

According to Tan, the search for safe haven property investment destinations and the increased value proposition compared to elevated home prices in other global gateway cities largely supported the demand revival for Singapore ultra-luxury homes.

She cautioned however that growing headwinds such as the prospect of a slow economy and possibly lack of an uplift in private home sales could limit price growth of ultra-luxury homes going forward in the next 6 months or so.

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