Singapore, 20 July 2017 – The company secures $142M in new appointments with optimism but caution to market recovery
Just four months after opening in Singapore, List Sotheby’s International Realty, Singapore has secured $142 million in new business appointments in the Singapore market that is seeing signs of an upward trend. Despite these new appointments, the realtor maintains that it is still too early to expect a full residential market recovery because economic fundamentals are still consolidating. The GDP growth for the second quarter of 2017 was 2.5 per cent, which remained unchanged from the government’s revised first-quarter growth from 2.7 per cent to 2.5 per cent. Moreover, the current unemployment rate is also inching upwards among the mid-career professionals.
Nonetheless the realtor, which specialises in luxury residential properties, has revealed that in the past two decades, a pick-up in the sales activity of the Good Class Bungalow (GCB) market during a downturn, including the 1999 Asian Financial Crisis, had seemingly acted as a stimulus to boost the sale of new homes, which led to the recovery of the luxury market. List Sotheby’s International Realty, Singapore, which is plugged into a network of 880 offices with 20,000 sales associates across nearly 70 countries, believes this trend is making a comeback today.
According to List Sotheby’s International Realty’s Singapore’s research arm, interest in GCBs and the bungalows at Sentosa Cove picked up in the first half of 2017. Based on caveats lodged, 20 GCBs and seven bungalows at Sentosa Cove have been transacted compared to 14 GCBs and none at Sentosa Cove over the same period in 2016. At this pace, the GCB market in 2017 could perform better than in 2016, which clocked in a total sales volume of 37 GCBs. As for Sentosa Cove, the bungalow market has already outperformed the 2016 sales volume. The 20 GCBs sold in H1 2017 amounted to an investment value of $432.21 million or $1,242 psf on land area. This compares with the value of $298.36 million or $1,318 psf for the 14 GCBs sold in the same period in 2016.
Mr. Leong Boon Hoe, Chief Operating Officer of List Sotheby’s International Realty, Singapore reveals that this pickup in GCBs we see now also occurred two decades ago during the 1999 Asian Financial Crisis, the post-recession years of 2004 to 2006 and 2009 to 2010 amidst the sub-prime mortgage-led global financial crisis, and shows how the confidence of the astute GCB investor had underpinned the recovery of the luxury residential market.
Leong explains, “Based on current market conditions, we believe foreign investors still find Singapore properties an attractive option. This can be substantiated by the 545 caveats lodged by permanent resident and foreign buyers in the Core Central Region in the first half of 2017, representing a 22% y-o-y increase by the same group. Comparing with an islandwide 33% y-o-y growth over the same period, the foreign investors’ return of confidence is strongly felt in the Core Central Region. Excluding Singaporeans, the top five nationalities who bought residential properties in H1 2017 were PRC nationals, Malaysians, Indonesians, North Americans and Hongkongers.”
It is with this tide of measured optimism that List Sotheby’s International Realty, Singapore secured a total of approximately $142 million in new appointments in Singapore, which include the $108 million Wallich Residence Super Penthouse, the $21 million Sentosa Cove bungalow, and the $13 million Marina Bay Residences. Significant regional listings include Sansiri’s 98 Wireless, which is the most expensive luxury freehold condominium in Bangkok, and UEM Sunrise Berhad’s upcoming Mayfair apartments in Melbourne, which were designed by the renowned and the late architect Zaha Hadid.