Bungalow Sales Bolster Luxury Market

Luxury Homes H1 2020

Luxury homebuyers tread carefully

The COVID-19 pandemic, described as “the crisis of a generation" by PM Lee, disrupted the global economy in a way never seen before. Global economies almost came to a standstill from March to May as most countries shut their borders and imposed lockdown measures on workplaces, schools, malls and F&B outlets in a bid to stop the spread of the coronavirus.

In the property market, sales galleries were closed and all property viewings suspended until 1 June. The lockdown has since gradually eased. Some of the luxury properties sold in H1 2020 were viewed by the buyers before the lock-down happened. The virtual platform also proved to be an effective tool to engage the more savvy home buyers. As a few of the bungalows were bought for redevelopment, the buyers were satisfied to view from the outside without entering the properties.  

In H1 2020, 14 bungalows in the Good Class Bungalow (GCB) areas were reportedly sold, fewer than the number sold in H2 2019 and in H1 2019. The five bungalow deals at Sentosa Cove in H1 2020 was a surprise after only 1 unit was sold in H2 2019 and three in H1 2019. Decline in luxury apartments was more stark. The 84 luxury apartment deals in H1 2020 was less than 50% of the volumes in the half-yearly sales in 2019 marking the first time it fell below 100 deals in a six-month period since H2 2015.

The analysis of prices shows that bungalows were still edging up from H2 2019 levels: 6.5% rise in GCB prices to $1,466 psf and 9.3% rise in Sentosa Cove bungalow prices to $1,825 psf. This uptick could be attributable to their scarcity and aesthetic appeal to investors. However, prices of luxury apartments moderated by around 2% to $2,957 psf over the same period. The weakness could be attributed to the absence of transactions exceeding $20 mil each, whereas there were eight such deals in H2 2019 and seven in H1 2019.

Good Class Bungalows (GCBs)

The sale of 14 bungalows in GCB areas during the uncertain economic climate of H1 2020 shows that GCBs are unique properties that are always much sought after by keen investors. The highest price of $40.0 mil ($1,964 psf) went to an old bungalow at Cluny Park. Two bungalows at Windsor Park were sold in this period, one at $21.7 mil ($1,028 psf) and the other at $21.3 mil ($1,063 psf). This location appeals to people who like the surrounding nature reserve, Lower Peirce Reservoir, Upper Peirce Reservoir and MacRitchie Reservoir. It was reported that all three buyers planned to redevelop the sites.

Separately, the media reported the sale of a GCB at White House Park at nearly $60 mil. Built in the 1970s, the property has a sprawling land area of 35,290 sq ft. Similarly, the buyer was said to have plans to redevelop it.

With the current Covid-19 situation, there might be some bungalow owners who are willing to lower their price expectations and invest the potential cash proceeds in other investment opportunities that may surface at this point of time. This would allow a better match of buyer-seller expectations so that deals could be struck. All in, we expect a total of 30 to 35 bungalows in GCB Areas to be sold in 2020, lower than the 40 bungalows sold in 2019.  

Sentosa Cove Bungalows

The sale of five bungalows at Sentosa Cove within H1 2020 gave the micro-market a lift after a lull year of only four bungalow transactions in 2019. Sentosa Cove is still attractive to high-net-worth investors because it is the only location in Singapore that offers a waterfront resort lifestyle and where foreigners are allowed to own landed properties. 

Of the five deals, the priciest bungalow is located at Pearl Island and was sold for $25.0 mil ($2,002 psf). The second highest price of $24.0 mil ($2,464 psf) went to a villa at Cove Grove. The premium it commanded could be attributed to its unblocked view of the Southern Islands. The remaining three villas fetched between $14 mil and $16 mil each.

Overall, the total prices of the five transactions reflected a land rate of $1,825 psf, which is around 9% higher than the price level at end-2019. We were aware that some of the buyers had been negotiating the prices since more than six months ago. In view of the present pandemic, some owners were willing to lower their price expectations thereby closing the price gap between buyers and sellers. Hence the deals were finally struck.

As travel restrictions are gradually relaxed in H2 2020, we expect to see more foreign interest to return. This could lead to a similar number of bungalows to be sold in the second half of 2020.

The government had announced future development plans for the Greater Southern Waterfront, of which Sentosa island is a part. One of these is a new residential precinct to be developed at the former Keppel Golf and Country Club. Resorts World Sentosa had also announced plans to build two new hotels and new theme parks. These new initiatives will likely breathe new life into Sentosa Cove.

Luxury Apartments

The sales momentum of luxury apartments slowed down in H1 2020 largely due to the circuit breaker which halted all property viewings. Only 84 transactions were registered, less than half the number of deals in H2 2019 and H1 2019 respectively. The last time there was less than 100 deals in a six-month period happened in H2 2015.

One of the developments which stood out was Le Nouvel Ardmore where seven luxury units were sold in H1 2020. Priced between $15.8 mil and $18.2 mil, these are all high floor units with sizes between 3,821 sq ft and 4,273 sq ft. Another prominent project was Boulevard 88 where six units were sold between $6.2 mil and $10.3 mil for sizes ranging from 1,776 sq ft to 2,777 sq ft.  

Some penthouses were known to be sold in H1 2020. The most expensive of them was the 8,740 sq ft penthouse in Ardmore Park which sold for $27.6 mil. Another noteworthy deal was the sale of the 3,509 sq ft junior penthouse at Wallich Residence at $17.5 mil. The price reflected $4,987 psf which was a record for this 99-year leasehold project located in the Downtown Core.

Profile of buyers

Despite the smaller number of transactions in H1 2020, the profile of buyers for luxury units from $5 mil onwards was similar to that in H2 2019. Singaporeans accounted for 32% of the transactions while permanent residents (PRs) and foreigners accounted for 67%.

The biggest group of foreign buyers (including PRs) were still the Chinese, with Indonesians taking up the second position, followed by Americans, Taiwanese and Indian nationals. These were the top five groups of foreign buyers in H1 2020.


The latest report by the International Monetary Fund (IMF) released in June 2020 predicted that the global economy will shrink by 4.9%. It said that even if the world is now in the recovery phase, the strength of the recovery is in doubt because the vaccine has not been found.

Amidst this bleak outlook, some investors would choose to hold cash and wait for the clouds to clear. Some are ready to jump into any  distressed sales in the market.

So far, developers have launched Boulevard 88 (154 units), Cuscaden Reserve (192 units), 19 Nassim (93 units), Nouvel 18 (156 units) and 8 Saint Thomas (250 units). EDEN at Draycott Park (20 units) is currently open for preview.

We expect the prices of luxury apartments to ease further in H2 2020 as developers offer innovative financial packages to move sales.

To view premium content and download full report