Auction market slumps 59.7% in 1H2023, lowest sales value in three years: Edmund Tie
The local property auction market has had a significant drop of 59.7% in total transaction value over the first six months of this year, as compared to 2H2022, according to a research note published by Edmund Tie. The total value for the successfully auctioned 11 properties came up to only $15.2 million.Joy Tan, head of auction and sales at Edmund Tie, attributes this fall to largely low quantum properties being put up for sale, mostly either below or just past the S$1 million mark, and only one high-value transaction taking place above S$5 million. This transaction was for a three-storey semi-detached house on Vaughan Road, priced at $6.3 million.
The low transaction value is in stark contrast to the one seen in 1H2020, the onset of the Covid-19 pandemic, when one property was sold at an amount of $0.94 million.
Out of the 11 successful property transactions in 1H2023, seven were industrial properties, three were residential, and one was an office property. Tan says that despite the low sales figure being recorded, buyers are displaying a growing acceptance towards leasehold properties with shorter remaining lease tenures of between 30 and 60 years. She believes this is due to domestic investors developing a higher risk tolerance in the face of the volatile financial markets, as well as a shift towards alternative investment opportunities.
External economic factors, such as fears of an impending recession, increasing interest rates and the cooling measures announced in April are also impacting the property auction market. Tan further adds that when new private residential projects are set to launch over the next few quarters, potential buyers are holding back on their purchases.
Residents of Orchard Boulevard Condo can discover a unique fusion of convenience and luxury in the palatial abodes. They can enjoy retail therapy in the numerous malls located within walking distance where various fashion, dining, and entertainment experiences await them. Moreover, they can remain connected to the city through the Orchard Boulevard MRT station, located just a mere few minutes away. This strategic location offers a wide range of amenities that cements the property’s appeal.
Looking ahead, Tan expects mortgage listings to pick up only in 2024, given the time lag between banks repossessing properties and putting them up for auction. On the other hand, commercial listings are expected to garner more buying interest given the waiver of additional buyer’s stamp duty and the increasing number of family offices in Singapore.