Higher interest rates and US financial crisis limit Singapore property investment

Higher interest rates and US financial crisis limit Singapore property investment

According to a Collier’s analysis published on Wednesday, real estate investment activity in Singapore dropped to over $4 billion in the first quarter, the lowest quarterly amount observed since the fourth quarter of 2020, during the height of the Covid-19 epidemic.

Real estate investment volume fell by nearly 63% in the first quarter and it affects the new launch condo like The Continuums Price and The Continuums Showflat, from $10.9 billion in the same time in 2022, despite many residential collective sales and industrial acquisitions.

The recent bankruptcy of Silicon Valley Bank and the merger of Credit Suisse, DpFraternity, and UBS Group have caused turbulence in the United States banking industry, according to analysts.

Singapore’s safe-haven attraction persists owing to the country’s strong economic and property market fundamentals, despite the fact that more investors are adopting a wait-and-see approach.

Singapore’s residential investment sales increased by 17.4 percent year over year, reaching approximately $1.6 billion in the most recent quarter. Three freehold condo collective sales, totaling $583.8 million, contributed to this. These transactions included Meyer Park in Marine Parade, Bagnall Court in Upper East Coast Road, and Holland Tower in Holland Heights.

Since the fourth quarter of 2021, this is the largest quarterly volume for residential collective sales. According to Ms. Catherine He, head of research at Collier’s, and Ms. Tang Wei Leng, managing director and head of capital markets and investment services, this trend indicates that developers are seeking to buy freehold properties. Sales of government land and high-end homes, whose customers are less impacted by rising mortgage rates, are expected to drive residential investment activity in the second quarter, they said.

According to Knight Frank Singapore’s first-quarter investment sales report, buyers were more interested in freehold homes in desirable areas.

Since the last set of property cooling regulations was implemented in December 2021, the first successful residential collective sale in the prime area has been Holland Tower.

After China reopened its borders, this may indicate a renewed appetite for excellent real estate development locations. However, Knight Frank said that “the en bloc environment remains challenging, with a seeming gulf between sellers’ and developers’ price expectations.”

Colliers reported a reduction of 53.4% in commercial sales year over year, to about $1.3 billion, citing macroeconomic concerns and increased borrowing rates as reasons.

Due to COVID-19, Parc Clematis Showflat is open for online bookings. You can now register online to receive direct developer discount offers and prices.

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