SALES and prices of Singapore’s prime residential properties suffered a hard landing in the second half of 2023, as sharply higher Additional Buyer’s Stamp Duty (ABSD) knocked the wind out of the high-end market. 

Property consultancy Knight Frank said that there were 64 prime non-landed residential transactions totalling S$503.9 million in H2 2023, with prices averaging S$2,302 per square feet (psf). This is less than half of the previous half-year, when 134 deals chalked up S$1.2 billion at an average price of S$2,625 psf. 

For the whole of 2023, there were 198 prime condo deals worth S$1.7 billion – a 33.4 per cent decline from the S$2.5 billion posted the previous year. 

The 2023 tally was also much lower than the 298 deals recorded in 2022, and 479 deals in 2021, noted Nicholas Keong, Knight Frank’s senior director and head of residential and private office.

Knight Frank’s analysis of the prime-homes market counts only units that are at least 2,500 square feet (sq ft) in size located in the most highly valued areas in Districts 1, 2 and 4 – the central business district and Sentosa – and Districts 9, 10 and 11 – the Tanglin/Orchard Road area, Bukit Timah and Holland Road area, and Newton/Novena locations. 

Keong attributed the fall in sales to the higher ABSD rates – which doubled to 60 per cent for foreign homebuyers – that took effect in April. 

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“Coupled with a mismatch in price expectations between buyers and sellers, sales volume of luxury non-landed homes dropped significantly, with ABSD effectively cooling the high-end market,” he said. 

Prime condo prices consequently fell 6.6 per cent to S$2,302 psf in H2, from S$2,464 psf a year ago, as sellers lowered expectations on price premiums, said Keong. 

An SRI market report released on Jan 3 indicated that there were at least 11 transactions for new ultra-luxury condos last year – that is, units that cost S$10 million or more. In 2022, there were 19 of such sales.

Topping the list was a 8,633 sq ft unit at freehold Les Maisons Nassim, which transacted at S$45 million or S$5,213 psf in May. 

On the resale front, there were at least 36 transactions in 2023 that exceeded the S$10 million threshold, a plunge from the 58 transactions in 2022. The priciest sale was of a 10,710 sq ft unit at the freehold Goodwood Residence in Bukit Timah at S$32 million or S$2,988 psf in September (see amendment note).

Keong believes that prime condo prices are unlikely to increase in any “significant fashion” in the coming year and may see “marginal declines”, “as premiums continue to be eroded with homeowners not exhibiting the same urgency as before”.  

He expects prices to be flat, ranging “between minus 1 per cent and 2 per cent in 2024, most likely at the negative end of the range”.

The prime landed market had a similarly muted year. “Transaction volume eased throughout the year due to limited saleable stock,” Knight Frank said.

Some S$2.1 billion worth of landed homes was sold in H2 2023, down 26 per cent from H1. For the whole year, total sales came in at S$5 billion, about 18 per cent lower than in 2022, and 51.5 per cent less than 2021’s record high of S$10.2 billion.

Just two Good Class Bungalows (GCBs) were sold in H2 2023, from eight deals in H1. The GCB market recorded 10 sales in 2023, half of the 20 GCBs sold in 2022, and substantially lower than the 60 sales in 2021. The average unit land price tumbled 42 per cent to S$1,712 psf in H2 2023 from the S$2,952 psf in H1 2023, said Knight Frank.

Amendment note: An earlier version of this article labelled Goodwood Residence a 99-year leasehold property. It is a freehold property.