RENTAL transaction volumes for non-landed luxury homes continue to rise in the third quarter of 2023, up 13.6 per cent compared to the previous quarter, Huttons Asia’s market report indicated on Monday (Nov 6).

Huttons Asia’s chief executive, Mark Yip, said non-landed luxury homes’ rentals edged up by 1.8 per cent in Q3. This could be due to more foreigners renting while waiting to obtain their citizenship or permanent residence before buying.

The figures were based on an estimated 701 non-landed luxury homes under Huttons’ basket of properties in Q3.

For the nine months ended Sep 30, rents of non-landed luxury homes increased by almost 20 per cent to S$15,894 per month, said Huttons.

Similarly, in the Good Class Bungalow (GCB) segment, the number of rental transactions was up 44.2 per cent during the quarter. The highest transacted rent was S$120,000 per month for a detached house in the Nassim Road good class bungalow area, the company added.

On the sales front, sentiment in the non-landed luxury homes was down after the Additional Buyer’s Stamp Duty (ABSD)’s policy was implemented in April 2023.

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Transactions of non-landed luxury homes dropped to 37 units in Q3, 41.3 per cent down from the 63 transactions in Q2.

Based on caveats, the total value of non-landed luxury homes was S$295.8 million, 50.9 per cent lower than Q2’s S$601.9 million, the company said.

For the nine months ended Sep 30, a total of 222 non-landed luxury homes worth S$1.82 billion were sold, with the total transacted amount almost 25 per cent lower than the same period in 2022, the report indicated.

Huttons said the top three best-selling projects in Q3 were Goodwood Residence, Beverly Hill and Nassim Park Residences. Based on caveats, the most expensive unit was a 10,710 square feet penthouse in Goodwood Residence that was sold for S$32 million.   

For the GCB segment, Huttons said an estimated three GCBs were sold during the quarter. The total value of these GCBs sold was S$69.55 million, 82.3 per cent lower than the previous quarter and 85 per cent year on year. This was the lowest transaction volume achieved since Q4 2013, added Huttons.

Yip said after the recent anti-money laundering arrest, owners of GCBs are “increasingly wary of renting their GCB to Chinese foreigners”.

“The rental market is likely to remain subdued in the coming months. Many owners of GCBs are holding back from selling as they do not think buyers are willing to match their asking prices,” he added.

Huttons expects the non-landed luxury market to see a return of interest after the dust has settled. Although there is a slight uptick in foreigners buying non-landed luxury homes in recent months, “the level of transactions is unlikely to return to pre-ABSD level”, the property firm said.