Savills said this is the lowest recorded sales volume in 14 years.

The sales of residential apartments dropped 68.4% quarter-on-quarter (QoQ) to 690 units in the fourth quarter (Q4) of 2022, a recent Savills Research report showed. 

This is the lowest recorded quarter in 14 years or since fourth quarter 2008 when new sales volume was tallied at 419 units. Year-on-year (YoY), residential sales plummeted 77.1% in Q4 2022.

For the whole year of 2022, new sales reached 7,099 units, 45.5% lower than the 13,027 units sold in 2021. It was the lowest sales volume since 2008’s 4,264 units.

High interest rates and looming macroeconomic uncertainty also led to the 26.8% QoQ decline of secondary sales volume to 2,898 units in the fourth quarter.

The core central region had the largest drop in unit sales of 30.1% QoQ. On a yearly basis, secondary sales dropped 42.6%. For the entire 2022, secondary sales fell by 28.0%.

Sales volume of Singaporeans also dropped 47.9% in Q4 2022. Nearly less than half the recorded volume in the previous quarter at 2,303 units. This was the smallest tally in more than two years, or since 2020’s second quarter, which recorded 1,865 units.

Non-landed homes

The report also revealed that non-landed homes by permanent residents and foreigners sold fell by 25.3% to 667 units and 13.5% to 224 units, respectively.

Urban Redevelopment Authority property price index of private residential properties rose for the 11th straight quarter at 0.4% QoQ. Savills, however, said this was smaller versus the 3.8% increase seen in the third quarter. For 2022, the price index grew by 8.6% versus the 10.6% the previous year.

For luxury non-landed private residential units, prices grew for the ninth straight quarter by 0.9% QoQ to S$2,568 per square foot. On a YoY basis, prices grew by 3.8%. This was the largest annual increment since 2018.

Outlook

In the first two months of 2023, property buyers look more into affordable prices rather than bedroom count, Savills Research said.

“The Singapore residential market continues to move along at a healthy pace. However, the concern on the horizon is whether land prices can continue to rise without taking a breather as new demand is now concentrating even more in the smaller unit types” Savills Singapore Chief Executive Officer Marcus Loo said.

For 2023, the real estate expert forecasts a 7% increase in private residential property prices.