Auction market slumps 59.7% in 1H2023, lowest sales value in three years: Edmund Tie

The local real estate auction sale market efficiently sold 11 estates over the very first six months in this year. A research note published by Edmund Tie mentions that the complete deal worth for the effectively auctioned real properties was $15.2 million.

She adds that over the past few months, investors are showing an increasing acceptance in the direction of leasehold buildings with shorter remaining lease terms of usually 30 to 60 years. “This is likely because of financiers’ higher chance resistance, as financial markets remain unpredictable, and also a noticeable preference change to another investment possibilities.”

This was the lowest sales price reported by the auction market ever since 1H2020, the beginning of the Covid-19 pandemic, when only one estate was yielded $0.94 million. It is in addition a notable decrease of 59.7% compared to 2H2022 which recorded 17 sales cost $37.7 million.

Lakegarden Residences floor plan

” In addition, on the back of the high interest rates, the air-cooling steps publicized in April and also the total unpredictable macro setting, customers have actually usually followed a wait-and-see posture,” claims Tan.

Looking in advance, she assumes to see home loan listings pick up merely in 2024, presented the time lag between financial institutions repossessing residential properties as well as placing them up for public sale. She as well projects commercial listings to gather more buying rate of interest. “Given that commercial deals are going to not acquire additional buyer’s stamp duty and with the boost in household offices in Singapore, well-priced business office listings will certainly also likely be very searched for,” she states.

Cognisant of the upcoming new nonpublic non commercial projects readied to hit the market over the following several quarters, probable customers are holding off on their investments, claims Tan, including that outside variables like concerns of an upcoming economic downturn also higher interest rates are similarly influencing sales.

The “high-value deal” was for a three-storey semi-detached house on Vaughan Road that was transacted for $6.3 million. Furthermore, 7 of the profitable properties sold at auction were industrialized properties, with the balance being 3 residential properties and even a workplace real estate.

According to Joy Tan, head of auction and sales at Edmund Tie, the small sales worth in 1H2023 resulted from “the properties pounded being of low quantum, mainly possibly below or simply past the S$ 1 million mark. There was only one high-value purchase that was over S$ 5 million”.

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