LUXURY RESIDENTIAL MARKETVIEW

Singapore, H1 2017

Bang for the Buck – Luxury

Continues to Attract
GDP Y-o-Y Mortgage Rate GCB Price Sentosa Cove Bungalows Apartment price
2.5% Q2 2017 1.5% Jul 17 $1,242 psf $1,541 psf $2,446 psf

*Arrows indicate change from end-2016

GOOD CLASS BUNGALOWS (GCB)

KEY POINTS
Sales of luxury homes rose in H1 2017 as buyers found value in
the segment.
22 GCBs were sold in H1 2017, on par with 23 GCBs in H2
2016, boosted by smaller sized deals. The average price eased
by 6.9% to $1,242 psf from end-2016.
Eight bungalows in Sentosa Cove were sold in H1 2017. Prices
for Sentosa Cove bungalows were 18.1% lower at $1,541 psf.
Sales volume of luxury apartments was stable in H1 2017 with
170 units sold. Sales in 2017 are likely to surpass last year’s
tally of 255 luxury apartment sales, which had been the highest
volume in four years.
The average price of luxury apartments rose from $2,396 psf in
H2 2016 to $2,446 psf in H1 2017, although this was lower
than $2,519 psf in H1 2016.
Investor interest in luxury homes is likely to continue for the rest
of 2017 despite prevailing cooling measures.
Chart 1: GCB Sales Activity
$ bn
2.5
Sales activity in the GCB market in H1 2017 was
largely in line with H1 2016, as overall economic
sentiments remained mixed. While outlook in the
manufacturing and services sectors have generally
improved from a year back, business expectations
for industries such as oil and gas and the retail,
food and beverage trades are subdued.
A total of 22 GCBs were sold in H1 2017 for $463.91
mil, compared with 23 GCBs for $490.17 mil in H2
2016 and 14 GCBs for $298.36 mil in H1 2016.
Average prices of GCBs fell 6.9% from H2 2016 to
$1,242 psf on land area in H1 2017.
GCB sales volume in H1 2017 was boosted by
multiple smaller sized deals in GCB areas. A total of
11 GCBs sold in H1 2017 had plot sizes of less than
15,070 sq. ft., compared with seven in H2 2016.
Although the average land rate was lower in H1
2017, this reflected the location of some deals
$ psf during the period, rather than a broad-based
1,500 decline in GCB prices.

2.0 1,200
While there is still choice stock for sale, the gap in
price expectations between buyers and sellers
1.5 900
remain a barrier to transactions. The largest deal in
1.0 600 H1 2017 was that of a Queen Astrid Park bungalow,
which went for $46.00 mil or $1,548 psf to a local
0.5 300 businessman.

0.0 0
CBRE Research expects 35 to 40 GCBs to be sold in
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
H1 2017

2017, similar to last year’s tally of 37 sales, as sellers

Investment Value Average $ psf
are not under pressure to sell. Prices are expected to
Source: CBRE Research, July 2017 be flat or with marginal correction.
Note: Data is based on all bungalow sales in the GCB Areas, including those
with land areas less than 15,070 sq. ft.

H1 2017 CBRE Research © CBRE Ltd. 2017 | 1

 L U X U R Y R E S I D E N T I A L M A R K E T V I E W SINGAPORE

SENTOSA COVE BUNGALOWS

Table 1: Selected transactions
Location/ Typein 2016 Land/ Floor Price ($
Eight bungalows in Sentosa Cove were sold in H1 Property Area (sf) mil)
2017, compared with four in H2 2016 and none in
Queen Astrid Park GCB 29,709 46.00
H1 2016. The higher volume came as many sellers
King Albert Park GCB 39,224 43.80
have become more realistic in their price
expectations and buyers are increasingly seeing Leedon Park GCB 31,216 40.88
value in these properties. Over half of the purchases Victoria Park Close GCB 29,956 40.00
were by Singaporeans, including new citizens, who
Lakeshore View Bungalow 11,270 21.25
are able to buy houses on Mainland Singapore but
were attracted to the lifestyle and living Cove Grove Bungalow 9,354 16.80

environment of the area. En Bloc (8

1 Draycott Park 17,438 72.00
Apts)

The total value of Sentosa Cove bungalow purchases The Nassim, 5st
Apt 9,300 25.58
in H1 2017 was $116.65 mil, or $1,541 psf on land Floor

area, compared with $1,881 psf in H2 2016. Sales The Marq on

Paterson Hill, 13th Apt 6,232 21.80
volume could reach 15 to 20 bungalows in 2017, Floor
with prices to remain around current values.
Nassim Park
Residences, 5th Apt 6,953 21.00
LUXURY APARTMENTS Floor

In H1 2017, a total of 170 caveats were lodged for Le Nouvel

Ardmore, 23rd Apt 3.789 15.17
apartments in the CCR worth $5.00 mil and above –
Floor
more than the tallies of 132 in H1 2016 and 123 in
Source: URA, CBRE Research, Jul 2017
H2 2016. The higher volume came despite no new
Chart 2: Average Luxury Residential Prices
project launch in the CCR during the period – $ psf
suggesting that buyers may be looking at value buys 3,000
in the segment, in light of softer prices. The price 2,500
index for non-landed homes in the CCR has fallen 2,000
an estimated 11.2% from its last peak in Q1 2013.
1,500
1,000
Average prices among transacted apartments in the
500
CCR worth $5.00 mil and above were $2,446 psf in
0
H1 2017, higher than $2,396 psf in H2 2016 but
2012

2013

2014

2015

2016

H1 2017
lower than $2,519 psf in H1 2016. The 2.9% y-o-y GCB Sentosa Bungalows Apartment
decline in average price was likely due to the fact
that the best-selling luxury project during the Source: CBRE Research, Jul 2017
period was Leedon Residence, which sold 44 units
Chart 3: Luxury Sales Volume
worth $5.00 mil and above – or an average price of
Units
$1,993 psf. In contrast, in H1 2016, the top-selling 500
luxury project was Ardmore Three with 35 such
400
caveats lodged at an average price of $3,217 psf.
300

Even so, CBRE Research believes that overall luxury 200 170
prices should remain relatively stable in the rest of 100
2017 due to the strong holding power of developers 22 8
0
amid limited new supply for the segment; while
2012

2013

2014

2015

2016

H1 2017

transaction volume should gradually rise compared

GCB Sentosa Cove Bungalows Luxury Apartments
with 2016.
Source: CBRE Research, Jul 2017
Note: Apartment sales in Core Central Region (CCR) that are $5 mil and above
were adopted as a proxy for luxury apartments.

H1 2017 CBRE Research © CBRE Ltd. 2017 | 2

 LUXURY RESIDENTIAL MARKETVIEW SINGAPORE

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Desmond Sim
Head of Research, Singapore and SEA
+65 6326 1638
Desmond.Sim@cbre.com.sg

Rennie Whang
Residential Research
+65 6326 1663
Rennie.Whang@cbre.com.sg

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