This Asia-Pacific residential property market saw an expedited growth in the second half of 2023 (H2 2023), with Singapore registering as the top-performing market in the region, according to a report published by Knight Frank Asia Pacific (APAC).
The report, Asia-Pacific Residential Review Index for H2 2023, found that Singapore registered 13.7% year-on-year (YoY) residential price growth in H2 2023.
“Despite quieter sales market and reduced launches due to a challenging macroeconomic environment and higher acquisition costs following cooling measures in April 2023, Singapore remains a safe haven, attracting talent and maintaining population growth.
Cooling measures are usually implemented by the Singaporean government in a bid to lower property prices in the market, when housing prices increase, especially if the public housing, HDB flats, have crossed the SGD$1 million mark.
“This, coupled with the wealth effect, is expected to support stable prices despite a decline in transaction volumes,” it said in a statement today (Feb 1).
The report also found that 21 out of the 25 cities tracked in Asia-Pacific recorded positive annual price growth in H2 2023, with an average YoY residential price growth of 4.5%.
Knight Frank APAC managing director Kevin Coppel said the residential market experienced a surge in the past six months, following the decision by United States’ Federal Reserve System (Fed) to pause rate hikes, which encouraged potential buyers who had been waiting on the sidelines to make purchasing decisions.
“(Besides that), ongoing constraints on the supply side, including input costs, labour shortages and construction delays, have played a role in supporting prices in numerous cities across the Asia-Pacific region.
“Notable performers such as Singapore, Sydney, Brisbane, Perth, Manila, Delhi, and Bengaluru have benefited from factors like the wealth effect, demand exceeding supply, and optimistic economic growth prospects,” he said.
Knight Frank APAC research head Christine Li added: “Despite encountering unforeseen challenges such as geopolitical issues and persistent inflation, Asia-Pacific real estate has demonstrated a more optimistic outlook heading into 2024.
“The annual growth rate of 4.5% has reversed early pessimism in sentiment, and the robust economic momentum is anticipated to sustain homebuyer sentiment throughout 2024.”
Meanwhile, Knight Frank Property Hub managing director Enoch Khoo holds an optimistic view for Malaysia due to the Budget 2024 presented last year.
“(The budget) placed emphasis on a key initiative aimed at positively impacting the local real estate market despite inflationary pressures and elevated overnight policy rate (OPR).
“Therefore, it encourage the market to move positively with increased sales volume, new launches, and successful completions,” Khoo said.
Other findings include encouraging growth in Australia, with major Australian cities except Melbourne, namely Perth, Sydney, Brisbane, and Gold Coast mainstream residential markets experienced double-digit growth in 2023.
“The residential price growth range between 10.8% and 12.8% YoY. Prices are expected to rise by mid-range single digits in 2024,” it added.
The Asia-Pacific Residential Review is an investor focused report which provides an in-depth look at the performance of 25 mainstream residential markets across the region including Malaysia, Singapore, Australia, India and Hong Kong SAR.
