Strong basics support demand & prices of mass-market condos
Mass-market condos continue to be in demand, and their prices are rising.
The HDB resale price and the median household income are rising, so more people choose non-landed housing in private residences.
In Singapore, mass-market condos account for approximately half of all condominium transactions. This segment is a major influence on the pricing trends and dynamics of the larger private housing markets.
In this analysis, mass market condominiums refers all types of residential non-landed property (excluding executive condos) located outside Central Region (OCR). These condos typically are gated communities and have amenities like parking, landscaping pools, gyms or other recreational facilities.
Price Trends
After a 4-year decline in the prices of private housing from 2013-2017, they began to rebound during Q3 2017. In the past five year, the OCR price index for non-landed non-private residential properties has increased by 39.8%. It is now higher than the 34.3% annual growth rate of non-landed non-private housing on the whole island. OCR condos saw a strong rise from late 2020 to Q3202, due in part to the constant increase of HDB resale apartment prices. Find out the attractive pricing of Lentor Mansion Pricing
Rental Trends
Rents of non-landed properties increased faster in the last five than prices. The overall rental index in private non-landed property increased by 45.2%, from Q4 2017, to Q4 20,22. This was higher than the price index increase of 34.3%. The OCR non landed housing rental index grew at the fastest rate, 55.9% in the same time period.
Market Size
In the private non-landed market, the mass market segment consistently has been the largest market in terms the housing units purchased over the past nineteen years. This is mainly because the OCR, which covers four of Singapore’s five regions, is the largest in terms of geography.
Buyer Profile
HDB Upgraders tend to purchase suburban condominiums rather than private housing in any other segment. In 2022 HDB-upgraded condos made up 45%, which challenges the notion that HDB-upgraded condominiums dominate the OCR’s private housing market.
Conclusion
HDB upgraders’ and investors’ interest in mass-market condos is supported by market fundamentals like increasing HDB resale price and median household earnings.
Approximately 30-40 new private housing developments are scheduled to begin in 2023. About 30% of those units will be located in OCR. This will help meet the demand of new private housing units in the OCR while avoiding oversupply.
