Singapore Real Estate Investment Continued Downtrend In Q3
SINGAPORE – Property investment in the city-state declined for the 2nd straight quarter in Q3 2022 amidst growing economic uncertainty and rising borrowing costs, reported Mingtiandi on Wednesday noon (19 October, SGT).
According to a recent report from Cushman & Wakefield (C&W), overall investment across all property types in Singapore fell 39 percent to S$4.78 billion in Q3 2022 from S$7.9 billion in the same period last year. It is also lower than S$16.1 billion recorded in Q2 2022.
The real estate consultancy said the fall in property transactions is due to the lacklustre commercial property market, with sales of office and retail properties plunging 95 percent quarter-on-quarter in Q3 2022.
On the other hand, deals involving smaller properties such as shophouses and strata office space dominated the market, as real estate investors shunned large-ticket acquisition requiring hefty financing.
“The commercial investment sales market tumbled in Q3 2022 given the scarcity of quality commercial assets amid more challenging market conditions,” said C&W’s Research Head for Singapore Xian Yang Wong.
“Many property owners / long-term investors would prefer to keep the high-quality assets in their portfolio instead of divesting them, especially during such a volatile environment,” he explained.
Cushman & Wakefield’s Head of capital markets & Executive Director Shaun Poh revealed that investors continue to seek quality commercial properties. However, demand is now focused on bite-sized projects or assets like shophouses and strata office space.
Notably, investment in the city-state’s previously sizzling hot real estate market started to weaken in Q2 2022 when deal volume fell by about 30 percent from the S$12 billion in sales witnessed during the 1st quarter of the year.
Despite the downtrend in the last 2quarters, total property deals for the 1st 3 quarters still reached S$26.9 billion, surpassing the S$26 billion registered in 2021 by around 3 percent.