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

The local property auction sale marketplace efficiently marketed 11 properties over the initial six months of this year. A research note posted by Edmund Tie mentions that the total deal value for the properly auctioned real properties was $15.2 million.

According to Joy Tan, head of sell-off and sales at Edmund Tie, the low sales value in 1H2023 was because of “the properties pounded being of lowered quantum, mostly either beneath or simply past the S$ 1 million mark. There was only one high-value deal that was above S$ 5 million”.

The “high-value transaction” was for a three-storey semi-detached residence on Vaughan Street that was transacted for $6.3 million. In addition, seven of the profitable real estates sold at sell-off were industrial residential properties, with the balance being 3 homes along with an office property.

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This was the most affordable sales value documented by the auction market ever since 1H2020, the beginning of the Covid-19 pandemic, when just one property was sold for $0.94 million. It is in addition a major decrease of 59.7% compared to 2H2022 which reported 17 sales cost $37.7 million.

Cognisant of the upcoming brand-new private non commercial projects set to hit the marketplace over the upcoming few quarters, prospective customers are holding back on their acquisitions, says Tan, including that exterior factors including worries of an approaching economic downturn also higher rate of interest are also influencing sales.

Looking in advance, she expects to see home loan listings pick up only in 2024, presented the moment lag in between banks repossessing residential properties as well as placing them up for auction. She even projects commercial listings to garner even more purchasing rate of interest. “Considered that business deals will not sustain extra buyer’s stamp duty and with the rise in family workplaces in Singapore, well-priced office listings will certainly also likely be very sought after,” she explains.

” In addition, on the back of the high interest rates, the cooling down procedures publicized in April and also the overall unpredictable macro environment, customers have actually normally followed a wait-and-see posture,” states Tan.

She includes that over the past couple of months, investors are showing an expanding acceptance in the direction of leasehold real estates with much shorter standing lease tenures of typically 30 to 60 years. “This is likely due to investors’ higher chance tolerance, as economic markets continue to be unstable, and an obvious preference shift to substitute investment opportunities.”

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