Analysis of Singapore’s Private Housing Property Market Prices (July 2017 to 2022)

Background

Singapore has consistently ranked among the most expensive cities in the world. In fact, Singapore held the No.1 spot for 2017 to 2019, and No.2 in 2020. In 2021, it dropped out of the top 10, falling to No.13 but recovered to No.5 in 2022. The cost of housing plays a major part in keeping Singapore in such a high position.

It is important to understand that Singapore’s Housing market is broken up between the vastly expensive apartments and condominium and more affordable HDBs favoured by most of Singaporean residents. My analysis in this report will focus on the sale of apartments and condominiums that occurred between July 2017 and July 2022 in all 28 postal districts. I am leaving the possibility of doing an analysis on the HDB property market in a subsequent analysis.

In order to have a little more context during our discussions, I have included the following table. It breaks down the township within each district and indicates which market segment they belong to. ( CCR - Core Central Region, RCR - Rest of Central Region and OCR - Outside Central Region)

Property prices tend to go on the order of CCR, RCR and OCR. With CCR typically where the more high end properties are and OCR being on the other side of the spectrum. This provides a fairly high level view as townships can be in one or two of these market segments as the data will show later. The districts are usually referred to as D and the number. For example D1 refers to District 1.

The question I am trying to answer is: Is Singapore’s Housing prices as formidable as it is famous for and is it rising out of control?

District Name Market.Segment
1 Boat Quay, Chinatown, Havelock Road, Marina Square, Raffles Place, Suntec City CCR
2 Anson Road, Chinatown, Neil Road, Raffles Place, Shenton Way, Tanjong Pagar CCR
3 Alexandra Road, Tiong Bahru, Queenstown RCR
4 Keppel, Mount Faber, Sentosa, Telok Blangah RCR
5 Buona Vista, Dover, Pasir Panjang, West Coast RCR
6 City Hall, High Street, North Bridge Road CCR
7 Beach Road, Bencoolen Road, Bugis, Rochor RCR
8 Little India, Farrer Park, Serangoon Road RCR
9 Cairnhill, Killiney, Leonie Hill, Orchard, Oxley CCR
10 Balmoral, Bukit Timah, Grange Road, Holland, Orchard Boulevard, River Valley, Tanglin Road CCR
11 Chancery, Bukit Timah, Dunearn Road, Newton CCR
12 Balestier, Moulmein, Novena, Toa Payoh RCR
13 Potong Pasir, Machpherson RCR
14 Eunos, Geylang, Kembangan, Paya Lebar RCR
15 Katong, Marine Parade, Siglap, Tanjong Rhu RCR
16 Bayshore, Bedok, Chai Chee OCR
17 Changi, Loyang, Pasir Ris OCR
18 Pasir Ris, Simei, Tampines OCR
19 Hougang, Punggol, Sengkang OCR
20 Ang Mo Kio, Bishan, Braddell Road, Thomson RCR
21 Clementi, Upper Bukit Timah, Hume Avenue OCR
22 Boon Lay, Jurong, Tuas OCR
23 Bukit Batok, Choa Chu Kang,Hillview Avenue, Upper Bukit Timah OCR
24 Kranji, Lim Chu Kang,Sungei Gedong, Tengah OCR
25 Admiralty, Woodlands OCR
26 Tagore, Yio Chu Kang OCR
27 Admiralty, Sembawang, Yishun OCR
28 Seletar, Yio Chu Kang OCR

Recorded Sales in all 28 districts

The following bar graph shows that during that period and despite the high costs as well as the 3 years of the peak of the Coronovirus pandemic, the high end market for property in Singapore wasn’t at a complete standstill.

I would like to note that D24 did not record a single sale but that is no unexpected as the area has yet to see the development inspired boom periods in other districts like Punggol in D19.

Looking at the scatter graph, you can see the range of pricing per square ft broken down by districts. Although I was expecting a higher than expected price per sqft in the Core Central Regions, I was still surprised by the price levels of the D10 but also by the relatively low mark for D1 by comparsion.

When we plot the Price per sqft vs the Market Segments, It was no surprise that the prices lined up as previously stated. The Core Central Region properties tended to have higher median prices, followed by the RCR and then finally the OCR.

However, if you hover over the boxplot, it can be observed that both CCR and RCR has had transactions where prices were on the low end of the spectrum that overlaps with prices of the OCR region.

When looking at the area in sqft of properties sold, I was expecting due to the higher price per sqft in the CCR and RCR regions respectively to be smaller when compared to properties in the RCR region.

However, it seems to be the complete opposite. Those who live in the RCR, the apartments and condominiums are smaller when compared to their counterparts in the CCR and RCR.

When we take a closer look at the summary data concerning area, it is interesting to see that the median sizes of apartment and condominiums do not have such a high variance on average but there are a great number of outlier cases that skews the data and maybe even perception as there are lot of apartments that are far beyond the average size. That together with the high per sqft prices in certain areas, it can seem like that properties are extremely high all the time.

In some parts of Asia, it is quite common to find properties that are not freehold. That is the property is almost purchased as a lease. In Singapore, the most common lease term is 99 years but there are cases of leases that last for 999 years and above. However, I have chosen to focus on lease periods of between 60 and 150 years which is the majority of the data I possessed.

Thought a large portion of the data set shows that higher prices tend to follow a sizeable lease remaining in years, it can be observed in some cases that low lease remaining isn’t as much a deterence to purchase the property at high prices.

Taking a zoomed in view of the market price of up to 10 million, there is a lot of properties sold between 150,000 and 5 million that have around 30 years remaining. Perhaps, 30 years is more than enough time for the purchaser as the intention is not to past on the property to their heirs.

The property market has started to heat up since Singapore came out of COVID lockdowns and international borders started to open. However, judging by the scatter graph below, properties sold before the start of the first cases of COVID seems to have stayed on the market longer before getting sold. There is a noticeable trend downwards. Perhaps, supply was not able to keep up with demand and COVID made it worse.

Finally, it seems that the median housing prices in the high end market sector isn’t rising out of control as first expected. It is still high but the median prices over the last 5 years has stayed fairly consistent over the last 5 years. Once again, it can be observed in the CCR and RCR regions, there has been a large number of outlier property sales that might have skew perception as both regions have witness property sales that are outside the median prices for their respective regions.

Does Singapore property market deserve the reputation as one of the most expensive in the world? Yes but as always the answer is a little more nuance. In the truly high end market, in the city state where land is scarce. It seems that the old adage of Location Location Location is truer than average. The clientele of this market are the super rich where money is no object but even in this market, there is some evidence that relative bargains can be had and it is not as impossible as it may first seem.

However, as stated at the beginning, this is only half the story. It would be fascinating to do a similar analysis of the public HDB market where a majority of average Singaporeans and expats might be living. Only by comparing the two halves, can we have a more complete picture to this interesting question.