Singapore auction listings drop 20.8% to just 80 listings in Q1 

Blame it on owner sale listings dropping by more than half during the quarter.

Real estate auction listings in Singapore declined by 20.8% q-o-q to 80 listings (including repeat listings and excluding properties sold outside of auction) in Q1 2022, owing to a sharp drop in owner sale listings. 

According to Knight Frank, owner sale listings more than halved to 28 listings from 58 last quarter, partly due to the Chinese New Year festivities. At the same time, mortgagee listings climbed by 23.7% q-o-q to 47 from 38. 

Here’s more from Knight Frank:

A steady reduction in the inventory of residential properties for auction led the decline in listings. Robust underlying demand in the residential market led to properties being snapped up, especially those with strong value propositions. Well-located business spaces, both newly listed and those on the market for some time, were also bought with the potential for future gains as well as for own use. 

Success rates (including repeat listings and excluding properties sold outside of auction) during auction thus breached double digits to hit 11.3% in Q1 2022, the highest recorded quarterly percentage in about a decade. A total of nine properties were sold in the quarter for a gross sales value of S$21.1 million despite the overall drop in listings. Properties sold under the hammer were also diverse, spread across different sectors.

Mortgagee sales

Mortgagee sale listings inched up q-o-q to 47 in Q1 2022 with more office units put up for auction. 

Despite the q-o-q increase, listings were still 59.8% lower y-o-y than the 117 in Q1 2021 as the economy continues to recover. Broad-based rental improvement, especially in the private residential market, possibly provided distressed owners with the means to cover their current mortgage instalments, contributing to restraint being observed by banks in foreclosing residential properties. During the quarter, residential assets were also quick to be picked up by some auction bidders. 

There were only 21 residential mortgagee listings in Q1 2022, a drop compared to 56 a year ago. 

Three newly listed residential mortgagee sale listings were sold during auction, all below S$2.0 million. A 785-sf apartment in Central Imperial (D14) sold for S$800,000 at 6.7% above its opening price, while an 893-sf apartment in The Shore Residences (D15) sold for S$1.53 million. Another 1,808-sf 2-bedroom penthouse at The Nautical (District 27) sold for S$1.72 million, 1.2% above the opening price. 

A mortgagee sale retail unit listing in Sim Lim Square was also sold. At S$1.16 million or S$1,859 psf, the unit can be considered a value-buy when compared with the S$2,210 psf when it was last purchased in 2012.

Owner sales

Owner sale listings dipped to 28 in Q1 2022 against 58 in the previous quarter, marking the third quarter with a consecutive dip. 

There were only seven residential owner sale listings in the quarter, an all-time low (discounting H1 2020 when auctions were disrupted due to COVID-19). While some had been sold under the hammer, a strong residential market perhaps gave some owners the confidence to sell their properties independently. 

An owner sale retail unit in Sim Lim Tower sold for about S$1.46 million (S$2,049 psf), 9.5% lower than the average price of S$2,252 psf for retail units in the building in 2022 year-to-date* (YTD). While retail trades struggling in the modern digital retail economy might have led to compressed prices, there is strong enbloc potential going forward due to its central location, which also lies just outside the boundaries where new strata subdivision has recently been disallowed. Refreshed strata retail units and concepts will likely be well-received at such locations. 

Separately, two office units at Chinatown Point were sold under Receiver Sales at S$1.29 million (S$1,739 psf) and S$1.79 million (S$1,698 psf). Prices of offices outside of the core Raffles Place/Marina Bay precinct remained modest and appealing to both owner-occupiers and investors. The second of two triplex townhouses at 8 Nassim Hill under Sheriff Sales was sold for S$9.79 million (S$2,327 psf), 14.5% above the opening price. The buyer bought the unit during auction without a physical viewing due to the prestige and limited stock of these highly coveted homes in the area.

Market outlook

As casualties from COVID-19 start to surface with the government lifting financial relief measures, there are some early signs of credit stress. While it is expected that listings will probably increase in H2 2022, this will for the most part likely be contributed by business space. Residential listings in the immediate-term, could continue to decline given the current underlying demand buyer as well as leasing demand for residential homes at generally robust prices and rents. Hence, success rates at auction are projected to be slightly above our previous estimate of 5% for the whole of 2022