A steady demand for two- and one-bedroom homes in Singapore has driven up the median price of homes in this size range within the Rest of Central Region (RCR) by 31.3% y-o-y from $1.34 million in the 1Q2022 quarter to $1.76 million in the 1Q2023. This is an analysis of study from Savills Singapore, which examined the transaction records for private residences that are greater than the amount of $2,000 per square foot or up to square feet.
Hillock Green ebrochure boasts of nearby recreational facilities such as Thomson Nature Park, Yio Chu Kang Stadium & Sports Complex.
The report pointed out that two-bedroom and one-bedroom units of this size had median prices increase by $1.58 million at the end of 1Q2022 and $1.63 million during 1Q2023. The increase in the median cost for units in this category amounts to a rise by 3.4% every year. In the suburbs or outside of the Central Region (OCR), two and one-bedroom homes also experienced a notable increase by 15.3% y-o-y to reach $1.39 million in 1Q2023 when compared the $1.21 million during 1Q2022.
“Buyers prefer to smaller-sized houses and they are prepared to pay more for smaller units,” says Alan Cheong who is the head of the research department at Savills Singapore. “Even before the outbreak smaller sizes of units have been popular with HDB upgrading and investment buyers because of their lower price”.
Recent transactions show that the share of transactions involving one- and two-bedroom homes against all homes sold is expected to go upwards between 21.4% in 1Q2022 to 47% in 1Q2023. The Savills report further stated that “the growing popularity of the smaller two and one bedroom homes can be explained by a number of reasons, such as their potential to rent and their the proximity to major facilities”.
New launches in recent times including the Botany in Dairy Farm and Sceneca Residence show a strong demand for these smaller kinds. For instance In two-68 unit Sceneca Residence the sale of 161 units was for the average price of $2,082 per square foot. 72.7% of the sales being attributed to smallerand two-bedroom units.
The buying behavior of buyers in the present selling marketplace “hints of their desire for private residential properties and the desire to purchase one is driven more by budget than bedroom size,” says Cheong. “With increasing unit square feet costs, demand for new sales is directing towards smaller format homes. The result is that buyers are paying more for smaller houses”. The costs of construction and land are also on the rise and are “inevitably” passing onto the buyers, in particular by the cost of smaller units, he states.
Savills confirms its prediction that residential private property prices will rise by 7% in 2023.