The Singapore real estate market will continue to be strong
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There is a good chance that Singapore property market is expected to remain a bright spot across the globe despite growing macroeconomic headwinds as per Savills Research. As the rising rate of inflation and concerns about recession have cast shadows over the global real estate market however, the city-state is set to be strong.
“In general the Singapore real estate market should be in a favorable position to avoid the negative consequences of global economic turmoil as well as the global political turmoil,” says Alan Cheong who is the chief executive officer of Savills Singapore Research and Consultancy.
Cheong states she believes that Singapore market is buoyed by the shortage of supplies in the majority of segments, and developers of the housing market have the ability to hold financial assets. In this way, the market has the capacity to “overcome the negative effects of rising interest rates and recessions in the economy”.
Singapore witnessed $9.1 billion worth of real estate investment deals in the three-quarters beginning in 2022. That’s an increase of 47% from the same time in 2021, as per MSCI Real Assets figures. Savills adds that the residential rental market has seen a strong growth and the rents of private residential properties rising 8.6% q-o-q in 3Q2022 this was the biggest quarterly growth over the past 15 years.
Other sectors also have positive indicators, like the office space, which is seeing rising rental rates for CBD offices despite a decrease in vacant spaces as well as the rental rates in logistic properties are expected to rise in 2023.
The International Monetary Fund is projecting Singapore to track the gross domestic product (GDP) expansion by 2.3% in 2023, exceeding the 1% as well as 0.5% GDP growth rates projected in both the US and EU respectively.