CONDOMINIUM resale volumes rebounded 17.4 per cent in March, reaching its highest level in seven months, as buyers returned to the market after a seasonal lull in February.

Flash data from SRX and 99.co released on Thursday (Apr 25) showed that 883 units were resold in March, compared with the 752 units that changed hands in February.

Resale volumes were however 22.8 per cent lower year on year (yoy), and 12 per cent lower than the five-year average volumes for the month of March.

Possible reasons for the volume recovery include the resumption of launches during the month, resulting in a spillover effect on the resale market, said property analysts.

“Some existing condo owners may have taken the opportunity to buy a new condo and sell their existing condo, so they do not need to pay ABSD (Additional Buyer’s Stamp Duty) on the second residential property. Some buyers may have made a comparison and chosen a resale condo,” said Huttons Asia chief executive Mark Yip. 

Analysts also noted an uptick in purchases by foreigners during the month as viewings during the Chinese New Year period rose.

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“Some of these viewings may have translated to purchases in March,” said Yip.

Referencing data from URA Realis and research, PropNex head of research and content Wong Siew Ying said the proportion of condo home deals to foreign buyers (non-permanent residents) rose to 1.3 per cent of total resale volume, up from 0.5 per cent in February.

Despite the slight uptick in activity observed in March, Wong believes the mismatch in pricing expectations could potentially weigh on transactions.

“Observations suggest that many sellers, while open to negotiations, are not keen to lower their asking price substantially in view of the high cost of replacement homes,” she added.

Meanwhile, the proportion of resale non-landed private home transactions to foreign buyers rose to 1.3 per cent of the month’s resale volume – up from 0.5 per cent in February. In absolute terms, there were 11 resale transactions to foreign buyers during the month – six transactions were to buyers from the US, three to those from China, and one each from Norway and Switzerland.

Resale prices, meanwhile, remained muted, inching up 0.4 per cent on the month but were 5 per cent higher yoy.

Hutton’s Yip believes price growth was measured as many buyers were restrained by high interest rates.

The same can be said for property investors, said Mogul.sg chief research officer Nicholas Mak, as the “higher-for-longer” interest rates increase the financing costs for property investors.

“Property investors hoping to use the rental income of their investment condo unit to pay for the mortgage instalments are hit by the double whammy of high interest rates and falling rentals,” he noted.

The highest price gains were recorded in the Outside Central Region (OCR), which registered a 1.6 per cent growth in resale prices.

“The faster price growth is unsurprising, given that there were more suburban launches in recent months and the median price of most new homes was transacted above S$2,000 per square foot,” said Christine Sun, chief researcher and strategist at OrangeTee Group.

Resale prices in the Rest of Central Region (RCR) climbed 1.2 per cent. In contrast, resale prices in the Core Central Region (CCR) declined by 2.8 per cent from the previous month.

Resale prices in all regions were up compared to the same period last year. The OCR continued to lead in this area with a gain of 7.1 per cent, followed by the RCR, where prices were 5.6 per cent higher and the CCR, where prices were up 1.5 per cent.

The majority of transactions (48.2 per cent) took place in the OCR, followed by 31.6 per cent from the RCR. The CCR accounted for 20.2 per cent of total resale volumes.

Notably, sub-sale transactions accounted for only 8.1 per cent of all secondary sales, down 4.3 percentage points from February.

This was the lowest percentage in 12 months, SRX and 99.co said.

Sub-sale deals refer to secondary sales made before a project’s completion, while secondary sale transactions comprise both resale and sub-sale transactions.

The highest transacted price in March was S$8.7 million for a unit at Corals at Keppel Bay in the RCR.

In the CCR, the most expensive condo deal was for a unit at Astrid Meadows, which changed hands for S$7.1 million. For the OCR, the highest transacted price was S$3.4 million for a unit at Seaside Residences.

The overall median capital gain for resale condos stood at S$380,000 in March, up S$20,000 from the month prior.

District 11 (Newton, Novena) posted the highest median capital gain at S$823,000, while District 1 (Boat Quay, Raffles Place, Marina) recorded a median capital loss of S$63,000.

District 26 (Mandai, Upper Thomson) recorded the highest median unlevered (debt-free) return at 63.3 per cent, while District 1 recorded a negative median unlevered return of 5.8 per cent.

Capital gains and returns on a condo resale unit are calculated by comparing the current transacted price with the previous transacted price of the same unit. Districts with fewer than 10 matching transactions are excluded from the ranking.