Watten house

The year 2023 marked a significant chapter in the story of Singapore’s luxury condominium market. It was a year where the industry faced challenges such as revised Additional Buyer’s Stamp Duty (ABSD) policies and the looming specter of a money laundering scandal. However, amidst the trials and tribulations, the market exhibited remarkable resilience and innovation.

According to Mark Yip, CEO of Huttons Asia, the three best-selling luxury condos in 2023 by volume were Klimt Cairnhill, Watten House, and Cape Royale. These projects distinguished themselves by offering spacious units, a coveted rarity in a market characterized by limited space. Furthermore, these developments were strategically located in sought-after addresses within the Core Central Region (CCR), enhancing their appeal.

 

About Watten House Condo

Watten house Entrance

One standout performer was Watten House, which made waves with its private preview on November 18. Within a single day, an impressive 57% of the 180 units in this freehold condo were sold, commanding an average price of $3,230 per square foot. Even more noteworthy, despite the subdued market sentiment and the cooling measures introduced in April 2023, Watten House managed to sell 109 units (61%) by December 13.

During the private preview, three out of eight penthouses at Watten House found buyers. One penthouse sold for a staggering $17 million, while the other two fetched over $14 million each, as reported by Ismail Gafoor of PropNex. These penthouses, measuring 4,008 square feet, were sold for $14.245 million ($3,484 per square foot) and nearly $14.5 million ($3,545 per square foot), respectively.

It’s worth noting that Watten House’s remarkable sales performance is even more commendable when considering the muted market sentiment and the significant ABSD hikes for foreign residential property buyers, doubling it to 60%. This year saw the introduction of property cooling measures on April 27.

Watten House, a joint venture between UOL Group and Singapore Land Group (SingLand), strategically chose the path of a private preview by appointments for home buyers. This strategy, often used in the luxury property segment, enables developers to create an intimate and personalized experience for potential buyers, according to Marcus Chu, CEO of ERA Singapore.

Watten House represents a redevelopment of the former Watten Estate condo, acquired en bloc for $550.8 million in October 2021. Located on Shelford Road, this freehold project now graces the prime Bukit Timah area of District 11.

 

About Klimt Cairnhill Condo

Klimt Cairnhill Penthouse

Another noteworthy luxury project of 2023 was the 138-unit Klimt Cairnhill by Low Keng Huat. This freehold development in prime District 9 was previewed in August 2021 and relaunched in January 2023, following the easing of Covid restrictions. By December 13, 92 units (67%) had been sold at an average price of $3,752 per square foot.

Interestingly, a surge in transactions was observed in 2023, with 83 of the 92 units sold during the year, compared to just five in 2022 and three in 2021. The prices ranged from $2.65 million ($3,197 per square foot) for an 829-square-foot two-bedroom unit to an impressive $27.5 million ($4,645 per square foot) for the largest penthouse spanning 5,920 square feet.

PropNex’s Gafoor pointed out that at Klimt Cairnhill, 37 of the 83 units were transacted after the implementation of the cooling measures in May.

 

About Cape Royal Condo

Cape Royal

Cape Royale, a 302-unit luxury, 99-year leasehold condominium by Ho Bee Land and IOI Properties Group, also attracted attention. With 85 units sold at an average price of $2,217 per square foot, this Sentosa Cove project offered a unique living experience. Notably, Cape Royale transacted approximately 46 of the 85 units in 2022. Of the 39 units sold in 2023, 14 were transacted after the property cooling measures came into effect in late April.

 

About Les Maisons Nassim Condo

Les Maisons Nassim Entrance

In the realm of luxury transactions, Les Maisons Nassim was a prominent player in 2023. This 14-unit luxury condo by Shun Tak Holdings exclusively featured large units exceeding 6,000 square feet each and was fully sold within just over two years of its May 2021 launch. The highest transactions reached $30.765 million and $32.749 million, for four-bedroom units of over 6,000 square feet each. Remarkably, the buyer of both units is said to be a permanent resident (PR), who enjoys a lower ABSD rate compared to foreign buyers.

 

Resilence in Core Central Region Condo

Foreign buyer activity in the luxury residential segment underwent significant changes in 2023. While the top three foreign nationalities (Chinese, Indonesians, and US citizens) remained constant after the cooling measures, the majority of them transitioned into PR status. This shift suggests that foreign buyers either paused their purchases or awaited PR approvals before entering the market, according to Huttons’ Yip.

Looking ahead, ERA’s Chu anticipates that Singaporeans will account for a larger proportion of buyers in luxury developments. Watten House serves as an example, where 96% of the 102 buyers at the private preview in November were Singaporeans and PRs. Following the property cooling measures, foreign buying activity decreased by 73% from the first half of 2023 to the period between July and November 2023. Nonetheless, foreigners managed to acquire 334 private homes since April 2023, with 77 (23%) of them priced above $5 million each.

The luxury condo market faced an additional setback in 2023 with the money laundering scandal, which led to the arrest of 10 individuals of Chinese origin in August. Over $2.8 billion in luxury properties, vehicles, cash, and other valuables were seized. This case underscored the importance of stricter anti-money laundering checks on property buyers, particularly in the luxury segment. Salespeople in luxury developments are now conducting thorough background assessments of potential buyers before viewings.

Looking forward, some ultra-high-net-worth individuals (UNHWIs) initially held off their property purchases in Singapore following the money laundering case. However, there are signs that these UNHWIs are gradually returning, possibly due to rising geopolitical politics that propel them to seek a safe haven, according to Huttons’ Yip.

Compared to the impact of the case on money laundering, PropNex’s Gafoor believes that the cooling measures is expected to have a more significant influence on buyers in the CCR. The number of transactions for new sales and resale properties in the CCR fell by 46.5% from May to November, following the ABSD hikes. The doubling in ABSD rates deterred foreign investors, particularly those not from countries with free trade agreements (FTAs) with Singapore, such as Norway, Liechtenstein, Iceland, Switzerland, and the US, which enjoy the same stamp duty treatment as Singaporeans.

Residential property purchases by Chinese nationals, for instance, dropped by 83% between May and November, compared to the period between January and April. There were also fewer buyers from Indonesia, another key foreign market for Singapore properties.

Luxury New Condos Launches in 2024

In 2024, the luxury condo market in the CCR promises exciting developments. Projects like

Additionally, several major luxury developments with over 100 units each are scheduled for launch next year, ensuring a dynamic and evolving landscape for luxury condo enthusiasts.

Singapore’s luxury condominium market showcased its ability to adapt and thrive in the face of challenges in 2023. With a mix of strategic location, innovative marketing strategies, and a shift in buyer demographics, the luxury condo market continues to evolve, offering a diverse range of options for investors and high-net-worth individuals in Singapore.