Singapore luxury property market set to shine in 2022

As Singapore eases border restrictions, the high-end market could see a return of buying activity judging by two project launches in the prime area.

By Khalil Adis

The exclusive area of Cairnhill where Cairnhill 16 sales gallery is located at. Photo: Khalil Adis.

If 2021 is the year for HDB resale flats and mass market condominiums, 2022 could finally see Singapore’s high-end market picking up.

That is the prediction among property developer TSky Cairnhill Pte Ltd who will officially launch Cairnhill 16 to prospective homebuyers and investors on 27 November 2021. 

This comes as Singapore eases border restrictions for quarantine-free travel and as the country adjusts to a “new normal” of living with Covid-19. 

“We believe that demand for Singapore residential property will gradually return as the country remains a safe haven for property investment,” said Edward Ang, executive chairman, Ocean Sky International. 

As such, next year could possibly see the return of buying activity among wealthy foreign investors in the somewhat lacklustre prime area of Singapore.

Located on the former site of Cairnhill Heights at 16 Cairnhill Rise, Cairnhill 16 was sold through a collective sale to TSky in 2018. 

TSky Cairnhill is owned by TSky Development Pte Ltd, Ocean City Global Limited, Seacare Property Development Pte Ltd and Min Ghee Investment (2018) Pte Ltd.

TSky Development is, in turn, a joint-venture between Singapore-listed Tiong Seng Holdings and Ocean Sky International.

Two new launches in the CCR in the fourth quarter of 2021 

An artist impression of Cairnhill 16. Image: TSky.

Cairnhill 16, a freehold development, is among one of two noteworthy launches in the fourth quarter of 2021 that are located within the Core Central Region (CCR).

The other project is Canninghill Piers, a 99-year-leasehold development located within the Clarke Quay area that is jointly developed by CapitaLand and City Developments Limited (CDL).

Both projects start from more than $2,500 per sq ft, the bench mark price for the top-end of the property market, appears to signify that developers are somewhat confident in an upswing in buying activities in the luxury market.

Cairnhill 16’s indicative launch prices are expected to start from around $2,789 per sq ft.

Nestled within the tranquil Cairnhill area, Cairnhill 16 will feature 39 limited hilltop luxury residences that will be served with private lift access and smart home features.

Sited within a 15-storey residential tower at a quiet cul-de-sac, Cairnhill 16 will comprise 13 two-bedroom units, 13 three-bedroom units, 9 three-bedroom plus study units and 4 four-bedroom units. 

At the media preview, held on 11 November 2021,  the developer showcased the high-end finishes prospective buyers can expect as seen at its sales gallery such as imported kitchen cabinets and designer appliances from V-Zug and Grohe.

With a minimum ceiling height of 3.6 metres and up to 4.6 metres on the top floor, Cairnhill 16 is all about making a grand entrance.

Cairnhill 16's unit sizes will range from 775 sq ft to 1,744 sq ft.

The indicative launch prices for a two-bedroom unit will start from $2.2 million while its three-bedroom, three-bedroom plus study and four-bedroom units will start from $2.9 million, $3.6 and $5.7 million respectively. 

Located within a stone throw’s away from Orchard Road, Newton MRT station, the medical hub of Mount Elizabeth Hospital and Paragon Medical Centre as well as several good schools such as Anglo-Chinese School (Junior) and St Margaret’s Primary School, Cairnhill has always been a perennial favourite among wealthy local and foreign investors who are attracted to its unparalleled location.

This is exactly the niche market that TSky Cairnhill Pte Ltd is hoping to bank on.

“I am positive on the property market. With our vaccination plans all fully executed and our policy of opening up the borders, this will certainly help. The Cairnhill area has been traditionally known to be an Indonesian area. Of late, we have seen many Chinese buyers come in and regional buyers,” said Ang. 

With the easing of travel restrictions and the introduction of more Vaccinated Travel Lanes (VTLs) being introduced,  Ang is confident many of such buyers will return to the market.

“Singapore has positioned itself as a stable and safe haven for investment, whether it is for financial or real estate investment. I think this will attract foreigners to really have the confidence to put their investment dollar in Singapore,” he said.
  
Meanwhile, Canninghill Piers is an integrated development that will start from around $2,721 per sq ft.  

Located on the former Liang Court site, Canninghill Piers will feature a hotel, commercial units, a serviced residence and two residential towers comprising around 700 apartments. 

However, unlike Cairnhill 16, Canninghill Piers will enjoy direct connectivity to Fort Canning MRT station linking residents to the Downtown Line (DTL).

Buying activity in prime areas have been lagging behind other areas on the island

Journalists being briefed by a representative of Cairnhill 16. Photo: Khalil Adis.

The exodus of expatriates and border closure arising from the pandemic had impacted the high-end market.

Meanwhile, other areas on the island continued to remain resilient.

Data from the Urban Redevelopment Authority (URA) appears to confirm this.

For instance, its third quarter of 2021 data showed that prices of non-landed properties in the Core Central Region (CCR) decreased by 0.5 per cent in the third quarter, compared with the 1.1 per cent increase in the previous quarter.

In comparison, prices of non-landed properties in the Rest of Central Region (RCR) increased by 2.6 per cent, compared with the 0.1 per cent increase in the previous quarter. 

Meanwhile, prices of non-landed properties in the Outside Central Region (OCR) decreased by 0.1 per cent, compared with the 1.9 per cent increase in the previous quarter.

This suggests that buying activity in the prime areas of Orchard, Newton and the core city centre had remained somewhat lukewarm.

Echoing a similar sentiment is Pek Zhi Kai, executive director, for Tiong Seng Group. 

“Buying in the luxury market segment, particularly within the Core Central Region, has not been as exciting as the Outside Central Region. That’s why so far the measures that we have heard of largely, they come in the form that public housing remains affordable and mass market housing remains affordable. Whereas, the Core Central Region has been somewhat muted over the last couple of years or so. It is not going to attract that many measures. It is just making sure that this market will still remain buoyant rather than depressed,” he said.

Cooling measure unlikely 

A luxury condominium above ION Orchard. Photo: Khalil Adis.

​Overall, the Private Property Index (PPI) is now at a record high of 165.1 points with prices of private residential properties increasing by 1.1 per cent in the third quarter of 2021, compared with the 0.8 per cent increase in the previous quarter. 

This will likely surge ahead in the fourth quarter of 2021 as borders start to reopen.

Moving forward, market watchers say despite the record-breaking index, they do not think the government will likely announce cooling measures.

“I think cooling measures may not kick in. I think it will be a more targeted approach whereby housing remains sustainable and within reach for Singaporeans. With this as an end goal, for the current market itself, I don’t necessarily think the cooling measures will be coming in now,” said Pek.

Meanwhile, investors say while they welcome the anticipated return of the luxury market, ultimately, they are still looking for the best deals.

One such investor is Singaporean James Tan who is watching the market closely.

“The price point at above $2,500 per sq ft is similar or almost higher to the level we saw before Covid-19. Although I am looking to pay in cash, I think the price right now is rather high. I may wait further till I see a good deal in the market,” he said.

Ang also agrees that the property market has defied expectations despite Covid-19 noting that construction costs had increased significantly “due to rising construction and commodities costs."

“In terms of prices, we can see that even during the Covid-19 period, prices have been steadily climbing. We hope that prices will continue to see a steady yet sustainable climb,” he said.