The first quarter of 2024 witnessed a notable shift in the auction market dynamics, characterized by a decline in mortgagee sale listings alongside a significant uptick in owner sale listings, according to Knight Frank Singapore. Here’s a closer look at the key highlights from the latest research report:
Key Highlights:
- Lunar New Year festivities led to a temporary slowdown in auction activities, with 90 auction listings recorded in 1Q2024, marking a 9.1% decline q-o-q.
- Despite the quarterly dip, auction listings increased by 16.9% y-o-y, primarily driven by a surge in owner sale listings.
- Residential properties dominated the auction market, comprising 47.8% of all listings, followed by retail, office, and industrial properties.
- Successful sales totaled $13.2 million, with a success rate of 5.6% for the quarter, up from 4% in the previous quarter.
- Mortgagee listings decreased by 29% q-o-q, with only 22 listings recorded in 1Q2024, indicating a potential stabilization in distressed property sales.
- Owner sale listings saw a 47.8% y-o-y increase, with 68 listings in 1Q2024, possibly influenced by financial distress amid rising bankruptcy applications and business cessations.
- Anticipating market trends, Knight Frank foresees a rise in auction listings in the second half of 2024, driven by owners seeking to dispose of properties amidst challenging economic conditions.
- Borrowing costs may escalate for homeowners as fixed-rate mortgages expire, potentially prompting further property divestment amid a softening rental market.
The contrasting trends in mortgagee and owner sale listings offer insights into the evolving real estate landscape amid economic uncertainties. While the decline in distressed property sales signals some stabilization, the surge in owner listings underscores the impact of financial distress on property owners. As bankruptcy applications and business cessations rise, the auction market is poised to witness increased activity, presenting both challenges and opportunities for buyers and sellers alike.
Stay informed about evolving market trends and emerging opportunities in the auction market. Connect with local real estate experts to explore investment strategies tailored to your financial goals and risk tolerance. Whether you're considering property acquisition or divestment, proactive engagement with industry professionals can help navigate the dynamic real estate landscape effectively.