Loss-making private home resales surge to highest level in years

An increasing share of private home resales in Singapore's prime districts are being sold below their original purchase price, signalling growing pressure on the luxury residential market.

Data shows that loss-making transactions in the core central region climbed to 4.6 per cent in the third quarter, up from 3.7 per cent in the preceding three-month period and 3.3 per cent in the same quarter last year.

The uptick reflects broader market softness in the high-end segment, where buyer appetite has moderated amid economic uncertainties and rising interest rates. Owners who purchased at peak valuations are increasingly finding themselves in negative equity positions when attempting to exit their holdings.

While four in five resale deals continue to generate positive returns for vendors, the widening proportion of underwater transactions underscores the challenges facing property owners holding properties in prime locations over extended periods. Market observers attribute the shift to a correction from the elevated price levels seen during the post-pandemic surge.

The trend carries implications for future supply dynamics, as homeowners may adopt a hold-and-wait strategy rather than crystallise losses in the current environment.