A Balanced Outlook Amidst Global Challenges
Knight Frank has just unveiled its highly anticipated Asia-Pacific Residential Index for the first half of 2023. The report meticulously tracks the average residential prices across 25 cities in the Asia-Pacific region. Notably, 14 out of these 25 cities have recorded positive annual price growth, with Singapore standing out as the top-performing market, boasting an 8% year-on-year growth.
Victoria Garrett, Head of Residential at Knight Frank Asia-Pacific, commented, “After the bull run in home values over the past few years, prices plateaued six months into 2023, indicating that correction is taking place in more markets. With rate hikes being paused, buyers are utilising this window of opportunity to lock down on their dream homes, which is notably predominantly seen in Australia, New Zealand, and India. While the high inflationary conditions plough on, the combination of limited housing supply, restricted new constructions and robust household formation will support prices in various markets.”
Key Takeaways
- The average year-on-year residential price growth within the Asia-Pacific region in H1 2023 stands at -0.2%.
- 14 out of the 25 cities tracked recorded positive annual price growth.
- Singapore leads with an 8% YOY growth, followed by other promising markets like Malaysia and India.
The Asia-Pacific Residential Index for H1 2023 offers a nuanced view of the residential market, highlighting the opportunities and challenges that lie ahead. With a balanced outlook and resilience in key markets, the region continues to adapt and evolve, promising an intriguing future for investors and homeowners alike.
Resilience in Key Markets
Christine Li, Head of Research at Knight Frank Asia-Pacific, added, “The Asia Pacific region maintains a balanced outlook, adapting to global challenges while showcasing resilience in key markets. Steady sales momentum, positive year-on-year growth in select markets, and buyer confidence in the face of diminishing affordability underscore the region’s promising outlook. As we move forward, the rate of price deceleration in Australasia could start to restore confidence in the Australian and New Zealand markets, while the rise in income levels, coupled with a strong aspiration for property ownership, will sustain demand in emerging markets such as India and Malaysia.”
Country-Specific Highlights
Singapore
Singapore continues its price growth streak, even as its economy narrowly sidestepped a technical recession in Q2 2023.
Malaysia
Despite a slowdown in the economy, both Kuala Lumpur and Penang saw their prices grow, with Penang being the second-best performing city in Southeast Asia. Judy Ong, Senior Executive Director of Research & Consultancy at Knight Frank Malaysia, noted, “Improvements in road and rail links will underpin demand for well conceptualised residential products in key cities and moving forward, prices are expected to hold steady.”
Australia
The Reserve Bank of Australia has maintained the official cash rate at 4.10%, and despite higher mortgage rates, the average sales volume remained flat bi-annually, indicating a restoration of confidence in the property market.
Also read: iPhone 15 in India: A Game-Changer for Apple’s Market Strategy?
New Zealand
The housing market is showing signs of gaining momentum, even in the face of a technical recession, with the rate of price deceleration slowing down.
Greater China
Homebuyers remain cautious due to bearish stock market performance and high-interest rates, resulting in a sluggish economic recovery.
India
With dwindling ready inventory, residential launches have remained robust, and prices have been on an upward trajectory since H2 2021.
Legal Disclaimer: The Editor provides this news content "as is," without any warranty of any kind. We disclaim all responsibility and liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. For any complaints or copyright concerns regarding this article, please contact the author mentioned above.
