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Shophouse transaction is expected to be greater in 2021 as prices stabilise due to ‘due to buyer’s resistance and present cautiousness in light of the still nascent and tentative economic recovery’, according to a Knight Frank.
Despite a dip in market activity during the first half of 2020, Knight Frank expects the shophouse market to be vibrant this year, reported Singapore Business Review (SBR).
A report by the property consultancy showed that while total shophouse transaction value fell 3.8% year-on-year in 2020, sales rebounded in Q4 2020, even surpassing pre-pandemic levels. The shophouse market registered 51 transactions in Q4 2020, 19 more than that posted in the previous quarter.
Knight Frank attributed the Q4 increase to the pent-up demand from family offices, corporates and first-time investors. It was also buoyed by the low costs of borrowing as well as the high liquidity in the market.
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“While shophouse transaction volume in 2021 is expected to be greater than 2020, price increases are likely to stabilise due to buyer’s resistance and present cautiousness in light of the still nascent and tentative economic recovery,” said Knight Frank as quoted by SBR.
The property consultancy expects the roll out of COVID-19 vaccine to boost investment sentiment, with historical shophouses continuing to be a sought-after heritage asset.
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