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How Have Past Epidemics Affected Singapore’s Real Estate Market and What We Can Learn from It.

Updated: May 7, 2020

Over the past 2 decades, we have seen a few epidemics happening to Singapore and even the whole world. We had SARS in 2003, H1N1 in 2009 and currently Covid-19. The chart below shows the list of epidemics that we had in the recent years. It also shows the detailed information of the duration of the disease, number of infections and deaths, mortality rate and even the impact on the economy.

Covid 19 impact on Singapore
Epidemics in recent years

In this article, we will not be talking about Covid-19 but just looking at the past epidemics that had happened and how did it impact Singapore’s real estate market.

Looking at the roller coaster real estate charts from the past years, historical figures have shown that epidemics does not affect the market as much as financial crisis.

Historically, financial crises have more impact on prices & sales volume
Epidemics had limited impact on property market

From the chart above, we could see that both the price and sales volume increased after SARS and H1N1. On the contrary, sales volume for non-landed housing register a drop of 51.1% and the average unit price saw a dip of 17.3% during the Global Financial Crisis. Then what about our rental market? During SARS, our private property rental market saw an increase in volume of 24.1% but there was a slight dip in rental pricing by 2.9%. For the H1N1 period, there was a marginal drop in volume by 8.5% but we saw an increase in rental prices by 3.2%. For the HDB rental market, there was an increase in both rental volume and prices for both SARS and H1N1 periods.

So, as we can see, the buying momentum often increases after the epidemics and why is this so? One of the reasons will be foreign buyers. As I have mentioned in my previous article - <Where Might Our Real Estate Market Be Heading After This Covid-19 Is Over?>, after a closure of an epidemic saga, people from all over the world will probably want to end up in countries where the epidemics are well controlled and managed, so that in the event if another epidemic or pandemic occurs, they will be in a place where they will feel confident that they be well taken care of. Let us take a look at the following 2 charts on foreign buyers.

Limited impact on demand from foreigners
Impact on Foreign Buyers (non-landed homes)
Surge in buying after each epidemic
Impact on Singapore's Top Foreign Buyers

From the charts, we could see that purchases from PRs and foreigners increased dramatically by 164.6% and 91.6% respectively after SARS. When it came to H1N1, the figures were more humble at 16.8% for PRs and 49.8% for foreigners. Even when there was a decrease in figures when we compare SARS to H1N1, we will realise that the foreigners are still very much into buying our Singapore properties.

Our real estate market attracted buyers from all nationalities like magnets is to iron. There was an increase in sales volumes from all nationalities with the largest being the Chinese. After SARS, there was an increase of sales volume by 250% for the Chinese and 57.1% after H1N1.

I hope this article sheds some light on how our real estate market behaved after the 2 most recent epidemics that Singapore faced. For Covid-19, much still needs to be observed but at the point of this article being written, our prices are still standing firm at the moment. If you are still very curious and wishes to have a discussion on how our real estate market will behave after the saga of Covid-19 closes, feel free to give us a call and we will gladly have a chat with you and show you more charts regarding the numbers of our real estate market.

* All charts are original works by OrangeTee & Tie Research and Consultancy and Copyrights of OrangeTee & Tie Pte. Ltd.

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