Asia-Pacific Residential Review H2 2020

Residential markets across the Asia-Pacific region experienced trends of stability in H2 2020. 14 out of the 24 markets tracked by Knight Frank recorded stable or increased year-on-year price growths. On average, prices grew 1.9% compared to 2019. Low interest rates environments had buffered the residential markets from the effects of the pandemic and weaker economies in H2 2020.

Southeast Asia

Singapore’s housing demand saw a better-than-expected performance after the city state’s “Circuit Breaker”. Despite that, the core central region recorded only a 0.2% fall year-on-year, while the rest of central region rose 5.1%. With low interest rates, low household leverage levels and a gradually recovering economy should act as a floor to any price declines in 2021.

Condo prices in Bangkok fell 3.0% year-on-year in H2 2020, as economic sentiments were battered by the lack of tourist activities and ongoing political uncertainty. Compounding the issue is the addition of new supply into the market in late 2020. Price discounts and other offers have been introduced by developers to drum up sales for the market. In 2021, further rounds of policy easing and other policy tweaks, announced over the past 12 to 24 months, should help the market’s performance improve.

Australasia

While housing prices fell in H2 2020 for Australia, the market still recorded a 1.3% year-on-year mainstream growth average across its 4 major capitals. Perth was the top performer, with prices growing 3.7% year-on-year, as its major economic driver of mining activities was relatively unscathed from the effects of the pandemic. Low interest rates are expected in the following years, and with limited supply across its submarkets, these factors should keep Australian residential prices resilient in 2021.

East Asia

On average, prices in the Chinese Mainland’s Tier-1 capital cities 3.9% year-on-year in H2 2020. This was an acceleration in growth rates from H1 2020, which saw a 2.9% annual rise. Prices across these submarkets were driven by economic recovery, following the initial shocks of the COVID-19 pandemic and policy tightening measures prior. As this remains true going into 2021, housing demand is likely to return to pre-COVID levels.

South Asia

India saw a severe standstill in sales activity in H1 2020, having undergone stringent lockdowns in that period. The three major markets of Mumbai, NCR Delhi and Bengaluru recorded an average price decline of -2.7% year-on-year in H2 2020 due to affected demand. As the economy began opening up in the second half of 2020 and armed with better management of the COVID-19 pandemic, residential sales did begin to improve 60% in H2 2020 compared to H1, across the top 8 cities in the market. With lower residential price levels and interest rates, affordability in the market is at its best levels for buyers in years, and 2021 is likely to be a strong year for the Indian residential sector.

To read the full Asia-Pacific Residential Review H2 2020, click here.