New Landscape in Singapore's Housing Market: Are Resale Private Homes More Sought-After?

Price Gap Between New and Resale Private Homes Narrows to 17.4%: Are Buyers Favouring Resale Properties?

In the first half of this year, a clear trend emerged in the local private residential market: resale property prices accelerated, narrowing the price gap between new and resale private homes to 17.4%, the lowest level in recent years. At the same time, resale transactions accounted for 62% of total market volume, indicating that resale homes are finding greater favour among buyers.

Price Gap Between New and Resale Homes Gradually Narrowing

In the first half of this year, the average transacted price for new non-landed private homes stood at $2.26 million, compared to $1.92 million for resale homes. This 17.4% gap has narrowed significantly from 24.6% last year and 28.3% the year before.

This shift is largely driven by two key factors:

Resale prices have risen faster — more homeowners who bought during the pandemic (around 2020) are choosing to sell, spurring activity in the secondary market.

New launch price growth has moderated — developers are adopting more sensitive and competitive pricing strategies to attract buyers.

PSF Price Gap Also Narrowing

On a per-square-foot (psf) basis, the price gap between new and resale private homes widened from 5.5% in 2012 to a peak of 52.9% in 2023. However, in the first half of this year, this gap contracted to 40.9%.

Currently, the average unit price for new private homes stands at $2,489 psf, compared to $1,767 psf for resale units.

It is worth noting that resale private homes are generally larger in size, meaning that even with a lower psf price, their overall quantum is not necessarily low. Pre-pandemic, the transacted quantum of resale units was even higher than that of new launches at times. Only post-pandemic, driven by surging land costs, labour, and construction expenses, did new home prices swiftly outpace resale units.

Why Are Buyers Leaning Towards Resale Private Homes?

The share of resale private homes among overall transactions rose from 57.7% in 2023 to 62% this year.

Key reasons include: resale properties offer larger floor plates with relatively sensible lump-sum prices; quicker or immediate move-in timelines; and a distinct psf price advantage offering better value for money.

More condominiums completed in 2023 have entered the resale market, naturally bolstering transaction volumes. Both new launches and resale homes cater to different segments: the former appeals to buyers seeking brand-new units, while the latter is ideal for those with immediate housing needs.

Purchasing a resale property can also involve a more tedious process, requiring time to browse listings and arrange physical viewings, which demands more effort compared to buying a new launch.

Diverging Views on Future Price Gap Trends

Some believe the price gap could widen. With several mid- to high-end new projects slated for launch, new private home prices could accelerate, whereas limited resale supply may keep resale price increases measured.

Other analysts suggest the price gap could narrow further. The rationale: several condominiums launched in 2021 will attain their Temporary Occupation Permit (TOP) next year, and owners holding their units past the four-year mark can sell without incurring Seller's Stamp Duty (SSD), thereby injecting more supply into the resale market.

Regardless of which scenario unfolds, current data indicates that resale homes are steadily gaining traction among buyers. The dynamic price interplay between new launches and the resale market will continue to shape the next chapter of Singapore's property landscape.