Non-Landed Private Home Resale Market Softens in December Amid Year-End Lull

Singapore Non-Landed Private Home Resale Market Slows at Year-End; Experts Anticipate Rebound Within Months

Influenced by the typical year-end lull in the property market, Singapore's non-landed private residential resale market moderated in December. Overall resale prices held flat compared to November, while transaction volumes dipped by 2.5% month-on-month. Despite this, full-year overall resale prices still posted a 4% gain. Analysts generally view this adjustment as temporary, noting that underlying demand remains resilient and is expected to regain momentum in the coming months.

Market Data Overview

According to flash estimates, the resale price index stood at 262.8 in December, unchanged from November. Specifically:

Outside Central Region (OCR): Resale prices rose 0.5% month-on-month

Rest of Central Region (RCR): Resale prices edged up 0.1%

Core Central Region (CCR): Resale prices dipped slightly by 0.2%

On a year-on-year basis, overall resale prices in December 2023 rose by 4%, with resale prices in the CCR, RCR, and OCR climbing by 2.1%, 3.8%, and 5.4% respectively.

Resale transaction volume fell to 992 units in December, down 2.5% month-on-month, but surged 29.9% year-on-year, standing 10.1% above the five-year average for December.

Seasonal Lull and Heightened Market Competition

The softer market in December was primarily driven by the "year-end holiday lull", coupled with competition from five new private residential projects launched in November.

Nonetheless, resale market demand remains robust, underpinned by two major factors:

First, steady demand continues from buyers looking for ready-to-move-in homes.

Second, buyers seeking larger residential spaces continue to search for suitable units.

Furthermore, the price gap between resale condominiums and new launches is widening, which may channel more buyers toward the resale market. Following this brief pause, demand is projected to rebound over the coming months, with an improving credit environment expected to stimulate homebuying interest.

Experts: Market Expected to Rebound in March to April

Resale transactions typically taper off in November and December due to the school holidays and festive celebrations. As such, the current drop in transaction volume is largely seasonal. The market is poised to rebound in March or April, provided no new property cooling measures are introduced by the government.

However, the strong sales momentum at the newly launched The Orie could draw official attention. Whenever record-high transactions emerge in the market, authorities may consider stepping up regulatory curbs to keep home price growth in check.

Alternative Study Shows Marginal Price Gain

Meanwhile, alternative research data indicates that the non-landed private home price index inched up 0.6% in December. Specifically, resale prices in the Core Central Region (CCR) edged up 0.5% month-on-month; non-central regions (RCR and OCR) rose 0.6%; and shoebox units climbed 0.6%.

Additionally, the overall property price index for November was revised down to a 0.3% month-on-month increase.

Market Outlook

Overall, despite a brief year-end cooling in Singapore's non-landed private resale market in December, experts broadly believe that demand remains solid. Against the backdrop of an easing credit environment, the resale market is well positioned to resume growth in the months ahead.

For prospective homebuyers and investors planning to enter the market, short-term fluctuations may present favourable buying opportunities, making market movements over the coming months well worth tracking closely.