Overall private home resale prices rose 7.5% last year, growth expected to slow this year

Amid muted holiday-season trading in December last year, non-landed private residential resale volume fell by 10.4% month-on-month from November to 743 units. However, resale prices climbed for the fifth consecutive month, rising 0.5% month-on-month.

Mid-Tier Resale Prices Up 0.6% in December

Flash estimates show that private home resale prices continued their upward trajectory, clocking a full-year price growth of 7.5% in 2023 compared to 2022.

In December, resale price gains were largely underpinned by mid-tier homes in the Rest of Central Region (RCR), where prices rose 0.6%. Conversely, resale prices for mass-market homes in the Outside Central Region (OCR) and luxury residences in the Core Central Region (CCR) fell by 1.2% and 0.5% respectively.

With no new launches in the RCR, buyers turned to the secondary market, lifting mid-tier resale prices. District 3 (Queenstown and Tiong Bahru) accounted for the largest transaction volume, clocking an average price of $2,109 psf.

A unit at Four Seasons Park changed hands for $12.5 million, marking the highest resale transaction in December. The top mid-tier transaction was recorded at Corals at Keppel Bay for $8.4 million, while The Trilinq led the mass-market segment with a top price of $4 million.

Mass-Market Homes Account for Over Half of December Resale Volume

Resale volume in December dipped 10.4% month-on-month. Mass-market homes in the OCR accounted for over half of total resale volume, while mid-tier units represented around 30%, and luxury residences in the CCR made up 17.3%.

Among buyers of resale private homes in December, nearly 83% were Singapore Citizens and 15.7% were Permanent Residents. Of the eight foreign buyers, seven were from the United States and one was from China.

Non-Landed Resale Volume Falls 15% for Full Year

A total of around 10,166 non-landed private homes were transacted on the resale market for the entire year, down about 15% from 2022. The drop in volume was likely driven by high interest rates and climbing resale prices, which deterred price-sensitive buyers.

Sub-sales accounted for 13% of total secondary market activity in December, up by 1 percentage point from November. Sub-sales refer to secondary transactions executed before a development receives its completion status.

The price gap between new private homes and sub-sale units stood at 25% in December. Coupled with the completion of 19,000 non-landed private homes in 2023, this offered ample options for buyers seeking move-in-ready properties.

Resale price growth for non-landed private homes is expected to moderate to between 3% and 5% this year.

Faced with competition from new launches, the pace of resale price growth this year is expected to be more subdued than in 2023. Additionally, fewer developments are slated to obtain their Temporary Occupation Permit (TOP) this year, which will lead to lower resale volumes, projected to hover between 9,000 and 11,000 units.

Interest rates may soften this year, easing borrowing costs for buyers and potentially bolstering private housing demand. However, resale price gains for non-landed homes are forecast to trail behind 2023's 7.5%, rising by only around 4% to 6%.