Analysts expect HDB resale market to further cool in months ahead

Key Concepts:

• Singapore Public Housing Resale Market
• Private Home Market
• Price Growth
• Sales Volume
• Built-to-Order (BTO) Flats
• Sale of Balance Flats
• Quarter-on-Quarter Declines
• Easing Price Growth
• Competition from New Flats
• Shortened Waiting Times

Singapore Public Housing Resale Market Analysis

Analysts anticipate a continued cooling of Singapore's public housing resale market in the coming months. This projection follows a 0.4% price increase in the third quarter, marking the slowest pace of growth since the beginning of the pandemic in 2020. This trend represents the fourth consecutive quarter of easing price growth.

Key Observations and Trends:

• Quarter-on-Quarter Declines: For the first time since 2019, more than 10 towns across Singapore, including areas like Bukit Panjang, Tampines, and Jurong East, have experienced quarter-on-quarter declines in resale HDB prices.
• Sustained Overall Price Rise: Despite recent easing, overall prices have been on an upward trend for 22 consecutive quarters.
• Analyst Perspective on Price Movement: While overall prices have risen, analysts note that the market's response has not been uniform. On average, prices have remained relatively stable, with some easing observed towards the end of the quarter and the year. This easing is attributed to a slowdown in demand.

Factors Influencing Slower Growth:

• Increased Competition from New Flats: The primary driver for the slower price growth is identified as increased competition from a larger supply of new flats. This includes flats with shorter waiting times.
• Supply of New Flats: In July and October, nearly 20,000 Built-to-Order (BTO) and Sale of Balance flats were put up for sale.
• Impact on Older Flats: Analysts suggest that older flats may face price pressures as they compete with newly launched BTO flats, particularly those with shorter waiting periods.

Future Outlook for Public Housing:

• Projected Price Growth for 2025: Analysts forecast that prices for the whole of 2025 will grow by 3% to 5%.

Singapore Private Home Market Analysis

The private home market is also experiencing slowing price growth.

• Third Quarter Price Increase: Prices in the private home sector rose by 0.9% in the third quarter.
• Comparison to Previous Quarter: This growth is slightly slower than the 1.0% increase recorded in the previous quarter.
• Significant Jump in Sales Volume: Despite slower price growth, sales volume surged by nearly 45%.
• Driver of Sales Volume: This increase in sales volume was largely driven by new project launches, with over 4,100 units offered for sale, which is almost three times more than in the preceding quarter.

Synthesis and Conclusion:

The Singaporean property market, encompassing both public housing resale and private homes, is showing signs of cooling in terms of price growth. This moderation is primarily attributed to increased supply, particularly of new BTO flats with shorter waiting times, leading to greater competition. While resale HDB prices have seen quarter-on-quarter declines in some areas, overall prices have maintained an upward trajectory for an extended period. The private home market, while experiencing slower price appreciation, has seen a substantial increase in sales volume due to new project launches. Analysts project continued, albeit moderate, price growth for public housing in 2025.