Singapore's private home prices increased by just 1.1% in Q2 2024, down from 1.4% and 2.8% in the previous quarters, reflecting a cooling market. The first half of 2024 saw a total price rise of 2.5%, lower than the 3.1% in H1 2023 and 4.2% in H1 2022. Landed properties drove the increase with a 1.8% rise, while city fringe areas saw 2.2% growth. Resale transactions hit 3,344 units in Q2, up from 3,066 in Q1. Analysts predict a 1-5% price growth for 2024, with revised new home sales estimates of 5,500-7,000 units.
The latest data from the Urban Redevelopment Authority (URA) on Singapore's private home prices for the second quarter of 2024 paints a picture of a cooling market. Overall prices rose by just 1.1% in Q2, a significant decrease from the 1.4% and 2.8% growth observed in the previous two quarters. The first half of 2024 saw a total increase of 2.5%, which is lower than the growth witnessed in the first halves of both 2023 (3.1%) and 2022 (4.2%). Despite the slowdown, analysts still predict price growth of 1% to 5% for the entire year of 2024.
The increase in prices was primarily driven by landed properties, which saw a 1.8% rise in Q2, following a strong 2.6% increase in Q1. Non-landed homes, which make up the majority of the market, displayed a more varied performance across different locations. City fringe areas in the Rest of Central Region (RCR) saw the most significant growth at 2.2%, following a small 0.3% rise in Q1. This growth is likely due to limited new supply in the area, which boasts a population of over 500,000 residents. Suburban areas in the Outside Central Region (OCR) remained flat with a 0.3% growth, similar to the previous quarter. Prices in the OCR surged in 2023 by 13.7% but appear to be moderating now. Prices in the prime Core Central Region (CCR) dipped slightly by 0.2% after a jump of 3.4% in Q1. This could be due to a lack of new high-end projects and some developers offering discounts to move sales of existing units.
Interestingly, the resale market for non-landed homes saw a rise in sales volume across all segments. This is likely due to a few factors. Firstly, developers have launched fewer new projects in recent months, leading to a smaller pool of new homes available for purchase. Secondly, the price gap between new and resale properties appears to be widening, making resale options more attractive to cost-conscious buyers. Data from CBRE shows that resale transactions reached 3,344 units in Q2, up from 3,066 units in Q1 and exceeding the quarterly average for 2023. This trend is reflected in the overall sales figures, where resale deals now represent a higher proportion of total transactions at 76.4%, compared to 65.8% in Q1.
While the Singapore private home market is experiencing a slowdown, experts believe there's still room for moderate growth throughout 2024. Analysts have revised their forecasts for new home sales downwards, with estimates now in the 5,500 to 7,000 unit range, compared to earlier predictions of 7,000 to 8,000 units. The resale market is expected to remain active, particularly as the gap between new and resale prices widens.
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