Prices of Private Homes and HDB Resale Flats Rise for 11 Consecutive Quarters, But Stabilisation May Be Near

SINGAPORE — The property market in Singapore has seen a steady rise in both private home and HDB resale flat prices for 11 consecutive quarters, but there are signs that the market may be stabilising. PropertyGuru, the leading property website, noted a modest 0.4% increase in private residential property prices in Q4 2022, suggesting that prices could be reaching a plateau. The full effects of the property cooling measures introduced in September 2022 are expected to become more apparent in the upcoming quarter.

However, PropertyGuru also warned that private property prices in the resale market are unlikely to decrease in the short term due to limited supply and owners’ reluctance to lower prices. Despite this, new property launches for 2023 are anticipated to perform well, though their success will depend on the limited immediate options available.

HDB Resale Flat Prices
In the HDB resale market, prices continued to climb, with a 2.3% increase in the resale price index, rising from 168.1 points in Q3 2022 to 171.9 points in Q4 2022. This marks the eleventh straight quarter of growth. The demand for resale flats has remained robust, driven by a preference for larger flats and a record number of million-dollar HDB transactions last year.

Despite the steady demand, the completion of more Build-To-Order (BTO) projects and an increase in BTO flat launches could lead to a gradual cooling of the resale market in 2023. PropertyGuru predicts that the resale market may stabilise barring any significant economic disruptions.

Approximately 16,000 flats are expected to reach their Minimum Occupation Period (MOP) in 2023, with many located in areas such as Bukit Batok, Yishun, Buangkok, and Sembawang. These estates are likely to see continued growth in resale flat prices due to rising borrowing costs and high demand, particularly among first-time homebuyers.

Private Residential Property Prices
In comparison to a 3.8% quarter-on-quarter increase in Q3 2022, the 0.4% rise in private home prices at the end of last year indicates that the market may be stabilising. PropertyGuru highlighted that the full impact of the cooling measures, higher interest rates, and the lack of major new launches in Q4 2022 still needs to be fully assessed.

The report also pointed out that slower price growth in the Outside Central Region (OCR) was due to a lack of major condominium launches, while non-landed private property price growth in the Core Central Region (CCR) also slowed down. While resale prices remain high, actual transaction volumes have continued to decline.