Private home prices jumped 2.3 per cent in Q4 2024 on November’s new sales surge

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Private home prices jumped 2.3 per cent in Q4 2024 on November’s new sales surge​

The private residential price index grew 3.9 per cent in 2024, the slowest annual price growth recorded since 2020.ST PHOTO: KUA CHEE SIONG

Grace Leong
UPDATED JAN 24, 2025, 06:53 PM

SINGAPORE – Private residential property prices rose 2.3 per cent in the last three months of 2024, reversing a 0.7 per cent drop from the previous quarter, after a last-minute surge in new home sales in November following cuts in local mortgage interest rates.

The traditionally quiet fourth quarter bloomed into an active period for property launches and sales after developers, having held off for most of the year, released a slew of projects in November to capitalise on lower borrowing costs and pent-up demand, Ms Chia Siew Chuin, JLL’s head of residential research in Singapore, noted.

Nonetheless, the Urban Redevelopment Authority’s (URA) overall private home price index grew at a slower pace of 3.9 per cent in 2024, compared with a 6.8 per cent gain in 2023 and an 8.6 per cent jump in 2022.

It is the slowest annual price growth recorded since 2020, when prices increased by just 2.2 per cent during the Covid-19 pandemic, suggesting buyer caution.

Prices in the landed segment stabilised, dipping just 0.1 per cent in the fourth quarter, compared with flash estimates of a 0.9 per cent quarter-on-quarter correction. This follows a 3.4 per cent drop in the preceding quarter.

Fuelled by November’s sizzling new launch sales, non-landed home prices jumped 3 per cent in the fourth quarter, compared with a 0.1 per cent gain in the previous quarter.

For 2024, prices of landed properties rose by 0.9 per cent, while those of non-landed properties jumped 4.7 per cent, moderating from 8 per cent and 6.6 per cent growth, respectively, in 2023.

Price growth in the prime district jumped 2.6 per cent in the fourth quarter, reversing a 1.1 per cent drop in the previous quarter, while the suburban market jumped 3.3 per cent after remaining unchanged in the third quarter.

Non-landed property prices in the city fringe increased by 3 per cent in the fourth quarter compared with the 0.8 per cent rise in the previous quarter. Price growth in this sub-market also outpaced that of the prime and suburban markets, with a rise of 5.8 per cent for the whole of 2024. Suburban condominium prices rose 3.7 per cent in 2024.

Prime private property prices grew 4.5 per cent in 2024, despite muted demand throughout much of the year, hamstrung by the 60 per cent additional buyer’s stamp duty (ABSD) for foreigners.

“Foreign professionals and expatriates who have turned to the leasing market due to the prohibitive ABSD are unlikely to return as buyers any time soon, especially with rents no longer rising and in some instances easing,” Knight Frank research head Leonard Tay said.

“Despite the fall of interest rates coupled with more new launches expected in 2025, prime condo demand would likely come from local home buyers. With demand in the high-end market expected to remain soft until the curbs are lifted, price growth will likely remain subdued,” he added.

According to the URA, 3,425 uncompleted private homes, excluding executive condominiums, were launched for sale in the fourth quarter, compared with 1,284 units in the previous quarter. For the whole of 2024, developers launched 6,647 uncompleted private residential properties for sale, compared with the 7,551 units in 2023.

Of a total of 22 new launches excluding exec condos, or 6,302 units, about 57 per cent were launched in the fourth quarter, Cushman & Wakefield research head Wong Xian Yang said.

On a quarterly basis, new private home sales volume jumped to 3,420 units in the fourth quarter – the highest quarterly figure since third quarter 2021’s 3,550 units – up from 1,160 units in the third quarter. For the whole of 2024, developers sold 6,469 private residential units, compared to the 6,421 units in 2023.

The resale market recorded 3,702 transactions in the fourth quarter, a 4.1 per cent quarter-on-quarter drop due to the surge in new project launches, Ms Chia noted. That said, the resale market demonstrated resilience, with total annual transactions reaching 14,053 units in 2024, surpassing the 11,329 units sold in 2023.

Ms Chia said resale prices were underpinned by a substantial discount from new home sales prices, buyers’ preference for larger living spaces, improving economic conditions and easing interest rates.

Meanwhile, the private rental market remained unchanged in the fourth quarter after a 0.8 per cent rebound in the third quarter. For the whole of 2024, rentals of private residential properties fell by 1.9 per cent, a reversal from the 8.7 per cent increase in 2023.

Rentals of non-landed properties in the prime district rose 0.9 per cent in the fourth quarter, compared with a 1.6 per cent drop in the previous quarter, while those in the city fringe edged up 0.3 per cent after the 1.7 per cent jump in the previous quarter.

Ms Chia said the fourth quarter’s rental gains in the prime and city fringe areas were marginal because landlords, facing rising costs, could not offer significant rent reductions, while tenants had more rental options with an increase in newly completed projects.

In the suburban market, rentals dropped by 0.8 per cent in the fourth quarter, compared with the 2.2 per cent increase in the previous quarter.