In the fourth quarter of 2024, home prices experienced a significant rebound, contrary to the narrative of a 2.3% quarterly increase. As we move into 2025, the housing market faces a complex balance between affordability and supply, setting the stage for an intriguing year ahead.
Key Takeaways
- Private home prices in Singapore surged by 2.3% QoQ in Q4 2024, reversing a 0.7% decline in Q3 2024.
- Non-landed private homes in the Rest of Central Region (RCR) and Outside Central Region (OCR) saw 3.4% QoQ price increases each in Q4 2024.
- The Core Central Region (CCR) experienced a 2.4% QoQ price increase in Q4 2024, ending two quarters of decline.
- Seven major non-landed projects launched in Q4 2024, leading to the highest quarterly new home sales since Q3 2021, with 3,453 units sold.
- The cumulative price increase for 2024 was 3.9%, with overall private home prices expected to rise by 3% to 4% in 2025.
Quarterly Price Growth Overview
In the fourth quarter of 2024, Singapore’s private home prices exhibited a notable resurgence, particularly when compared to the preceding quarters. The prices increased by 2.3% on a quarter-on-quarter basis, reversing the 0.7% decline seen in the third quarter of 2024. This growth marks the fastest quarterly increase since the 2.8% rise in the fourth quarter of 2023.
The cumulative price growth for 2024 stands at 3.9%, a slowdown from the 6.8% growth in 2023 and the 10.6% in 2021. These price trends reflect the dynamic market dynamics, where regions like the Rest of Central Region (RCR) and Outside Central Region (OCR) showed significant growth, with RCR recording a 5.8% year-on-year increase and OCR easing to 3.7% from 13.7% in 2023. Furthermore, the anticipated new units from developments expected in 2024 may further influence market supply and demand dynamics.
Non-Landed Homes Performance
The fourth quarter of 2024 saw a significant uptick in the performance of non-landed private homes in Singapore, with prices rising by 3.0% on a quarter-on-quarter basis.
This growth was driven by strong demand across all sub-markets, with the Rest of Central Region (RCR) and Outside Central Region (OCR) recording increases of 3.0% and 3.3%, respectively, while the Core Central Region (CCR) saw a 2.6% rise.
The launch of seven major non-landed projects in the fourth quarter, including five in November, further boosted the market.
These new launches resulted in 3,420 new homes being sold, a 194.8% increase from the previous quarter, highlighting the robust non-landed demand and significant investment potential in this segment.
The successful launches also had a positive impact on nearby existing projects, underscoring the market’s resilience and attractiveness. Additionally, the release of GLS sites in River Valley is expected to further stimulate the demand for high-quality residential units.
New Launches and Sales Activity
The robust performance of non-landed private homes in the fourth quarter of 2024 was further fueled by a surge in new launches and robust sales activity.
Seven major non-landed projects were launched in the quarter, with November 2024 seeing the highest number of launches since November 2019. This led to a significant increase in sales, with developers selling 3,420 new homes, a 194.8% rise from the previous quarter and the highest quarterly sales since 3Q2021.
The successful launches had a ripple effect, boosting sales in earlier projects in the vicinity. These new project strategies align with observed sales trends, indicating continued healthy demand for new homes. Notably, developments like The Reserve Residences exemplify the growing interest in integrated projects that combine residential, retail, and transport facilities.
Upcoming projects in 2025, such as Elta, Parktown Residence, and Lentor Central Residences, are expected to maintain this momentum.
Resale Market Trends
Resale private home transactions in Singapore saw a significant surge in the fourth quarter of 2024, with a total of 3,702 units sold, contributing to an annual total of 14,053 units. This represents a 24% increase in resale volume compared to 2023, marking the highest in three years.
Despite the robust sales activity, resale pricing remained relatively stable, reflecting the balanced market demand. The overall rental prices in 2024, however, declined by 1.9% year-on-year, reversing the 8.7% increase from 2023. This divergence suggests that rental price growth will vary, with newly completed homes likely to appreciate while older properties may experience flat growth, influencing market demand and resale pricing dynamics. Furthermore, the rising resale prices in the HDB market in 2023 have contributed to the overall perception of property value in Singapore.
Landed Property Price Changes
Landed property prices in Singapore experienced a notable slowdown in 2024, with a cumulative increase of only 0.9% for the year, marking the slowest growth in seven years.
This sluggish performance stands in contrast to the more vibrant non-landed market, which saw significant growth driven by new launches and strong sales volumes.
The landed property trends reflect a more cautious investor and buyer sentiment, possibly influenced by economic uncertainties and higher interest rates.
Landed price fluctuations have been minimal, indicating a stable but stagnant segment of the market.
This stability, however, may appeal to investors seeking safer and more predictable returns, highlighting the diverse opportunities within Singapore’s real estate landscape. Additionally, the increase in buyer stamp duty has contributed to a more cautious market environment.
Future Market Outlook
As the real estate market in Singapore navigates the nuances of 2024, the outlook for 2025 appears promising, particularly for non-landed private homes. Continued healthy sales are anticipated for new launches, with notable projects like Elta, Parktown Residence, and Lentor Central Residences on the horizon.
Price projections for these new projects range from $2,200 to above $3,000 per square foot, with overall private home prices expected to rise by 3% to 4% in 2025.
Investors can refine their investment strategies by monitoring economic indicators such as sales volume and unsold stock levels. As of the end of 4Q2024, the unsold stock stood at 19,606 units, with 24 new launches anticipated in 2025.
This balanced supply and demand dynamic suggests a stable and potentially lucrative market for real estate investments in the coming year. Additionally, the potential for long-term appreciation reinforces the attractiveness of investing in this sector.
Regional Price Variations
Regional price variations in the Singaporean real estate market have been a significant factor in shaping the overall housing landscape.
The fourth quarter of 2024 saw distinct price growth patterns across different regions. The Rest of Central Region (RCR) recorded the highest price growth of 5.8% year-on-year, driven by strong demand and new project launches.
In contrast, the Outside Central Region (OCR) experienced a more modest growth of 3.7%, a significant slowdown from the 13.7% seen in 2023.
The Core Central Region (CCR) also showed growth, with prices increasing by 2.6% quarter-on-quarter.
These regional demand dynamics and resulting price disparities highlight the varying levels of attractiveness and investment potential across Singapore’s real estate sectors.
Conclusion
The fourth quarter of 2024 saw a significant rebound in home prices, driven by strong demand and successful project launches. Despite economic headwinds, the non-landed homes market experienced a surge in leasing volume, particularly in the Rest of Central Region. New launches and resale market activities contributed to the robust recovery in the private housing market. However, the impact of higher mortgage rates and cooling measures, such as the Additional Buyer’s Stamp Duty, continues to influence market dynamics heading into 2025.