Third quarter private home prices rebounded 0.5%, reversing a 0.2% drop in the previous quarter. This was led by demand from local buyers for properties in the city fringe and the suburbs.
Factors Driving Third Quarter 2023 New Private Home Prices
Below is a summary of factors that drove third quarter 2023 private home prices:
- Private home prices rebounded by 0.5% in the third quarter after a 0.2% drop in the previous quarter.
- Demand from local buyers drove price gains in the city fringe and suburbs.
- New launches in the city fringe and suburbs contributed to the price rebound.
- Prices of non-landed homes rose by 2.1% in Q3 after a 0.6% drop in the previous quarter.
- The number of units sold fell by 15% compared to the second quarter and 26% year-on-year.
- Take-up rates for new launches dropped to 30-50% in Q3 amid buyer fatigue and increasing resistance to high prices.
- Despite more new launches and newly launched units, just 1,905 new private homes (excluding executive condominiums) were sold in the third quarter, down 10.4% from the 2,127 units sold in the previous quarter amid ongoing economic uncertainties which led to more selective buyings and decreased in demand.
- Despite the 0.5% rebound, overall price growth was less than the average growth of 2.1% over the past three years.
- Year-on-year, private home prices grew at a slower pace of 3.6% in the first nine months of 2023 compared to 8.2% growth over the same period in 2022 and 5.3 per cent in 2021.
- Landed property prices fell by 4.9% in the third quarter, reversing a 1.1% gain in the previous quarter. This is the largest quarterly drop since Q1 2009, when landed home prices fell 9.2% quarter-on-quarter
- Non-landed suburban private home prices rose by 5.1% compared with a 1.2% growth in the previous quarter, while prices of non-landed private homes in the city fringe climbed 2.3%, reversing a 2.5% drop in Q2. This can be attributed to new launches in Q3 like Lentor Hills Residences, The Myst, The Lakegarden Residences and The Arden in the suburbs, and Grand Dunman and Pinetree Hill in the city fringe.
- Median new home prices in the suburbs increased to $2,080 psf in Q3 from $2,025 psf in the previous quarter.
- Resale home prices in the suburbs rose by 1.2% quarter-on-quarter even as resale volumes dropped
- Prices in the prime district fell 2.6% cent in Q3, extending a loss of 0.1% in the previous quarter. This may be due to the increased stamp duty for foreigners and the ongoing money laundering probe.
- Total private home sales in the prime district decreased by 32.6% in Q3 to 683 units while foreigners’ demand for homes in the district dropped by a hefty 63.7%.
- But in October and November, transaction volumes are expected to pick up due to a slew of new launches such as Watten House in Bukit Timah, The Hill @ one-north, Hillock Green in Lentor Central, and J’Den in Jurong Lake District.