Home price growth slows in Q1 as buyers turn cautious: URA flash figures

Transactions down 20% QoQ.

Private home price growth in Singapore has slowed to a 1.5% quarterly increase in the first quarter from 2.8% previously, in what property analysts perceive as a sign of persisting cautious buying sentiment.

Flash figures from the Urban Redevelopment Authority on Monday showed prices of both private landed and non-landed homes grew at a slower pace of 3.4% and 1% last quarter, respectively. 

Despite the slowdown, Tricia Song, research head for Singapore and Southeast Asia at CBRE, said seeing overall home prices increase for the third consecutive quarter while transaction volume disappoints already testifies to price resiliency.

Song expects price growth to ease further this quarter before picking up in the second half as homebuyers observe greater caution with their purchases. She also noted that the average price of private homes have already risen by 35% since the pandemic struck in the first quarter of 2020.

“We see increasing buyer selectiveness amid uncertain economic conditions. Negative newsflows from a slew of company layoffs, albeit globally which could have further dented buying sentiment to start the year,” she added.

URA’s preliminary figures showed trades of new private homes dropped 20% in the first quarter from the preceding three months, or a softer 16% decline compared to the same period last year.

Chia Siew Chuin, JLL’s head for residential Research, also expects buyers to maintain a “selective stance” in shopping for homes considering the slew of new condo projects slated for launch this year. 

Developers will likely adjust their prices to boost sales, Chia said, although she does not see “substantial price corrections” happening over the near term.

“Cooling measures are unlikely in the short term in view that the price increase in 1Q24 was measured and supported by genuine local demand that still remains prudent,” she added.

Knight Frank’s research head, Leonard Tay, said homebuyers are likely to assess the project’s quality, location, and the track record of the developer more closely as they are now faced with plenty of options.