Private housing demand to stay resilient in H2: analysts

Experts expect prices to rise by 2% to 5% in 2026, supported by domestic demand and upcoming launches.

The private residential market is expected to remain resilient in the second half of 2026, although economic uncertainty, a weaker hiring outlook and additional housing supply may keep price growth measured, property analysts said.

Final data from the Urban Redevelopment Authority showed private home prices rising 0.5% quarter-on-quarter in Q2, slowing from 0.9% in Q1. Prices increased by 1.4% in the first half of the year.

PropNex CEO Kelvin Fong said the headline increase was mainly driven by landed homes, where prices rose 2.5%. Non-landed prices, which are more representative of the wider private housing market, edged down 0.1%.

“From the perspective of many homebuyers, this may be seen as a flat quarter,” Fong said.

However, PropNex said the performance of Vela Bay, Tengah Garden Residences and Hudson Place Residences showed that buyers remain willing to commit when projects meet their expectations on pricing and value.

At least 66% of units sold at each development were priced below $2.5m, indicating that developers continued to place affordability at the centre of their pricing strategies.

Unsold uncompleted inventory, excluding executive condominiums, declined 7.2% to 14,929 units. PropNex said this remained manageable and represented about 18 months of sales based on the historical annual average.

The firm expects approximately 9,000 new-home sales and 14,000 to 15,000 resale transactions in 2026, with overall private residential prices rising by 3% to 4%.

Knight Frank expects the more sustainable and balanced phase of price growth observed since 2024 to continue.

It said demand would remain supported by Singaporean buyers, intergenerational wealth and the country’s position as a stable financial centre. Mortgage rates that are more favourable than a year earlier should also support demand from HDB upgraders and owner-occupiers.

Knight Frank expects buyers to favour well-connected projects with longer-term growth potential. It forecasts both landed and non-landed private home prices to rise by 3% to 5% in 2026.

Realion chief researcher and strategist Christine Sun was more cautious, citing mortgage costs, macroeconomic uncertainty and a weaker employment outlook as potential constraints on demand.

She said prospective buyers may become more careful about large purchases, although employment growth in AI, software and semiconductor-related sectors could partially offset the broader labour-market slowdown.

Realion forecasts price growth of 2.5% to 3.5%, with between 22,500 and 25,000 private home transactions excluding ECs during the year.

SRI head of research and data analytics Mohan Sandrasegeran said underlying demand remains healthy when supported by well-located and appropriately priced projects.

He expects the stronger second-half launch pipeline, including Dunearn House, Thomson Reserve and Lucerne Grand, to support transaction activity.

However, uncertainty surrounding interest rates, energy prices, geopolitical tensions and US tariffs may encourage buyers to take a more measured approach.

SRI said additional Government Land Sales sites and upcoming completions should broaden buyer choice and moderate price growth without causing an oversupply. It forecasts prices to rise by 2.5% to 3.5%, with 8,000 to 9,000 new-home sales excluding ECs.

Huttons expects stronger-than-anticipated economic growth, low unemployment and lower financing costs to sustain demand. It noted that the three-month Singapore Overnight Rate Average had fallen by 2.6 percentage points between end-2023 and end-June 2026.

Domestic buyers continue to anchor the market, with Singaporeans and permanent residents accounting for 98.5% of purchases in Q2.

Huttons expects 7,500 to 9,000 new-home transactions and price growth of 2% to 5% in 2026, barring external shocks.

Analysts also expect the rental market to remain stable. Knight Frank forecasts rental growth of 1% to 3%, whilst Realion expects an increase of 2% to 3% but cautioned that newly MOP flats and employment uncertainty may increase competition for tenants.