SINGAPORE: Private housing prices fell in the third quarter of the year as sales momentum slowed, according to flash estimates released by the Urban Redevelopment Authority (URA) on Tuesday (Oct 1).
The private residential property price index decreased by 1.1 per cent on a quarter-on-quarter basis in the third quarter of this year, reversing the 0.9 per cent increase in the previous quarter.
It is the first time prices have dipped since the second quarter of 2023.
Sales transaction volume also fell by about 11 per cent on a quarter-on-quarter basis in the third quarter of this year, URA said.
For the first three quarters of 2024, the overall private housing prices saw an increase of 1.1 per cent, a significant moderation from the 3.9 per cent gain over the same period in 2023.
For the first three quarters of 2024, sales transaction volume fell by 8.1 per cent from the level a year ago.
PRIVATE PROPERTIES
Prices for landed properties decreased by 3.8 per cent in the third quarter, compared to the 1.9 per cent increase in the previous quarter.
For non-landed private properties, prices decreased by 0.3 per cent this quarter, a reversal from the 0.6 per cent increase in the previous quarter.
Prices for non-landed properties in the Core Central Region (CCR) saw the largest dip of 1.5 per cent this quarter, extending the 0.3 per cent decrease in the previous quarter.
Prices in the Outside Central Region (OCR) fell by 0.1 per cent, compared to the 0.2 per cent increase in the previous quarter.
Non-landed private property prices in the Rest of Central Region (RCR) increased by 0.2 per cent, moderating from the increase of 1.6 per cent in the previous quarter.
The fall in prices can be attributed to several factors. These include the lower demand and fewer launches during the Hungry Ghost Festival and September school holidays, said property analysts.
Many prospective buyers may have exhibited greater caution in their purchasing decisions, as they were “more restrained in their affordability due to the elevated cost of living and interest rates”, said Ms Christine Sun, chief researcher and strategist at OrangeTee Group.
Others could have refrained from making purchases as they were anticipating a potential decrease in interest rates by the Federal Reserve in September.
The URA warned that despite the recent interest rate cuts by the US Federal Reserve, domestic mortgage rates are expected to remain elevated, relative to the low levels seen over the past decade.
“While macroeconomic conditions remain sound, the economic outlook is subject to uncertainties, and market sentiments continue to be sensitive to geopolitical developments and global interest rate changes,” said the authority.
It urged people to “continue to exercise prudence” when buying properties and taking on mortgage loans.
The flash estimates are compiled based on transaction prices given in contracts submitted for stamp duty payment and data on units sold by developers up until mid-September.
URA will release its full set of real estate statistics for the third quarter of 2024 on Oct 25.
