According to data released on Monday by the Urban Redevelopment Authority, developers sold only 6,671 residential units last year, with sales in December dropping to 135 units, less than one-fifth of the previous month's sales.

The annual data marked a nearly 10% decrease from the previous year, reaching the lowest level since 2008, indicating a further cooling trend in the market. While Singapore has so far avoided the most severe conditions of the global housing downturn, the impact of real estate purchase restrictions and economic slowdown on the industry is becoming increasingly apparent.

In April of the previous year, the government doubled the stamp duty for foreign property buyers, raising it to 60%, dealing a blow to external demand. Citigroup expects profit margins for developers' residential projects to further decline this year, partially due to approximately 44 projects available in the market. According to real estate brokerage firm Huttons Group, new homes will face further tests in January, with at least six new developments scheduled for launch this month.

The sluggish sales have weighed down developer stock prices. City Developments Limited, Singapore's largest publicly-listed real estate company, fell by 19% last year, exceeding the decline in the country's benchmark stock index.

Analyst Ken Foong stated, "The high prices of newly launched projects and the high-interest-rate environment may be the main reasons for the decline in sales volume." He believes that developers may need to adjust sales prices to attract demand.

Earlier, the market indicated that the overall transaction volume in the private residential market (including resale transactions) reached the lowest level since 2016, further confirming the downward trend in sales.

Tricia Song, Director of Research for Singapore and Southeast Asia at CBRE, stated that market sentiment has become selective due to "numerous options from the launch of new developments, buyer fatigue, and increasing resistance to high price points," in addition to the ongoing economic softness.

While the economic slowdown has not yet had a significant impact on property prices, local demand has driven the value growth of integrated private residential complexes in areas that typically lack such products. According to preliminary official estimates, property prices rose by 6.7% last year.

Foong indicates that this means "if prices are above economic fundamentals, the government may still take new restrictive measures to ensure market stability and sustainable development."

In contrast, CBRE's Song suggests that the decline in sales indicates an overheated market, and the risk of taking more cooling measures is relatively low.

Analysts have divergent views on the future trend of property prices. Morgan Stanley predicts a 3% decline, while Citigroup expects a 4-5% increase this year. Property prices may experience fluctuations, with some downside risks present.