The Singapore Property Sales Price Index picked up in the second quarter of 2022, recording a quarterly increase of 3.69%, compared to a quarterly increase of 1.98% from the fourth quarter of 2021 to the first quarter of 2022.

HDB resale prices will continue to increase modestly in the next quarter despite the increasing reluctance of regular buyers to match high prices.

In addition to demand fueled by young families unwilling to wait for long BTO completion times and an influx of units that have just completed their Minimum Occupancy Period (MOP) into the resale market, prices remain supported by a continued preference for larger HDB flat types.

Buyers of these higher priced, larger units are mostly private property "downgraders" or HDB upgraders willing to pay a high cash over valuation (COV).

Transactions of million-dollar HDB flats this year have already surpassed the pace of 2021. If this momentum is maintained, we expect more than 300 million-dollar units to be transacted in 2022.

Meanwhile, the private property market without land appears to have rebounded from the impact of the property cooling measures in December 2021. Rising mortgage rates also appear to have had little impact on buying sentiment.

Buyers are reacting to the launch of major projects Piccadilly Grand and Liv @ MB in the second quarter of 2022, reflecting pent-up demand for attractive projects such as those with an edge-of-town location and walking distance to metro stations and amenities. In the upcoming quarter, prices show no signs of weakening due to a range of attractive new projects and resilient demand.

Based on volume, Piccadilly Grand (District 8), Liv @ MB (District 15) and North Gaia (District 27) are the best-selling new-to-market condos for the second quarter of 2022.

Rest of Central Region (RCR) was the main price driver in 2Q2022, mainly due to the successful launch of new offerings in District 8 and District 15. As more people return to the office, buyers are likely to turn their attention to RCR properties in anticipation of the daily work commute.

However, a preference for larger homes continues to exist. Buyers continue to look for homes in the Out-of-Central Region (OCR), where properties are at their best between size and price point.

Home prices in the Out-of-Central region are likely to rebound in the third quarter of 2022. In addition to AMO condo launches, other notable upcoming OCR launches include Sceneca Condos, Lentor Modern, and Sky Eden @ Bedok. Tengah Garden Residences EC and Tampines North EC are also expected to perform well.

The best performing HDB resale units by volume are those that feature HDB flats containing mostly new MOPS units. HDB upgraders who have sold their new MSRP flats continue to opt for larger resale HDB flats located in more attractive and expensive urban fringe areas.

The rental price index climbed upwards and is now at a 16-quarter high, while the rental demand and supply index recorded a quarterly decline.

The median asking price of HDB rental properties listed on PropertyGuru recorded a quarter-on-quarter decline for the first time in three years (following the launch of the PropertyGuru Rental Price Index). While the 0.95% year-over-year change is small, it may be a sign that the HDB rental market is finally slowing down.

More young families are collecting the keys to their BTO flats and exiting the HDB rental market. However, singles and unmarried couples seeking space and privacy are continuing to rent. Foreign talent looking for affordable rental options are also turning to the HDB rental market, keeping prices booming.

The list of top-performing non-landed private property rental projects by volume shows a preference for properties located in the RCR and Core Central Region (CCR). Properties close to the Central Business District (CBD) and areas traditionally favored by expatriates are also seeing more uptake.

In anticipation of the return of these expatriates, asking prices for both non-landed and landed private property rental units on PropertyGuru have seen a sharp increase. As a result, these higher asking prices are likely to translate into greater rental price growth in the third quarter of 2022.

This quarter, OCR regions accounted for four of the five regions ranked by private property rental yields. Despite this, demand for rental properties across Singapore remains strong.

Mature HDB flats had the highest rental yields, with Bedok and Geylang tied for the highest rental yields. Although resale and rental prices in these communities have risen significantly, many people still seek to rent in these HDB flats because they offer a good balance between connectivity, nearby amenities and cost.