Analysts cite high inflation, rising mortgage lending and last September's property cooling measures that lowered the loan ceiling for many buyers, coupled with a weaker macroeconomic outlook for the coming year, as reasons for the slowdown in house price growth.
With more new private housing projects expected to come on the market in prime locations and on the fringes of urban areas in the next few months, the overall private property price index is expected to receive a boost.
In an interview with the Lianhe Zaobao newspaper, Sun Yanqing, Director of Industrial Research and Consulting at OrangeEasy, said that border controls around the world were largely lifted last year, with many nationals rushing to travel overseas, resulting in a significant drop in new private home sales activity at the end of the year.
Developers suspended the launch of new projects during the national holiday season, resulting in fewer sales of new private homes in the fourth quarter.
According to the Urban Redevelopment Authority's Real Estate Information System (URA Realis), only 666 new private residential units, excluding executive condominiums (ECs), were sold in the fourth quarter of last year, a 69.1 per cent drop from the previous year.
Meanwhile, resale private homes fell by 36.4 per cent year-on-year to 2,360 units.
There will be around 50 new private residential projects coming on the market in 2023, with at least seven of them being large projects of over 500 units.
Most analysts expect the local new private housing market to remain buoyant in the coming year, with home prices expected to rise by between two and eight per cent, as more new projects are launched to meet pent-up demand and more foreign buyers return.
According to figures provided by OrangeTee & Tie to the Union-Tribune, 48 new private housing projects will be launched in 2023, with a total of 11,391 units.
In addition, two new executive condominiums (ECs) will also be launched in Bukit Batok West, resulting in more than 12,000 new private residential units.