According to data released by the Urban Redevelopment Authority (URA), the overall private residential prices in the country exhibited a turnaround in the third quarter, with a 0.8% increase compared to the previous quarter, slightly higher than the official estimate of 0.5%. However, analysts expect the price growth trend to slow down, and the annual private residential transaction volume for this year is also expected to be lower than last year, as developers grapple with oversupply challenges.

Specific data indicates that non-landed private residential prices rose by 2.2% in the third quarter, reversing the 0.6% decline in the previous quarter. Among them, prices for mass-market private residential properties outside the central region (OCR) continued to rise, expanding from 1.2% in the second quarter to 5.5% in the third quarter. Prices for other central region properties (RCR), representing mid-tier private residential properties, increased by 2.1% in the third quarter, reversing the 2.5% decline in the previous quarter.

In contrast, prices for high-end private residential properties in the core central region (CCR) intensified their decline, expanding from 0.1% in the second quarter to 2.7% in the third quarter.

The significant increase in mass-market private residential prices in the third quarter was primarily influenced by the launch of new projects and price hikes. It is expected that this growth trend will stabilize or slow down in the near future. The prices of high-end private residential properties have been affected by government cooling measures, with reduced demand from foreign buyers impacting market sentiment.

On the other hand, landed private residential prices declined by 3.6% in the third quarter, reversing the 1.1% increase in the previous quarter, ending eight consecutive quarters of growth. Nevertheless, it is anticipated that prices will not continue to fall, as landed private residential properties remain in short supply and continue to be sought after by local Singaporeans.

More signs indicate resistance in private residential property prices. The overall private residential sales volume decreased by 3.5% in the third quarter to 5,201 units, a 15.4% year-on-year decrease.

Of these, sales of new private residential properties fell by 8.5% to 1,946 units, while the transaction volume of resale private residential properties decreased by 2.6% to 2,900 units.

Regarding private residential rents, there was a 0.8% quarter-on-quarter increase in the third quarter, lower than the 2.8% increase in the previous quarter and significantly lower than the 7.2% increase in the first quarter. The URA pointed out that the growth rate of private residential rents has slowed for four consecutive quarters, and the 0.8% increase in the third quarter is the lowest since the fourth quarter of 2020.

In addition, developers launched 2,805 units in the third quarter, up from 2,374 units in the previous quarter. However, the sales volume in each quarter this year was lower than the launch volume, indicating an oversupply in the market. This has been influenced to some extent by recent cooling measures, weakening the demand for home purchases and the stability of new housing supply.

In the previous year, private residential prices rose by 8.6%, with a transaction volume of 21,890 units. It is projected that the annual private residential transaction volume for this year will range between 18,000 and 20,000 units. The private residential market remains resilient, with low unemployment rates and resale prices of government flats continuing to rise in the third quarter, supporting the demand for upgraded private residential properties.

The real estate market will continue to be influenced by the interest rate environment. As the time for maintaining high interest rates is longer than expected, homeowners are facing high monthly mortgage payments. With new geopolitical uncertainties and global economic growth lower than expected, buyers will remain cautious.