Local resale prices of non-landed private homes climbed for the 29th consecutive month, rising 0.8 per cent in December last year. However, private resale volumes fell for the third consecutive month and were below the average of the past five years.

Analysts noted that the property cooling measures introduced at the end of September last year, as well as the price gap between buyers and sellers, had weighed on private resale performance.

For the full year, overall private resale prices rose by 9.7 per cent. Resale prices in the out-of-central region (OCR), which represents the mass market, rose most significantly by 11.2 per cent over the year.

Other Central Region (RCR), representing mid-range private housing, and Core Central Region (CCR), representing high-end private housing, saw resale price increases of 8.4 per cent and 5.8 per cent respectively.

On a year-on-year basis, resale prices for mass market private homes rose by 1%, while resale prices for high-end and mid-range private homes fell by 0.2% and 0.6% respectively.

Meanwhile, the number of private residential resales fell for the third consecutive month, with some 661 units changing hands in December last year, down 14 per cent from 769 units in the previous month.

The introduction at the end of September last year of the 15-month requirement for private homeowners to buy resale HDB flats after the sale of their homes may have weighed on private resale performance. This discouraged some potential sellers who were looking to buy a resale HDB flat as a replacement from doing so, further dampening the volume of private home resales.

While private resale prices rose last year compared to 2021, the rate of increase was lower than that of new private home launches, and the median price difference between the two is still quite large. It is expected that more budget-conscious buyers may look to resell their private homes, boosting demand in the resale market.

However, resale inventory may remain tight in the short term as homeowners delay sales due to the 15-month waiting period and as some homeowners tend to rent out their units amidst a positive rental market, thereby supporting resale prices.

Private resale volumes have fallen for three consecutive months since the introduction of cooling measures in September last year, rising interest rates and the year-end holidays. Many buyers expect resale prices to moderate following the introduction of the cooling measures, while sellers are holding firm on their asking prices.

As a result, the gap in price expectations between buyers and sellers widened, resulting in fewer deals being struck or longer negotiation times for transactions. This price gap is likely to widen in the short term as most sellers are reluctant to adjust their asking prices.

Resale prices for mass-market private homes remained firm in December, up 1 per cent year-on-year, in contrast to the decline in resale prices for high-end and mid-range private homes. Resale prices remained firm outside the Central District, as resale private homes in this district remain the most affordable private homes in today's market and there is demand for them.

The increase in supply may help to slow the pace of price growth as more private homes receive Temporary Occupation Permits this year. Resale price increases are expected to slow from 8.7 per cent last year to 5-8 per cent this year.

November 2022: 769 units, December 2022: 661 units (down 14%)

Resale prices outside the Central District remain strong as resale private homes in this district remain the most affordable private homes in today's market and there is demand for them.