The closure of the city by the epidemic was a watershed, and from 2017 to the second quarter of 2020, the real estate market had been in a phase of steady growth, increasing by roughly 2-3% per year; but from the second quarter of 2020 to the third quarter of 2022, prices climbed rapidly, rising by 23.47%, an average increase of over 10% per year.

This clearly far exceeds the growth in income levels of the population.

Secondly, the economic picture for next year is not promising.

While the Singapore economy had a very bright performance this year due to the exceptional epidemic, looking ahead to 2023, the epidemic in China, the recession in Europe and the US, and the war between Russia and Ukraine are all uncertainties.

According to the Ministry of Trade and Industry's forecast, Singapore's economic growth will slow down to between 0.5% and 2.5% in 2023, down from around 3.5% growth in 2022.

Thirdly, the supply of homes on the market is gradually recovering.

The year 2023 will see a peak in the delivery of new projects, with an estimated 14,801 units, not including Affinity and Riverfront Residences, which are estimated to be delivered in late 2023 or early 2024.

Meanwhile new openings in 2023 are estimated at 45 units/12,000, a significant improvement on the 15 units/5,000 units in 2021.

An increase in supply is the best way to curb price rises.

Fourth, interest rates are high and will continue to be so

High interest rates have become the biggest concern for local homebuyers, on top of high house prices: high house prices only require enough for a down payment, high interest rates require a high income along with stability.

The market predicts that the Fed rate will reach its highest point, 4.75%, by the end of 2023.

This means that mortgage rates will remain in an upward trend throughout 2023, although the rate will slow. If the banks can come up with some long-term fixed rate packages below 4% next, it could go a long way to easing buyers' anxiety.

But the cooling is not to say that house prices are going down, but rather that the rate of increase has become smaller because.

Fifth, rents are high and demand remains strong

Rents are rising much faster than house prices, so the ability of homeowners to hold on to their properties is not a concern.

Moreover, with so many years of government guidance, the Singapore property market is already very much a typical owner-occupied market where home ownership is not speculative and demand for home ownership is stable and sustained.

For most first-time buyers, the act of buying a home itself has little to do with property prices, and it is better to buy when the time comes than to rent.

Overall, house prices are expected to rise by 3-5% in 2023, with the sellers' market gradually weakening, making it difficult to resell high premium properties and enabling buyers to have more reasonably priced options.