Singapore Home Price Growth Eases to More Than Two-Year Low as Sales Slide

Singapore’s private home prices inched up 0.4 percent in the fourth quarter of 2022 compared with levels in the prior three months to record the slowest growth pace in more than two years, according to data from the Urban Redevelopment Authority.

The URA’s final reading marked a pullback from 3.8 percent growth in the third quarter, as new home sales volume (excluding executive condos) in the October-December period hit a 14-year low of 690 units transacted.

The fourth quarter saw price growth momentum lose steam amid a lack of major new launches, fast-depleting unsold inventory and the year-end market lull, said PropNex Realty CEO Ismail Gafoor.

“The cooling measures introduced at the end of September 2022 probably also caused some would-be buyers to temporarily postpone their decision to buy a property as they review the changes,” Gafoor said Friday in a release.

Landed Segment Leads

Landed private homes led price growth in 2022’s final quarter with a 0.6 percent rise that represented a sixth straight quarterly increase.

For the full year, private landed home prices climbed 9.6 percent, marking the fifth consecutive year of price growth, to build further on the 13.3 percent price increase in 2021, PropNex said.

Non-landed private home prices edged up 0.3 percent quarterly, hitting the brakes after a 4.4 percent surge during July-September, as a shortage of big project launches and the seasonal lull weighed on the market.

Tricia Song, head of research for Southeast Asia at CBRE, noted that the fourth quarter saw four smaller project launches: Kovan Jewel (34 units) in the Outside Central Region and Enchante (25), Hill House (72) and Sophia Regency (38) in the Core Central Region.

“Take-up was mostly lukewarm at these new launches, as homebuying sentiment in Q4 2022 was dented by the worsening macroeconomic backdrop and high mortgage rates,” Song said.

Developers Stay Cautious

Developers launched just 504 uncompleted private residential units in the fourth quarter, down sharply from 1,455 units introduced in the previous quarter.

Unsold inventory rose by 2.4 percent during the last three months of 2022, reversing a 1.9 percent decline in the previous quarter, said Wong Xian Yang, head of research for Singapore at Cushman & Wakefield. Unsold stock stayed low at 16,152 units compared with a five-year annual average of 25,020.

“Despite still-low inventory levels, developers have remained cautious and slowed land acquisition activities given an uncertain macro environment and heightened development risks,” Wong said. “The performance of a slew of new launches in 2023 would be a litmus test for buyer demand amidst current headwinds.”

Coming off a robust 2022 in which overall private residential prices jumped 8.6 percent, the market could surprise on the upside in the first quarter of 2023 as developers push out new launches catering to resilient buying demand, according to Wong.