Private residential prices to fall until 1Q24: analyst

In 3Q23, prices remained broadly flat, increasing marginally by 0.5% QoQ.

Given the slower market momentum and rise in government land sales (GLS) supply will keep a lid on the upward trajectory of private residential prices in the coming quarters, according to RHB analyst, Vijay Natarajan.

“We expect prices to see a slight fall up till 1Q24, mainly on supply increases presenting more buyer choices during weaker demand times,” Natarajan said.

Based on RHB’s report, there will be 11 more new launches in 4Q23, with the majority in the high-end segment. 

“With an increase in supply and higher unsold units adding up from recent launches, we expect take-up rates to ease to 20-30% levels over the launch weekends vis-s-vis the 50-70% seen earlier this year,”  Natarajan said.

“Additionally, we also anticipate developers of selective projects (especially in the high-end segment) to start dangling soft discounts to move inventory amidst increasing competition,” he added.

Given the greater resilience in Singapore’s economy and labour market, however, Natarajan expects prices to grow by 1% to 3% in 2023, higher than his previous estimate of -2% to 2%.

In 2024, Natarajan expects prices to grow at 0%-2% “with a weaker 1H offset by a stronger 2H.”