New Launches Helped To Prop Up Private Home Prices In Q4 2023; Growth In Hdb Resale Prices Continued To Moderate, Flash Estimates Showed

02 January 2024, Singapore – Residential property prices continued to climb in Q4 2023, with private home prices rising at a faster pace quarter-on-quarter – propped up by transactions at new launches. Meanwhile, the price growth momentum in the public housing resale market eased further during the quarter, amidst growing price resistance and cautious sentiment among buyers. The flash estimates tracked transactions up till mid-December; the final print for the entire Q4 2023 will be published on 26 January 2024.

 Q4 2023 URA Private Residential Property Index (Flash)  

Flash estimates from the Urban Redevelopment Authority (URA) showed that overall private home prices rose by 2.7% QOQ in Q4 2023, accelerating from the 0.8% QOQ increase in the previous quarter (see Table 1). Cumulatively, overall private home prices have risen by 6.7% in 2023 – moderating from the 8.6% price growth in 2022. 

 Table 1: URA Private Property Price Index

Price IndicesQ1 2022Q2 2022Q3 2022Q4 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023 (Flash)Q4 2023
(QOQ % Change)(YOY % Change)(QOQ % Change)(YOY % Change)
Overall PPI0.
·        CCR-
·        RCR-
·        OCR2.22.17.5-

Source: PropNex Research, URA

In the landed homes segment, prices staged a swift recovery in Q4 2023, growing by 4.5% QOQ – overturning the 3.6% QOQ decline in the previous quarter. This is the strongest quarter of price growth since Q1 2023 where landed home values rose by 5.9% QOQ. The price increase could be supported by the slight rise in detached house transactions which rose from 39 units in Q3 to 43 units in Q4 2023, according to URA Realis caveat data. The average price of detached house which rose by about 16% QOQ to $1,714 psf on land area in Q4 could have mitigated the weaker prices in the semi-detached and terrace house segments. The price growth in Q4 takes the overall landed home price increase to 7.8% in 2023 – down from 9.6% in 2022.

Meanwhile, thenon-landed homes segment saw a 2.2% QOQ price growth in Q4 2023, following a similar 2.2% increase in the previous quarter. The strengthening in non-landed home prices came about as new project launches in the Core Central Region (CCR) and Outside Central Region (OCR) helped to spur price growth.In Q4 2023, non-landed home prices in theOCR jumped by 4.6% QOQ, building on the 5.5% QOQ growth in Q3 2023. New project launches in the quarter, J’den and Hillock Green have contributed to pushing mass-market prices higher, particularly J’den which has set a new benchmark price not only in Jurong East, but also for new launches in the OCR. J’den was the best-selling new private residential project in Q4 2023, moving 327 units at an average price of $2,475 psf (see Table 2). In 2023, OCR home prices booked a healthy 13.8% growth, compared with the 9.3% increase in 2022, according to the flash estimates.

Table 2: Top-selling new private homes in Q4 2023 (ex. EC)

ProjectRegionUnits soldAverage $PSF price

Source: PropNex Research, URA Realis (data till 24 December 2023)

Non-landed prices in the CCR climbed by 4.2% QOQ, reversing the 2.7% QOQ decline in the previous quarter. This is the largest quarterly price growth in the CCR since Q1 2018, where prices increased by 5.5% QOQ. Prices of homes in the CCR were propped up by new launch project Watten House which sold 114 units in Q4 2023 at an average price of $3,209 psf. In addition, caveat data also showed that some projects achieved higher average unit prices QOQ in Q4 2023 – they included Klimt Cairnhill which transacted 13 units at an average price of $3,509 psf, and Midtown Modern which sold 13 units with prices averaging at $3,098 psf.

Over in the Rest of Central Region (RCR), non-landed home prices dipped by 1.2% QOQ in Q4, compared with the 2.1% QOQ increase in the previous quarter. The lack of fresh project launches in the RCR in Q4 2023 likely stymied price growth in this sub-market. The top-selling project in the new sales segment in Q4 was The Reserve Residences, which saw 40 units changed hands at an average price of $2,444 psf. RCR non-landed home prices rose by 2.7% in 2023 – easing from the 9.7% growth in 2022.

The URA said 3,800 private homes (up till mid-December) have been sold in Q4 2023, compared with 5,201 units in the previous quarter. It added that sales transaction volume (up to mid-December) came up to 18,510 in 2023 versus 21,890 in 2022.

Based on caveats lodged and URA figures, PropNex estimates that developers sold about 6,400 new private homes (ex. EC) in the year-to-24 December period, and new home sales will underperform the 7,099 new homes (ex. EC) sold in the full-year 2022. Meanwhile, some 10,850 resale private homes (ex. EC) have been sold over the same period – private resale volume is also expected to come in below the 14,026 units resold in 2022.

Please attribute the comments below to Ismail Gafoor, CEO of PropNex Realty.

“Overall, private home prices still posted a relatively healthy gain of 2.7% QOQ in Q4 2023, and 6.7% in 2023. It has been a relatively challenging year in 2023, as market sentiment turned more cautious and buyers are more hesitant to make their move, especially towards the later part of the year. The high interest rates, muted economic growth, and cooling measures introduced in April have combined to tame sales volumes.

That being said, the private residential market has been resilient, and we feel that Q4 2023 offered some bright spots – J’den and Watten House performed well above expectations, Hillock Green garnered encouraging sales, and Lentor Hill Residences which was launched previously continued to move units at a steady clip amid the ample supply of new homes in the Lentor area. We think the market still has ample liquidity to deploy and many buyers are waiting for the project that would tick as many boxes as possible, fulfilling most, if not all their top priorities for a home, and at a realistic price.

Based on the caveat data, we note that the median unit price of new non-landed private homes sold in the CCR and OCR rose QOQ by more than 9% each in Q4 2023 – most likely helped by the sales at J’den and Watten House during the quarter (see Table 3). Meanwhile, the median unit price of non-landed resale private homes rose across all segments – but average resale unit prices are still substantially lower than that of new sales (41% to 58% price gap). To this end, we expect resale homes to continue to enjoy stable demand in view of their more affordable pricing.

Table 3: Median unit price ($PSF) of non-landed new private homes and resale private homes (ex. EC) by Quarter and by Region

Non-landed private new home sales median $PSF price
Q4 QOQ % change9.9%-0.5%9.4%
Non-landed private home resale median $PSF price
Q4 QOQ % change4.3%3.4%3.8%

Source: PropNex Research, URA Realis (data till 24 December 2023)

Given the subdued home sales in 2023 and stronger pipeline of new launches in 2024, we expect developers to price units more sensitively, in a bid to drive sales momentum at the launch weekends. With the tighter additional buyers’ stamp measures keeping investors and foreign buyers at bay, home sales in 2024 will be driven by owner-occupiers and the local market.

In Q4 2023, foreign buyers (non-PR) accounted for 1.9% of the total non-landed new sale and resale private home transactions, according to caveats lodged (see Table 4). This represents a slight increase from the 1.8% in Q3 2023, but is still much lower than the 7.3% and 4.2% proportion in Q1 2023 and Q2 2023 respectively. The proportion of Singaporean buyers, meanwhile, rose further to 81.8% in Q4 2023 from 81.5% in the previous quarter.

Table 4: Non-landed new private home sales and non-landed resales (Ex. EC) by nationality by residential status by Quarter

Nationality by Residential Status2022Q12022Q22022Q32022Q42023Q12023Q22023Q32023Q4
Foreigner (NPR)3.1%4.9%4.7%7.2%7.3%4.2%1.8%1.9%
Singapore Permanent Residents (PR)18.0%17.1%15.9%20.8%19.9%16.1%16.6%16.3%

Source: PropNex Research, URA Realis (data till 24 December 2023)

For 2024, PropNex expects private home prices to potentially increase by 3% to 4%, while new home sales could come in at 7,000 to 7,500 units (ex. EC); private residential resale volume may hover at around 13,000 to 14,000 units.”

Q4 2023 HDB Resale Price Index (Flash)  

The flash estimates released by the Housing and Development Board (HDB) showed that resale prices of public housing flats climbed by 1.0% QOQ in Q4 2023, easing slightly from the 1.3% QOQ increase in the previous quarter (see Table 4). This marks the 15th straight QOQ growth in the HDB Resale Price Index. Cumulatively, HDB resale prices have risen by 4.8% in 2023 – moderating from the 10.4% growth in 2022.

The HDB said that 6,440 resale flats were transacted in Q4 2023 (up to 28 December) – dipping by 2.3% QOQ from 6,592 HDB flats resold in Q3 2023 (up to 28 September). In the year-to-28 December period, the resale volume came in at 26,628 units – down by 3.8% from 27,686 transactions in the same period in 2022.

Table 5: HDB Resale Price Index

QuarterQOQ % changeYOY % change
Q1 20213.0%8.1%
Q2 20213.0%11.0%
Q3 20212.9%12.5%
Q4 20213.4%12.7%
Q1 2022 2.4%12.2%
Q2 20222.8%12.0%
Q3 20222.6%11.6%
Q4 2022 2.3%10.4%
Q1 20231.0%8.8%
Q2 20231.5%7.5%
Q3 20231.3%6.2%
Q4 2023 (Flash)1.0%4.8%

Source: PropNex Research, HDB

Please attribute the comments below to Wong Siew Ying, Head of Research and Content, PropNex Realty.

“Despite the slight decline in resale flat volume, HDB resale prices continued to inched upwards in Q4 2023, with a 1.0% QOQ increase, according to the flash estimates. This marks the slowest pace of quarterly price growth in three quarters since Q1 2023, where prices also climbed by 1.0% QOQ. The implementation of various cooling measures in September 2022 has taken the wind out of the sails and HDB resale prices are now growing at a considerably slower clip, with the quarterly price growth never once crossing the 2%-mark in 2023 – a noteworthy trend given that the pace of price growth in each quarter has been well over 2% or 3% between Q4 2020 and Q4 2022. We think this presents a more sustainable trend of price movement, following two years of healthy gains.  

Apart from the cooling measures – such as the 15-month wait-out period, and tighter conditions for home loans granted by the HDB – peaking resale prices, and a mismatch in price expectations also weighed on sales and curbed excessive price upside. Based on transaction data, the average resale prices saw muted growth across various flat types from Q3 to Q4 2023 (see Table 6), with prices creeping up by less than 1% QOQ. Four-room flats led the resale price increase in the quarter, with the average price rising by 0.7% QOQ to $594,212, while the average price of 3-room and 5-room resale flats each climbed by 0.6% QOQ to $415,491 and $693,846 respectively in Q4 2023.

Table 6: HDB average resale price by flat type

 Average transacted HDB resale prices
 QOQ % change in average HDB resale prices

Source: PropNex Research, (data retrieved on 2 Jan 2024)

As for the dip in sales volume in Q4 2023, we think the resale flat demand could also have been affected by HDB’s two Build-to-Order (BTO) exercises in October and December, where a total of 12,857 new BTO flats in various estates were offered for sale. Although the BTO application rates for the two BTO sales exercises were relatively more subdued compared with previous BTO launches, we believe it is likely that some BTO projects that are in attractive locations or with shorter waiting times could have drawn some buyers from the HDB resale market, particularly those who have no pressing need for a move-in ready home.

In Q4 2023, there were 134 resale flats transacted for at least $1 million – taking the total for 2023 to a record breaking 470 million-dollar resale flat deals, smashing last year’s record of 369 such transactions. This is also the first time that every quarter in a year saw more than 100 flats resold for $1 million or more. We expect the number of million-dollar resale flats transacted to remain elevated as buyers find value in such units owing to their unique attributes and superior locations. In addition, former private home owners who have fulfilled their 15-month wait-out period could also slowly trickle back into the resale market; they may take interest in some of the choice flats and have the financial means to pay a higher price for them.

For 2024, PropNex projects that overall HDB resale prices could rise by 4% to 5%, and resale volume to potentially come in at around 26,000 to 27,000 units.”

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