In the first half of this year, Singapore's property market displayed a resilient performance, as evidenced by statistics released by the Housing and Development Board (HDB) and other institutionsThe resale prices and transaction volumes for government-subsidized housing both saw an upward trend, while the landed residential segment remained stableHowever, the increases in private residential property prices slowed, and the rental growth for premium office spaces also deceleratedExperts in the field anticipate that the prices of real estate and government housing rents will remain relatively stable in the latter half of this year, mirroring the performance observed in the first half.

Government housing, which accounts for over 80% of the nation’s residential options, showed notable statistics in the first quarterThe resale prices surged by 1.7% from the previous quarter, exceeding the last quarter’s growth of 1.1%, marking it as the highest quarterly increase since the end of 2022. On the transaction front, a total of 6,928 government housing units changed hands in the first quarter, representing a 5.5% year-on-year increase

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According to forecasts released by the HDB, the second quarter saw a year-on-year jump of 6.5% in resale prices and a 2.1% rise compared to the first quarterCumulatively, this signifies that the overall resale prices of government housing have been on the upswing for 17 consecutive quarters, with total transactions reaching 7,208 units, up 14.5% from the same period last year.

The boost in resale prices and volumes of government housing in the first half can be attributed to a strong consumer demand alongside a reduced number of units reaching the minimum occupancy period compared to last year, resulting in tighter market suppliesCumulatively, the resale prices for government housing in the first half experienced a growth of 4%, surpassing the 2.5% increase seen during the same period last year.

In response to the rapid increases in the prices of government housing in recent years, the HDB introduced new regulations on May 13 aimed at controlling resale transactions

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The initiative mandates stringent identity verification for both buyers and sellersSellers are now required to submit a resale application form to the HDB, and buyers must obtain a resale eligibility letter from the HDBThis move seeks to mitigate the risks associated with various agents manipulating the resale prices by allowing multiple agents to list the same property on standard trading platforms.

Apart from government housing, the private residential sector also plays a crucial role in catering to both the local populace and expatriatesRecent estimates from the Urban Redevelopment Authority (URA) indicated that private residential prices rose by 1.1% in the second quarter, a sequential decrease compared to the 1.4% recorded in the first quarterAlthough the overall private property index continues to increase, the pace of growth has shown signs of slowing downFactors contributing to this decline include persistently high interest rates, unclear economic prospects, and cooling measures aimed at the property market, leading buyers to exercise more caution when making real estate purchases.

In the first half of this year, private residential prices saw a 2.5% increase, which is lower than the 3.1% rise observed during the same period last year

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Economists believe that the subdued launch of new projects has also played a role in slowing down the growth in private residential pricesAs new projects are anticipated to hit the market in the coming months, there is a consensus that market activities may ramp up, with price increases expected to settle between 3% and 4% for the year.

To prevent overheating in the real estate market, the Singaporean government significantly increased the Additional Buyer’s Stamp Duty (ABSD) on residential properties starting April 27. Consequently, buyer interest has gradually waned since last year, with new private property sales hitting a 15-year low in 2022. This trend has persisted into the first half of this year, where only 1,843 private units were sold, marking the lowest figure for new private housing sales during this period.

Interestingly, while new private residential sales have experienced a downturn, the resale market remains robust

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Due to the limited number of new private projects launched, homebuyers have increasingly diverted their attention to the resale market, propelling both transaction volumes and prices higherIn the second quarter, the median price per square foot for non-landed new properties fell by 1.5% to SGD 2,238, while the median price per square foot for resale properties climbed by 2.1% to SGD 1,709. In terms of volume, new private sales plummeted by 41.4%, whereas the resale transactions saw a gain of 5.8%.

The latter half of the year is expected to witness the launch of nearly 20 new private property projects, offering approximately 10,000 unitsIndustry insiders predict that around two-thirds of these new private sales will occur in the second half of the year, with prices likely remaining stable due to a plethora of project choices and a growing reluctance from buyers to engage with inflated price points

Buyers are exhibiting a more pragmatic approach to property purchasing decisions.

Furthermore, Singapore's landed housing market remained stable in the first half of the year, with a total transaction value reaching SGD 3.7 billionTransactions for premium bungalows were particularly vibrant, contributing SGD 219 million, up 8% sequentiallyAccording to a recent report by property consulting firm Bonaparte Realty, there were 681 transactions across new, resale, and uncompleted landed properties in the first half, which falls short of the 760 transactions recorded in the second half of last year.

Regarding office rents, real estate consultancy Knight Frank has predicted that due to the uncertain international economic outlook and some tenants resisting rising rental costs, the increase in office rents in Singapore could further slow down or even stagnate in the latter half of the year