Private Residential Property Report – Q2 2024

Overview

Despite the relatively tepid home sales owing to limited new project launches, overall private residential property prices continued to climb in Q2 2024 – albeit at a more moderate pace compared with the previous quarter.

Prices

URA’s flash estimates showed that overall private home prices rose by 1.1% QOQ in Q2 2024, slowing from the 1.4% QOQ increase in Q1.
The price growth in Q2 2024 was led by the landed homes segment, where prices climbed by 1.8% QOQ, easing from the 2.6% QOQ increase in the previous quarter. The price growth came amid an increase in transaction volumes of landed homes during the quarter.
According to caveats lodged, there were 429 landed home transactions in Q2 2024 – picking up from the 378 transactions in Q1.
Based on URA Realis caveat data, average unit prices of detached homes ($1,796 psf) and terrace houses ($1,870 psf) led the price increase, growing by 6.7% QOQ and 5.9% QOQ respectively. Semi-detached homes ($1,724 psf) saw their average unit price inched up by just 0.6% QOQ in Q2.
In the non-landed private homes segment, prices crept up by 0.9% QOQ in Q2. The price growth was mainly spurred by the Rest of Central Region (RCR) sub-market.
Non-landed home prices in the RCR grew by 2.2% QOQ, accelerating from the 0.3% QOQ increase in Q1. Transactions at The Hill @ One North had helped to lift prices during the quarter; it sold 43 units at an average price of $2,601 psf.
Prices of non-landed homes in the OCR inched up by just 0.3% QOQ in Q2 – a slight improvement from the 0.2% QOQ growth in Q1. It appears that prices in the OCR could possibly be peaking in view of two quarters of marginal growths in Q1 and Q2 2024.
The Core Central Region (CCR) sub-market saw prices slip by -0.2% QOQ in Q2, reversing from the 3.4% QOQ growth in Q1. The marginal decline in prices could be attributed to the higher base in the first quarter.

Transactions

Home sales activity in Q2 2024 was largely led by the resale market, as there were limited new project launches in the quarter.
Many of the fresh launches in Q2 have been boutique developments that offer fewer units, while the largest project launched was the 190-unit Skywaters Residences, a luxury project that is unlikely to fit the budget of most mass-market home buyers. The only other major launch in Q2 was The Hill @ One North, which sold about 30% of its 142 units since its launch in April 2024.
Based on figures from URA Realis caveat data and monthly sales data, developers sold 694 new private homes (ex. EC) in Q2 (till 23 June) – set to underperform the 1,164 units sold in Q1.
With a lack of project launches, developers’ sales look unlikely to cross the 1,000-unit mark in Q2 2024. Factoring the 1,164 units shifted in Q1 2024, developers sold over 1,850 new units (ex. EC) in the year-to-23 June 2024 period.

The top selling project in Q2 was The Botany at Dairy Farm, in the OCR, which sold 85 units at an average unit price of $2,010 psf (see Table 1).
The OCR sub-market drove new home sales in Q2 making up about 57% of new homes sold.
Activity in the resale market remained resilient during the quarter as buyers hunt for value-buys. Based on caveats lodged, there were 3,073 private homes sold on the resale market in Q2 2024 – rising by 14.3% QOQ from Q1 2024, where 2,689 resale homes were sold.
One factor that is supporting resale demand is potentially the sizable price gap between new and resale homes, with the latter seen as more affordable by some buyers. According to caveats lodged, the overall average transacted unit price gap between new private homes (ex. EC) at $2,408 psf and that of resale private homes at $1,719 psf was 40% in Q2 2024.
The volume of sub-sales declined to about 271 units, falling by 28% QOQ from Q1 2024 which saw 377 units being transacted. This takes the total private homes transactions to 3,344 units (including new sale and resale) in Q2 2024, based on the caveat data.

Private Home Leasing

Private residential rentals are expected to continue its downward trend in Q2 2024. In the first quarter of 2024, private home rental index fell by 1.9% QOQ, following the 2.1% QOQ decrease in Q4 2023.
In May 2024, the median rentals of private homes stood at $4.87 psf per month – down by 5.6% from the peak in April 2023 at $5.16 psf.
About 13,051 rental contracts, amounting to $68.5 million were signed in April and May 2024 – slightly up from 12,862 contracts worth $71.2 million signed in the same period in 2023. Rentals of private homes are expected to ease further going into 2H 2024 with the waning leasing demand.
The moderation in the home leasing market which started in Q2 2023 was mainly driven by a sharp increase in the number of new homes being completed. More than 21,200 new units of private homes (including EC) were completed in the whole of 2023, injecting fresh rental stock to the market. Meanwhile, as completions get ramped up, former tenants received keys to their new homes and need not rent anymore, releasing more units into the rental supply.

Private Residential Market Outlook

In view of the slow sales in Q2, PropNex has revised its projections for new private home sales to around 6,000 to 6,500 units (ex. EC), from the initial forecast of 7,000 to 7,500 units (ex. EC) for the whole of 2024. PropNex remains optimistic that developers’ sales will pick up in Q3 2024, as several more sizable projects are expected to be launched for sale. For the full year 2024, the overall private home prices could rise by 4% to 5% – slowing from the 6.8% increase in 2023.

Home sales have been lukewarm, particularly in the primary market where a limited number of project launches has weighed on the transaction volume. Some homebuyers could be holding out for more projects to come onstream later in the year, so that they have a wider range of options. Based on observations from consumer seminars and engagement events that were conducted in the past months, there is still ample interest in private residential properties, but prospective buyers are seeking more clarity on how prices will move going forward, and perhaps looking to compare between projects as new launches come on.

Some of the new projects that could be rolled out in Q3 2024 include Sora in Yuan Ching Road, Kassia in Flora Drive, Emerald of Katong in Jalan Tembusu, The Chuan Park, Arina East Residences in Tanjong Rhu, the Bukit Timah Link project, Meyer Blue, and Union Square Residences which can collectively offer more than 3,300 new private residential units.

With buyers being selective and more price sensitive, developers will likely focus on keeping the price quantum affordable at the early stages of launches to drive sales momentum.

HouseAreYou.sg

Overview

Prices

Transactions

Private Home Leasing

Private Residential Market Outlook

Two-Speed Housing Market In Q2 2024

HDB Resale Report – Q2 2024

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PROPNEX REALTY PTE. LTD.

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