Singapore's property market has experienced its first price decline in five quarters due to a slowdown in market transactions. The Urban Redevelopment Authority (URA) reported a 1.1% quarter-on-quarter drop in the private residential property price index for the last quarter, marking the first decrease since Q2 2023. This is in contrast to a 0.9% increase in Q2 of this year.
New home sales in Singapore are expected to be the worst since the global financial crisis, hindered by purchasing restrictions and high interest rates. Although the Federal Reserve initiated rate cuts, domestic mortgage rates are likely to remain relatively high. URA estimated an 11% decline in the total transaction volume for private homes, including secondary market sales, in Q3.
Morgan Stanley analysts Wilson Ng and Derek Chang projected that private residential property prices in Singapore would drop by another 1% in Q4 of this year and by 5% next year. The recent decline in prices was driven primarily by decreases in landed property prices and central area home prices.
