_Knight Frank Commentary (Q2 2024 Real Estate Statistics from URA)

URA Private Residential Flash Estimates

Overall price growth in the private residential market continued to ease further in Q2 2024 as the URA All Residential Price Index increased 1.1% q-o-q, lower than the increase of 1.4% q-o-q in Q1 2024. This resulted in a total increase of 2.5% in the first half of the year. The private home market will continue on the path towards stability, and will likely plateau in certain market segments in the remaining half of 2024 with demand continuing to be selective and measured, especially with options from upcoming launches. 

Nonetheless, private home prices in the new launch market will remain elevated due to land costs that were committed  some 12 to 18 months ago, as well as prevailing high construction costs. This contributed to prices in the Rest of Central Region (RCR) growing by 2.2% q-o-q, and in the Outside Central Region (OCR) by a more marginal 0.3% q-o-q in Q2 2024. 

However, in the Core Central Region (CCR), there was a decline of 0.2% during the quarter. Prime non-landed home prices are likely to have started to flatline with pressure on sellers to lower expectations, given the lack of demand from foreign buyers due to the doubling of the Additional Buyer’s Stamp Duty rate to 60% from end-April 2023. Singaporean homebuyers scouting out prospects in the prime areas have also become more selective in the search for an ideal home for themselves. With the current limited demand in the high-end market segment, prime prices are likely to remain flat between -1% and 2% for the whole year as sellers that are under
pressure to sell in the resale market could adjust expectations down to prevailing market levels. 

Given the combination of the above factors, overall private home prices remain on track to grow by 3% to 5% in 2024 (as projected earlier), lower than the 6.8% annual increase in 2023.

Landed home prices grew 1.8% q-o-q in Q2 2024, and 4.5% from January to June 2024 based on the Q2 2024 flash estimates announced today. Landed homes priced at valuation or slightly under will be quickly snapped up in the current market, notwithstanding the elevated interest rates. Demand for landed homes from Singaporeans moving up the housing aspiration ladder remains intact against limited supply in land scarce Singapore, and most sellers continue to maintain asking premiums in this much sought-after housing type. Therefore, prices of landed homes are expected to be supported with moderate increases throughout 2024.