Singapore new home sales hit 15-year low as high prices, interest rates cool market

Appetite for new homes will be tested further in January, with at least six launches slated for this month, according to real estate agency Huttons Group.

The slowdown in sales is dragging developers’ shares. City Developments Ltd., Singapore’s largest listed property firm, saw a 19 per cent drop last year, outpacing a fall in the country’s benchmark equity index.

Singapore home prices fall for 1st time in 3 years as red-hot pace slows

The URA said earlier this month that overall transaction volumes in the private residential market – which also includes resale deals – hit the lowest level last year since 2016.

The transaction slowdown has yet to significantly weigh on prices, with local demand bolstering the value of private residential complexes in districts that typically lack such offerings. Home prices rose 6.7 per cent last year, according to preliminary official estimates.

That means there is still “a chance that the government might impose new curbs to ensure a ‘stable and sustainable’ market if prices run ahead of economic fundamentals,” said Foong.

Analysts are divided on price trends.

Morgan Stanley is predicting a 3 per cent drop, while Citigroup expects a 4-5 per cent gain this year. Bloomberg Intelligence sees prices moving sideways with some downside risk.