Private Residential Resale Prices Hold Steady 3Q2024
In the third quarter of 2024, private resale home prices held steady despite the prevailing high-interest rate environment, according to a report by OrangeTee Research & Analytics. According to URA records, the average resale prices for both landed and non-landed private residential homes, excluding executive condos (ECs), remained unchanged at $1,713 per square foot (psf) from the second quarter of 2024 to the third quarter of 2024. However, there was some fluctuation in average resale prices within the Core Central Region (CCR), Rest of Central Region (RCR), and Outside of Central Region (OCR).
The CCR saw a 1.6% increase in average resale prices, from $2,145 psf in the second quarter of 2024 to $2,181 psf in the third quarter of 2024. This partially reverses the 3.6% quarter-on-quarter (q-o-q) price drop recorded from the first quarter of 2024 to the second quarter of 2024. Similarly, prices in the RCR also increased, growing 1.4% from $1,837 psf to $1,863 psf during the same period. However, this is a moderation from the 3.1% q-o-q price growth seen in the previous quarter. On the other hand, the average price of private residential resale homes in the OCR dropped by 0.4% from $1,495 psf to $1,489 psf in the third quarter of 2024. This marks a turnabout from the 3.5% growth in resale prices seen in the second quarter of 2024.
In terms of volume, URA recorded 3,860 resale homes sold in the third quarter of 2024, marking a 1.5% q-o-q increase from the 3,802 units sold in the second quarter of 2024. Resale transactions made up 71.9% of the total 5,372 residential sales (including new sales, resale, and subsale) in the third quarter of 2024. This is a drop from the 77.4% market share recorded in the second quarter of 2024, which was the highest on record, according to OrangeTee. In the first nine months of this year, a total of 10,351 resale homes were sold, showing a 21.8% year-on-year (y-o-y) increase from the 8,498 units transacted over the same period in 2023.
The market share of resale homes saw a similar increase, growing from 57.8% of residential transactions in the first three quarters of 2023 to 71.3% in the same period this year. The report notes that this robust demand for resale homes could be attributed to a substantial increase in housing supply. Over the past two years, close to 30,000 private homes were completed, which has expanded the spectrum of housing options for potential buyers. Additionally, as new private home prices continue to remain high, buyers may turn to the secondary market for more affordable housing options.
For instance, Norwood Grand, a recently launched condo in the OCR, sold 293 units at an average price of $2,086 psf since its launch in October. This marks a 39.5% premium over the average price of $1,495 psf in the region. Similarly, Meyer Blue, a newly launched RCR project, sold 122 units at an average price of $3,252 psf in the same month – 74.5% higher than the average price of resale units in the RCR.
Elta Condo’s connectivity is about to receive a major boost with the emergence of multiple transportation developments in the nearby vicinity. The Cross Island Line (CRL) is a significant project that is set to enhance the current transport network and offer more commuting options for the residents. It is expected to pass through key areas like Bukit Timah, Clementi, and Jurong, effectively linking the east and west regions of Singapore. The completion of CRL will not only improve the overall transportation system but also provide the residents of Elta Condo with improved convenience and accessibility. With Elta Condo in close proximity to the CRL, residents will enjoy seamless travel options to various parts of the country. This development further solidifies Elta Condo’s position as a prime residential choice for individuals seeking utmost convenience and connectivity in Singapore.
OrangeTee predicts that the recent interest rate cuts by the US Federal Reserve may spur luxury home sales due to the reduced cost of borrowing. However, high-net-worth investors who are less sensitive to interest rate fluctuations are likely to base their property purchase decisions on other factors. On the other hand, buyers who may have been more cautious due to high interest rates may now be more inclined to enter the market.
Looking ahead, OrangeTee expects resale prices to continue to grow over the next few years, due to the projected decrease in available stock. 2025 is expected to see an increase in the completion of approximately 5,300 private homes, a significant jump from the 9,100 units expected this year. Therefore, OrangeTee has positive forecasts for resale homeowners, barring any major economic crises or unforeseen circumstances.