Singapore property outlook and predictions for 2024

The HDB, private property and rental markets will see price stabilisation in 2024 favouring buyers and tenants. 
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By Khalil Adis

Aerial view of Gardens by the Bay and Marina Barrage in Singapore. Photo: Pexels courtesy of Ingo Joseph.

If 2023 saw the HDB and private resale markets reaching record highs before subduing, then 2024 will likely see a further price correction arising from the property cooling measures, high-interest rates and upcoming supply.

Likewise, the red-hot rental market will see further signs of stabilisation in the upcoming year.

HDB resale market

HDB flats in Punggol. Photo: Khalil Adis Consultancy.

The HDB Resale Price Index (RPI) reached a record high in the third quarter of 2023 at 178.5 points.

According to HDB’s flash estimate, the RPI for the fourth quarter of 2023 is at 180.2 points which is an increase of 1.0 per cent over that in the third quarter.

A total of 24,447 flats were offered by HDB in 2023 comprising 22,780 Build-To-Order (BTO) flats and a further 1,500 and 167 flats offered under the Sale of Balance Flats (SBF) exercise and open booking of flats respectively.

This new flat supply will likely divert buyers away from the resale market which leads to a corresponding dip in demand in both the resale and rental markets.

As demand for resale HDB flats and rental eases, the RPI will likely correct itself to a more sustainable level.

Private property market

Skies Miltonia in Yishun located in the Rest of Central Region (RCR). Photo: Khalil Adis Consultancy.

The private property market also witnessed the Private Property Index (PPI) climbing to a record high of 196.0 points in the third quarter of 2023.

Meanwhile, the Urban Redevelopment Authority’s flash estimate showed that the PPI increased by 2.7 per cent on a quarter-on-quarter basis in the fourth quarter of 2023, to reach 201.3 points.

This brings the price gain for the whole of 2023 to 6.7 points.

The property cooling measures implemented in 2023 also affected sales volume as the government increased the Additional Buyer’s Stamp Duty (ABSD) and imposed a 15-month wait-out period for private property owners downgrading to HDB flats.

Data from URA showed that sales transaction volume fell by about 27 per cent on a quarter-on-quarter basis for the fourth quarter of 2023.

For the whole of 2023, sale transaction volume fell by about 15 per cent compared to 2022. This was the lowest annual sale transaction volume since 2016. 

Correspondingly, the increase in ABSD for foreigners from 30 per cent to 60 per cent appeared to impact prime areas the most.

According to URA’s data, non-landed private properties in the prime areas were the most affected while those that are located in the Outside Central Region (OCR) were the least impacted.

For example, the PPI for properties located in the Core Central Region (CCR) remained somewhat flat with a slight dip noted when the cooling measures were announced before rebounding to slightly below the 150-point level.

Meanwhile, those that are located in the RCR saw the index strengthening considerably from 2022 to 2023.

This implies that this particular segment had remained somewhat resilient despite the property cooling measures.

One of the reasons could be that the RCR is relatively affordable making it popular among first-time local private property buyers who will not be impacted by the ABSD.

Government ramping up supply in private and HDB markets

Construction of Built-to-Order (BTO) HDB flats in Punggol. Photo: Khalil Adis Consultancy.

To further cool the property market, the government is ramping up supply of 5,160 units in the second half of 2023.

This will bring the total pipeline supply of private housing to about 59,100 units.

According to the URA, of this, 41,900 units will comprise those with planning approval and 17,200 units from Government Land Sale (GLS) sites and awarded en-bloc sites that have not been granted planning approval yet.

Overall, a total supply of about 100,000 public and private housing units will be completed between 2023 and 2025.

This will likely see a further price correction and promote market stability favouring buyers.

Growth areas

Aerial view of Punggol Digital District. Photo: Khalil Adis Consultancy.

The growth areas in Singapore have remained unchanged based on URA’s Master Plan 2019.

The growth areas are in the Greater Southern Waterfront, Punggol Digital District and Woodlands Regional Centre.

Read more about the Greater Southern Waterfront here.

Read more about Punggol Digital District here.

Read more about Woodlands Regional Centre here.

What’s in store for buyers

Construction of new BTO flats in Punggol. Photo: Khalil Adis Consultancy.

With about 100,000 public and private housing units to be completed between 2023 and 2025, 2024 will shift towards a buyers' market.

This is because the incoming supply will ease demand and will likely see a further price correction and promote market stability in the resale market.

This will undoubtedly favour buyers.

What’s in store for sellers

Aerial view of Tanjong Pagar and the Greater Southern Waterfront. Photo: Khalil Adis Consultancy.

Sellers will likely face a tough time in 2024 as the 100,000 supply of both public and private housing will see buyers buy new launches in both markets.

As such, sellers will need to price their houses realistically to continue attracting buyers.

We are also likely to see fewer million-dollar HDB flats and those selling with cash-over-valuation (COV).

Sellers will need to be pragmatic, moving forward.

What’s in store for tenants

2024 is a year to negotiate your lease. Photo: Pexels by fauzel.

Tenants, there will be plenty of good deals in the market. 

As such, 2024 is a good year for you to secure new a home with a fresh new lease at a reasonable price.

This is because the incoming supply will impact the rental market resulting in rentals for HDB and private properties coming down.

If your lease is expiring this year, it may be a good idea to renegotiate your lease with your landlord at market price.

What’s in store for landlords

Landlords will have to be realistic in 2024. Photo: Pexels by Kampus Production.

Landlords will have to be realistic in their asking price in 2024 as the rental market is cooling off.

Conclusion

DUO located in Bugis. Photo: Pexels by Geraldine Tay.

As Singapore's property market navigates the dynamic landscape of 2024, stakeholders should remain vigilant to the evolving trends.

The delicate balance between supply and demand, coupled with government interventions, will play a pivotal role in shaping the property landscape for buyers, sellers, tenants and landlords alike.