Singapore’s once red-hot condo market appears to be losing some steam. Data from the Urban Redevelopment Authority (URA) released earlier this week indicates a moderation in price growth and a significant decline in sales activity for the first quarter of 2024.
Prices Rise, But at a Slower Pace
Condo prices in Singapore grew by just 1.5% in the first three months of 2024, a marked slowdown compared to the 2.8% increase witnessed in the previous quarter. This signifies a potential turning point for the market, which has seen steady price increases in recent years.
Sales Tumble as Buyers Adopt Wait-and-See Approach
The condo market also experienced a sharp decline in sales volume. The URA reported a 20% plunge in transactions compared to the fourth quarter of 2023. This continues a downward trend, with 2023 recording the lowest yearly sales volume since 2016.
Experts believe a combination of factors is contributing to the cautious behavior among buyers. Rising interest rates, coupled with economic uncertainty and an increase in job cuts, are prompting potential homebuyers to adopt a wait-and-see approach.
Shifting Demographics in the Market
The data also highlights a shift in the demographics of condo buyers in Singapore. Foreign purchases continued to dwindle, with Singaporeans and Permanent Residents accounting for nearly 99% of all transactions in Q1.
Market Outlook
While condo prices remain on an upward trajectory, the slowdown suggests the market is entering a cooling phase with softer price growth and declining sales volume. A more comprehensive picture of the Singapore property market will emerge when the URA releases its detailed data later in April. However, the initial indications point towards a potential cooling trend in the condo market.
