2024 is set to be a pivotal year for new property launches. Thirty-one developments are poised to enter the market, offering over 12,000 new private homes. The projected launch of 23 projects will introduce approximately 8,800 units, marking a significant uptick from 2023. Large projects, ranging between six to nine, are expected to dominate these launches, potentially driving sales higher.
Market overview and recent developments
The recent years have witnessed a significant catch-up in housing supply, with approximately 28,600 new homes completed in 2022 and 2023. Current property measures and tightened mortgage rules have moderated property price growth, which declined from 8.6% in 2022 to an estimated range of 4% to 5.5% in 2023.
This shift signals a market adjusting to new economic realities.
Predictions for 2024
The year 2024 is expected to see modest price growth in the private residential market, influenced by a blend of market stability and improving economic conditions. The Ministry of Trade and Industry (MTI) projects the economy to grow between 1% and 3%, buoyed by the recovery in sectors like travel, tourism, and electronics. Lower interest rates, forecasted by many economists, could further ease borrowing costs, enhancing housing affordability.
Private home sales are projected to remain robust, with an estimated 16,000 to 19,000 units sold, and price growth forecasted between 3% and 6%.
New home sales and launches
2024 is set to be a pivotal year for new property launches. Thirty-one developments are poised to enter the market, offering over 12,000 new private homes. The projected launch of 23 projects will introduce approximately 8,800 units, marking a significant uptick from 2023.
Large projects, ranging between six to nine, are expected to dominate these launches, potentially driving sales higher.
Luxury market outlook
Contrasting the broader market, the luxury segment in the prime core central region (CCR) will see a substantial reduction in new launches. However, notable projects like Marina View Residences, Newport Residences, and Skywaters Residences are set to make a mark in the luxury landscape.
Resale market in suburban areas
The suburban resale market is poised for moderate price growth due to a dwindling supply. With more than 19,000 private properties completed in 2023, the number of completions is expected to drop by 48.2% to 9,875 homes in 2024. This decrease, especially pronounced in the suburbs, could exert upward pressure on resale prices, with a projected increase of 3% to 5%.
Rental market forecast
The rental market is likely to see continued softening in 2024. The completion of almost 16,000 new homes from 2022 to 2024 will introduce new dynamics, especially in the city fringe and OCR regions.
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In the luxury segment, the high foreign demand may mitigate a sharp rental correction. Overall, rental growth is expected to slow down significantly from the peak growth of 29.7% in 2022.
Read more: Singapore’s 28 districts mapped across Core Central Region (CCR), Rest of Central Region (RCR), and Outside Central Region (OCR)
Additional insights on HDB rental trends
In parallel with the private housing market, the HDB rental market is also experiencing notable shifts. In 2022, the number of HDB flats rented out decreased to 36,166 units, influenced partly by Malaysian workers returning to daily commutes instead of maintaining local tenancies.
However, this trend is reversing in 2023, with a projected increase of 7.8% in HDB rentals, reaching approximately 39,000 units. This uptick is attributed to tenants displaced from the private residential market and HDB upgraders transitioning to new private residential projects.
The surge in private residential rents by 29.7% in 2022 has pushed some tenants towards more affordable HDB flats. Additionally, HDB upgraders purchasing uncompleted private condos often sell their existing HDB flats and rent temporarily to avoid the 20% additional buyer’s stamp duty on a second property. Despite these factors, early signs of stabilization in HDB rents are emerging in the fourth quarter of 2023.
Looking ahead to 2024, Huttons Data Analytics forecasts a continued, albeit slower, growth in HDB rents, estimating an increase of between 5% and 8%. This projection comes in the wake of a lower number of new private and public flats completion compared to 2023, slightly reducing the supply of HDB flats for rent.
Additionally, the launch of around 7,500 new private residential units in the city fringe and suburbs is expected to draw more HDB upgraders, potentially boosting rental demand for HDB flats temporarily. With an anticipated rosier economic outlook in 2024, the influx of S Pass holders may also contribute to this rental market dynamic.
Conclusion
As 2024 unfolds, the private housing market in Singapore is set to experience nuanced shifts across various segments. This analysis provides a detailed overview of what stakeholders can expect, highlighting the evolving dynamics in sales, launches, and rental trends. With a stable market on the horizon, these insights offer valuable perspectives for informed decision-making in the realm of real estate investment and ownership.
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