SINGAPORE: The resale volume of condominiums in Singapore experienced a 0.6% month-on-month decline, marking the third consecutive month of reduced activity, according to real estate experts OrangeTee.
The dip is attributed to a growing reluctance among buyers to commit to higher prices in the resale market.
OrangeTee pointed to concerns over inflation and uncertainties in the global economic landscape as primary factors contributing to the softening buying sentiment.
The group noted that some potential buyers are exercising caution in their spending while others are awaiting potential interest rate moderation, hoping for improved housing affordability.
Huttons Asia also observed resistance among buyers to inflated prices for resale condominiums, driven partly by persistently high interest rates.
After a significant price increase of close to 10% in 2022 and an additional 7.3% in 2023, resale condo prices moderated by -0.8% in January 2024.
Huttons attributed this moderation to the limiting effect of high-interest rates on buyers’ willingness to invest in resale condos at elevated prices.
The luxury segment, however, defied the trend with notable activity in The Ritz-Carlton Residences.
Two units were sold to Chinese permanent residents for $16.5 million each, setting a new high per-square-foot price for the project.
Huttons Asia CEO Mark Yip expressed optimism about the luxury segment, indicating a recent uptick in interest and predicting potential future purchases.
Mr Yip told Singapore Business Review that he anticipates a moderation in the overall resale condo prices, forecasting a rise of 4% to 6% in 2024, compared to the 7.3% increase in 2023.
OrangeTee, while acknowledging the recent dip in housing prices, remains cautious about declaring it a market correction. The experts believe a more accurate assessment can be made after observing the market for one to two more quarters.
Despite the current challenges, both OrangeTee and Huttons Asia expressed optimism about the market’s future, pointing out that with fewer condominiums expected to be completed in 2024, there is potential for a price increase due to decreased supply.
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