Homebuyers turn to resale condos as new home prices climb in Singapore

SINGAPORE: As the cost of new homes in Singapore continues to rise, a growing number of homebuyers are shifting their focus to the secondary market, opting for more affordable resale condos, according to property experts.

In April, resale transactions surged, achieving the highest monthly total over the past year and sustaining price growth momentum.

Christine Sun, Chief Researcher and Strategist at OrangeTee attributes this increase to the steady or rising prices of new private homes, prompting buyers to consider older resale condos within the same areas.

This pattern is particularly noticeable in regions with numerous new launches.

“New project launches, accompanied by extensive marketing campaigns, tend to raise awareness of existing private housing in the vicinity, thereby boosting resale activity,” Ms Sun explained to Singapore Business Review (SBR).

According to data from 99.co and SRX, the volume of resale condos jumped by 23% to 1,122 units in April compared to the previous month. During the same period, prices saw a 1.5% increase.

This marked the second consecutive month of rising condo resales, a trend Ismail Gafoor, CEO of PropNex Realty, links to homebuyers returning from the Lunar New Year break in February.

“Many prospective buyers had been delaying their purchases, anticipating a drop in interest rates and housing prices,” Mr Gafoor told SBR.

Looking ahead, Huttons Asia CEO Mark Yip predicted that the secondary market will continue to gain momentum in the coming months.

However, he forecasts that overall resale price growth will moderate to 4% to 6% for 2024, down from a 7.3% increase last year.

“The resale condo market is likely to remain active in the near future, particularly in the absence of new launches,” Mr Yip said.