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Singapore Property Market Overview 3Q2024: Flash Estimates for HDB and Private Sectors

The 3Q2024 URA and HDB Flash Estimates highlight key trends in Singapore’s real estate market during the third quarter of 2024. The private residential property index recorded a moderation of -1.1% in 3Q2024, contrasting with a 0.9% increase in 2Q2024. For the first nine months of 2024, prices moderated by 1.1%, a stark contrast to the 3.9% growth in the same period in 2023. This moderation was influenced by several factors, including the Hungry Ghost Festival, September school holidays, and limited new launches. Additionally, fewer high-value transactions (especially those priced above $10 million) likely contributed to the slower price growth. Despite these challenges, the new launch market remained resilient. New home sales in 3Q2024 are expected to reach 1,072 units, a 47.9% quarter-on-quarter growth. The bulk of this growth was driven by the Outside Central Region (OCR), where sales jumped by 65.0%. This strong performance reflects buyer preference for more affordable housing options in areas outside the city center. In contrast, the Core Central Region (CCR) saw a 33.3% decline in sales due to fewer launches. As buyers anticipate interest rate cuts from the US Federal Reserve, market sentiment may improve. The reduction in borrowing costs could lead to a resurgence in demand, particularly for upcoming projects like Norwood Grand and Meyer Blue. These projects are strategically positioned to benefit from renewed market activity. The HDB resale market continued to show robust growth. Flash estimates indicate a 2.5% rise in resale prices for 3Q2024, slightly higher than the 2.3% increase seen in the previous quarter. Over the first nine months of 2024, HDB resale prices have risen by 6.8%, compared to 3.8% during the same period in 2023. Larger flat types, particularly 4-room and 5-room units, and newer flats (with leases starting from 2013) have driven this growth. These newer flats saw price increases of 3.7% between 2Q2024 and 3Q2024, reflecting their continued popularity among buyers. A significant rise in million-dollar HDB transactions was also noted, with approximately 331 such deals in 3Q2024, up from 236 in 2Q2024. However, the impact of the cooling measures introduced in August 2024, including the reduction of the Loan-to-Value limit for HDB loans, is not yet reflected in these figures. The full effects of these policies are expected to become evident in late 4Q2024 or beyond. As the market approaches the final quarter of 2024, the outlook for both the private and HDB resale markets remains cautiously optimistic. While demand for larger and newer flats continues to support price growth, buyers are encouraged to exercise prudence, considering long-term affordability and the evolving market landscape

September 2024 GLS Tender Review: Tampines Street 94 & Media Circle Analysis

The September 2024 GLS (Government Land Sales) commentary outlines the tender results for two key sites: Tampines Street 94 and Media Circle. Tampines Street 94: This site, zoned for mixed-use residential and commercial development, attracted six bids. The top bid came from a joint venture between Hoi Hup Realty Pte Ltd and Sunway Developments Pte Ltd, offering $668.3 million (equivalent to $1,004 per square foot per plot ratio (psf ppr)). The second-highest bid by Sing Holdings Residential Pte. Ltd. was just 1.9% lower at $655.6 million ($985 psf ppr), highlighting competitive bidding despite a cautious market. The keen interest in this site demonstrates continued demand for strategically located mixed-use parcels, offering both residential and commercial potential. The proximity to amenities and the Tampines West MRT station enhances its appeal. Recent mixed-use projects, like J’den, which saw over 80% of units sold at launch, indicate strong market demand. The upcoming Executive Condominium (EC) at Tampines Street 95 is expected to further increase foot traffic and commercial viability for the development, making it an attractive proposition for developers and investors alike. The Tampines Street 94 development also benefits from its location within a residential area dense with HDB blocks, ensuring a ready customer base for its commercial offerings. Situated near educational institutions like Temasek Polytechnic, St. Hilda’s Secondary School, and others, the site is ideal for families. Given the market conditions, the expected launch price is projected to range between $2,200 to $2,300 psf, aligned with the Outside Central Region (OCR) median price of $2,107 psf as of Q2 2024. This site’s launch could be influenced by the earlier-launched Tampines Avenue 11 project, potentially setting price expectations for buyers. Media Circle: This site, located within the one-north Mediapolis precinct, was tendered for residential use (specifically for long-stay serviced apartments) with commercial space on the first storey. It attracted only one bid, submitted by Frasers Property in collaboration with Padawan MC Pte Ltd and Empire One North Property Pte Ltd, for $120.1 million ($461 psf ppr). Frasers Property, known for its experience in serviced apartments, sees potential in the site's strategic location, close to media and technology job hubs within the vibrant Mediapolis area. This contrasts sharply with the lack of interest in the Upper Thomson Road (Parcel A) site, which also included a serviced apartment component. The one-north area's connectivity and appeal to expatriates and professionals looking for convenience and proximity to work explain the interest in Media Circle. Rental demand in the Queenstown planning area, where Media Circle is located, has grown significantly, with rental contracts increasing from 1,340 in the first half of 2023 to 2,024 in the first half of 2024, further validating the attractiveness of this location for long-term rentals. This report concludes by emphasizing that while the information presented is based on available data, real estate investment decisions should be approached with professional advice, as market conditions and regulatory factors can shift.

August 2024 Developer Sales: OCR Shines Despite Hungry Ghost Festival Dip

In August 2024, developers sold a total of 208 units, excluding Executive Condominiums (ECs), marking a significant month-on-month decline of 63.6% from July's 571 units. This drop in sales aligns with the Hungry Ghost Festival, a period traditionally associated with reduced home-buying activity due to cultural beliefs. The sales volume during this month was the lowest since February 2024, when only 153 units were sold during the Chinese New Year period. Year-on-year, new home sales in August 2024 reflected a 47.2% drop from the 394 units sold in August 2023. Despite the overall decline, the Outside Central Region (OCR) remained a bright spot, contributing 59.1% of the total sales. Projects such as Hillock Green, Lentor Hills Residences, and Hillhaven were among the key contributors. The Rest of Central Region (RCR) accounted for 31.3% of sales, while the Core Central Region (CCR) made up 9.6%. The OCR's continued strong performance highlights the demand for more affordable housing in non-central locations, attracting a mix of first-time homeowners and upgraders. Tembusu Grand, located in the RCR, led the sales in August with 30 units sold at a median price of $2,455 per square foot (psf). Its strong performance was supported by the upcoming launch of Emerald of Katong, which boosted the neighborhood's profile. Enhanced connectivity due to new Thomson-East Coast Line stations further improved the attractiveness of the area. The luxury property market, despite the broader market moderation, demonstrated resilience. The most notable transaction in August was a $14.7 million sale at 32 Gilstead, which was also the highest transacted freehold condominium in the first eight months of 2024. This transaction underscored the continued demand for prime properties among high-net-worth individuals, even during typically quieter periods. Looking ahead, the market is expected to likely rebound with the conclusion of the Hungry Ghost Festival and several new project launches. Developers are strategically timing these launches to capture demand, and upcoming projects like 8@BT, Norwood Grand, and Meyer Blue are poised to drive interest. Additionally, a potential Federal Reserve rate cut could further ease global interest rates, including those in Singapore, potentially boosting buyer sentiment and market activity. In conclusion, while August 2024 saw a slowdown in developer sales due to seasonal factors, the OCR and luxury property segments remained resilient. Upcoming launches and favourable economic conditions are expected to bolster the market in the coming months.