Singapore home prices decline as sales slow down

Bloomberg

Singapore's home prices fell for the first time in five quarters as a sales slowdown weighed on the market.

An index of private home prices dropped 1.1 percent last quarter from the previous three months, according to a preliminary estimate released yesterday by the Urban Redevelopment Authority. That compares with a 0.9 percent increase in the second quarter and is the first decline since the second quarter of 2023.

Singapore is on course for its worst year in new home sales since the global financial crisis. Property purchase curbs and high interest rates have deterred buyers, and borrowers are unlikely to get much relief any time soon.

"Despite recent interest-rate cuts by the US Federal Reserve, domestic mortgage rates are expected to remain elevated relative to the low levels seen over the past decade," the authority said in a statement. Transaction volumes for private homes, including the second-hand market, fell by about 11 percent in the third quarter, it estimated.

For months, developers had been resisting price drops and holding back the release of new projects. That has prompted more cautious buyers to turn to comparatively cheaper second-hand private units and government-built public housing instead.

Homebuyers are now "more restrained" due to the high cost of living and interest rates, said Christine Sun, chief researcher and strategist at real estate agency OrangeTee Group.