top of page

Property Herald: Private housing price recovery in 3Q 2023 could be short-lived


Based on the flash estimates of the private and public housing price indices for the third quarter of this year and the current market conditions, the Singapore residential property prices could be facing slower growth in the coming months.

Image credit: REUTERS
Image credit: REUTERS

Public housing price growth slowing down

The Singapore public housing resale prices grew at a slower pace this year compared to 2022. The HDB resale price index increased by 3.8% in the first nine months of 2023, which is less than half the 8.0% growth in the corresponding period in 2022.

The robust supply of BTO flats available for applications in 2022 and 2023 and the normalisation of the pace of construction of new HDB flats has sapped demand from the HDB resale market, which contributes to the slower price expansion of resale flats.

In 2021 and 2022, the prices of HDB resale flats increased strongly partly due to the delay in the construction of BTO flats which drove many homebuyers to purchase resale flats. However, as the supply chain disruptions in the construction industry eases in 2023, leading to shorter waiting time for BTO flats, more buyers are turning to buying BTO flats from the government.

Chart 1: Price trend of HDB resale flats

The lower demand for resale flats is reflected in the 15.2% quarter-on-quarter (qoq) drop in the number of resale flats transacted in 3Q 2023. The decline in resale flats transaction in the third quarter of this year is not simply due to seasonal factor, such as the Hungry Ghost Month in the third quarter. The HDB resale volume fell by a sharp 25.7% year-on-year (yoy) in 3Q 2023. This shows that the lower demand for resale HDB flats contributes to the slower price growth of such real estate.

Some buyers regard buying properties in the Ghost Month as inauspicious. In addition, some property sellers would avoid allowing potential buyers and strangers to visit and view their properties during the Ghost Month to prevent “unclean spirits” from entering their properties. As a result, property transactions are typically lower during the Ghost Month.

Weak recovery in private housing prices in the third quarter

Although the private residential property price index rebounded in the third quarter from the 0.2% qoq contraction in 2Q 2023, the recovery is a modest 0.5% qoq growth. On an annual basis, the private housing price index expanded by 4.0% yoy, which is the slowest annual rate of price growth since 4Q 2020, when the property prices were climbing out the doldrums due to the adverse impact of the Covid-19 pandemic.

Chart 2: Private residential property price index

Private mass-market price growth expected to slow down

The property market segment that enjoyed the highest price growth in 3Q 2023 is the mass market, which is represented by the Outside Central Region (OCR). The OCR non-landed price index jumped by 5.1% qoq in the third quarter from a 1.2% increase in the preceding quarter.

However, it will be challenging to maintain the 5% quarterly rate of price growth in the next few quarters. Firstly, in the past 13 years, whenever the OCR property price index increased by 5% or more in a certain quarter, the growth rate would fall to 3% or less in the following few quarters, indicating that the 5% quarterly price growth is unsustainable.

Secondly, the slower price growth and weaker demand for HDB resale flats would reduce the housing demand from HDB upgraders, which is an important source of demand for mass-market private housing. This in turn, could result in slower property price growth in the mass market.

High-end and landed housing prices

The landed housing price index contracted by 4.9% qoq in the third quarter of this year. This is the largest quarterly rate of decline since 1Q 2009, when the property market was battered by the Global Financial Crisis. Although in the past six years, the landed housing price index had occasionally declined for one quarter and recovered in the following quarter, the past single-quarter price decline was in the range of a moderate 0.1% to 2.0% qoq, smaller than the 4.9% price fall in 3Q 2023.

At the same time, the prime CCR non-landed property price index declined for two consecutive quarters since 1Q 2023. The pace of the CCR property price contraction had accelerated from the marginal 0.1% decline in 2Q 2023 to the 2.6% reduction in the third quarter.

The faster pace of price decline in the high-end segment is partly due to the property cooling measures that have stifled the home-buying demand from foreigners. The proportion of private housing units bought by foreigners without Singapore permanent residence (SPR) status fell from 6.4% before the introduction of the latest round of property cooling measures in April 2023, to 1.7% in 3Q 2023.

Table 1: Proportion of private housing units based on buyers’ residence status



Singapore PR

Non-PR Foreigners



3Q 2022






4Q 2022






1Q 2023






2Q 2023






3Q 2023






Source:, URA

The high-end property market segment depends on foreign demand more than the other two segments. Therefore, a sharp decline in foreign demand would weaken buying demand for high-end residential real estate.

The decline in both the Core Central Region (CCR) non-landed property price index and the landed housing price index in 3Q 2023 could indicate weaker demand for high value housing. The median price of landed properties ranges from $3.9 million in the OCR to $7.22 million in the CCR. This is the price range of condominium units that are larger than the typical 3-bedroom units in the respective market segment.

Table 2: Median price of landed houses in 3Q 2023

Median price of landed houses







Source:, URA

Impact of price decline in high-end property segment

The decline in prices in the high-end property segment due to weaker demand will increase the pressure on sellers and developers of properties in this segment to either lower their asking prices or to be more patient when selling their properties.

In addition, it would also reduce the demand for development land in the high-end segment. Two Government Land Sale (GLS) sites would be launched for sale in 4Q 2023. One of the sites is located at Orchard Boulevard and the other at Zion Road. If the sentiments in the high-end property market remains weak, these two land tenders would attract fewer bids from property developers and some of the bids will be opportunistic.


The Singapore housing market is caught in a pincer where high-end property prices are weakening, and the public housing price growth is slowing down.

In addition, interest rate is expected to remain higher for longer. The high mortgage rate would reduce the housing budgets of homebuyers and weigh down demand from property investors. If the property price trends continue in this trajectory, the price growth would be lacklustre in 2024.

The slower demand and price growth of HDB resale flats would result in lower housing demand from HDB upgraders as the slower price growth of HDB resale flats would weaken the confidence and purchasing power of HDB upgraders. As the HDB resale market forms the base that supports the private housing market, any weakness in the public housing market will have an adverse effect on the private housing market, starting with the private mass market segment.

However, there is a chance that housing demand and prices could increase healthily next year if the economy, job market and household income were to expand at a more robust pace. Currently, the Singapore economy grew by a marginal 0.5% in 2Q 2023.

Another factor that could give a shot in the arm for the property market is if the government were to row back some of the property cooling measures. However, that could be too much to hope for.

With three more months to go, it is very likely that that the price growth of private and public housing in 2023 would be lower than that in the previous year. Based on the current market conditions, the private housing price index and the HDB resale price index could end this year with a 4% to 5.5% increase and a healthy 4.5% to 6% growth respectively.


bottom of page