Public and private property price growth show signs of moderation in Q1 2025
(Photo credit: ST Photo/Lim Yaohui)
Source: The Straits Times
Price growth of both public and private housing slowed in the first quarter of 2025, according to flash estimates released by the authorities on April 1, in what could be early signs that property prices are moderating.
Minister for National Development Desmond Lee attributed the slower price growth to an increase in housing supply in both the public and private markets, and a drop in overall private home transaction volumes.
Flash estimates show that the HDB’s resale price index (RPI) grew by 1.5 per cent, down from 2.6 per cent in the fourth quarter of 2024 - the lowest growth in the last five quarters.
This can be attributed to the sustained supply of Build-To-Order (BTO) flats, as well as the largest-ever Sale of Balance Flats (SBF) exercise in February, Mr Lee said in a FaceBook post on April 1.
On the private housing front, flash estimates for the Private Residential Price Index (PPI) show a smaller increase of 0.6 per cent in the first quarter compared to a 2.3 per cent increase in the fourth quarter, as the price momentum for non-landed properties eased across all market segments.
The total sale transaction volume also declined by 15 per cent on a quarter-on-quarter basis, he added.
“We will maintain a strong supply of housing to meet the needs of homebuyers, and to further stabilise the property market,” said Mr Lee.
“We will launch more than 50,000 BTO flats from 2025 to 2027, comprising about 12,000 shorter waiting time flats with waiting times of 2 plus years. In February this year, we held the largest Sale of Balance Flats exercise in history, with some 5,500 flats offered.”
Another SBF exercise will be conducted in July this year, with around 3,000 flats on offer. The combined annual SBF supply of about 8,500 flats will be the largest since 2017, he said.
But Mr Lee noted that there is some supply tightness in the public resale market as fewer flats reached the Minimum Occupation period (MOP) in recent years, due partly to COVID-19 construction delays.
“However, the number of new flats reaching MOP will increase significantly, from 8,000 this year to 13,500 next year. This will steadily increase to 19,500 flats in 2028. This means that more resale flats are entering the market soon, and the supply tightness will ease,” he said.
On the private housing market, Mr Lee said that the overall private housing supply has been progressively ramped up through the Government Land Sales (GLS) programme.
For the first half of 2025, private housing supply has increased to around 8,500 units, with 5,000 units to be released under the confirmed list. This is almost 60 per cent higher than the average confirmed list supply from 2021 to 2023.
Mr Lee said the authorities would keep up the confirmed list supply in the second half of 2025, and this would also include releasing more executive condominium (EC) units.
Close to 1,000 EC units will be launched under the confirmed list in the first half of 2025 and a further 1,000 will be released in the second half of the year.
“This brings the total EC supply to 2,000 units for the whole of 2025 - the highest EC supply in recent years, almost double the average yearly supply launched from 2021 to 2023,” he added.