Private home prices rise at slower pace as sales slump; buyers eye Middle East crisis fallout

SINGAPORE – Private residential price growth continued to slow for a third straight quarter, edging up 0.3 per cent in the first quarter as transaction volumes fell after hitting a four-year high in 2025.

Amid rising geopolitical uncertainty and concerns over price inflation following the outbreak of the Iran war on Feb 28, buyers – particularly HDB upgraders – may turn more selective and price-sensitive, as HDB resale prices posted their first quarterly decline in almost seven years.

Data released by the Urban Redevelopment Authority (URA) on April 1 showed that the 0.3 per cent rise in overall private home prices was the smallest quarter-on-quarter increase in six quarters. It followed a 0.6 per cent gain in the fourth quarter of 2025, a 0.9 per cent rise in the third quarter, and a 1 per cent gain in the second quarter.

That said, Knight Frank Singapore’s head of research Leonard Tay noted that the finalised first-quarter overall price data, due on April 24, could be slightly higher as brisk sales at new launches Pinery Residences and Rivelle Tampines executive condominium (EC) have yet to be factored in.

But he cautioned that the Middle East crisis’ impact on the operating margins of businesses in many industries could lead to job layoffs here, and affect home-buying sentiment.

“While domestic demand for private residential homes continues to be strong, home buyers are keeping an eye on how events in the Middle East will affect job security and their ability to buy new homes... Buyers are also wary that interest rates may rise,” Mr Tay said.

Property consultant Cushman & Wakefield’s research head Wong Xian Yang noted: “While HDB upgrader demand remains, the overall momentum is slowing as HDB resale prices fell 0.1 per cent in the first quarter – the first fall in almost seven years.”

“This points to a market that is becoming increasingly price-sensitive,” he said.

Mr Kelvin Fong, chief executive of PropNex, noted that demand has remained resilient for sensibly priced projects in attractive locations even as overall sales volumes moderated.

Developers have also remained bullish in the two government land sale tenders that closed in March – Lentor Central and Dover Drive – where both received benchmark top bids, noted Ms Tricia Song, CBRE’s research head for Singapore and South-east Asia.

But buyers could turn cautious in the face of a protracted Middle East conflict. “Competitive and realistic developer pricing will be critical,” she said.

Meanwhile, the conflict may have already weighed on sentiment in the landed market, as landed home sales fell 28 per cent to 416 units in the first quarter from 574 units in the previous quarter, PropNex noted.

“Landed transactions weakened noticeably in March compared with the sales in January and February,” the agency said.

This resulted in landed property prices falling by 1.8 per cent, against a 3.4 per cent increase in the fourth quarter of 2025, while non-landed prices gained 1 per cent, rebounding from a 0.2 per cent drop in the previous quarter.

The total number of transactions fell by nearly 40 per cent quarter on quarter to 4,041 units, down from 6,699 units in the fourth quarter of 2025, due to fewer new launches and the Chinese New Year holiday, analysts said.

Ms Christine Sun, chief researcher and strategist at Realion (OrangeTee & ETC) Group, pointed to a 55 per cent plunge in landed and non-landed private home sales (excluding ECs) in the city-fringe submarket to 1,174 units in the first quarter, from 2,606 units in the fourth quarter.

Suburban sales declined 29.7 per cent, while transactions in the prime district fell 17.9 per cent in the first quarter, she said.

She noted that the Chinese New Year period further dampened sales momentum.

Mr Marcus Chu, chief executive of ERA Singapore, said private home prices remained broadly stable in the first quarter, even as transaction volumes pulled back sharply.

“This reflects a market that is consolidating following the strong launch-driven momentum in the second half of 2025,” he said.

Mr Chu added that demand remained focused on new launches.

“Projects that entered the market continued to attract strong interest, pulling buyers away from the resale and sub-sale sectors, which experienced softer activity,” he noted.

PropNex noted that 2,662 private homes were resold in the first quarter as at March 24, compared with 3,529 resale units changing hands in the fourth quarter of 2025.

The average take-up rate for new launches during the launch weekend stood at 70.5 per cent – with the highest reaching 92.5 per cent – reflecting a healthy initial response, said Mr Mohan Sandrasegeran, head of research and data analytics at SRI.

Notably, Rivelle Tampines and Pinery Residences recorded the highest take-up rates of 92.5 per cent, while River Modern registered the highest take-up rate in the prime district at 90 per cent over its launch weekend, he added.

In terms of price growth by sub-market, suburban properties led the gains, rising 1.3 per cent – the strongest quarterly increase in five quarters – compared with 1 per cent in the previous quarter.

Activity is expected to pick up for the suburbs in the second quarter, with the upcoming launches of Vela Bay in Bayshore, Tengah Garden Residences and Lentor Gardens Residences.

City-fringe properties saw a 0.9 per cent price gain in the first quarter, up from a 0.7 per cent increase in the previous quarter.

Prime property prices rose 0.4 per cent in the first quarter, after a 3.5 per cent drop in the fourth quarter of 2025. This was buoyed by new launches Newport Residences and River Modern achieving take-up rates of 74 per cent and 92 per cent respectively to date, ERA said.