Your search results

Singapore Property Price Set to Explode Upwards in 2024?

Posted by Jayson Ang on March 10, 2023

| 0

TLDR

Understanding the factors influencing property prices in Singapore for 2024 can help in making informed decisions. Despite high rental rates and rising mortgage rates, property prices have continued to climb. The government’s cooling measures have segregated the HDB and private property markets, affecting property valuations. Sellers holding multiple properties are driving the market, while limited options for downgrading to HDB contribute to the high property prices. The market dynamics suggest that buying or selling now depends on individual circumstances, and strategic real estate advice can guide through the process effectively.

As we move into 2024, there is a theory that property prices in Singapore will not drop but instead continue to rise higher and higher. This theory is backed by several situations that have emerged over the past three years.

Despite the interest rate remaining at an elevated level and possibly rising further, we have seen no signs of property prices falling. In fact, property prices have been climbing higher despite the low transaction volume. This signifies that not many are willing to sell off their property at a lower price, and buyers can still afford to buy.

Firstly, we are facing very high rental rates in the market right now, and owners of properties are getting extremely high rental yield. Mortgage rates have been on the rise since January 2022, and three months solar rates have reached 3.029 percent, putting off many home buyers. The rising home interest rate has made home loans much more expensive to service, so buyers feel that it is too expensive to service the loan or are no longer eligible to borrow the same amount of money, causing the number of qualified buyers in the market to drop. This has led to a drop in property transaction volume. With lesser buyers now in the market, one would expect property prices to drop. However, the theory suggests otherwise.

One reason why property prices can continue to rise into the future without dropping at all is that the high rental rates in the market can actually cause property prices to go up. High rental rates must be priced into the property, and since rental rates are very high, it has to be priced into the property as well. With this, rental rates are even higher, and investors are getting high return on their rental properties. There is no urgency to sell their properties, as they are getting a net positive monthly return. The only situation they will consider selling the property is if the rental is being priced into the price of the property.

Private property owners who want to downgrade to an HDB will find that it is no longer an option as part of the recent cooling measure announced by the government. Home sellers can no longer sell their prime property and subsequently buy an HDB unless they are above 55 years old. If they want to do so, they have to wait out a 15-month period, which means that they have to rent a property for 15 months at least, causing rental prices to go up, and this can also cause property prices to go up again. Even if they are 55 years old and above, they can only buy an HDB four rooms and below immediately. This has segregated the HDB and the private property market very clearly, which can cause property prices to remain high.

Today, people who are selling their private property are not likely selling to downgrade to an HDB, but it is more likely that they are either upgrading or downgrading to another private property. If they choose to downgrade, they have to find a place to rent, causing greater demand for rental properties, thereby driving private property prices up. If they choose to buy another condominium, it is kind of zero sum, as when they sell, they buy, and this can also cause property prices to go up.

In conclusion, sellers who are in the market right now are probably people who own multiple properties because they have holding power. They are not scared of price drops or, in other words, are just savvy enough to price in the rental if they even want to sell the property. Rising rental demand causes rising property prices. With interest rates at an all-time high, TDSR at 55, and a high 25% down payment requirement, private property sellers find it hard to downgrade to an HDB.

Should You Buy, Sell or Wait?

If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?

It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.

I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.

I can help you by:

Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.

You May Also Like …

All Blog Posts Opinion

Where to Find the Most Affordable New Launches in 2023 – Starting at $1.31 Million

Jayson Ang – January 24, 2023 –

TLDR When looking for an affordable new launch condo in Singapore as of January 2023, consider projects like 10 Evelyn,...

All Buying Tips Selling Tips

Could It Be Wise to Sell Your Property After Just 3 to 4 Years?

Jayson Ang – February 5, 2024 –

TLDR In this blog post, the writer delves into the Singapore property market, particularly focusing on the effectiveness of quick...

Mandarin Top 5

Top 5 Things to Do in Singapore on a Rainy Day

Jayson Ang – March 24, 2024 –

Singapore, the beautiful island city-state, is known for its sunny weather and stunning attractions. However, even in this tropical paradise,...

Mandarin Top 5

Top 5 Places to Watch the Sunset in Singapore

Jayson Ang – March 21, 2024 –

Singapore, a bustling city-state known for its modern architecture and vibrant culture, is also home to some of the most...

All Blog Posts Buying Tips

Step-By-Step Guide To Buy Resale HDB (Updated March 2023)

Jayson Ang – July 13, 2023 –

TLDR The process of purchasing a resale HDB flat involves steps such as checking eligibility, calculating affordability, registering intent to...

Mandarin Top 5

Top 5 Emerging Trends in Singapore Real Estate: What Investors Need to Know

Jayson Ang – November 1, 2024 –

The Singapore real estate market has experienced significant growth in recent years, attracting investors from around the world. As the...

All Buying Tips Opinion Selling Tips

Will New Launch Condos See a Drop in Prices Soon?

Jayson Ang – July 12, 2024 –

TLDR The real estate market in Singapore is experiencing a trend of lackluster bids for prime properties in various locations....

All Blog Posts

Singapore Private Residential Market Outlook 2023

Jayson Ang – January 8, 2023 –

TLDR The Singapore residential property market has shown resilience in 2022, with price growth in both private housing and HDB...

Mandarin Top 5

5 Most Iconic Landmarks In Singapore’s Landscape

Jayson Ang – June 14, 2024 –

Singapore's landscapes is renowned for its innovative and dynamic approach to urban development, boasting some of the most iconic landmarks...

All Buying Tips

7 Essential Tips for Finding Your Perfect Retirement Home

Jayson Ang – October 27, 2024 –

TLDR Searching for a forever home should balance heart and practicality. Avoid homes with stairs, high cabinets, big kitchens, and...

Mandarin Top 5

Retiring in Singapore? Here’s Where to Find the 5 Best Property Investments for Comfort and Security!

Jayson Ang – March 22, 2024 –

Retirees have unique needs when it comes to property investments. They require properties that offer comfort, security, and easy access...

Mandarin Top 5

Top 5 : What I Wish I Had Known about Property

Jayson Ang – March 17, 2025 –

The world of real estate is a complex and dynamic field, filled with opportunities and challenges. It's a realm where...

All Buying Tips Opinion

6 Hot Property Market Trends in Singapore 2024: What Buyers Should Anticipate

Jayson Ang – May 27, 2024 –

TLDR When diving into Singapore's property market, expect a rollercoaster ride as trends shift drastically in 2024. Landlords and tenants...

All Opinion

Is it Possible for the Government to Truly “Reclaim Your Home” in Singapore?

Jayson Ang – January 25, 2025 –

The Singaporean government possesses considerable authority to reclaim land, whether freehold or not, in accordance with the Land Acquisition Act....

All Buying Tips Opinion

6 Misleading Claims Property Agents Often Make That Savvy Buyers Are Aware Of

Jayson Ang – March 15, 2024 –

TLDR Real estate agents can sometimes use deceptive tactics to push sales. Be cautious of claims about other interested buyers,...

All Selling Tips

Unlock The Secrets To Successfully Selling Your Home In Just 7 Simple Steps!

Jayson Ang – August 1, 2023 –

TLDR When preparing to sell your house in Singapore, research the average prices in your area to set a realistic...

All Buying Tips

Single, Over 35, and Searching for a Home? Here’s Your Guide to Choosing Between an HDB and a Condo!

Jayson Ang – January 21, 2025 –

At the age of 35, a single Singaporean starts a significant year, highlighted by the long-awaited chance to buy their...

All Blog Posts Buying Tips

Discover What Else You Can Focus On Beyond PSF – Here’s How!

Jayson Ang – July 17, 2023 –

TLDR When considering real estate investments, factors like property size, location, and PSF play crucial roles in determining affordability. Smaller...