Your search results

Surprising Prediction: Will Singapore Property Prices Drop in 2024?

Posted by Jayson Ang on June 8, 2024

| 0

TLDR

When considering the current real estate market in Singapore, it’s crucial to understand the impact of factors such as interest rates, Additional Buyer’s Stamp Duty (ABSD), and economic uncertainties on property prices. While high-end properties in prime regions may experience a price reduction due to rising interest rates, the potential decrease in foreign investments could be a more significant concern. As economic conditions evolve, there might be a shift towards more affordable areas, leading to a balancing of property values between different regions. For individuals looking to enter the market, strategic planning and caution in leveraging loans are advised. Whether to buy, sell, or wait depends on your unique situation, and seeking professional advice can help navigate the complexities of property investment in Singapore.

While it might not shock many, a study suggests that top-tier properties, such as the luxurious residences in our Core Central Region, may see a value reduction of about 3.9% this year. This trend seems to be driven by the increase in interest rates.

This might seem a little odd at first glance. The common assumption is that rising interest rates would likely impact the less affluent regions more than the highly valued areas. After all, those investing in $10 million penthouses could potentially borrow less if they chose to – some may even purchase without a loan, merely seeking financial leverage.

However, an average home buyer can’t just conjure up $1.6 million for a resale condo. The typical Singaporean requires a substantial loan to transition into private property ownership. Consequently, if interest rates alone can trigger a price drop in high-end areas, this effect would be magnified in non-prime regions where buyers rely heavily on loans and are more vulnerable to rising interest rates.

If there’s a decrease in prime region property prices, my hunch is that it’ll be more linked with our Additional Buyer’s Stamp Duty (ABSD) rates rather than bank loan rates. With the ABSD for foreigners currently standing at 60%, this is a significantly worrying factor compared to a slight increase in interest rates. If this does discourage foreign investors, we’re likely to notice the initial impact in the prime regions.

Economic Headwinds: Unveiling Their Overwhelming Impact!

At times, there’s a delay in how shifts in the broader economy affect the real estate market. Currently, we might not have fully grasped the implications of escalating global conflicts and the virtual upheaval happening within tech firms.

Furthermore, it appears that elevated interest rates are here to stay, prompting businesses to slow down expansion. This, essentially, makes employers more prudent.

From my experience in real estate during the previous financial meltdown, I’ve seen just how quickly circumstances can flip: An expatriate could choose any condominium in River Valley one day, and the next, they’re bargaining for a walk-up in Geylang.

As housing allowances dwindle and local workers replace expatriates (cheers to that!), we may witness a faster overall retreat from premium locations to city outskirts or even more remote areas. Over the next few years, I think it will be this scenario, rather than high interest rates, that will depress premium property values.

All things considered, these conditions present an opportunity for those who are ready. If you’ve been hoarding substantial savings and biding your time, now may be when the price difference between Core Central Region (CCR) and Rest of Central Region (RCR) could shrink significantly. Just be cautious not to rely too heavily on loans when upgrading.

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

Are You Ready to Take on the Singapore Property Market in 2023? 12 Reasons to Be Hopeful (Or Wary)!

Jayson Ang – December 21, 2022 –

2022 sure was a rollercoaster ride for the property market, and the world! From war in Europe to skyrocketing interest...

All Buying Tips Opinion

What Is The Best Location To Purchase A House To Ensure Your Child Has The Highest Probability Of Attending A Well-Renowned Primary School?

Jayson Ang – October 25, 2023 –

TLDR Parents often seek homes within 1km of desired primary schools to increase enrollment chances. Consider oversubscription rates and population...

Top 5 Questions to Ask : Is Singapore Property Investment for Me?

Mandarin Top 5

Singapore Property Swapper

Jayson Ang – December 7, 2022 –

https://www.youtube.com/watch?v=B1NTnjxDPy4 Jayson Ang, also known as the Singapore Property Swapper, is a certified Propnex agent and top 1% producer who...

All Opinion

Reasons Why En-Bloc Sales Are Expected to Remain Slow in 2025

Jayson Ang – February 6, 2025 –

TLDR From 2014 to 2024, the en-bloc market has faced challenges due to fluctuating cooling measures and a shift from...

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...

All Blog Posts Buying Tips Opinion

Does Sell 1 Buy 2 Strategy Still Works Today in 2024?

Jayson Ang – June 28, 2023 –

TLDR When considering the "Sell One By Two" property investment strategy, keep in mind that it involves selling your previous...

Mandarin Top 5

Top 5 : What Are The Key Factors That Drive Foreign Investment In Singapore’s Real Estate Market

Jayson Ang – January 2, 2025 –

Singapore, a thriving city-state in Southeast Asia, has become a magnet for foreign investors looking to capitalize on its booming...

All Opinion

Why En Blocs Often Fail to Succeed

Jayson Ang – April 26, 2024 –

TLDR In this blog post, the focus is on the challenges and complexities of en-bloc transactions in Singapore's property market....

All Buying Tips Opinion

Three Singaporeans Share Their Experiences of Co-Owning a Property with Friends

Jayson Ang – March 18, 2025 –

TLDR In Singapore, some individuals venture into property investments with unrelated partners, driven by opportunities and personal circumstances. Jim, leaving...