The Singapore real estate market has recently shown a mild upward trend, with housing prices rising for the third consecutive quarter. This trend seems to be reversing the stable trend in the past few months. Despite warnings from the government about high interest rates, market demand remains stable, driving up housing prices.

According to the Urban Renewal Authority of SingaporePreliminary data released on April 1st showed that local private housing prices in the first quarter of this year increased by 1.5% compared to the previous three months. Although the increase has slowed down compared to 2.8% in the fourth quarter of 2023, it still shows market activity. However, at the same time, sales have decreased by 20%, indicating that the market supply and demand relationship is undergoing subtle changes.

Xie Xiaocui, head of residential research at JLL Singapore, said that the current data reflects that the potential demand from local buyers remains stable. She believes that it is unlikely to take cooling measures in the short term, as the rise in housing prices is supported by genuine local demand. The Singapore real estate market has performed relatively steadily globally, successfully avoiding the world's most severe real estate recession. Despite high interest rates and a series of measures taken by the government in recent years to control market overheating, local demand remains strong.

However, high interest rates have raised concerns among the government about homebuyers borrowing. The Municipal Construction Bureau has warned that compared to the past decade, domestic mortgage interest rates are expected to remain at a relatively high level. Morgan Stanley predicts that private housing prices in Singapore will decline this year3% believe that the residential value is approaching its peak.

Of particular note, segmented markets such as luxury apartments are facing increasing pressure. Last year, the tax was levied on foreigners purchasing housesThe 60% stamp duty has dealt a heavy blow to this market, and developers have encountered difficulties in selling units, sometimes having to offer discounts to promote sales.

The Singapore government is also actively addressing concerns from voters about housing affordability. In the recent annual budget, the government did not introduce large-scale demand stimulus measures like other competitors such as Hong Kong. This strategy is particularly evident in the housing market, which is the main type of housing for most Singaporeans. The data from the first quarter shows that the price increase of second-hand housing units has accelerated, indicating the sustained demand for such housing in the market.

Despite recent positive market performance, analysts believe that purchasing sentiment may be affected due to a large number of residential projects going public this year. Therefore, the current high sales volume is likely to be a short-lived phenomenon. The Municipal Construction Bureau willThe final price change data will be released on April 26th, at which time the market will have a clearer understanding of the true direction of the Singapore real estate market.