Private residential prices to increase amidst new new project launches in 2025

Over 12,000 units may be launched this year, an analyst said.

The prices of private residential properties are expected to increase in 2025, fueled by more project launches and a tightening of supply of homes, according to analysts.

According to the latest data from the Urban Redevelopment Authority, the increase in private residential price index slowed to 3.9% in 2024 from 6.8% the previous year. The overall private residential rental index also declined by 1.9% last year, the first full-year decline since 2020.

For this year, industry experts see a faster price appreciation, with OrangeTee Group Chief Researcher and Strategist Christine Sun predicting it to range from 4% to 7%, driven by more project launches and a faster resale price growth due to a tighter supply of homes.

“Next year, many new projects are expected to be launched, potentially leading to an increase in new home sales,” she said.

“On the other hand, the number of private home completions, or homes receiving Temporary Occupation Permits (TOP), is likely to decrease further in 2025. As a result, overall sales are projected to remain steady at around 18,000 to 22,000 units in 2025,” she added.

Lee Sze Teck, senior director, data analytics at Huttons, also expects prices in the property market to grow between 4% and 7% in 2025.

This year, there may be 22 launches with an estimated 12,422 units this year. This includes two EC launches, Aurelle of Tampines and one EC at Plantation Close.

Recent interest rate adjustments in the US may limit the potential for further decreases in domestic interest rates during 2025, the expert said. Developers are also estimated to sell between 7,000 and 8,000 units in 2025 amidst improved sales sentiments, Lee added.

For Leonard Tay, head, research at Knight Frank Singapore, “rental growth is expected between 1% and 3% in 2025, supported by renewals at large and continued interest in family-sized inventory.”

“Landlords who previously refused to budge on asking rates, have now rationalised their expectations in order to keep their units occupied. Expatriate families continued to search for homes in the rental market as opposed to buying, due to the hefty ABSD payable by foreign homebuyers,” Tay said.