BuffeTed by headwinds from all directions, Singapore’s housing markets braked and adjusted over the past year but stayed stable, experts on a panel organised by The Business Times said. 

At the broad base, the public housing market is stable with about 25,000 transactions in a typical year, said PropNex Realty’s chief executive Ismail Gafoor. However, the new classification of flats into Standard, Plus and Prime categories may have an “impact on mobility”. 

With a minimum occupation period of 10 years for Plus and Prime flats, and a four to five-year construction timeline, buyers can expect to be tied down to the property for at least 14 to 15 years, which may affect their subsequent movement up the property ladder. Buyers will need to take a long-term approach to planning, added Gafoor.

Despite some moderation and deceleration seen in the housing market in 2023,  the government’s regulations have helped to provide support for general market growth, OrangeTee Group’s chief executive Justin Quek said. 

Prices are still trending up, with fresh supply limited by fewer new private residential launches last year and overall sales volume declining, Quek noted. 

Gafoor and Quek were speaking at a property seminar organised by BT on Saturday (Feb 24), titled “Unlocking Real Estate Opportunities in the Year of the Dragon”, along with Alan Cheong, executive director for research and consultancy at Savills Singapore.

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BT senior correspondent Leslie Yee moderated the discussion.

The event had a total of 120 registrations from all backgrounds and ages. Up for discussion were issues such as drivers of the market, the impact of interest rates, investment opportunities in office, retail and industrial segments, and where homebuyers can find value. 

In the private residential market, Savills’ Cheong noted that the 2023 story was a “tale of two segments” – new sales versus the resale market. High costs of land and construction are pushing up new launch prices, which in turn keeps the overall price index up, while also holding down sales volume. Meanwhile, any major layoffs in the technology sector may have repercussions on housing demand, he said, and predicted that resale prices may remain flat this year.

OrangeTee’s Quek pointed out that Singapore households have more savings today than they did 10 to 15 years ago, and are also building up equity in their owned homes. An  average household equity ratio of 60 per cent debt to 40 per cent equity leaves “quite a bit of buffer in the system”, he said. Those who lose their jobs may not be forced to let their properties go. 

Pricing gaps are also popping up, as the market does not move all at once. Areas that were expensive can suddenly look accessible, said Quek.

PropNex’s Gafoor considered executive condominiums to be good investments for young couples looking to move up the property ladder after getting their first Build-To-Order flat, because of their more affordable per-square-foot price compared to mass market condos.

For those with the means and the budget, Gafoor said that a freehold landed property will always be a safeguard against inflation and rising interest rates, due to the scarcity of such properties in the market.

Another option for investment is to look at overseas properties, suggested OrangeTee’s Quek.

And certain industrial assets still offer yields that are tenable, said Savills’ Cheong. Buildings with modern specifications and in good locations will continue to be highly sought after, he explained.

In the office segment, strata-titled office units offer potential, Cheong said, as the Urban Redevelopment Authority has put a lid on such space and limited supply may drive up prices and demand.

“A lot of people are always waiting for the right time to buy. But the right time can be any time. Our property market is moderate and stable, and that is the best time to review your portfolio,” said Quek. 

BT Property Outlook Seminar 2024 is part of BT Club’s lineup of events for the year. Check btclub.sg for more details.