• Prices of private properties, public resale flats and rentals have risen across the board
• These figures were released by URA and HDB on Friday
• Experts said they expect prices to climb further as demand continues to outpace supply
• They were split on whether rental prices will continue to rise

SINGAPORE — Prices of private apartments and public resale flats rose across the board in the first quarter of 2021. This was from data released by the Urban Redevelopment Authority (URA) and the Housing and Development Board (HDB) on Friday (April 23).

Property analysts expect this upward trend to continue for the private property and HDB resale markets in the coming months, giving reasons such as construction delays brought about by the pandemic, low interest rates, and rising demand from foreign investors.

Private property prices in Singapore rose by 3.3 per cent in the first quarter — surpassing the flash estimate of 2.9 per cent released by URA earlier this month.

The jump seen in the first quarter is the steepest quarterly increase since the second quarter of 2018, when private residential prices climbed 3.4 per cent.

For resale prices in the public housing market, they notched up 3 per cent increases over those in the fourth quarter of the last year — the fourth consecutive quarter of increases.

LOW MORTGAGE RATES, DEMAND BY FOREIGNERS

Property experts variously told TODAY that they expect that private residential prices will rise within the range of 4 to 10 per cent in 2021.

Ms Christine Sun, senior vice-president of research and analytics at property firm OrangeTee & Tie, said that a recovering economy and low mortgage rates may propel demand and prices for private homes further.

“Singapore’s economy is expected to see a strong rebound this year on higher growth prospects for the manufacturing service sectors… The higher economic growth forecast will lift buyer sentiment and lend support to Singapore’s property market,” she said.

She added that foreign demand in private homes here is expected to return stronger in the coming months as well, with vaccination exercises worldwide paving the way for more cross-border travel.

Mr Nicholas Mak, head of research and consultancy at ERA Realty, said that concerns about rising home prices and the possible introduction of market cooling measures have also motivated some buyers to rush in and snap up private properties.

“The rising prices of HDB resale flats would also increase the purchasing power of HDB upgraders (who switch to buying private property),” he said.

Buyers may also flood the public housing market due to similar expectations that property prices will rise as the economy recovers and due to optimism from the breakthroughs in vaccination, Ms Sun said.

Couples with wedding plans and families who need immediate housing will likely look to the resale market as well, rather than wait for Build-to-Order (BTO) flats to be completed.

“There is still a backlog of (BTO) projects facing construction delays caused by the pandemic,” she noted.

“The situation could be exacerbated as further construction delays may be expected as a result of new quarantine orders arising from the recent resurgence of Covid-19 cases in certain worker dormitories,” Ms Sun added.

She expects HDB resale prices to rise by 5 to 9 per cent this year.

During a briefing by the Government's Covid-19 task force, Education Minister Lawrence Wong who is co-chair of the group said that delays can be expected in construction projects as the authorities roll out stricter measures in response to the recent coronavirus outbreak at Westlite Woodlands dormitory.

MIXED OUTLOOK ON RENTAL MARKET

The URA data indicated that rents for private housing rose 2.2 per cent in the first quarter compared to the fourth quarter of last year.

The analysts interviewed by TODAY were split on their predictions on the rental market, with some expecting a moderate increase of a range about 2 to 7 per cent, and others predicting that rental prices will not go up further.

Mr Mak of ERA Realty said that a moderate increase in rental prices can be expected, and this is partially due to the slowdown in the completion of construction projects, which leads to a lower supply of new housing units.

Some property buyers could turn to renting first while waiting for their residence to be completed, he added.

Though Ms Sun said that construction delays could have some impact on the rental market, she said that it is still more influenced by permanent residents and foreigners.

With more Singaporeans, permanent residents and long-term pass holders returning to Singapore for work, this would push the rental demand higher, she said.

However, Mr Chris Koh, director at real estate consultancy Chris International, pointed out that the URA data shows that there are more than 24,000 vacant units available in private residential developments.

“So this may be a dampener on the rental market (because) we still have a large supply of units out there,” he said, adding that the demand from foreigners coming to Singapore will eventually settle down in the coming months, as it usually does further into the year.