Private Residential Prices Still Rising Despite Slower Sales Tariff Wars Savills Singapore
Private residential property sales in Singapore are expected to be affected by the recent US tariffs, according to a report by Savills Singapore in May. With the economic environment becoming more uncertain, homebuyers may become more hesitant and adopt a wait-and-see approach before making a purchase. This could result in a slowdown in new sales in the future.
Prior to the announcement of the tariffs, the private residential market was already showing signs of easing. After a strong increase in launches in the fourth quarter of 2024, new launches decreased by 8.4% compared to the previous quarter in the first quarter of 2025. This was accompanied by a 1.3% decline in new sales. In addition, secondary sales also fell for the second consecutive quarter, by 3.2%, leading to an overall decline in non-landed residential sales volume for the first time in three quarters.
The report also noted that in the first quarter of 2025, purchases of non-landed homes decreased for all residency statuses except for permanent residents. While purchases by permanent residents increased by 2.1%, purchases by Singaporeans and foreigners decreased by 2.6% and 17.6% respectively.
Despite the decline in sales volume, property prices continued to rise in the first quarter of 2025, although at a slower pace compared to the previous quarter. Prices increased by 0.8%, compared to the 2.3% growth in the fourth quarter of 2024. The firm also highlighted that although developer sales have slowed since April, prices have continued to rise.
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The firm attributed the resilience of property prices to the baby boomers who view property as a store of wealth, as well as rising HDB resale prices, which have closed the price gap for upgraders. Barring any major market disruptions or cooling measures by the government, the firm believes that prices will continue to increase, driven by new launches. These include several projects in the Core Central Region, such as the 525-unit River Green, the 596-unit Promenade Peak, and the 683-unit Marina View Residences, as well as the 937-unit One Marina Gardens in the Rest of Central Region and the 941-unit Springleaf Residence in the Outside Central Region.
Overall, Savills maintains its full-year forecast of 7% price growth for this year. It believes that the upcoming new launches are likely to set new benchmarks in their respective locations, further contributing to a faster pace of price growth in the coming quarters.