Revival in demand for private resale homes

Volume of transactions in Jan-Aug up 11% from same period a year ago, data shows

- Christine Sun

The private resale market has reached a new pinnacle, underscoring its dominance in the real estate sector. Despite the prevailing high interest rates and the multiple cooling measures, demand for resale homes has seen a revival.

The Urban Redevelopment Authority's (URA) data shows that the volume of resale home transactions has demonstrated a robust recovery, posting an 11 per cent increase from 7,980 units in the period from January to August 2023 to 8,823 over the same period in 2024.

The market resurgence is significant when juxtaposed against the protracted market stagnation after the implementation of the total debt servicing ratio in 2013.

During the initial eight months of each year from 2013 to 2017, an annual average of approximately 5,300 units were sold.

Another indicator that the resale market has gained significant ground is the market share relative to the total private home transactions, which stood at an impressive 72 per cent in the first eight months of 2024. This is a substantial increase from 58 per cent within the same timeframe in 2023. In August 2024, the proportion of resale transactions climbed further to 78 per cent.

The demand for resale properties is expected to remain strong. But who has been driving the market and what types of properties are popular now? We look at the first eight months of 2024 and compare this with the same periods in previous years.

DEMAND DRIVERS

There was a substantial increase in housing supply, with close to 30,000 private homes completed in the past two years.

As housing stock builds up, the expanding inventory of residences will become accessible for resale, thus broadening the spectrum of housing options for prospective purchasers.