Why Demand for Private Resale Homes Will Remain High

Buyers to Continue Eyeing Market If Price Gap Between New and Resale Properties Stays Wide

- Christine Sun

The private resale market demonstrated a robust resurgence, with sales increasing notably by almost 25 per cent year on year, even as prices climbed higher in 2024. This trend sharply contrasts with the new home sales market, where sales volume experienced a modest increase of only 0.7 per cent compared with 2023.

According to data from the Urban Redevelopment Authority, 14,053 private resale homes were transacted in 2024. This marks the highest number of resale transactions since 2021, when 19,962 units were sold. During that period, many buyers rushed back to the market following the easing of pandemic lockdown restrictions.

More recently, the robust resale volumes could have been driven by a confluence of factors. In 2023, around 20,000 private homes obtained their temporary occupation permit (TOP), leading to a surge in properties available for resale. Moreover, the rising prices of new homes spurred some buyers to seek more affordable housing options in the secondary market.

Rising affluence was another factor. Many HDB home owners profited considerably from selling their flats at high prices in recent years, enabling them to upgrade to private housing.

So, prospects for private resale properties may continue to be promising in 2025.

SUPPLY SHORTAGE

In 2024, prices of resale private homes grew at a slower pace of 5.1 per cent, compared with 7.5 per cent in 2023 and 8.7 per cent in 2022. The smaller growth could be attributed to increased competition from numerous private residential properties completed in 2023. As a result, sellers were more willing to accept lower-price offers.

But the number of private home completions dipped significantly in 2024, and the decline is expected to continue in 2025.