Is The Property Market Taking A Turn For The Worse & Is It Still Worth Investing Now?

manfred lau
7 min readAug 18, 2023


Slow Start for Orchard Sophia, TMW Maxwell, & The Arden

The past week has been rather dull for show flats of newly launched developments such as Orchard Sophia, TMW Maxwell, and The Arden. TMW Maxwell fared the poorest with just 7 units sold, while Orchard Sophia and The Arden sold 19 units and 27 units respectively.

On paper, these seem like rather lackluster results as compared to how new launches have been performing the past 2 years. However, diving deeper, we can understand the low take-up rate for Orchard Sophia and TMW Maxwell. For one, these two developments are located in the CCR where they are more affected by the latest 60% foreigner ABSD. Furthermore, TMW Maxwell consists of only 1- & 2-bedder units. At an average psf of $3,300, it is of no surprise that buyers will seriously consider before putting in their cheque. Orchard Sophia, on the other hand, averaged at around $2,800 psf with their largest 3-bedroom unit at 840 sqft. Honestly, for a family of four, a 840 sqft unit is barely comfortable. Considering all these, it’s not surprising afterall to be greeted with poor performances for the new launches the past week.

How Has The Housing Market Been Performing?

HDB Market

Prices of HDB flats increased by 1.5% (higher than the 1% growth in 1Q2023) while resale transactions fell to the lowest in three years in 2Q2023.

Among the cooling measures implemented in December 2021, September 2022 and April 2023 were a wait-out period of 15 months before private property owners can purchase a non-subsidised HDB resale flat and the lowering of loan-to-value limit for HDB housing loans. Coupled with a strong pipeline of supply by the government, there seems to be some moderation in the the rate of increase in resale prices. This points towards a more sustainable growth trajectory for HDB resale prices following the robust price increases experienced over the last few years.

The dip in resale transactions could be partially due to the increased supply of BTO units by the government with shorter waiting time. Furthermore, buyer resistance seems to have set in as well, with mismatched seller and buyer expectations.

In 2Q2023 alone, the top five HDB towns that raked in the most resale transactions were Punggol, Woodlands, Sengkang, Yishun and Bukit Batok.

Private Market

The number of private residential units sold in the resale market in 2Q2023 jumped 13.8% q-o-q to 3,261 units. Although this marks the end of three consecutive quarter decline in the private resale market, the market is down 26.1% on a yearly basis. The improvement in the resale market last quarter was sustained by better sales in the Rest of Central Region (RCR), which saw a 24.7% increase in sales volume, and in the Outside Central Region (OCR), which recorded a 12.8% increase in sales volume. Sales in the Core Central Region (CCR) remained unchanged from the previous quarter.

Luxury non-landed private residential projects saw a slowdown in the rate of increase in prices, largely due to higher ABSD rates for foreigners which has deterred them — the main driving force for luxury homes within CCR.

With a new benchmark of $2,000 psf in the OCR and $2,400 psf in RCR, consumers and investors alike are starting to question how high and how fast will prices rise in the near future. Nonetheless, Savills forecasts a 7% rise in private residential property prices for 2023.

Is a ‘Looming Recession’ The Cause For Slower Activity in The Market?

When the first few cases of the pandemic arrived on the shores of Singapore, we panicked. Unaware of what this new virus can do to our bodies, we started adopting healthier lifestyles and taking supplements. When countries started going into lockdown, we panicked again. More so than before because now we had to worry about our jobs on top of our health. Investors started shorting because the stock market was a sea of red. The future seemed rather bleak for some. However, what happened was contrary to what I expected to happen. The housing market which was supposed to take a hit, boomed. There was a buying frenzy in the market even in times of uncertainty. Could it be due to low interest rates that banks were offering? Or maybe we were deprived from travelling and had to spend our money somewhere.

In an article released by The Straits Times, Singapore’s economy expanded by 0.3% in 2Q2023 from the previous three months, narrowly avoiding a technical recession.

GDP also grew 0.7% year on year in the April-June period. In the first three months of 2023, the economy had grown by 0.4% year on year, slowing from the 2.1% expansion in the previous quarter. On a quarter-on-quarter seasonally adjusted basis, it shrank 0.4%, a reversal from the 0.1% growth in the fourth quarter of 2022.

In a separate article released by Channel News Asia, authorities have maintained their forecast for GDP growth to range between 0.5% and 2.5%

DBS economist Chan Han Teng does not expect a technical recession and is penciling a turnaround in the economy in the second half of 2023 to take full-year growth to 2.2%

Given the export nature of Singapore, we cannot rule out the possibility that there could be some quarters of negative quarter-on-quarter growth this year. However, a technical recession, if any, would be led by the manufacturing sector, while the consumer-facing sectors and aviation will continue to be resilient. Our economy has fared well given the circumstances faced, and I feel we are still within clear waters of a recession.

Additionally, the crawling pace of the housing market may be a reaction to recent cooling measures as buyers adopt a ‘wait-and-see’ approach. With 26 upcoming new launches to look forward to for the rest of 2023, buyers are not eager to snap up units as they would usually want to view all the different projects before arriving at their decision.

Should I Still Invest My Money In Real Estate or Park My Capital Elsewhere?

Word on the ground is that the high psf is an area of concern for both investors and home-buyers. While I do have to agree that the price per square foot for private residential properties have ‘skyrocketed’ over the past two years, we cannot look at psf alone and make a blanket statement. For starters, price psf tends to increase as a unit gets smaller and more affordable, but decrease as the unit gets larger and less affordable.

The sweet spot for HDB upgraders are within the $1.6m — $1.8m range. If we were to look at the mass market as a whole, there are plenty of units that fall within this range albeit with high psf marks. Comparing price per square foot makes sense if all variables were held constant, but when older units have inefficiencies such as planters and bay windows, comparing it solely by psf would not be a fair comparison.

Many have turned to fixed deposits as an alternative with several banks offering high promotional rates recently and I certainly do not have any qualms about it. Personally, I think any form of investment is great as long as it yields a return that is higher than inflation. For those who still believes in real estate as a form of investment, it is safe to say that residential home prices have a proven track record for being resilient even in times of uncertainty as we have seen in the Asian Financial Crisis in 1997 and the 2007–08 Financial Crisis. Furthermore, housing prices purely based on the law of demand and supply will point towards an upward trajectory in the future unless we can devise a method to substantially increase land space in Singapore.


If you asked me whether it still is worth investing in real estate, my answer from a completely unbiased standpoint is still yes. However, the point of consideration now shifts toward which unit within the development because unit analysis is more pertinent now than ever if the purchase is purely for investment. Consult an expert if you are unsure because the most minute detail can have an effect on the holding period of your investment.

There are some developments I would certainly invest in even now, but there are also others which I would avoid even with huge developer discounts.

I hope this article serves purposeful in helping you make a more well-informed decision, regardless of whether you’re purchasing a property for own-stay or investment. As always, feel free to share your opinion in the comment section and I will take time to address them when I can. Till next time!



manfred lau

Real Estate Agent based in Singapore sharing bite-sized content while trying to keep it light. If you’re reading my stories, I hope you enjoy them!