SINGAPORE - 2020 was a standout year for the Singapore private residential market, which defied the pandemic and weaker economic conditions to notch a 2.1 per cent gain in the fourth quarter, up from 0.8 per cent from the previous three months, and 0.5 per cent growth a year ago.

It was also a stellar year for the Housing Board resale market, which saw prices jump 5 per cent in 2020 - the steepest growth since 2012 when resale flat values jumped 6.5 per cent.

The private property market's resilience - even as unemployment rose and Singapore's economy is expected to shrink 5.8 per cent in 2020 - sparked recent ministerial remarks that the Government is keeping a close watch on the market, fuelling speculation of more cooling measures.

Data released on Friday morning (Jan 22) by the Urban Redevelopment Authority (URA) showed that for the whole of 2020, the price rise was unchanged from its flash estimate of 2.2 per cent, compared with 2.7 per cent growth in 2019. Prices surged 7.9 per cent in 2018.

Analysts say it is still too early to call if cooling measures will be implemented, as there has only been one quarter of strong growth, fuelled by pent-up demand post-circuit breaker, vaccine optimism, ample liquidity and low interest rates.

But the likelihood of such measures may increase if prices continue to grow at more than 2 per cent for another one to two quarters, said Mr Wong Xian Yang, associate director of research for Singapore and South-east Asia at Cushman & Wakefield.

Meanwhile, sales of new units by developers fell 26 per cent in the fourth quarter from the previous three months. For the whole of 2020, though, sales of new private homes achieved a rise of 0.7 per cent in a pandemic year.

For the fourth quarter of 2020, developers sold 2,603 units (excluding executive condominiums), down from the 3,517 units taken up in the third quarter. For 2020, developers sold 9,982 new homes, up 0.7 per cent from 9,912 units sold a year earlier.

Private resale transactions accounted for 61.3 per cent of all sales done in the fourth quarter compared with 49.2 per cent in the previous quarter. Resale volumes surged to 4,249 units in the fourth quarter, compared with 3,467 units sold in the third quarter.

For 2020, resales jumped nearly 20 per cent to 10,729 transactions, compared with 8,949 in 2019.

In terms of property type, prices of non-landed condominiums and apartments grew 2.5 per cent last year, outpacing the 1.2 per cent rise in the prices of landed properties.

For the fourth quarter, prices of landed homes fell 1.6 per cent, compared with 3.7 per cent growth in the third quarter, after remaining unchanged in the second quarter. Prices of non-landed homes grew 3 per cent in the fourth quarter, compared with a 0.1 per cent increase in the previous quarter.

The URA said prices of non-landed properties in the prime or core central region (CCR) rose 3.2 per cent in the fourth quarter compared with a 3.8 per cent fall in the third quarter. This as many projects including including Fourth Avenue Residences, Kopar at Newton, and Jadescape revised their selling prices upwards in the fourth quarter, analysts noted.

Thanks to new launches such as The Linq At Beauty World and The Landmark, prices of non-landed properties in the city fringe or rest of central region (RCR) jumped 4.4 per cent, compared with a 2.5 per cent rise in the previous quarter.

Prices in the suburbs or outside central region (OCR) rose 1.8 per cent, compared with a 1.7 per cent gain in the previous quarter.

PropNex chief executive Ismail Gafoor believes that 2020's home sales drivers - such as low interest rates, effective management of Covid-19, and economic recovery hopes - will continue to spur buying interest this year.

"In particular, the resale market is one to watch and expect resale transactions to exceed 10,000 units again in 2021, as the entry prices in the resale segment are seen to be more attractive compared to many new launches," he added.

The pandemic seemed to have reversed a decade of rampant growth in the rental market, Ms Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, noted.

In 2020, private home rents dropped 0.6 per cent compared with a 1.4 per cent rise n 2019. Rents of non-landed properties dipped 0.1 per cent in the fourth quarter, easing from a drop of 0.6 per cent in the previous quarter.

For the whole of 2020, rents of non-landed properties in CCR and RCR fell 2.4 per cent and 0.1 per cent respectively, while rents of non-landed properties in OCR gained 3 per cent.

But there are some bright spots, from rising rental demand from overseas Singaporeans, permanent residents, and long-term pass holders who have returned to Singapore in recent weeks. Mass vaccination programmes launched across the globe and phase three reopening may lend some support to the leasing market this year, Ms Sun said.