HDB resale values are up by 4.9% in the first half of 2023 and 1.1% for Q4 as growth slows
Owners are more likely to expect a higher price for their own flats when they learn that their neighbors have sold it for at least a million dollar. With the recent changes in flat classification, which will be implemented later this summer, many owners have been holding their prices because their flats don’t come with restrictions for resale.
Data from the Housing and Development Board revealed on Friday (Jan. 26) that RESALE prices for public housing flats increased in the fourth-quarter of 2023. However, the increase was slower than it had been in the previous quarter.
Resale prices in Q4 were up 1.1%, compared to a growth of 1.3 % for the previous quarter. They are also below the quarterly average growth rate of 2.5% for 2022.
Resale prices for flats increased 4.9 per cent in 2023 – the slowest rate of growth since 2019, when they only rose 0.1 per cent.
HDB is offering around 4,100 flats in Bedok, Queenstown and Choa Chu Kang as well as Hougang, Punggol, Woodlands, Hougang and Punggol during its Build-To-Order exercise (BTO) for February.
Sale of Balance Flats, a program that offers 1,500 additional flats. The launch of BTO flats in 2024 will total 19,600.
Experts believe that last year’s growth in prices was slowed by a decline in housing demand and inflationary fears, as well as higher interest rates.
HDB data show that resale volumes in 2017 were down by 4.2 per cent, from 27,896 to 26,735 units.
In Q4 only, the number resale transaction cases fell by 2.2% to 6,547. This is the lowest quarter-by-quarter volume recorded since 2020. Resale sales were down by 0.8 percent year over year.
Property analysts attribute the Q4 slowdown due to the greater supply of Build To Order (BTO), flats, and the lull at the end of the year.
On top of the cooling measures, government succeeded in curbing the increase in prices for resale apartments through aggressive increases in supply.
The fear of missing out is fading for many homebuyers.
HDB resale apartment prices are rising, but buyers are reluctant to pay more.
HDB data showed that three-room HDB flats were the most expensive in the central region, with a median resale of S$481,500. Geylang had the lowest, at S$345,000.
Bukit Pantjang had the lowest median price of S$503,000, while Queenstown recorded the highest at S$928,000.
Bukit Merah had the highest median five-room apartment price at S$959,000. Jurong West, on the other hand, recorded the lowest at S$588,000.
Hougang was the place with the highest median resale prices for executive apartments, at S$895,000. Jurong West, however, had a median of S$698,000.
470 million-dollar apartments were sold, a record high. These flats are still a tiny fraction (2.1%) of the total market.
The number of HDB resale deals worth over $1 million will increase in 2024 as buyers continue to be attracted by the superior features and locations of these flats.
In January, a five room DBSS flat located at 139A Lorong I Toa Payoh sold for S$1,57m, a new record in the resale sector.
In Q4, the demand for HDB flats dipped slightly. HDB’s approval rate for rental applications dropped 0.7 percent to 9,787 from 9,852 in the previous quarter.
This brings the total number rented flats in the quarter up to 58.159 units. This is an increase of 0.6% from the previous tally of the previous quarterly of 57.797 units.
The median rent for a 5-room apartment in Queenstown reached S$4,300. In contrast, the lowest rental prices were S$2,200. These flats are located in Bukit Meray and Bukit Panjang.
On the demand-side, local renters may continue to shrink while others could return to the market if private rental rates moderate.
The rental stock will continue to decline. Rentable inventory may shrink as a result of the increase in Additional Purchaser’s Stamp duty rates. This discourages homeowners to buy a second HDB apartment while renting out their HDB flats.