Resale Flat Prices Rise 25 19Th Straight Quarter Hdb 4Q2024 Flash
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Housing and Development Board (HDB) has released their flash estimates for the resale flat market on Jan 2. It showed that prices grew by 2.5% in the fourth quarter of 2024, slightly lower than the 2.7% growth in the previous quarter. This marks the 19th consecutive quarter of price increases in the HDB resale segment.
According to Christine Sun, chief researcher and strategist at OrangeTee Group, this growth is slower compared to previous years. In 2024, HDB resale prices grew by 9.6%, which is double the 4.9% growth in 2023. However, it is still slower than the 10.4% increase in 2022 and 12.7% growth in 2021.
HDB caveat data from data.gov.sg showed a slowdown in price growth for certain flat types in 4Q2024. For example, the median price of four-room flats increased by 2.5%, slower than the 3.4% growth in 3Q2024. Similarly, two-room flats saw a 2% increase in 4Q2024, compared to 3.9% in the previous quarter. Executive flats recorded a 1.2% increase in 4Q2024, lower than the 1.7% growth in 3Q2024. In contrast, prices for five-room flats grew by 3.2% in 4Q2024, faster than the 1.2% increase in 3Q2024.
Resale volume in 4Q2024 declined by 3.6% year-on-year to 6,314 units from 6,547 units in 4Q2023. It also decreased by 22.5% quarter-on-quarter from 8,142 units in 3Q2024. Sun attributes this decline to HDB launching over 8,500 new flats in the October Build-to-Order (BTO) exercise, which diverted demand from the resale market towards the BTO market. The year-end school holidays, when many Singaporeans travel abroad, also slowed down sales activities and house viewings.
Wong Siew Ying, head of research and content at PropNex, points out that the slower growth in 4Q2024 could also be attributed to the government’s intervention in August 2024, when the loan-to-value (LTV) limit for HDB loans was reduced to 75%. This measure could be working through the market, along with the thinner resale volume during the quarter.
In 2024, total resale volume was 28,876 units, which is 8% higher than the 26,735 units recorded in 2023 and 27,896 units in 2022. However, it is still lower than the peak of 31,017 units in 2021.
The decline in resale transactions in 4Q2024 also led to a decrease in million-dollar flat transactions to 283 units from 331 units in 3Q2024. However, the total number of million-dollar transactions reached a record high of 1,033 units in 2024, more than double the 469 million-dollar transactions in the previous year.
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Toa Payoh town had the most million-dollar resale flat deals in 4Q2024, with 58 transactions, 20 of which were for four- and five-room units at Alkaff Vista in Bidadari Park Drive that had recently crossed the five-year minimum occupation period (MOP).
Eugene Lim, key executive officer of ERA Singapore, says that the new classification of Plus and Prime-classified BTO flats may have driven more homebuyers to seek out HDB resale homes in central locations. These buyers are unwilling to accept the resale restrictions such as a 10-year MOP, rental restrictions after MOP, subsidy clawback upon resale, and resale income cap on future buyers.
According to OrangeTee, HDB resale prices are expected to continue rising in 2025, but at a slower pace than in previous years. Prices have already reached new highs in many areas, creating affordability concerns for potential buyers. The ongoing supply of BTO flats may help moderate price growth in the resale market, but the degree of price stabilisation will depend on the number of BTO flats the government plans to release in the upcoming years.
In February 2025, HDB will launch its largest sale of balance flats (SBF) exercise, offering more than 5,500 flats across various towns. Some prospective resale flat buyers may decide to wait and try their luck. ERA projects a 3% to 6% growth in HDB resale prices in 2025, with 26,000 to 27,000 resale units changing hands by the end of the year.
PropNex expects the HDB resale market to perform well in 2025, underpinned by healthy housing demand and fewer MOP flats coming on board. PropNex projects a 5% to 7% increase in HDB resale flat prices in 2025, with 29,000 to 30,000 resale units changing hands. As there is no upfront information on the BTO projects with a shorter waiting time, buyers are likely to turn to the resale market, notes Huttons Asia’s senior director of data analytics, Lee Sze Teck. He projects that the million-dollar flat market may stabilise in the range of 900 to 1,200 units in 2025.
Huttons projects that HDB resale flat transactions will end the year at 26,000 to 28,000, with resale flat prices expected to grow at a slower pace of 5% to 8%.