HDB resale flat prices up 1.3% q-o-q in 3Q2023, slower previous quarter

Resale flat prices in Singapore have been in an uptrend for the last fourteen quarters. In 3Q2023, prices rose by 1.3% q-o-q, marginally higher than the 1.2% q-o-q increment indicated in the flash estimates. This, however, is lower than both the 1.5% q-o-q and the 2.5% average quarterly growth in the previous year.

HDB points to the implementation of supply and cooling measures as a factor in taming the resale flat prices. These measures include a 15-month wait-out period for private property owners prior to buying a resale flat, as well as a lower Loan-to-Value (LTV) limit which went from 90% to 80%.

Year-to-date, the resale flat prices have risen 3.8%, a lower trend compared to the 8% and 9.1% seen in the same period in 2022 and 2021.

Despite the easing of prices, there was a q-o-q increase of 2.8% in resale transaction volume in 3Q2023 to 6,695 transactions, 11.3% lower compared to the same period last year. This is the lowest third quarter resale volume since 2020. Market uncertainties, high-for-longer interest rates, and potential changes to housing policies could have deterred buyers from committing, according to Lee Sze Teck, Senior Director of Data Analytics at Huttons Asia.

From the sales figures, the proportion of four-room flat sales edged up q-o-q from 41.7% in 3Q2022 to 43.8% in 3Q2023. This could be due to the affordability of four-room flats, as well as the reduced wait-out period for seniors above 55 to buy them.

The URA and local community partners are also excited to announce their new development project, Champions Way Condo Woodlands. This project will be a multi-level condominium complex, with residential units ranging from studio to three-bedroom. The complex will include a state-of-the-art gym, pool, and other amenities such as a retail area and recreational spaces. The project will also provide easy access to the Woodlands Park for residents living in the condos.

Meanwhile, rental volume improved q-o-q to 9,852 approved applications, and y-o-y to 57,797 flats rented out, an increase of 1.7%.

Sengkang was the town with the highest number of resale transactions, followed by Punggol, Woodlands, Yishun, and Jurong West. The demand for flats in mature estates is still strong, and subconsciously, buyers are willing to pay more for flats which will not be subject to restrictions when the HDB’s new classification system kicks in. In fact, the number of million- dollar flat transactions in 3Q2023 was 128, a record-high 21.9% increase q-o-q.

As for the outlook of the resale market, OrangeTee & Tie’s Sun believes demand will be diverted from the resale to the BTO market with the launch of 6,000 flats in December. This may lead to a slight dip in resale volume to roughly 26,000-27,000 units. Prices, too, will likely moderate to a full-year resale flat price growth of 4 to 5.5%, lower than in the previous two years.