SINGAPORE (EDGEPROP) - Resale prices of public housing flats grew 2.3% q-o-q in 1Q2022, according to flash estimates released by HDB on April 1. On a y-o-y basis, HDB resale prices were up 12% in 1Q2022.

See also: HDB to buy back flats from owners affected by ethnic quota limits

HDB resale prices continued to grow despite a dip in market activities during the quarter, says Christine Sun, OrangeTee & Tie’s senior vice president of research and analytics. 6,500 HDB flats were resold in 1Q2022, declining 18% q-o-q from the 7,940 units transacted the previous quarter. Nonetheless, the growth in prices for 1Q2021 is slower compared to the 3.4% growth logged in 4Q2021. The figure also represents the lowest quarterly increase since 3Q2020, when prices rose 1.5%. (Find HDB flats for rent or sale with our Singapore HDB directory)

The lower number of HDB resale transactions this past quarter was underpinned by the seasonal lull leading up to the Lunar New Year, as well as a spike in Covid-19 community cases, which peaked at 25,000 daily cases in February. “There were fewer prospective buyers due to the safe management measures that placed a cap on the number of unique visitors per household,” Sun adds.

The market was also affected by the introduction of cooling measures in December, which caused some buyers to take a wait-and-see approach while they took stock of the market. The tighter supply of resale flats available may have also curtailed transaction volume, says PropNex Realty’s head of research and content Wong Siew Ying. “Some HDB upgraders could have held back on selling their flat as their new home is not ready for occupation owing to completion delays.”

Despite the fewer flats sold, Sun notes that 82 flats were sold for at least $1 million in 1Q2022, almost on par with the 85 transactions recorded in 4Q2021. This includes a five-room HDB flat at Pinnacle@Duxton selling for a record price of $1.39 million last month. In total, six flats were sold for above $1.3 million, higher than the four units that transacted at such prices the previous quarter.

Looking ahead, the HDB resale market is expected to remain buoyant, with demand remaining resilient. While over 31,000 flats are expected to reach minimum occupation period (MOP) in 2022 thus boosting supply, Huttons Asia’s senior director of research Lee Sze Teck says that the new homes will likely command higher prices, underpinning further price increases in the market. He anticipates HDB resale prices to grow by up to 8% this year.

Other consultants have similar projections, including OrangeTee & Tie’s Sun, who is forecasting resale price growth between 5% to 8% this year. However, she points out that the higher cost of living, driven by inflation and rising economic uncertainties, could potentially impact buyer sentiment. “​​Should inflation worsen, more people may opt for smaller flats or flats in non-mature estates, which tend to be lower-priced.”