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Resale flat prices rise 2.5% in 3Q2024: HDB Flash Estimates
By Nicholas Lam | October 1, 2024

HDB resale flat prices in 3Q2024 has continued its upward trajectory for the 18th consecutive quarter. (Photo: Samuel Isaac Chua / EdgeProp Singapore)

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HDB resale flat prices have continued their upward trajectory for the 18th consecutive quarter. Flash estimates released by HDB on Oct 1 show that HDB resale prices rose by 2.5% q-o-q in 3Q2024, accelerating from the 2.3% q-o-q growth recorded in 2Q2024.

This marks the fastest quarterly growth since 3Q2022 which saw a 2.6% q-o-q rise in HDB resale prices.

Since the start of the year, HDB resale prices have risen by 6.8% - faster than the 3.8% increase measured over the same period last year. However, the price growth to date is still slower than the 8% spike recorded over the first three quarters of 2022.

Read also: Is it a Good Deal?: $838,000 for a three-room HDB flat along Holland Drive



HDB resale flat transactions by price range. (Source: Data.gov.sg as of 30 Sep 2024, ERA Research and Market Intelligence)

The rise in HDB resale prices was underpinned by strong broad-based demand coupled with supply tightness as fewer new HDB flats meet their minimum occupancy period (MOP) in 2024 as compared to 2023, says HDB.

Resale flat volume surged to 8,035 units as of Sept 29, representing a 20% y-o-y increase over 6,695 resale deals last year.

By flat type, four-room flats saw the highest price growth of 3.4% on a q-o-q basis, notes Christine Sun, chief researcher and strategist at OrangeTee Group. It was followed by two-room flats (2.9% growth), three-room flats (2.8% growth), then executive flats (2.4% growth). Five-room flats saw the slowest q-o-q price growth of just 1.5%, according to caveat data taken from data.gov.sg as of 8.15 am on Oct 1.

Sun believes that the increased demand for four-room flats could be driven by more HDB upgraders opting to purchase larger HDB flats as private property prices remain elevated. More private home downgraders may have also opted to buy HDB resale flats due to their affordability.


Surge in million-dollar flats

A total of 328 HDB resale flats sold for a million dollars or more in 3Q2024. This marks a 39% q-o-q increase from the 236 units recorded in 2Q2024 and is over 250% higher than the 128 units recorded in 3Q2023.

Million-dollar flats made up more than 4% of the HDB resale market in 3Q2024, says Lee Sze Teck, senior director of data analytics at Huttons. He adds that around 90% of the million-dollar flat deals in 3Q2024 occurred in mature estates, with the Kallang-Whampoa estate seeing the most deals at 54, followed by Bukit Merah (44) and Queenstown (37).

Read also: October 2024 BTO Part 2: Eight projects in the suburbs

Proportion of million-dollar flats across HDB towns in 3Q 2024. (Source: HDB, Huttons Data Analytics as of 1 Oct 2024)

According to non-landed private home caveats, purchasers with HDB addresses made up 28.8% of all transactions. This marks a drop from the 37.2% and 33.8% recorded respectively in the first and second quarter of the year.

“The lower number of condo upgraders likely means that these homebuyers defaulted to the HDB market instead, driving transactions and therefore prices,” says Eugene Lim, key executive officer at ERA. “This homebuyer group has the capital and are willing to purchase million-dollar flats, leading to the rise in transactions.”

HDB Flat Transactions over $1m. (Source: HDB as of 26 September 2024, ERA Research and Market Intelligence)

To date, there have been 747 million-dollar flat transactions this year, surpassing the 469 transactions seen throughout the whole of 2023. Given the sales momentum, OrangeTee’s Sun believes million-dollar flats are on track to double last year’s figure.


Resilient demand despite cooling measures

Since Aug 20, Loan-to-Value (LTV) limits on HDB loans have been lowered from 80% to 75%, bringing them in line with loans offered by financial institutions. This is the fourth round of cooling measures targeting the HDB market since 2021.

Despite the measures, Huttons’ Lee forecasts that demand for the HDB resale market will remain strong for the rest of the year. “The recent cut in interest rates will translate into lower borrowing costs and a higher loan quantum for buyers,” he explains. This could help homebuyers afford resale flats in better location, resulting in an increase in resale prices in the coming months.

Huttons has revised its predicted 2024 total HDB resale transaction volume to between 29,000 and 30,000, up from between 26,000 and 28,000 previously. The consultancy expects resale flat prices to grow between 8% and 10% across the year.

Read also: Is it a Good Deal?: $1.08 million for a four-room HDB flat in Ang Mo Kio

The October Build-To-Order (BTO) exercise will offer about 8,500 flats across 15 projects, representing 40% of all BTO units launched this year.

The last BTO exercise of the year will also debut the new classification of HDB flats into Standard, Plus or Prime flats based on their location attributes. The Plus and Prime flats come with more stringent resale restrictions such as a longer MOP period, resale income ceiling, and subsidy clawback upon resale.

ERA’s Lim expects the exercise to draw some buyers away from the resale market as the exercise includes flats in attractive locations. However, this may be offset by buyers seeking resale units near prime locations to avoid the tighter resale restrictions.

In any case, OrangeTee Group’s Sun warns homebuyers against overpaying. “Should prices persist at elevated levels, it is imperative for prospective home buyers to exercise prudence,” she says. “The prevailing trends indicate that many buyers are paying a premium for flats situated on lower floors, smaller units or flats located farther from the city centre.”

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