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Shocked over $1.5 million HDB? Let’s put things into perspectives
By EdgeProp Singapore | July 4, 2023
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SINGAPORE (EDGEPROP): Singapore's property market often makes the headlines, but our recent report on the sale of a jumbo (adjoined) HDB flat in Tiong Bahru for $1.5 million caused a stir. To recap, a 1,894 sqft HDB flat at 50 Moh Guan Terrace in the heart of Tiong Bahru shattered records when it was sold for $1.5 million, eclipsing the previous record of $1.418 million for a 5-room HDB at 92 Dawson Road. This figure seems more shocking considering the flat was completed in 1973 and has a lease of less than 49 years remaining. What's behind this seemingly staggering price? Or are there other factors which make this price more palatable and reasonable?

Scrutinizing the Price on a PSF basis

Yes, the HDB at Tiong Bahru clinched the title of the most expensive HDB in history. However, in terms of price per square foot (PSF), it doesn’t even hold the record for the block it is situated in. The flat at 50 Moh Guan Terrace went for $791 PSF, whereas another 3-room flat in the same block sold for $807 PSF earlier this year.  Remember, this block has a lease of less than 49 years.  In fact, 3 years ago, there was another transaction that was sold for $896 PSF.  No question was raised about the lease then.

From a PSF perspective, there's an even higher transaction within the same block: EdgeProp Research Tool

For the highest PSF in HDB history, one must look at Pinnacle @ Duxton in Tanjong Pagar, arguably Singapore's most famous and record-breaking HDB development. In April 2023, a high-floor 4-room flat at 1C Cantonment Road sold for an eye-watering $1,369 PSF, a staggering 73% higher on a PSF basis compared to the $1.5 million flat in Tiong Bahru. The total price? A cool $1.4 million for a 1,022 sqft flat.  The PSF for Pinnacle @ Duxton flats have consistently exceed the $1,000 PSF threshold.



In terms of PSF, the highest recorded was for a 4-rooom flat at Pinnacle @ Duxton: EdgeProp Research Tool

The Rarity of Jumbo HDB Flats in Central Areas

Another factor contributing to the price is the scarcity of jumbo HDB flats, especially in central areas like Tiong Bahru and Bukit Merah. In 2023, there have been a mere 37 transactions for HDB flats exceeding 1,800 sqft. Out of these, 31 were in Woodlands, 4 in Yishun, 1 in Ang Mo Kio, and a singular one in Tiong Bahru - the one we’re discussing.

Tiong Bahru is one of Singapore’s most coveted neighborhoods, with its rich history, charming architecture, and an eclectic mix of cafes and boutiques. The area also boasts excellent connectivity and proximity to the central business district. The URA Master Plan 2019 has also earmarked Tiong Bahru for further development and rejuvenation, making properties in the area an attractive investment. The rarity of such flats in prime locations adds a premium to their price. As Singapore's land becomes more scarce, these jumbo flats could become even more sought-after.

HDB Remains the Most Affordable Housing Asset Class in Singapore

It’s crucial to view the Tiong Bahru HDB within the broader property market landscape. Despite their rising prices, HDBs are still the most economical housing option in Singapore. For context, new condos in Tiong Bahru such as Highline Residences, Regency Suites, and Twin Regency are transacting upwards of $2,000 PSF. A similar-sized condo to the Tiong Bahru jumbo flat would set a buyer back around $3.5 million! Even older developments like Central Green Condominium, Harvest Mansions, and Meraprime average at $1,500 PSF.

Condos in Tiong Bahru are transacting upwards of $1,500 PSF on average: EdgeProp Research Tool

Prices of Larger HDBs Appear to be Moderating

The Singapore government implemented a set of cooling measures affecting HDBs in September 2022. To recap, these included a requirement for private residential property owners and ex-owners to wait for 15 months after selling their property before being eligible to buy a non-subsidized resale flat. Additionally, the Loan-to-Value (LTV) ratio was lowered from 85% to 80%. It is reasonable to assume that these measures will have the largest impact on highest-quantum HDBs, which typically are the 5-room or larger HDBs.

Average resale prices of 5-room HDBs have remained flat since Oct'22, whereas prices of 3-room and 4-room HDBs have appreciated 2%: EdgeProp Market Trends

From October 2022 to May 2023, average prices of 5-room HDBs have remained flat. In contrast, prices of 3-room and 4-room HDBs have appreciated by 2%. Furthermore, the number of million-dollar HDB transactions has remained stable. After reaching a peak of 45 million-dollar HDB transactions in September 2022, the average number this year has been around 35. (Find HDB flats for rent or sale with our Singapore HDB directory)

The number of million-dollar HDBs in Singapore.  The figure looks to be flatenning after a high of 45 in Sept 2022: EdgeProp Shortlist Tool

Concluding Remarks

While the $1.5 million tag on the Tiong Bahru HDB flat is undoubtedly eye-catching, an in-depth analysis offers insights into what drives the price. The rarity of jumbo HDB flats in prime locations, the relatively reasonable PSF and the comparative affordability of HDBs, all contribute to shaping prices.

As Singapore's property market continues to evolve, it’s vital for buyers and homeowners to keep a discerning eye on the numbers beyond just the headline figures.

Check out the latest listings near 50 Moh Guan Terrace, Pinnacle @ Duxton, Highline Residences, Regency Suites, Twin Regency, Central Green Condominium, Harvest Mansions, Meraprime


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