HDB resale price growth slows, even as number of million-dollar transactions hit record high

Price resistance has set into the HDB resale market in Singapore, with the overall flat prices growing at a slower pace in 3Q2023. Million-dollar flat transactions reached a record of 128 units in the same quarter, highlighting an uptick in the buying activity in the market.

research & analytics at OrangeTee & Tie, Christine Sun observes that the slower growth in resale flat prices is likely due to inflationary concerns, as well as interest rates that have stayed elevated for longer than anticipated.

Four-room flats saw the biggest growth in resale prices, climbing 1.8% q-o-q from $579,740 in 2Q2023 to $589,992 in the third quarter. This was followed by executive flats, which grew by 1.2% from an average of $827,549 to $$837,138.

Average resale prices declined in 10 towns in 3Q2023 however, more than the six towns recorded in the prior quarter.

Conversely, HDB resale transaction volumes rose 2.9% q-o-q in 3Q2023 to reach 6,592 units. This was attributed to more grants given to first-timers purchasing HDB resale flats, as well as the delay in the August Build-To-Order (BTO) sales launch, which diverted more Singaporeans to the resale market.

Million-dollar resale flats hit a new record in 3Q2023, with 128 units sold for at least $1 million, surpassing the previous quarterly record of 111 units in 3Q2022.

OrangeTee & Tie predicts that affordability will continue to be influenced by the interest rate environment, and resale prices are expected to grow at a more measured pace. The firm is projecting a full-year price growth of around 4% to 5.5% for HDB resale flats in 2023. For volume, the firm predicts resale flat transactions to dip slightly to about 26,000 to 27,000 units this year.

Sengkang saw the highest transaction volume at 504 units in 3Q2023, while Bukit Panjang saw its first million-dollar flat transaction at $1.02 million for a 1,367 sq ft executive flat at Jelebu Road. Currently, only four towns – Sengkang, Choa Chu Kang, Jurong West and Sembawang – have yet to log a million-dollar flat transaction.

Price resistance has set into Singapore’s HDB resale market in 3Q2023, with average prices growing at a slower pace than the 1.5% q-o-q increase logged in 2Q2023 and the 2.5% average quarterly growth clocked in 2022. Despite this, resale transaction volumes rose 2.9% q-o-q in 3Q2023 to reach 6,592 units due to grants given to first-timers and the delay of the August BTO sales launch.

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Million-dollar resale flats hit a record of 128 units in 3Q2023, surpassing the previous quarterly record of 111 units in 3Q2022. OrangeTee & Tie is expecting a full-year price growth of around 4% to 5.5% for HDB resale flats in 2023, and a slight dip of resale flat transactions to about 26,000 to 27,000 units this year.

Inflationary concerns and elevated interest rates were cited as reasons for the price resistance in the HDB resale market. Four-room flats saw the biggest growth in resale prices, climbing 1.8% q-o-q, followed by executive flats, which grew by 1.2% q-o-q.

OrangeTee & Tie believes affordability will be influenced by the interest rate environment, with the HDB loan packages offered by many local banks hovering at above 3%. In addition, there may be more demand diverted to the BTO market as more flats are released.

Four towns – Sengkang, Choa Chu Kang, Jurong West and Sembawang – have yet to log a million-dollar flat transaction, with OrangeTee & Tie predicting Sengkang could be the next, considering it has seen ten units sold for at least $900,000.