HDB resale prices continue climbing; up 2.5% in Q4 and 9.6% for 2024
Price growth eases slightly from 2.7% in Q3
HOUSING and Development Board (HDB) resale prices continued to rise in the last quarter of 2024, albeit at a slower pace of 2.5 per cent compared with the 2.7 per cent recorded in Q3.
Resale flat prices for 2024 rose by 9.6 per cent, HDB flash estimates indicated on Thursday (Jan 2).
“The resale prices in Q4 2024 continued to be driven by a strong broad-based demand, as well as some supply tightness in the market,” said HDB.
It added that this also reflects the market conditions after the lowering of the loan-to-value limit for HDB housing loans to 75 per cent from 80 per cent. This was rolled out on Aug 20 to cool the market and encourage greater prudence among homebuyers.
The Q4 increase of 2.5 per cent represents the slowest growth rate since Q2 2024, when prices rose by 2.3 per cent, noted Christine Sun, OrangeTee Group’s chief researcher and strategist.
Citing HDB caveat data, she said price growth has slowed down for some flat types.
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The median price of four-room flats, for instance, crept up 2.5 per cent in Q4 – slower than the 3.4 per cent growth in Q3.
Million-dollar flats
The smaller number of million-dollar flat transactions may have contributed to the smaller gains in prices in Q4, said Lee Sze Teck, Huttons Asia’s senior director of data analytics.
About 270 resale flats were sold for S$1 million and above in Q4, down 18.4 per cent from the previous quarter.
Demand has tapered off as the US Federal Reserve slashed interest rates, said Lee, adding that lower borrowing costs and a higher loan quantum could have spurred buyers to consider purchasing condos or executive condos in Q4.
Mohan Sandrasegeran, SRI head of research and data analytics, also said demand fell in tandem with cooling measures implemented in Q3 last year.
“This moderation may reflect cautious sentiment among some buyers, who are recaliberating their decisions in response to the cooling measures,” he added.
Meanwhile, transaction volumes of resale flats stood at 6,314 units as at Dec 30, down 3.6 per cent from the same period the previous year.
The October Build-To-Order (BTO) flat exercise, where more than 8,500 new units were launched, likely drew some attention away from the resale market, said OrangeTee’s Sun.
HDB said it launched a total of 21,225 new flats, comprising 19,637 BTO flats and 1,588 flats offered under the Sale of Balance Flats (SBF) exercise in 2024.
In February 2025, the agency will launch about 5,000 BTO flats in Kallang/Whampoa, Queenstown, Woodlands and Yishun. It will also offer the “largest-ever” SBF exercise with more than 5,500 flats across various towns or estates.
Huttons Asia’s Lee said that some prospective resale flats buyers might be waiting for the SBF exercise, thus dampening Q4 resale volume.
For the full year up to Dec 30, total resale volume stood at 28,876 units, up 8 per cent from the 26,735 units recorded in the corresponding period the year before. This marks the highest HDB resale volume since 2021, said Eugene Lim, ERA Singapore’s key executive officer.
This comes as private residential prices continue to rise, urging HDB owners to upgrade within the public housing market instead, he added.
The new classification of Plus and Prime BTO flats may have also spurred some homebuyers to seek out resale homes in central locations, he said.
“These buyers are unwilling to accept the resale restrictions such as a 10-year minimum occupation period (MOP), rental restrictions after MOP, subsidy clawback upon resale, and resale income cap on future buyers,” he noted.
Further gains
Market watchers expect resale prices to continue rising at a slower pace amid robust demand and limited supply.
SRI’s Sandrasegeran projects demand to be buoyed by couples, families and unsuccessful BTO applicants seeking immediate housing options.
Buyers will also be more drawn to popular estates with “desirable attributes”, including close proximity to transport nodes, schools and recreational facilities, he said.
Huttons Asia’s Lee also noted that buyers are likely to move into the resale market as the number of BTO flats in 2025 falls to 17,290, down 12 per cent from 2024.
But the limited supply of resale flats reaching their MOP will contribute to tighter market conditions in the new year, said Sandrasegeran.
About 6,976 flats are projected to reach MOP in 2025 – a 41.6 per cent decline from the 11,952 flats expected to become eligible in 2024, he noted.
“This reduced supply, particularly for flats with unique attributes like larger layouts and longer lease balances, is anticipated to support price resilience in the resale market,” he added.
Market watchers project resale flat transactions to be between 26,000 and 28,000, and prices to grow at a pace of 3 to 8 per cent in 2025.
HDB said: “The government will continue to monitor the property market closely and adjust its policies as necessary to promote a stable and sustainable property market.”
It added: “Households are strongly advised to exercise prudence in their property purchases as the property market moves in cycles and those who buy high will be hit harder if prices weaken.”
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