HOUSING and Development Board (HDB) resale volumes recovered in July 2023 from a decline observed the month before, while prices maintained their upward trajectory.

Flash data from real estate portal SRX and property agency 99.co released on Thursday (Aug 10) showed that 2,056 HDB resale flats transacted in July, up 10.7 per cent from the earlier month, albeit 13 per cent lower when compared with the previous year.

By flat type, 45.2 per cent of overall volumes for July came from four-roomers. Five-room flats contributed to 24.8 per cent, with 23.8 per cent from three-room resale transactions and 6.2 per cent from executive flats.

The majority or 62.7 per cent of resale volumes came from non-mature estates, with the remaining 37.3 per cent from mature estates.

Luqman Hakim, chief data and analytics officer at 99.co, said that the recovery in resale volumes came as anticipated after the June holidays. He further expects a slight uptick in volume over the coming months due to the rescheduling of Build-To-Order (BTO) sales exercise to September or October, instead of August.

“This delay will likely impact the date of the next sales of balance exercise, prompting potential buyers to turn towards the resale market,” he pointed out.

A NEWSLETTER FOR YOU

Tuesday, 12 pm

Property Insights

Get an exclusive analysis of real estate and property news in Singapore and beyond.

Sign Up

Likewise, ERA Realty’s key executive officer Eugene Lim thinks that homebuyers could return to the HDB resale market in the near future. 

“Applicants who have been unsuccessful in securing a BTO flat may be returning to the resale market in the second half of 2023. With close to 18,000 HDB homes reaching their minimum occupation period from 2022, the homebuyers will have wider options in the resale HDB market to choose from,” said Lim.

Prices of resale HDB flats stayed on an upward trajectory, rising 0.3 per cent from the previous month as non-mature estate prices increased 0.4 per cent, and mature estates booked a decline of the same percentage.

Prices of all room types increased month on month, save for five-roomers, which fell by 0.3 per cent. Executive flat resale prices rose 1.2 per cent, while prices of three-room and four-room flats rose 0.3 per cent and 0.2 per cent, respectively.

Year on year, resale prices increased 7 per cent with price increases registered across all room types. Four-room flats registered the most price hikes at 7.7 per cent, followed by executive flats (6.5 per cent), three-roomers (6.8 per cent) and five-roomers (5.8 per cent).

Mature estates logged a 5.9 per cent year-on-year increase for resale prices, while non-mature estate prices rose 7 per cent.

The highest transacted price for a resale flat in July 2023 was S$1.38 million for a five-room Design, Build and Sell Scheme flat at The Peak @ Toa Payoh.

Within non-mature estates, an executive apartment at Woodlands Street 82 recorded the highest transacted price of S$1.15 million. 

Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, noted that the rate of resale price growth in July 2023 has slowed compared with the same periods in 2022 and 2021.

The slower price increase could be attributed to demand diverted to the BTO market, since more projects were launched for sale over the past two years, she said.

Noting that resale prices have reached record highs in many locations and affected the affordability threshold of some buyers, Sun believes there will be limited upside potential for prices to trend significantly higher.

There is also an increasing proportion of buyers who are “priced out” of flats in mature estates, commented Mark Yip, chief executive of Huttons Asia. Based on his observations, the stronger demand for flats in non-mature estates led to its resale price gains for the month.

Continued resistance by buyers to pay more for their flats have kept resale price increases to under 1 per cent for the third consecutive month, said Yip.

For the whole of 2023, Huttons projects price increases in the resale market to be capped at 5 per cent amid increasing BTO and resale flat supply, with transaction volumes estimated to fall within the range of 24,000 to 26,000 units.

Million-dollar resale flat transactions were down at 32 in July, as opposed to the sale of 34 such units in June.

July’s million-dollar transactions made up 1.6 per cent of total resale volumes in the month, and came from mainly sales in Bukit Merah (five units), Toa Payoh and Kallang/Whampoa (four units each), as well as Queenstown, Bishan and Clementi (three units each).

PropNex’s head of research and content Wong Siew Ying said that she expects million-dollar resale transactions to remain elevated amid an environment of rising private home prices that could channel some buying interest to resale flats.

“Buyers may be willing to part with S$1 million or more for a resale flat as it would still be cheaper than a private resale condo in the vicinity,” she noted. “In a way, some buyers may feel that they get more bang for the buck by going for such resale HDB flats, particularly for those who have a fixed budget, but still wish to have a more spacious unit, and also to live closer to the city.”