Modest HDB resale price growth expected in 2026 amid rising supply

[SINGAPORE] The public housing market will likely see modest growth in resale prices next year, with ample fresh supply and cooling demand keeping a lid on flat prices.

Analysts project that resale prices of Housing & Development Board (HDB) flats could rise by between 1 and 5 per cent, after the market slowed considerably this year.

Resale flat prices were up 2.9 per cent for the first nine months of 2025, after rising sharply in 2024 to gain 9.7 per cent. Prices accelerated after a 4.9 per cent increase in 2023.

Against the cooling market, million-dollar transactions – though still a small fraction of overall resale activity – are expected to continue tracking upwards as sought-after projects hit the secondary market.

Prices inched up 0.4 per cent in the third quarter, the slowest pace in five years, and rose 2.9 per cent in the first nine months, compared with 6.9 per cent in 9M 2024 and 3.8 per cent in 9M 2023, said Christine Sun, chief researcher at Realion (OrangeTee & ETC).

Demand was diverted to the Build-To-Order (BTO) market. More than 30,000 new units were offered across three BTO and Sale of Balance Flats (SBF) exercises in 2025, attracting about 100,000 applicants – a three-year high versus 80,000 in 2023 and 82,000 in 2024, noted Sun.

HDB launched 102,433 BTO flats from 2021 to 2025, averaging 20,487 units a year, with nearly 28 per cent of 2025 flats having a waiting time of three years or less, said Huttons Asia’s senior director of data analytics, Lee Sze Teck.

This mirrors supply levels from 2011 to 2014, when 100,174 flats were offered. “When HDB increased BTO supply then, resale prices eased from 2013 to 2019. There are early signs that the pace of resale price growth is beginning to taper off in Q4 2025,” he added.

The resale market also recorded the lowest supply of flats fulfilling their minimum occupation period (MOP) in a decade, with 8,000 expected this year, down from 11,952 last year. The lower MOP supply partly explains the smaller gains, with fewer newer flats having an influence on the HDB resale price index, said Lee.

Policy tweaks also eased resale demand. Singles could buy two-room Flexi BTO flats nationwide from October 2024, with priority for those living near or with parents, while allocation for second-timer families rose by five percentage points, he added.

Given these factors, analysts expect 2025 to post growth of 3 to 4.5 per cent in resale prices.

Mature estates continued to outperform non-mature towns. As at Nov 24, average resale prices were S$703,563 in mature towns, up 7 per cent on the year, and S$615,696 in non-mature estates, up 5 per cent on the year, PropNex data showed.

But resale prices in non-mature estates have caught up over the years, said PropNex CEO Kelvin Fong. The average resale price gap narrowed to the “low- to mid-teens proportion in the past years”, compared with 24 per cent in 2018 and 22 per cent in 2017.

ERA Singapore’s key executive officer Eugene Lim said newer flats drove price growth, with prices of units 15 years and below rising 4.3 per cent and that of flats aged 16 to 25 years up 6.2 per cent in 9M 2025.

Prices of older flats grew more modestly, as buyers remained wary of lease decay and the discontinuation of the Selective En bloc Redevelopment Scheme. Uncertainty over older flats’ values makes buyers cautious, resulting in greater price resistance, said Lim.

The million-dollar question

Against the backdrop of an overall moderating market, the number of million-dollar flats continued to rise this year.

Flash estimates from SRX and 99.co showed 120 flats sold for at least S$1 million in November, up from 87 in October.

Such sales are typically for prime, city-fringe, well-connected flats with long leases, said Fong, which are appealing and affordable compared with private condos in the vicinity.

In Bukit Merah, for instance, the average price of million-dollar flats sized 100 to 119 square metres (sq m) was about S$1.2 million in the year to Nov 24 – below the S$3.4 million average for new condos of similar size, and the S$2.3 million for resale condos in the area, he added.

Huttons’ Lee projects that 2025 will record 1,550 million-dollar transactions, nearly 50 per cent more than in 2024. Centrally located flats that recently met their MOP and were under 10 years old made up 32 per cent of these deals.

“As buyers sourced for newer BTO flats in central locations without resale restrictions, these flats were highly sought-after. These flats may have set a benchmark in terms of prices – and that formed an expectation of the selling prices owners will be looking for, creating a snowball effect.”

Even so, average prices appear to be plateauing, with million-dollar flats estimated at S$1.14 million in 2025, just a hair above the S$1.12 million average in 2024, said Lee. “Compared to 2024, when there were several benchmark prices, there was a lower number of benchmark prices set – suggesting some price resistance among buyers.”

Such deals remain a minority in the broader resale market – accounting for 6 per cent of the 21,412 deals in the first 10 months of 2025, said ERA’s Lim. In contrast, about 20.6 per cent of deals fell in the S$750,000 to S$1 million range, while more than 70 per cent were below S$750,000.

BTO lottery effect still strong

The BTO lottery effect persists. Not all flats that just met their MOP fetch S$1 million, but most see substantial resale gains, said Huttons’ Lee. “Almost all BTO owners stand to make large gains. Owners of flats in non-mature estates may sell at double the purchase price from HDB.”

Centrally located estates such as Kallang/Whampoa, Toa Payoh and Queenstown stand out, with many flats resold above S$1 million, albeit at higher HDB purchase prices, he added.

At St George’s Towers in Kallang/Whampoa, for instance, 33 four-room flats were sold for at least S$1 million as at Nov 24, with resale prices averaging at about S$1.12 million, said Fong. Originally, its BTO prices ranged from S$459,000 to S$574,000, he noted, adding that sellers could have pocketed gains of about S$600,000.

Past standout sales in prime, newer, or well-designed projects anchored price expectations.

The Pinnacle @ Duxton was the first BTO to fetch at least S$1 million in 2015. Subsequent owners used it as a benchmark, creating a snowball effect that reinforced high price expectations, said Lee.

Fong added that the lottery effect can influence buyer behaviour, in that certain well-located BTO projects may see overwhelming demand as applicants chase expectations of a windfall.

It can also raise sellers’ price expectations when they put their flat up for sale, while buyers may feel anxious about affordability. “As recent transactions are a determinant of property value, it follows that the lottery effect could potentially influence prices of other resale flats nearby.”

To curb the effect, the government introduced stricter resale rules for Plus and Prime flats, including a 10-year MOP and subsidy clawback.

While the measures help keep resale prices in check, ERA’s Lim noted that when the first Plus or Prime projects reach their MOP, their scarcity and prime attributes could still support higher cash-over-valuation levels and resale prices if demand remains strong.

Fong said the new flat categories may dampen but not eliminate the lottery effect, with clawback impact dependent on market conditions. The 10-year MOP could create pent-up demand, supporting prices.

Hot spots

MOP supply will more than double to 13,484 in 2026, said Sun. Supply will swell further to 18,939 in 2027 and 21,393 in 2028, totalling nearly 54,000 flats in 2026 to 2028 and far exceeding the estimated 34,000 units in 2023 to 2025.

In particular, more than 8,100 flats in mature estates will reach their MOP in 2026, the highest in a decade and accounting for 60 per cent of all MOP units, Sun noted. Accordingly, more premium transactions are expected in these estates.

Towns with the largest number of flats reaching MOP in 2026 include Punggol (3,222), Queenstown (2,405) and Toa Payoh (2,133), said ERA’s Lim, who expects an increase in million-dollar transactions in popular towns due to strong demand.

On the other hand, competing supply from new flats is expected to intensify, Sun said. BTO and SBF participation has risen over the last three years, and more than 30,000 Plus and Prime flats have been launched since 2021, with more expected in desirable new estates in Mount Pleasant, the Greater Southern Waterfront and Bayshore. These may divert buyers from prime resale flats.

Policy changes may further reshape buying patterns, said Sun. The government is considering raising the BTO income ceiling – with estimates pointing to an increase from S$14,000 to S$16,000 for couples and families, and from S$7,000 to S$8,000 for singles.

This would widen the pool of eligible BTO buyers and allow higher-income households to buy larger, pricier new flats, potentially drawing demand away from larger resale units, she added.