HDB resale prices climb for 11th straight month in May: SRX

HDB resale prices rose 1.2 per cent in May 2021 from the previous month to remain on their upward trajectory for the eleventh straight month, according to flash data from real estate portal SRX Property released Thursday.

Year on year, the overall price increase for HDB resale flats grew 12 per cent in May although it remained 2.6 per cent lower than the peak in April 2013.

Prices for all room types grew, with three-room, four-room, five-room and executive flats seeing a 13.7 per cent, 11.1 per cent, 12 per cent and 13 per cent year-on-year hike, respectively.

Matured estate prices grew 11.6 per cent from the previous year, while prices in non-mature estates increased 12.4 per cent from a year ago.

There were 1,966 HDB resale transactions for May 2021, representing a 16 per cent decrease from the previous month but 440.1 per cent higher year on year. SRX said this also marks the first time transaction volumes have dropped below 2,000 since 11 months ago in May 2020.

The bulk of resale volume in May came from four-room HDB resale transactions at 43.5 per cent, followed by five-room (26.7 per cent) and three-room (21.1 per cent) flats. 7.3 per cent of resale volume was derived from executive flats, while the rest are from one-room, two-room and multi-gen units.

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According to SRX, a five-room unit at Buona Vista Court fetched the highest transacted price for a resale flat in May 2021 at S$1.2 million. Within non-mature estates, an executive apartment unit at Hougang Central was sold at the highest monthly transacted price of S$865,000.

Thirteen HDB resale flats transacted for at least S$1 million in May, fewer than in April 2021 when 21 such units were sold. This comprises 0.7 per cent of total resale volume for last month and brings the total number of such flats transacted in the year to date to 87, surpassing the 82 million-dollar flats sold for the whole of 2020.

Property analysts from OrangeTee & Tie credit May 2021's lower sales volume to the stricter Covid-19 restrictions implemented from May 16, which include curbs on in-person home viewing. However, they noted that the drop was "not as drastic" when last year's "circuit-breaker" measures were introduced in April. 

"Prices continued to rise last month probably because prices are usually more inelastic than volume. Home prices tend to take a longer time to adjust to market changes. To many sellers, they probably see the movement restrictions as temporary and are expecting demand to pick up again after the heightened alert period. Therefore, some sellers may not see a need to adjust their prices now," they added in a statement e-mailed Thursday. 

OrangeTee & Tie has highlighted a likelihood of more than 150 million-dollar flat transactions inked this year, notwithstanding further economic shocks or cooling measures. In its view, more flats have been selling at or above the million-dollar mark recently as many flats in mature estates have reached their minimum occupation period, and some buyers "do not mind paying top dollar" for these flats for their attractive locations and views. 

Similarly, Huttons Asia research director Lee Sze Teck believes there will be more million-dollar HDB resale transactions in 2021 as homeowners "ride on the buoyant resale market to cash out and upgrade". 

Commenting on the SRX flash data on Thursday, he attributed May's dip in transaction volumes to HDB's launch of a sale of balance flats (SBF) exercise in the same month, which he believes attracted some buyers to "try their luck" in the SBF whose completion dates were shorter than those of build-to-order (BTO) flats. 

"The longer construction periods are pushing many buyers either to the resale market or SBF. Some buyers changed their minds after applying for a BTO and switched to a resale flat instead because of the long waiting time," noted Mr Lee.