HDB resale prices continued to climb in 4Q2024, recording a quarterly increase of 2.6% according to data released by HDB on Jan 24. This marks the 19th consecutive quarter of price growth in the resale market, bringing the cumulative price increase for public housing to 9.7% for the whole of last year. The yearly uptick in resale prices nearly doubled the 4.9% y-o-y increase registered in 2023. However, last quarter’s price increase moderated slightly compared to the 2.7% q-o-q increase recorded in 3Q2024.
According to Mohan Sandrasegeran, head of research & data analytics at SRI, the robust growth in resale prices throughout 2024 can mainly be attributed to the limited supply of flats that reached their Minimum Occupation Period (MOP) during the year. This resulted in upward pressure on prices, particularly as buyers showed strong interest in newer flats and larger flat types such as five-room and executive units to cater to growing family needs.
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Of the various flat types in the HDB resale market, five-room flats recorded the highest resale price growth in 4Q2024, with the average price jumping 2.2% q-o-q to $754,097. Meanwhile, four-room flats also saw an increase of 2.2% q-o-q to $652,544 in the same quarter.
The Central Area saw the highest increase in prices, growing 25.6% q-o-q, followed by Toa Payoh (12.1%), Tampines (6.9%), Bishan (6.7%), and Bedok (6.1%), according to Christine Sun, chief researcher & strategist at OrangeTee Group.
In the last three months of 2024, approximately 5,000 HDB resale flats were sold for $1 million or more, bringing the total number of million-dollar transactions to 1,035 for the whole of last year. According to Lee Sze Teck, senior director of data analytics at Huttons Asia, over 90% of these transactions occurred in mature estates, with the Kallang/Whampoa estate recording the highest number at 156 units, followed by Toa Payoh (144 units) and Bukit Merah (135 units).
However, resale transactions in the HDB market decreased by 21.1% q-o-q from 8,142 units sold in 3Q2024 to 6,424 units sold in 4Q2024, which can be attributed to seasonal factors such as the year-end holiday and festive season, according to Lee.
Looking ahead, approximately 6,976 flats are expected to reach the end of their MOP this year, a 41.6% decrease compared to the 11,952 flats in 2024. This is because of the relatively fewer Build-to-Order (BTO) flats completed in 2020 during the Covid-19 pandemic. However, HDB has announced plans to launch over 25,000 new flats across three BTO sales exercises in 2025, with around 5,500 flats under the Sale of Balance Flats (SBF) exercise and 3,800 BTO flats designated as Shorter Waiting Time (SWT) flats that offer wait times of less than three years.
According to Sandrasegeran, this increase in public housing supply aims to address the growing demand for housing, with SBF flats being particularly appealing to buyers who value the option of acquiring a brand-new, ready-to-move-in flat with a shorter waiting time compared to the typical BTO process.
Looking ahead, Sandrasegeran forecasts resale prices in the HDB market to increase by 3.5% to 5.5% this year, with resale transaction volume ranging between 26,000 and 27,000. However, Lee predicts a more optimistic price increase of between 5% to 8% across the year.