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Flash data: HDB resale prices rise 2.5% in Q3 2024 as demand remains strong

The HDB’s latest flash data reported a 2.5% increase in resale prices for Q3 2024, up from 2.3% in Q2 and significantly higher than the 1.3% rise in the same period last year. Transaction volumes also surged to 8,035 units as of 29 Sept, compared to 7,352 in Q2. HDB defended that million-dollar transactions made up a small proportion, with most flats sold at “much lower prices” in Q3.

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SINGAPORE: The Housing and Development Board (HDB) reported an acceleration in resale-price growth for the third quarter of 2024, with prices increasing by 2.5% compared to a 2.3% rise in the previous quarter.

This growth marks a significant increase from the 1.3% recorded in the same period last year, as indicated by HDB’s flash estimates released on 1 October.

Transaction volumes of resale flats also showed robust performance, reaching 8,035 units sold as of 29 September. This figure represents a 20% increase from the same period last year and a notable rise from the 7,352 units sold in Q2.

Despite the rise in prices and volumes, million-dollar transactions continued to make up a small proportion of total resales, with the majority of flats being transacted at “much lower prices,” according to HDB.

The agency attributed the surge in both resale prices and transaction volumes to “strong broad-based demand,” coupled with a tightening supply in the market.

Fewer new flats have met the minimum occupation period this year compared to the previous year.

HDB noted that these trends reflect market conditions prior to the recent policy change that lowered the loan-to-value limit for HDB loans from 80% to 75%, effective 20 August.

This move aims to cool the resale market and encourage greater financial prudence among homebuyers.

“The government will continue to monitor the property market closely and adjust its policies as necessary to promote a stable and sustainable property market,” HDB stated.

It also urged households to exercise caution in their property purchases, warning that the cyclical nature of the market means those who buy at high prices may face greater challenges when prices eventually decline.

Since the beginning of the year, HDB resale prices have risen by 6.8%, a faster pace than the 3.8% increase observed during the same timeframe last year.

However, this growth rate still lags behind the 8% spike recorded in the first three quarters of 2022.

Looking ahead, HDB is set to offer approximately 8,500 flats across 15 Build-to-Order (BTO) projects in its October 2024 BTO exercise, which is the final exercise scheduled for the year.

This offering will account for 40% of the total BTO flats supplied this year.

The October BTO exercise will also introduce a new classification of HDB flats into Standard, Plus, or Prime categories based on their location attributes.

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Housing

Bukit Panjang makes history with first-ever million-dollar resale flat

In September, a Bukit Panjang HDB executive resale flat achieved a historic milestone, selling for $1.02 million, the first in the estate to breach the million-dollar mark.

As per SRI, 2023 has seen 322 million-dollar HDB resale deals to date, compared to 369 in 2022.

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1 year ago

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25 September 2023

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SINGAPORE: The serene residential enclave of Bukit Panjang has witnessed its first-ever million-dollar Housing and Development Board (HDB) flat sale, sending shockwaves through the local real estate market.

The record-breaking transaction occurred in September when a spacious 127 square meter (1,367 square feet) executive apartment, situated on levels 28 to 38 of Block 181 Jelebu Road, changed hands for a staggering $1.02 million, equating to a price per square foot (psf) of $746.

As per Singapore Realtors Inc (SRI), this highly coveted flat boasts a prime location nestled between the 28th and 30th floors of Block 181, a well-established development along Jelebu Road, completed in 2003.

Block 181 is renowned for its diverse mix of four-room, five-room, and executive flats.

The flat’s lease commenced in 2003, making the development approximately 20 years old.

SRI highlighted that Bukit Panjang has faced a scarcity of Build-to-Order (BTO) projects in recent years, with the last BTO launch dating back to 2016.

Consequently, resale properties within this sought-after enclave of Bukit Panjang have become a preferred choice among homebuyers seeking a place to call their own.

The strategic positioning of this development further enhances its appeal, offering close proximity to key amenities such as the Bukit Panjang MRT station on the downtown line (approximately 148 meters away), the bustling Hillion Mall, and the Bukit Panjang Integrated Transport Hub, just a short 5-minute walk away.

This enviable accessibility to public transportation and shopping centers positions this resale flat as an attractive and practical option for those seeking a convenient and comfortable living experience in Bukit Panjang.

A range of schools is conveniently located within a 1 to 2-kilometer radius of the HDB resale flat, including West View Primary School, Zhenghua Primary School, Greenridge Primary School, Bukit Panjang Primary School, Chua Chu Kang Secondary School, and West Spring Secondary School.

322 Million-Dollar deals to date

According to SRI, to date, a total of 322 million-dollar HDB resale deals have transpired within the first nine months of 2023, in contrast to the 369 million-dollar deals recorded in 2022.

Over the past few years, numerous residential estates across the island have borne witness to the phenomenon of million-dollar transactions, with notable exceptions being Choa Chu Kang, Jurong West, Sembawang, and Sengkang.

Singapore in August this year witnessed a significant surge in the resale market for HDB flats, a total of 54 HDB resale flats were transacted for at least $1,000,000, marking a notable increase compared to July 2023, which saw 32 such transactions, and June of the same year, with 34 million-dollar flat sales.

This is also the highest volume of resale flats transacted for at least $1 million to date, according to data from the Singapore Real Estate Exchange (SRX) issued on September.

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Housing

Singapore’s new 10-year Minimum Occupation Period for HDB Plus flats balances homeownership and flexibility, says Desmond Lee

Desmond Lee, Minister for National Development highlights the 10-year Minimum Occupation Period (MOP) for new HDB Plus flats, emphasizing its role in balancing owner occupation commitment and homeowner flexibility.

Additionally, BTO projects’ future categorization focuses on locational attributes, not estate maturity.

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1 year ago

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18 September 2023

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SINGAPORE: The 10-year Minimum Occupation Period (MOP) for new Housing Board (HDB) Plus flats aims to strike a delicate balance between bolstering the commitment to owner occupation and offering homeowners the flexibility to move for genuine reasons, said Minister for National Development Desmond Lee.

“We think that a MOP of 10 years seeks to strike a balance between strengthening the intent for owner occupation on the one hand, and giving home owners the flexibility of moving home for genuine reasons.”

In his address to Parliament on Monday (18 Sept), Minister Lee emphasized that the introduction of a 10-year MOP for HDB Plus flats represents a key component of their broader housing policy, aligning with the overarching goal of making homeownership accessible while maintaining social and economic stability.

Prime and Plus flats to have an extended 10-year MOP

The Minimum Occupation Period is a critical requirement for HDB flats, governing the period during which homeowners are restricted from selling or renting out their properties.

Historically, most HDB flats have had a 5-year MOP.

In Oct 2021, HDB introduced a new Prime Location Public Housing scheme (PLH) with an unprecedented MOP of 10 years, double the duration of regular Build-to-Order (BTO) flats.

The PLH model aims to keep future HDB flats in prime, central locations affordable and inclusive.

Starting in the latter half of 2024, Build-to-Order (BTO) projects will no longer be categorized based on whether they are located in mature or non-mature estates. Instead, they will be offered in three distinct models: Standard, Plus, or Prime.

Strickter regulations for Plus and Prime flats

Under this new housing framework, Standard flats represent public housing units spread throughout Singapore, featuring HDB’s standard subsidies and restrictions, including a MOP of five years.

Plus flats, on the other hand, occupy more desirable locations within a region and come with increased subsidies and stricter restrictions compared to Standard flats.

Prime flats are situated in the most coveted and central areas of Singapore and boast the highest subsidies and tightest restrictions.

Both Plus and Prime flats impose a 10-year MOP and an income ceiling at the time of resale.

“This new framework reflects the government’s commitment to achieve affordable home ownership, a good social mix and a fair system,” said Mr Lee.

Additionally, initial owners will face a clawback of the extra subsidies provided by the government, and they are prohibited from renting out their entire flat at any time.

Minister Lee emphasized that these measures are designed to ensure these flats are primarily used for owner occupation and not for speculative investments or rental income.

In response to questions raised by four Members of Parliament regarding the reclassification of HDB flats, particularly the categorization of BTO flats in choice locations under the Prime and Plus categories with stricter resale conditions, Minister Lee explained that the Ministry of National Development (MND) has been actively engaging with citizens and considering various suggestions.

Minister rejects rigid price caps idea, prefers additional subsidies to ensure fairness in housing market

A suggestion by Jurong MP Xie Yao Quan proposed a rigid price cap for Prime and Plus flats, but Minister Lee deemed this approach can be “distortionary” as prices may then not fully reflect the attributes of the flats.

“Instead, we will provide additional subsidies on top of these significant market discounts already provided for standard flats.”

Furthermore, the MND provides progressive grants to assist eligible first-time homebuyers, providing extra support to those in need.

When addressing inquiries about how the new framework promotes social diversity in HDB estates, Minister Lee emphasized that Prime and Plus projects will offer a diverse range of flat types to cater to various budgets and needs of Singaporeans.

To ensure inclusivity in neighbourhoods, the MND will continue to construct rental flats within integrated blocks wherever possible, including future Prime and Plus projects.

Minister Lee cited the example of River Peaks I, the inaugural Prime Location Public Housing project launched in November 2021.

“Some have asked if this new framework might cause our society to stratify further. In fact, on the contrary, this new framework seeks to achieve quite the opposite.”

“Without the new framework, flats in choice locations will likely become more expensive and out of reach for many Singaporeans over time,” said Mr Lee.

Minister Lee also highlighted that first-time homebuyers can benefit from the Enhanced CPF Housing Grant, a means-tested grant that provides up to $80,000 in grants for families and $40,000 for singles.

Leader of the Opposition seeks clarification on fiscal impact of New HDB BTO flat classification system

Notably, Pritam Singh, Leader of the Opposition also filed a question to ask the Minister what is the anticipated fiscal impact arising from additional taxpayer subsidies extended to Prime and Plus HDB flats under the new HDB BTO flat classification system.

In response, Mr Lee said the total fiscal impact is anticipated to be higher than if we keep to the status quo.

“The actual anticipated fiscal impact will depend on a number of factors, including market conditions at each launch, housing demand, the locational attributes of the sites and more.”

He said in deciding which model to launch new flats under, the government take into account various factors such as their specific locational attributes, affordability for buyers and the need to provide a range of different options for Singaporeans.

“We will continue to set aside the vast majority of our new flat supply for first time our families.”

Enhanced ballot chances and priority schemes for first-time families

According to Minister Lee, Under the new framework across all BTO projects, first timer families will receive 2 ballot chances.

And 1st timer, parents and married couples, or what we call the “FTPMC”, will receive 3 ballot chances and additional priority under the Family and Parenthood Priority Scheme.

More details on the specific prioritization and quotas for different groups will be announced when ready, said Mr Lee.

Single to purchase new two-room flexi BTO Flats

In response to the housing needs of singles and the elderly, Minister Lee announced the introduction of new housing options, including the availability of two-room flexi BTO flats for singles in standard, Plus, or prime projects starting in the latter half of 2024.

To meet the increasing demand, the Housing and Development Board (HDB) will launch up to 14,000 two-room flexi flats over the next three years, representing a substantial 30% increase compared to the preceding three years.

Despite delays attributed to COVID-19, the government is committed to reducing the median waiting time from 4 to 4.5 years to three to four years by the following year

“Our priority now is to build enough flats over the next few years to address this demand before we decide whether to make any further changes.”

Minister Lee also highlighted ongoing efforts to engage with singles regarding their housing preferences, including innovative housing typologies like co-living and intergenerational housing, which are currently under active consideration.

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