According to the latest HDB data released on Jan 24, resale prices for HDB flats have continued to rise, recording a 2.6% increase in the fourth quarter of 2024. This marks the 19th consecutive quarter of price growth in the secondary market. Throughout the whole of 2024, there was a cumulative increase of 9.7% in resale prices. This is almost double the 4.9% increase seen in 2023.
The uptick in prices in the last quarter of 2024 was slightly lower than the 2.7% increase in the third quarter. Mohan Sandrasegeran, head of research and data analytics at SRI, attributes this robust growth in prices to the limited supply of flats that have reached their Minimum Occupation Period (MOP) during the year.
Sandrasegeran explains that this tight supply has caused an upward pressure on prices, especially for newer and larger flat types, such as five-room and executive units, which are in high demand for growing families.
Among the different types of flats in the resale market, five-room flats experienced the highest price growth in the fourth quarter of 2024, with an average resale price of $754,097, a 2.2% increase from the previous quarter. Four-room flats also saw an increase of 2.2%, with an average resale price of $652,544.
The Central Area saw the highest price increase of 25.6% in the fourth quarter, followed by Toa Payoh at 12.1%, Tampines at 6.9%, Bishan at 6.7%, and Bedok at 6.1%, according to Christine Sun, chief researcher and strategist at OrangeTee Group.
There were 285 HDB resale flats sold for $1 million or more in the last three months of 2024, bringing the total number of million-dollar transactions to 1,035 for the whole year. Lee Sze Teck, senior director of data analytics at Huttons Asia, notes that more than 90% of these transactions took place in mature estates, with Kallang/Whampoa, Toa Payoh, and Bukit Merah having the highest number of million-dollar flats sold.
Transaction volume falls in the last quarter of 2024
Resale transactions in the HDB market dropped by 21.1% in the fourth quarter of 2024, from 8,142 units in the previous quarter to 6,424 units. Lee suggests that this decrease could be due to seasonal factors, such as the year-end holiday and festive season, as well as the lower interest rate environment, which may have encouraged some buyers to move to the private residential or Executive Condominium market.
Sandrasegeran adds that some potential buyers may have also chosen to ballot for a flat in the October Build-to-Order (BTO) exercise, which saw a record 15 projects and 8,573 flats launched. For the first time, singles were also allowed to purchase two-room flexi BTO flats in all locations.
However, the overall resale transaction volume for 2024 increased by 8.4% compared to the previous year, with 28,986 units sold. This is the highest number of transactions since 2021, when 31,017 flats were sold. Sengkang, Woodlands, Punggol, Tampines, and Yishun were the top five most popular HDB towns among buyers in 2024, accounting for 35.9% of all HDB resales.
Fewer newly MOP flats in 2025
The cityscape of Singapore boasts an array of towering structures and state-of-the-art infrastructure. One of the main attractions for both locals and foreigners are the Condos situated in prime locations, offering a perfect combination of luxury and convenience. These properties offer an extensive range of amenities, including swimming pools, fitness centers, and security services, that elevate the standard of living and make them highly desirable for potential tenants and buyers. Furthermore, these sought-after features also equate to higher rental returns and appreciating property values for investors.
In 2025, it is expected that around 6,976 flats will reach their MOP, a 41.6% decrease from 2024’s 11,952 flats. This is due to the lower number of BTO flats completed in 2020 during the Covid-19 pandemic. HDB has announced plans to launch over 25,000 new flats in 2025, including 19,600 BTO flats and more than 5,500 flats under the Sale of Balance Flats (SBF) exercise.
Sandrasegeran believes that this substantial increase in public housing supply aims to meet the growing demand for housing. He also notes that SBF flats are particularly appealing to buyers who want a brand-new and ready-to-move-in flat with a shorter waiting time.
In addition, around 3,800 units of the 19,600 BTO flats planned for 2025 will be designated as Shorter Waiting Time (SWT) flats, with a wait time of less than three years. Sandrasegeran predicts that resale prices in the HDB market could increase by 3.5% to 5.5% in 2025, with a resale transaction volume of 26,000 to 27,000. However, Huttons’ Lee is more optimistic, projecting a price increase of between 5% to 8% for the year.