HDB resale prices climb for fifth straight quarter but at slower pace: Flash data

Construction delays in new BTO flats have driven many families to turn to the secondary resale market, along with buyers who have downsized from private properties. 

Updated from : The Business Times, 2 July 2021

HOUSING Board resale prices climbed for the fifth consecutive quarter but eased from recent highs, flash estimates released on Thursday showed.

Resale prices rose 2.8 per cent in the three months to June this year from the previous quarter, compared with a 3 per cent rise in the first quarter.

Year on year, HDB resale prices were up by 10.8 per cent.

The slower price increase could be due to buyers’ resistance to paying more in cash over valuation, said Huttons Asia director of research Lee Sze Teck.

Last quarter’s HDB resale prices were just 2.1 per cent lower than their peak in the second quarter of 2013, said Christine Sun, real estate agency OrangeTee & Tie’s senior vice-president of research and analytics.

At the current pace of price growth and increased demand, prices are likely to reach the 2013 peak in the second half of this year, she added.

For the first half of this year, resale prices increased by 5.9 per cent, this was within her full-year estimates of 5-9 per cent, said Ms Sun.

Median prices of resale flats rose in 20 out of 26 towns, added Ms Sun.

Median resale prices rose the most in the central area, up 37.2 per cent to S$738,000, followed by S$520,000 in Marine Parade (up 14.8 per cent) and S$488,000 in Clementi (up 13.5 per cent). The construction delays in new Build-To-Order (BTO) flats drove many families to turn to the secondary resale market, along with buyers who have downsized from private properties, said Ms Sun.

“Due to the robust housing demand and supply shortage, bargains were fading and buyers have to move quickly if they spot a home that interests them, especially at popular locations. With many eager buyers willing to match the valuation of properties, prices of resale flats are creeping up in many areas,” she said.

An estimated 8 per cent fewer flats have changed hands in the second quarter of this year compared with the first quarter, said Huttons Asia chief executive Mark Yip.

All HDB towns, except for Bukit Merah, Choa Chu Kang and Marine Parade, saw a lower transacted volume, noted Mr Yip.

This was likely due to the tightened restrictions during Singapore’s phase two (heightened alert) in May and June, he added, although there is still keen interest in resale flats.

A total of 106 HDB flats were sold for at least S$1 million in the first half of this year, compared with 82 such deals in 2020 and 64 in 2019.

Mr Yip expects the number of million-dollar flat transactions to exceed 200 this year.

“While it may make headlines for the transacted value, such transactions are less than 1 per cent of the whole year transaction volume,” he said.

In August, HDB will launch about 4,900 BTO flats in Hougang, Jurong East, Kallang Whampoa, Queenstown and Tampines.

A further 3,100 to 3,600 BTO flats in Choa Chu Kang, Hougang, Jurong West, Kallang/Whampoa and Tengah will be offered in November.

HDB said it is monitoring the evolving Covid-19 situation and will make adjustments where necessary.