on Dec 23, 2024
On Jan 2, HDB released flash estimates indicating that resale flat prices rose by 2.5% q-o-q in 4Q2024. This represents a slight decrease from the 2.7% q-o-q growth seen in the previous quarter, making it the 19th consecutive quarter of price increases in the HDB resale segment.
The flash estimates also suggest that the median sale price of HDB resale flats has grown by 9.6% in 2024, which is twice the growth seen in 2023 (4.9%). However, this figure remains slightly lower than the 12.7% increase in 2021 and the 10.4% growth in 2022. According to Christine Sun, Chief Researcher and Strategist at OrangeTee Group, the slower pace of growth in 4Q2024 is largely due to the measures implemented by the government in August 2024, where the loan-to-value (LTV) limit for HDB loans was reduced from 80% to 75%.
Based on data downloaded from data.gov.sg on Jan 2 at 8.15am, HDB caveat data shows a slowdown in price growth for certain flat types. For example, the median price for four-room flats increased by 2.5% q-o-q in 4Q2024, a slower rate compared to the 3.4% growth seen in 3Q2024. Similarly, two-room flats saw a 2% q-o-q increase in 4Q2024, compared to a 3.9% growth in the previous quarter. Executive flats also saw a slower growth rate, with a 1.2% q-o-q increase in 4Q2024, compared to the 1.7% growth recorded in 3Q2024. On the other hand, five-room flats saw a faster growth rate of 3.2% in 4Q2024, up from the 1.2% increase in 3Q2024.
The resale volume for HDB flats saw a 3.6% y-o-y decline in 4Q2024, with a total of 6,314 units sold, down from 6,547 units in 4Q2023. This is also a 22.5% q-o-q decline from the 8,142 units sold in 3Q2024. Sun attributes this decline to the launch of over 8,500 new flats in the October Build-to-Order (BTO) exercise, especially those in prime and desirable locations. She also notes that the peak year-end school holidays, where many Singaporeans travel overseas, may have contributed to the decrease in house viewings and sales activities.
According to Wong Siew Ying, Head of Research and Content at PropNex, the stricter measures implemented by the government in August 2024 have also played a role in the slower pace of growth in 4Q2024. She believes that the reduced resale volume during this period may have also affected prices.
Resale volume for 2024 was at 28,876 units, an 8% increase from the 26,735 units recorded in the previous year, but lower than the 31,017 units sold in 2021. Out of all the transactions recorded in 2024, 1,033 units were million-dollar flats, more than double the 469 million-dollar transactions recorded in the year before.
In 4Q2024, the number of million-dollar transactions dropped to 283 units from 331 units in 3Q2024. Despite the decline, the total number of million-dollar transactions in 2024 reached a record high of 1,033 units. Sun points out that approximately 20 of the 58 million-dollar resale flat transactions in Toa Payoh were for four- and five-room flats in Alkaff Vista, Bidadari Park Drive, which had recently passed the five-year minimum occupation period (MOP).
Eugene Lim, Key Executive Officer at ERA Singapore, believes that the new classification of Plus and Prime classification BTO flats may have driven more homebuyers to seek out HDB resale homes in central locations, as these buyers are not willing to accept the resale restrictions. Sun believes that the ongoing supply of BTO flats will help to moderate price growth in the secondary market, but the actual amount of price stabilisation will depend on the number of BTO flats released in the upcoming years.
PropNex expects the resale market to perform well in 2025, backed by a strong demand for housing and fewer MOP flats entering the market. Wong predicts a 5% to 7% increase in resale prices and a total of 29,000 to 30,000 units sold by the end of 2025. Similarly, ERA predicts a more measured pace of growth, with a 3% to 6% increase in resale prices and approximately 26,000 to 27,000 units sold. Huttons projects a slower growth rate of 5% to 8%, with approximately 26,000 to 28,000 units sold.