Navigating the Shifting Tides of Singapore's HDB Resale Market

Navigating the Shifting Tides of Singapore's HDB Resale Market

The Singapore HDB resale market is at an intriguing crossroads. While the number of million-dollar HDB flat transactions reached a new high in the third quarter of 2023, the overall price growth has shown signs of slowing down. The confluence of these factors underscores a dynamic market landscape.

In the third quarter of 2023, HDB resale prices saw a modest uptick of 1.2% quarter-on-quarter, marking the 14th consecutive quarter of growth. This growth, although still positive, represents a deceleration when compared to the more robust 1.5% growth recorded in the second quarter and the 2.5% average quarterly growth observed in 2022. Moreover, the year-to-date price increase of 3.8% for the first nine months of 2023 pales in comparison to the 8% growth reported in the same period of 2022.

Several factors have contributed to this deceleration. One of the primary drivers is rising inflation, which has affected homebuyers' purchasing power as interest rates remained elevated for a longer period than anticipated. This environment is leading to a more cautious approach among consumers, who are showing resistance to further price hikes.

The market dynamics are quite diverse when examining different flat types. Four-room flats led the price growth, climbing 1.8% quarter-on-quarter. This upward trend was followed by executive flats, which registered a 1.2% price increase. However, the market is not uniform, and several towns saw average resale prices decline. For instance, Geylang experienced a notable 3.6% quarter-on-quarter drop, followed by the Central Area, Bukit Batok, and Sembawang.

Despite these varied price trends, HDB resale transaction volumes in the third quarter of 2023 rose 2.9% quarter-on-quarter, with 6,592 units changing hands. This growth can be attributed to an increase in grants provided to first-time buyers of HDB resale flats and a diversion of buyers to the resale market due to a delay in the August Build-To-Order (BTO) sales launch. However, on a year-on-year basis, transaction volume is still 9.7% lower than the third quarter of 2022.

When examining the types of flats being transacted, the proportion of sales shifted in the third quarter of 2023. Four-room flats saw a dip from 45.7% in the second quarter to 43.8%. Similarly, five-room flats decreased from 23.4% to 22.9%. Conversely, executive flats increased from 5.5% to 5.9%, two-room flats rose from 2.3% to 2.8%, and three-room flats grew from 23.1% to 24.6%.

The landscape is also shaped by location. Sengkang saw the highest transaction volume, followed by Punggol, Woodlands, Yishun, and Jurong West. Notably, the number of million-dollar resale flats reached a new record of 128 units, surpassing the previous quarterly high of 111 units in the third quarter of 2022.

Looking ahead, the HDB resale market is expected to be influenced by interest rate developments. The higher interest rates offered by local banks and the strict eligibility criteria for HDB loans are expected to impact affordability. With an increasing number of flats scheduled for sale in the BTO market, demand may be diverted from the resale market. Consequently, price growth is projected to be more moderate.

OrangeTee & Tie's forecast for 2023 suggests a full-year price growth ranging from 4% to 5.5% for HDB resale flats, a significant slowdown from the remarkable 12.7% growth in 2021 and the 10.4% growth in 2022. In terms of transaction volume, it is anticipated to decline slightly to about 26,000 to 27,000 units in 2023, compared to the 27,896 units recorded in 2022.

In conclusion, the Singapore HDB resale market is evolving as various factors reshape buyer preferences and influence pricing. Staying informed and adaptable will be key for buyers and sellers as they navigate these shifting tides.

Summary with Highlights:

  • HDB resale prices showed slower growth, up 1.2% in 3Q2023.
  • Million-dollar HDB flat transactions reached a record high of 128 units.
  • Some towns experienced declining average resale prices, such as Geylang and the Central Area.
  • Rising inflation and elevated interest rates are impacting buyer affordability.
  • More grants for first-time buyers and a delay in the August BTO sales launch boosted resale transaction volumes.
  • OrangeTee & Tie forecasts a more measured price growth of 4% to 5.5% for HDB resale flats in 2023.
  • Transaction volume is expected to slightly decline to about 26,000 to 27,000 units in 2023.
  • Buyers and sellers should stay informed and adaptable to navigate the evolving HDB resale market.

Call to Action: Are you considering entering the HDB resale market, or are you looking to make a move? With evolving dynamics, staying informed is crucial. Reach out for personalized insights and assistance in navigating the shifting landscape.


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