11 January 2025As per the flash estimates released on Jan 2 by the Housing & Development Board (HDB), the resale flat prices saw a q-o-q growth of 2.5% in 4Q2024, a slightly slower pace compared to the preceding quarter’s growth of 2.7%. This marks the 19th consecutive quarter of price increases in the HDB resale market. The data also shows that HDB resale prices escalated by 9.6% in 2024, which is twice the growth registered in 2023. However, this growth was slower as compared to the 10.4% jump in 2022 and the 12.7% increase in 2021, according to Christine Sun, the chief researcher and strategist at OrangeTee Group. According to the HDB caveat data downloaded from data.gov.sg at around 8.15 am on Jan 2, there was a decline in the price growth of some flat types in the 4Q2024, as noted by OrangeTee. As per the data, the median price of four-room flats increased by 2.5% q-o-q in 4Q2024, which was sluggish as compared to the growth of 3.4% seen in 3Q2024. In the same way, two-room flats escalated by 2% q-o-q in 4Q2024, which was slower than the 3.9% rise in 3Q2024. Executive flats had a price increase of 1.2% q-o-q in 4Q2024, which was 1.7% in the previous quarter. The only exception was for five-room flats, which showed a growth of 3.2% in 4Q2024, while it was only 1.2% in 3Q2024.A decline of 3.6% y-o-y was noticed in resale volume in 4Q2024Resale volume declined by 3.6% y-o-y in 4Q2024, which lowered from 6,314 units in 4Q2023 to 8,142 units in 3Q2024. Compared to the sales in 3Q2024, there was a 22.5% fall in sales in 4Q2024, which was 8,142 units in 3Q2024. Sun believes that the HDB resale transactions have come down due to the launch of more than 8,500 new flats by HDB during the October Build-to-Order (BTO) exercise. These units were in strategic locations like the prime and desirable locations, making them tempting to potential buyers. This caused the demand to shift from the resale market to the BTO market, as stated by her. During the year-end school holidays, a decrease in sales activities and house viewings is a usual phenomenon due to the traveling plans of Singaporeans. Wong Siew Ying, who is the head of research and content at PropNex, states that slower price growth was experienced in the 4Q2024 due to government intervention in 2024. This was when the housing loan limit for HDB was reduced by 5% to 75%. Regarding the resale market growth in 4Q2024, Wong believes that it was the result of the August 2024 measures, which would be evident in the market. Additionally, the reduced number of sales during this time also seemed to have impacted the prices as well. However, the resale volume of the HDB has recorded an increase of 8% in 2024 as compared to 2023. The resale volume this year witnessed a considerable increase of 27,896 units, lower than the 31,017 units recorded in 2021.The decline in the number of million-dollar flat transactions in 4Q2024The declining resale transactions in 4Q2024 led to a fall in million-dollar flat transactions as well, which recorded 283 units in 3Q2024, declining from 331 units in 4Q2023. However, Sun pointed out that 2024 showed a record high of 1,033 transactions. This was a staggering figure, more than double the previous year, which had only 469 transactions, as per Sun. Toa Payoh town had the highest number of million-dollar deals in 4Q2024, and out of the 58 transactions, 20 were of four- and five-room units at Alkaff Vista in Bidadari Park Drive. While agreeing with Sun, Eugene Lim, who stands as the key executive officer of ERA Singapore, believes that the new Plus and Prime classification BTO flats in central locations drew more home buyers to look for HDB resale homes. These buyers were not open to accepting resale restrictions like a 10-year minimum occupation period (MOP), rental restrictions after MOP, subsidy clawback upon resale, and the resale income cap on future buyers. Sun believes that HDB resale prices will continue to rise in 2025, but at a slower pace as compared to past years. Prices have already peaked in many areas, which is a matter of concern for prospective buyers. Additionally, as predicted by Sun, the continuous supply of BTO flats will check the price growth in the secondary market. However, it will depend on how many BTO flats the government will release in the next few years. In February 2025, the largest sale of balance flats (SBF) exercise is all set to be launched by HDB, which will offer more than 5,500 flats in various towns. Lee Sze Teck, the senior director of data analytics at Huttons Asia, believes that this will govern the market as many prospective buyers will be eyeing the resale market, as there is no upfront information about the BTO projects with a shorter waiting time. He believes that the year 2025 will see a decrease in prices, but the volume of resale transactions will remain steady at 26,000 to 28,000 units.
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