SINGAPORE: Prices of resale Housing and Development Board (HDB) flats rose 1.8 per cent in the first quarter of 2024, an increase from the 1.1 per cent growth seen in the previous quarter.
The Resale Price Index (RPI) for the first quarter of 2024 is 183.7, up from 180.4 in the previous quarter, according to data released by HDB on Friday (Apr 26).
The RPI reflects general price movements in the resale market.
Resale transactions also increased in the first quarter of this year, rising by 8 per cent compared to the fourth quarter of 2023. This is the fastest quarterly increase in more than a year.
Year-on-year, resale transactions rose by 1.3 per cent in the first quarter of 2024.
"On the whole, the HDB resale market is showing signs of stabilising, as HDB resale prices rose by 4.9 per cent in 2023, less than half of the 10.4 per cent increase in 2022 and the 12.7 per cent increase in 2021," the Housing Board said in a media release.
However, it advised prospective flat buyers to be prudent.
"The economic outlook is subject to uncertainties, particularly stemming from ongoing geopolitical conflicts, which could precipitate negative global supply and demand shocks," HDB said.
"Domestic mortgage rates are expected to remain at levels that are elevated relative to the low levels seen over the past decade.
"As such, households should continue to exercise financial prudence in their flat purchases."
Ms Christine Sun, chief researcher and strategist at OrangeTee, said that there has been a surge in demand for resale flats as more first-time buyers have opted to purchase flats from the secondary market instead of waiting for Build-to-Order (BTO) launches. Earlier this year, HDB announced that it would hold three instead of four BTO sales exercises in 2024.
"In addition, an increasing number of private property owners have now completed the mandatory 15-month wait-out period implemented in September 2022 for those looking to downgrade to a resale flat," she said. "This could have led to a surge in flat demand."
The demand for big flats in particular would have been pushed up by this, she added.
There were 7,068 resale transactions in the first quarter of 2024, compared to the 6,547 transactions in the fourth quarter of 2023.
The 8 per cent increase is the fastest quarterly increase since the third quarter of 2022, when growth of 10.7 per cent was recorded, Ms Sun said.
"This is also the highest Q1 sales growth recorded since data was (made) available from Q2 2007," she added.
In the rental market, the number of approved applications to rent out HDB flats fell by 4 per cent from 9,787 cases in the fourth quarter of 2023 to 9,398 cases in the first quarter of this year.
Compared to the first quarter of 2023, the number of approved applications in the first quarter of 2024 was 2.7 per cent lower.
As of the end of the first quarter of 2024, there were 58,355 HDB flats being rented out, an increase of 0.3 per cent over the previous quarter's 58,159 units.
"Rental volume has dipped for a second consecutive quarter which is unsurprising as demand usually slows at the end of the year and beginning of a new year," said Ms Sun.
"Moreover, supply has been dwindling since the number of flats that reached (their minimum occupation period) dropped last year and is projected to fall further this year."
She added that rental inventory may also have shrunk since the increase in additional buyer's stamp duty for buyers holding multiple properties, which "has discouraged homeowners from keeping their flats for rental income".
"Moving forward, demand may shrink as some tenants may shift to the private market since private rents have been moderating over the past six months," Ms Sun said.
"Rental price growth is projected to hold steady or dip by up to 3 per cent this year."
In its next sales exercise, HDB will offer about 6,800 BTO flats in Jurong East, Kallang-Whampoa, Queenstown, Tampines, Woodlands and Yishun.
More details on the launch numbers and project details will be provided closer to the launch date.
In the February 2024 BTO and Sale of Balance Flats exercises, HDB offered 4,126 flats across seven BTO projects and 1,588 balance flats.
HDB plans to launch about 19,600 BTO flats in total this year.
"As of February 2024, we have launched more than 67,000 flats and remain on track to launch a total of 100,000 flats from 2021 to 2025," HDB said.
"We will continue to closely monitor the housing demand and make adjustments as necessary."
Resale flats in mature estates are expected to see stronger demand and a steeper rise in prices this year, said ERA Singapore key executive officer Eugene Lim.
"In particular, those located in proximity to amenities and transport nodes which are not affected by the stringent resale conditions for the upcoming Prime and Plus flats are highly sought after by buyers," he said.
Resale demand in general could, however, ease slightly this quarter.
"The June BTO exercise is expected to be well-received by prospective buyers, as it will be the last batch of BTO flats unaffected by the upcoming reclassification framework," Mr Lim said.
"Coupled with the June school holidays, we may see a slight dip in resale demand in ... Q2 2024."
Mr Lim added that some buyers are waiting to see where the upcoming BTO projects slated for launch in October are before they decide on whether or not to buy a resale flat.
"These 9,700 flats will be the first batch of flats to be launched under the reclassification model," he said.
Mr Lim said that the total resale transaction volume for 2024 could come in at between 26,000 and 27,000 units, barring any unforeseen circumstances.
Ms Sun expects resale prices to "rise moderately by up to 5 per cent in 2024".
"This increase is comparable to, or slightly lower than, the 4.9 per cent growth observed in 2023," she said.
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The Resale Price Index (RPI) for the first quarter of 2024 is 183.7, up from 180.4 in the previous quarter, according to data released by HDB on Friday (Apr 26).
The RPI reflects general price movements in the resale market.
Resale transactions also increased in the first quarter of this year, rising by 8 per cent compared to the fourth quarter of 2023. This is the fastest quarterly increase in more than a year.
Year-on-year, resale transactions rose by 1.3 per cent in the first quarter of 2024.
"On the whole, the HDB resale market is showing signs of stabilising, as HDB resale prices rose by 4.9 per cent in 2023, less than half of the 10.4 per cent increase in 2022 and the 12.7 per cent increase in 2021," the Housing Board said in a media release.
However, it advised prospective flat buyers to be prudent.
"The economic outlook is subject to uncertainties, particularly stemming from ongoing geopolitical conflicts, which could precipitate negative global supply and demand shocks," HDB said.
"Domestic mortgage rates are expected to remain at levels that are elevated relative to the low levels seen over the past decade.
"As such, households should continue to exercise financial prudence in their flat purchases."
Ms Christine Sun, chief researcher and strategist at OrangeTee, said that there has been a surge in demand for resale flats as more first-time buyers have opted to purchase flats from the secondary market instead of waiting for Build-to-Order (BTO) launches. Earlier this year, HDB announced that it would hold three instead of four BTO sales exercises in 2024.
"In addition, an increasing number of private property owners have now completed the mandatory 15-month wait-out period implemented in September 2022 for those looking to downgrade to a resale flat," she said. "This could have led to a surge in flat demand."
The demand for big flats in particular would have been pushed up by this, she added.
There were 7,068 resale transactions in the first quarter of 2024, compared to the 6,547 transactions in the fourth quarter of 2023.
The 8 per cent increase is the fastest quarterly increase since the third quarter of 2022, when growth of 10.7 per cent was recorded, Ms Sun said.
"This is also the highest Q1 sales growth recorded since data was (made) available from Q2 2007," she added.
| Quarter | Resale Price Index | % Change |
| Q1 2024 | 183.7 | 1.8 |
| Q4 2023 | 180.4 | 1.1 |
| Q3 2023 | 178.5 | 1.3 |
| Q2 2023 | 176.2 | 1.5 |
| Q1 2023 | 173.6 | 1.0 |
RENTALS
In the rental market, the number of approved applications to rent out HDB flats fell by 4 per cent from 9,787 cases in the fourth quarter of 2023 to 9,398 cases in the first quarter of this year.
Compared to the first quarter of 2023, the number of approved applications in the first quarter of 2024 was 2.7 per cent lower.
As of the end of the first quarter of 2024, there were 58,355 HDB flats being rented out, an increase of 0.3 per cent over the previous quarter's 58,159 units.
"Rental volume has dipped for a second consecutive quarter which is unsurprising as demand usually slows at the end of the year and beginning of a new year," said Ms Sun.
"Moreover, supply has been dwindling since the number of flats that reached (their minimum occupation period) dropped last year and is projected to fall further this year."
She added that rental inventory may also have shrunk since the increase in additional buyer's stamp duty for buyers holding multiple properties, which "has discouraged homeowners from keeping their flats for rental income".
"Moving forward, demand may shrink as some tenants may shift to the private market since private rents have been moderating over the past six months," Ms Sun said.
"Rental price growth is projected to hold steady or dip by up to 3 per cent this year."
6,800 BTO FLATS TO BE LAUNCHED IN JUNE
In its next sales exercise, HDB will offer about 6,800 BTO flats in Jurong East, Kallang-Whampoa, Queenstown, Tampines, Woodlands and Yishun.
More details on the launch numbers and project details will be provided closer to the launch date.
In the February 2024 BTO and Sale of Balance Flats exercises, HDB offered 4,126 flats across seven BTO projects and 1,588 balance flats.
HDB plans to launch about 19,600 BTO flats in total this year.
"As of February 2024, we have launched more than 67,000 flats and remain on track to launch a total of 100,000 flats from 2021 to 2025," HDB said.
"We will continue to closely monitor the housing demand and make adjustments as necessary."
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MARKET OUTLOOK
Resale flats in mature estates are expected to see stronger demand and a steeper rise in prices this year, said ERA Singapore key executive officer Eugene Lim.
"In particular, those located in proximity to amenities and transport nodes which are not affected by the stringent resale conditions for the upcoming Prime and Plus flats are highly sought after by buyers," he said.
Resale demand in general could, however, ease slightly this quarter.
"The June BTO exercise is expected to be well-received by prospective buyers, as it will be the last batch of BTO flats unaffected by the upcoming reclassification framework," Mr Lim said.
"Coupled with the June school holidays, we may see a slight dip in resale demand in ... Q2 2024."
Mr Lim added that some buyers are waiting to see where the upcoming BTO projects slated for launch in October are before they decide on whether or not to buy a resale flat.
"These 9,700 flats will be the first batch of flats to be launched under the reclassification model," he said.
Mr Lim said that the total resale transaction volume for 2024 could come in at between 26,000 and 27,000 units, barring any unforeseen circumstances.
Ms Sun expects resale prices to "rise moderately by up to 5 per cent in 2024".
"This increase is comparable to, or slightly lower than, the 4.9 per cent growth observed in 2023," she said.
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