HDB Flash Estimates released on January 2nd revealed a 2.5% increase in resale flat prices in the fourth quarter of 2024, slightly slower than the 2.7% growth seen in the previous quarter. This marks the 19th consecutive quarter of price increases in the HDB resale segment.
According to Christine Sun, Chief Researcher and Strategist at OrangeTee Group, the flash estimates show a 9.6% increase in HDB resale prices in 2024, double the 4.9% growth seen in the previous year. However, this growth is still slower compared to the 10.4% increase in 2022 and 12.7% in 2021.
OrangeTee also notes that based on HDB caveat data, there has been a slowdown in price growth for certain flat types. For example, the median price of four-room flats saw a 2.5% increase in the fourth quarter of 2024, compared to a 3.4% growth in the third quarter.
Similarly, two-room flats saw a 2% increase in the fourth quarter, slower than the 3.9% growth in the previous quarter. Executive flats also registered a 1.2% increase in the fourth quarter, compared to 1.7% in the third quarter. However, prices for five-room flats saw a faster growth of 3.2% in the fourth quarter, compared to a 1.2% increase in the third quarter.
Resale volume in the fourth quarter of 2024 also showed a decline of 3.6% year-on-year, with 6,314 units sold compared to 6,547 units in the same period in 2023. This was also a 22.5% decrease from the 8,142 units sold in the previous quarter.
OrangeTee attributes this decline to HDB’s launch of over 8,500 new flats in the October Build-to-Order (BTO) exercise, which drew demand away from the resale market. The seasonal year-end school holidays also contributed to a decrease in house viewings and sales activities.
However, Wong Siew Ying, Head of Research and Content at PropNex, believes that the slower growth in the fourth quarter of 2024 is due to government intervention in August 2024 when the loan-to-value (LTV) limit for HDB loans was reduced by five percentage points to 75%. This may have affected sales and slowed down the growth in resale prices.
In 2024, the total resale volume reached 28,876 units, a 8% increase from the 26,735 units sold in 2023 and 27,896 units in 2022. However, it is still lower than the peak of 31,017 units in 2021.
The total number of million-dollar flat transactions also saw a decrease in the fourth quarter of 2024 to 283 units from 331 units in the previous quarter. Despite this, the total number of million-dollar transactions reached a record high of 1,033 units in 2024, more than double the 469 units in the previous year.
According to OrangeTee, Toa Payoh recorded the highest number of million-dollar transactions in the fourth quarter of 2024, with 58 transactions. This was followed by 20 transactions for four- and five-room units at Alkaff Vista in Bidadari Park Drive, which had recently crossed the five-year minimum occupation period (MOP).
Eugene Lim, Key Executive Officer of ERA Singapore, believes that the new Plus and Prime classification for BTO flats may have driven buyers to seek out HDB resale homes in central locations. These buyers may not be willing to accept the resale restrictions such as a 10-year MOP, rental restrictions after MOP, subsidy clawback upon resale, and resale income cap on future buyers.
Looking ahead, OrangeTee expects HDB resale prices to continue rising in 2025, but at a slower pace than in previous years. This is due to prices already reaching new highs in many areas, creating affordability concerns for potential buyers. The ongoing supply of BTO flats is also expected to help moderate price growth in the secondary market.
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In February 2025, HDB will launch its largest Sale of Balance Flats (SBF) exercise, offering more than 5,500 flats across various towns. PropNex projects that HDB resale flat prices may rise 5% to 7% in 2025, supported by a forecast of 29,000 to 30,000 units being sold by the end of the year.
ERA predicts a 3% to 6% growth in HDB resale prices, with 26,000 to 27,000 units being sold in 2025. Huttons also expects HDB resale prices to grow at a slower pace of 5% to 8%, with 26,000 to 28,000 units being sold in 2025. The supply of BTO flats in 2025 is expected to be lower than in 2024, which may drive more buyers to the resale market. With interest rates potentially going lower in 2025, some buyers may also set their sights on executive condos or resale condos.