Friday, 25 October 2024
Produced by Research Department
Summary
(1) The HDB resale volume in 3Q 2024 marks the highest quarterly number of resale flats sold since 3Q 2021. However, the number of HDB flats rented out in 3Q 2024 declined 4.6% qoq to 9,118 flats, due to the strong supply of newly completed HDB flats this year.
(2) A record number of 331 million-dollar flats were transacted in 3Q 2024, accounting for a significant 4.1% of all resale flats sold during the 3-month period. It is the eighth consecutive quarter of increase in the number of transacted million-dollar flats.
(3) The HDB resale prices could rise by 9% to 10% this year, about double the 4.9% price appreciation in 2023, while an estimated 29,000 to 30,000 HDB resale flats could exchange hands this year, which is approaching the peak of 31,017 resale flats sold in 2021.
(4) As a result, the number of million-dollar flats transacted this year could reach an unprecedented 950 to 1,000 flats.
Introduction
The market for HDB resale flats continues to expand in the July to September quarter with prices, transaction volume and the number of million-dollar flats continuing its upward trajectory.
HDB resale price increased unabated
The pace of increase in the prices of HDB resale flats picked up in the third quarter of 2024 with a 2.7% quarter-on-quarter (qoq) increase. This is the fastest rate of quarterly price growth since 2Q 2022. Over the past nine months, the prices of resale public housing has risen by 6.9%, which is more than the 4.9% price appreciation for the whole of 2023.
HDB resale volume on the upswing
The number of HDB resale flats transacted increased to 8,142 in 3Q 2024, up from 7,352 in 2Q 2024. This represents a 10.7% qoq growth and a robust 21.6% year-on-year (yoy) increase.
The HDB resale volume in 3Q 2024 also marks the highest quarterly number of resale flats sold since the third quarter of 2021, when the property market activities started to recover after the Covid vaccination programme was implemented.
While HDB rental volume declines
Conversely, the number of HDB flats rented out by the individual flat owners in 3Q 2024 declined 4.6% qoq to 9,118 flats, after reaching its recent peak in the third quarter of 2023. This is on the heels of the rising number of HDB flats completed this year. In the first eight months of 2024, the authorities have completed the construction of 10,500 HDB flats in 15 BTO projects. By the end of this year, it would have completed a total of 18,000 flats.
As a result, the leasing demand from those who are waiting for the keys to their new flats has soften.
Burgeoning number of million-dollar flats
In the upper end of the HDB resale market, 331 HDB resale flats were sold for at least $1 million each in 3Q 2024, accounting for a significant 4.1% of all resale flats sold during the 3-month period, according on official numbers. This also marks a record high number of quarterly transacted million-dollar HDB flats, and the eighth consecutive quarter of increase in the number of transacted million-dollar flats.
Two of the most expensive HDB resale flats sold in the first nine months of this year were both located at Bukit Merah. One of the flats is at Boon Tiong Road, near the Tiong Bahru MRT Station and retail mall, while the other flat is situated above the 45th floor at City Vue @ Henderson. Both flats are less than 10 years old. Each of the HDB 5-room flat was sold for $1,588,000 in June 2024, which translate to an average price of $1,311 per square foot (psf).
A total of 750 million-dollar HDB resale flats transacted from January to September this year, accounting for 3.3% of the total number of HDB resale flats sold over the same period.
By comparison, there were 336 million-dollar HDB flats sold in the corresponding period in 2023, representing just 1.3% of the total HDB resale transactions over the 9-month duration last year. Notably, the 331 million-dollar HDB flats sold in 3Q 2024 alone has nearly matched the total number of million-dollar flats transacted in the first nine months of 2023.
Outlook for HDB resale market
Despite the government’s efforts to cool the public housing resale market by ramping up the supply of BTO flats and tightening the mortgage restrictions, the HDB resale prices and volume continue to expand so far this year.
At the current rate of expansion, the HDB resale prices could rise by 9% to 10% this year, which is about double the 4.9% price appreciation in 2023. At the same time, an estimated 29,000 to 30,000 HDB resale flats could exchange hands this year, which is approaching the peak resale volume of 31,017 HDB resale flats sold in 2021.
One consequence of the expanding HDB resale market is the number of million-dollar flats transacted this year could reach an unprecedented 950 to 1,000 flats, which will be another record in our public housing market that is waiting to be broken…again.
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