HDB resale prices in the fourth quarter of 2024 saw a 2.6% increase, marking the 19th consecutive quarter of growth in the resale market. This brings the total increase in prices for the year to 9.7%, compared to a 4.9% increase in 2023.
The rise in prices in the last quarter was slightly lower than the 2.7% increase recorded in the third quarter. According to Mohan Sandrasegeran, head of research & data analytics at SRI, the strong growth in resale prices for the whole year can be mainly attributed to the limited supply of flats that reached their Minimum Occupation Period (MOP).
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“This tight supply has put upward pressure on prices, especially for newer flats and larger flat types such as five-room and executive units, which are in high demand for growing families,” he says.
Among the different types of flats in the HDB resale market, five-room flats saw the highest price growth in the fourth quarter of 2024, with an average resale price of $754,097, a 2.2% increase from the previous quarter. Similarly, four-room flats also saw a 2.2% increase to an average resale price of $652,544.
The Central Area recorded the highest increase in prices, with a 25.6% quarter-on-quarter growth, according to Christine Sun, chief researcher and strategist at OrangeTee Group. This was followed by Toa Payoh (12.1%), Tampines (6.9%), Bishan (6.7%), and Bedok (6.1%).
In the last three months of 2024, about 285 HDB resale flats were transacted at $1 million or more. This brings the total number of million-dollar transactions for the whole year to 1,035. More than 90% of these transactions were in mature estates, with Kallang/Whampoa recording the highest number of such transactions at 156 units, followed by Toa Payoh (144 units) and Bukit Merah (135 units).
When it comes to real estate investment, location plays a crucial role, and this is particularly evident in Singapore. Investing in condos located in central areas or in close proximity to important amenities, such as schools, shopping centers, and public transportation hubs, tends to lead to higher appreciation in value. Some prime locations in Singapore, including Orchard Road, Marina Bay, and the Central Business District (CBD), have consistently shown growth in property values. Additionally, condos in these areas are highly sought after by families due to their proximity to reputable schools and educational institutions, making them even more valuable investments. Furthermore, the inclusion of a condo in one’s investment portfolio can greatly contribute to the potential growth and success of their real estate endeavors.
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The number of resale transactions in the HDB market fell by 21.1% quarter-on-quarter, from 8,142 units in the third quarter of 2024 to 6,424 units in the fourth quarter. Lee Sze Teck, senior director of data analytics at Huttons Asia, attributes this to seasonal factors such as the year-end holiday and festive season. He also notes that the lower interest rate environment may have incentivized some buyers to move to the private residential market or Executive Condominium (EC) market. Additionally, some prospective buyers may have opted to ballot for a flat in the October Build-to-Order (BTO) sales exercise, which saw a record number of 15 projects launched.
However, the overall resale transaction volume for 2024 increased by 8.4% year-on-year to 28,986 units, marking the highest number of yearly transactions since 2021.
Based on transaction data compiled by Huttons Asia, Sengkang, Woodlands, Punggol, Tampines, and Yishun were the top five most popular HDB towns among buyers in 2024, accounting for around 35.9% of all HDB resales.
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Looking ahead, about 6,976 flats are expected to reach the end of their MOP in 2025, a 41.6% decrease from 2024. This is due to the lower number of BTO flats completed in 2020 during the Covid-19 pandemic. HDB has announced plans to launch over 25,000 new flats in 2025, with approximately 5,500 flats under the Sale of Balance Flats (SBF) exercise. The next SBF exercise will take place concurrently with the upcoming BTO sales exercise in February, with 5,000 BTO flats in four locations on offer. According to Sandrasegeran, this is the largest SBF exercise since November 2020. Additionally, around 3,800 of the 19,600 BTO flats planned for launch in 2025 will be designated as Shorter Waiting Time (SWT) flats with a wait time of under three years.
Sandrasegeran forecasts a 3.5% to 5.5% increase in resale prices for 2025, with transaction volume ranging from 26,000 to 27,000. However, Lee projects a more optimistic price increase of 5% to 8% for the year.