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SINGAPORE – Housing Board resale apartment prices rose for the third month in a row in September, and demand remained high after the nearly two-month blackout period.
HDB’s resale prices rose 0.8 percent in September compared to August, a faster rate than the previous two months, and were 3.1 percent higher year-on-year.
However, they were still 11.4% below their peak in April 2013.
In total, 2,489 HDB resale flats changed hands in September, an increase of 2.2 percent from August, flash estimates from real estate portal SRX showed on Thursday (October 8).
Year over year, the resale volume in September is 32.7% higher than the previous year.
September is also the fourth consecutive month that monthly sales surpassed 2,400 units and is above the two-year monthly average (between January 2018 and December 2019) of 1,842 units sold before the Covid-19 pandemic.
HDB’s resale market has posted the strongest quarterly sales since the third quarter of 2016, with 7,394 units sold from July to September, said OrangeTee & Tie director of research and consulting, Christine Sun.
“This indicates that the overall demand for the HDB resale market is generally healthy this year despite the period of disruptions, the economic slowdown and Covid-19,” he said. He added that the Hungry Ghost Festival failed to make a dent in housing demand this year as it did in previous years.
The lawsuit may have been fueled by young couples who turned to HDB’s resale flats after seeing the longer completion period of recently launched Build-To-Order projects, where some have a four- to five-year wait. said Ms. Sun.
“Some buyers are HDB upgraders who are turning to the HDB resale market due to price affordability,” he added.
Prices have also increased across the board for all HDB resale flat rates compared to a year ago.
Four-bedroom apartments posted the largest price increase of 2.7 percent, followed by three-bedroom and executive apartments by 2.5 percent, and five-bedroom apartments by 2.2 percent.
In September, the highest transaction price for a resale condo was $ 1.26 million for a five-bedroom condo at The Pinnacle @ Duxton in Tanjong Pagar. It was one of eight HDB resale floors that sold for at least $ 1 million that month.
Ms. Sun noted that this appears to be a “record high,” as the highest transaction price prior to this was $ 1.23 million for a five-bedroom HDB condo on Cantonment Road.
ERA Realty’s head of research and consulting, Nicholas Mak, said that the increase in HDB resale prices was supported by the proportionally higher number of new HDB apartments traded. The newest HDB floors are those with remaining leases of 90 years or more, including those that recently completed the five-year minimum occupancy period.
“These newer flats would normally be priced higher than the older flats in the vicinity, contributing to the increase in the price index,” Mak said.
Ms Wong Siew Ying, Head of Research and Content at PropNex, said: “Feedback from our realtors suggests that there is stiff competition for HDB resale units in the market, so prices should continue to find support in the coming months. We believe the HDB resale market has turned around and remains optimistic about its outlook for this year, despite the economic downturn caused by the pandemic. “
Mak estimated that around 22,500 to 23,500 HDB resale floors could change hands this year, which is roughly the average annual resale volume from 2017 to 2019.
The latest SRX report also showed that its overall median transaction over X-value (TOX) was $ 2,000 for HDB resale transactions in September, a drop of $ 1,000 compared to August.
The TOX median measures whether people are overpaying (in the case of positive TOX) or underpaying (when there is negative TOX) relative to the SRX computer generated estimated market value for flats.
Flats in Bukit Batok posted the highest median TOX of $ 6,500 positive, while flats in Bishan saw the lowest of $ 7,000 negatives.
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