SINGAPORE – Housing Board resale flat prices rose for the 17th consecutive month, climbing at a faster pace of 1.3 per cent in November compared with October, according to flash data from real estate portals 99.co and SRX on Thursday (Dec 9).
Last month’s resale prices had lodged the highest monthly growth since February this year when price rose by 1.4 per cent, and were 13.8 per cent higher than in November 2020, data showed. Price hikes were seen in both mature and non-mature estates and across all flat types.
November also saw 29 HDB resale flats changing hands for at least $1 million, the highest number of million-dollar flats sold in a month, smashing the previous record of 26 such units in August.
The most expensive flat sold last month was a $1.268 million five-room Design, Build and Sell Scheme unit at City View @ Boon Keng.
The 29 million-dollar flats made up 1.1 per cent of last month’s total resale transactions.
This brings the total number of such flats to 223 in the first 11 months of this year, in what has already been a record year for million-dollar flats.
There were 82 million-dollar flats for the whole of last year.
November’s record high number of million-dollar resale flats sold comes in the same month as the launch of the first Build-To-Order (BTO) project under a new prime location public housing (PLH) model, which subjects buyers to stricter home ownership criteria.
ERA Realty head of research and consultancy Nicholas Mak said the stricter restrictions for the Rochor BTO flats under the PLH model may have “turned some potential buyers away from this type of flats to the resale market”, thus contributing to the increase in million-dollar HDB flats transactions.
The highest transaction price in non-mature estates was $970,000 for a five-room loft unit at Treelodge @ Punggol, the data from 99.co and SRX showed.
In recent years, only six units in Punggol have been sold for more than $900,000.
Property analysts are widely expecting the robust performance seen in the HDB resale market to continue into 2022, largely on the back of fears of further construction delays in BTO projects after the detection of the Omicron variant.
Mr Mak said the emergence of Omicron has shown that the Covid-19 pandemic will take much longer than expected to resolve, which may further boost prices of HDB resale flats.
“The increase in HDB resale flat prices is caused by the mismatch in supply and demand, which, in turn, is caused by the supply chain disruption and delays in the construction industry that are induced by the pandemic,” he said.
“Unless the construction delays of BTO flats are resolved, the mismatch can cause HDB resale flat prices to rise by 7 per cent to 12 per cent in 2022.”
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In November, a total of 2,586 HDB resale flats changed hands, an increase of 3.2 per cent from the month before.
Ms Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, said some buyers may have turned to the HDB resale market as the completion periods can be “quite long” for some of the new BTO launches, especially projects in the mature estates.
For example, the Rochor BTO project is expected to take around six years to be completed; and Queen’s Arc in Queenstown, from the August BTO sales exercise, is estimated to take more than five years to be ready.
HDB has said that the longer build time for these project is due to site constraints and the tall building heights.
The latest curbs on new applications for workers holding S Passes or work permits to enter Singapore via the vaccinated travel lanes may also have a knock-on effect on the construction time of ongoing BTO projects and may turn more people to the HDB resale market, said Ms Sun.
Some buyers may feel uncertain about the completion periods of BTO projects, as these “could be impacted” by the changes, she said.
She anticipates HDB resale flat prices to rise by 10 per cent to 12 per cent this year, with prices continuing to climb, although at a slower pace of between 8 per cent and 11 per cent next year as some price resistance sets in.
Official HDB data says resale prices rose 9.1 per cent for the first nine months of 2021, while data from SRX shows that prices gained 9.2 per cent in the year to November.
Huttons Asia chief executive Mark Yip expects this year’s price gains to potentially be more than 13 per cent, marking the best performance for the HDB resale market since 2010.