Housing and Development Board (HDB), resale price continued to increase in the fourth quarter of 2023. However, it was at a slower rate of 1%, as compared to a 1.3% in Q3.

According to HDB’s flash data released on Tuesday, the Q4 growth in resale prices was lower than the quarterly average growth of 2.5% for 2022.

The increase of 4.8% for the full year was significantly less than the 10.4% increase in 2022 or the 12.7% increase in 2021.

The implementation of cooling measures by September 2022 has reduced the pace of growth of HDB resale price, with quarterly price increases never exceeding 2 percent in 2023.

This is an interesting trend, given that each quarter’s price growth has been more than 2 or 3 percent between Q4 2020 to Q4 2022.

HDB flats that sold for seven figures were responsible for the buoyant HDB prices.

He said that first-time buyers, HDB upgraders and those looking for private properties were the ones who sought these “million-dollar flats” but were priced out of a market that was recovering from the pandemic.

These buyers were looking for homes larger than 1,000 square feet. These buyers were looking for private homes larger than 1,000 square feet.

PropNex data shows that 134 flats sold for at least S$1,000,000 during the fourth quarter brought the total for 2023 to 470. This is approximately 26.8 percent higher than the 369 transactions that took place in 2022.

Experts expect that the number will continue to rise as more homebuyers look for better locations. The number of private property owners looking to “downgrade”, and who have completed the 15-month waiting period from last year, may start to trickle into the resale markets and be able to pay more.

Prices for various types of flats grew at a moderate rate. Prices rose by less than 1% in Q4 compared to Q3.

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The average price for resale four-room apartments rose by 0.7 percent to S$594,212 in Q4 2023. For three-room and 5-room flats, the price increased by 0.6 percent to S$415491, and S$693,846.

The fourth quarter’s resale volume dropped by 2.3 percent to 6,440 units, the lowest since 2020.

Rescheduled Build-To-Order flat launches from August to October or December may have diverted some attention away the resale marketplace.

BTO launches were held in Q4 and saw 24,346 applicants compete for 12,857 BTO apartments

Reclassification of BTO apartments as Standard, Plus or Prime from the second half 2024 onwards may have other implications. Plus and Prime flats are subject to resale restrictions, a longer MOP and subsidy clawbacks.

Some buyers may have been tempted to apply for BTO apartments before these changes were enacted.

The total volume of resale cases for the entire year up to December 28, 2023 was 26,628. This is a decrease of 3.8 percent from the 27,686 cases recorded the previous year.

As more people moved into new homes, they began to list their flats for sale.

Resale flats in mature estates are seeing resilient demand. The number of resale apartments is decreasing and they are selling quickly.

In the non-mature estates there are more flats for sale, and some units take a longer time to be sold.

Bukit Merah (HDB town), Toa Payoh (HDB town) and Kallang/Whampoa (HDB town) were the three HDB towns that had the most million-dollar flats. According to Huttons, these towns will account for 36.5% of all million-dollar flats transactions in 2023.

HDB has launched 22,780 BTO apartments for sale by 2023. The total number of flats sold was 24,447, including 1,500 flats under the Sale of Balance Flats and 167 flats offered through its open booking of apartments.

HDB reported that the median first-timer applications rates for BTO flats with three rooms and larger units are easing. In Q4 2023, the median application rate of first-time buyers in three-room units fell to 0.9 and for larger units it was 0.8. The rate varied from 2 to 68% during the pandemic (2020-2022).

HDB is offering around 4,100 flats this February in Bedok and Queenstown.

OrangeTee & Tie estimate that the government may launch an additional 37,000 apartments to meet its target of 100,000 flats between 2021 and 2025. This may cause some demand to shift away from the resale markets. From 2021 to the end of 2023, over 63,000 BTO apartments were sold.

A significant fall in resale values is unlikely to occur in the near future despite the increased competition on the BTO market. Prices in some locations will be supported by the scarcity of MOP apartments.

The number of apartments that have reached their MOP after five years and are potentially ready to enter the resale marketplace has decreased from 30,920 units by 2022, to 15,549 in 2023. The MOP is expected to drop further to 11,952 in 2024.