Singapore’s Housing and Development Board (HDB) resale market has experienced a deceleration in price growth for the second consecutive quarter, signaling a shift in the previously robust market dynamics.
Slowing Momentum in Resale Prices
In the first quarter of 2025, HDB resale prices increased by 1.5%, down from 2.6% in Q4 2024 and 2.7% in Q3 2024. This marks the slowest quarterly growth since Q4 2023, which saw a 1.1% increase.
The moderation in price growth is evident across various flat types:
- 4-room flats: Prices rose by 1.9% in Q1 2025, compared to 2.2% in the previous quarter.
- 5-room flats: Experienced a 2.1% increase, down from 2.7% in Q4 2024.
- 2-room flats: Saw a growth rate of 1.5%, a decrease from 2.3% in the preceding quarter.
- 1-room flats: Recorded a price drop of 3.3% in Q1 2025, following a 7.6% increase in Q4 2024.
- 3-room flats: Contrarily, these units posted a faster growth of 2.2% in Q1 2025.
- Executive flats: Registered a growth rate of 1.3% during the same period.
Factors Influencing the Market
Several elements contribute to this trend:
- Government Cooling Measures: In August 2024, the Loan-to-Value limit for HDB housing loans was reduced from 80% to 75%, aiming to promote financial prudence among buyers.
- Increased BTO Supply: HDB launched 21,225 new flats in 2024, including 19,637 Build-To-Order (BTO) units. An additional 5,000 BTO flats are set to be launched in February 2025, potentially diverting demand from the resale market.
- Buyer Caution: Economic uncertainties and rising mortgage rates have led buyers to adopt a more cautious approach, reassessing affordability and long-term implications.
Outlook for 2025
Analysts project that HDB resale prices will continue to grow in 2025, albeit at a more moderate pace of 4% to 6%, compared to the 9.6% increase in 2024. The number of flats reaching their Minimum Occupation Period (MOP) is expected to decline, potentially limiting supply and supporting prices.
The market for million-dollar flats remains robust, with expectations to surpass 1,000 transactions in 2025, driven by demand for larger units like lofts and maisonettes.
While the HDB resale market in Singapore shows signs of cooling, it continues to exhibit resilience. Buyers and sellers should stay informed about policy changes and market trends to make prudent decisions in this evolving landscape.
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