The resale market for public housing flats in Singapore experienced a significant uptick in the second quarter of 2024. According to data from the Housing and Development Board (HDB), resale prices grew by 2.3% over the previous quarter, driven by stronger demand amidst limited supply and global economic uncertainties. This growth rate exceeded the earlier estimate of 2.1% released on July 1.

Strong Price Growth and Increased Transaction Volumes

The 2.3% rise in Q2 follows a 1.8% increase in the first quarter and surpasses the 1.5% growth observed in Q2 2023.

On a year-on-year basis, resale prices climbed by 6.6%, outpacing the 6% price growth seen in private residential properties.

Notably, resale flat prices have surged by 43.7% since their lowest point in Q2 2019.

The number of resale transactions also increased, rising by 4% in Q2 to 7,352 units from 7,068 units in the previous quarter, marking a 12.9% year-on-year increase.

This resulted in a price growth of 4.2% for the first half of 2024 and a total transaction volume of 14,420 units, up 6.9% from the same period last year.

Older resale HDB Flats remain attractive

The number of resale flats that are at least 40 years old hit a new high, with 3,042 transactions in the first half of the year, according to data from the Housing and Development Board (HDB). This surpasses the previous first-half record of 2,412 units during the same period last year.

Although newer flats—those less than 10 years old—still command higher prices, the price difference between newer and older flats has narrowed over the past year.

Older flats are becoming a larger share of total resale transactions, accounting for 22 percent of the 13,838 transactions in the first half of 2024. This trend continues even as local residents remain aware of the diminishing leases on older flats.

Factors Driving Demand

Analysts attribute the price and sales volume hikes to robust demand for resale flats, particularly in mature estates.

Demand in these areas surged by 18.9% year-on-year in Q2, with 2,833 transactions recorded.

Buyers are particularly attracted to resale flats in mature estates because these flats are not subject to the stringent resale conditions and subsidy clawbacks of future Build-To-Order (BTO) homes, which will fall under the new Plus or Prime categories starting in H2 2024. The new BTO classification system will offer more subsidies for Plus and Prime flats but will also impose strict resale restrictions.

Economic Uncertainties and Supply Constraints

Economic uncertainties and job security concerns have also contributed to the increased demand, as some homebuyers who previously considered private residential properties opted for HDB resale flats instead. 

The supply of resale flats has been tight, with fewer new flats meeting the minimum occupation period (MOP) this year. This reduction in available resale stock has put upward pressure on prices amid strong demand.

Higher Demand for Larger HDB Flats

There were 4,214 transactions for five-room and executive flats in H1 2024, representing a 9.3 percent increase from the 3,854 units sold in H1 2023.

A growing number of private homeowners, having completed the 15-month wait-out period required to purchase a resale flat, may have contributed to the strong demand for larger flats.

In Q2, 236 million-dollar resale flats were sold, a nearly 30% increase from the previous quarter's 183 units.

Outlook for the Resale Market

PropertyforSale Managing Director, JT Chia, forecasts that HDB resale volumes will reach 26,000 and resale prices could increase by at least 7 percent this year, driven by strong demand for resale flats and steady price growth.

This trend is expected to continue as buyers seek to secure their homes amid economic uncertainties and evolving housing policies.