SINGAPORE: Resale prices for Housing and Development Board (HDB) flats in Singapore continued their upward trajectory, reaching new heights in January.

The market witnessed a notable surge in million-dollar flats and an unprecedented demand for larger homes, contributing to the acceleration of resale price growth. Property analysts say the primary catalyst behind rising resale prices is the strong demand for larger HDBs.

Christine Sun, Chief Researcher and Strategist at OrangeTee & Tie told Singapore Business Review (SBR) that last month’s 1.5% month-on-month (MoM) uptick in HDB resale prices marked the first time in nine months that price growth exceeded the 1% mark, since April 2023.

Ms Sun pointed out that the surge in demand for larger rooms was a key factor driving the overall price increase. In particular, the resale prices of five-room flats experienced a substantial 2.1% MoM jump in January.

The volume of transactions for five-room HDB flats in the secondary market also soared by a third, reaching 608 units – the highest since September 2022.

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“The demand surge for 5-room flats was within expectations as we had earlier anticipated that demand for large flats would likely rise this year,” noted Ms Sun.

She attributed this trend to the completion of the 15-month wait-out period for private residential property owners, who intended to transition to HDB resale flats, starting in January.

Mark Yip, CEO of Huttons Asia, added that higher sales of million-dollar flats further fueled the resale market. In January alone, 74 HDB flats surpassed the $1 million mark, marking the city-state’s highest monthly tally of million-dollar flats.

Looking ahead, Mr Yip told SBR that he expects the momentum to continue, projecting more than 500 HDB resale flats to be transacted in 2024, surpassing the 470 units resold in the previous year.

Recent data from 99-SRX revealed that HDB resale prices rose by 1.5% MoM and 5.7% year-on-year (YoY) in January.

The data also detailed that prices increased across different room types, with five-room flats leading the way with a 2.1% MoM price jump. Three-room, four-room, and executive prices increased by 1.7% MoM, 0.9% MoM, and 0.8% MoM, respectively.

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Sales volume experienced a significant uptick in January, with 2,629 HDB resale units transacted, reflecting a 30.8% MoM increase. Year-on-year, the resale volume in January 2024 was 2.1% higher.

In terms of transactions by room type, 4-room flats dominated with 45.6%, followed by 3-room (24.1%), 5-room (23.8%), and executive flats (6.5%).

Non-mature estates accounted for the majority of transactions at 62.3%, with mature estates making up the remaining 37.7%.