HDB flats originally bought for $500,000 are now being sold twice the price

The rise in the number of million-dollar HDB flats made the news recently; getting featured in a Reuters article published in different countries.

Shortages due to the Covid-19 pandemic caused the demand to increase, which has in turn led to higher prices.

In July, a 5-room HDB flat at SkyTerrace @ Dawson was sold for an all-time high of $1.418 million, surpassing the record set in May by another 5-room flat, and this time at City Vue @ Henderson, set the all-time high record, which sold for S$1.4 million.

The Reuters article noted that hundreds of HDB flats are being sold for over one million dollars, leading to talk that the government may impose cooling measures.

It also noted that the resale market has emerged, as ownership is transferable for both citizens and permanent residents.

“Some apartments originally purchased for around $500,000 are now fetching double that, depending on size and location,” the Reuters piece added.

And at least one realtor was quoted as saying that million-dollar HDB flats are here to stay. 

“There will always be people who like to live in central locations or larger spaces but unable to afford private condos. If you’re looking at private condo of similar size in the same location, the price could easily be $2.5 million,” said broker Clarence Long.

In 2021, 259 flats were sold for over $1 million, and as of last month, there have been around 230 for this year, according to official numbers.

And if the resale market is too pricey for some households, they can avail of HDB Built-To-Order (BTO) flats, which range from $300,000 to $700,000, but can come with a waiting period of at least five years. 

Recently, however, the Ministry of National Development and the Housing Development Board announced that a bigger supply of BTO flats is in the works, with more flats to be set aside for first-time homebuyers “in view of strong housing demand from this group and to increase their chances of securing their first homes.”

In a Bloomberg interview in June, Liu Thai Ker, the man behind Singapore’s Housing Development Board who is also known as “the architect of modern Singapore” expressed concerns over Singapore’s high property prices.

More and more properties in Singapore costing millions of dollars have been reported, as the property market has gotten pricier.

“I do worry that nowadays, public housing prices is really a business venture than actually solving the housing need. I feel that the implication may not be very good for the economic development of Singapore,” Mr Liu said. /TISG

Concerned residents talk to Pritam Singh about rising prices of HDB resale flats