HDB resale prices, transaction volumes see continued growth in November: SRX

29 HDB resale flats transacted for at least S$1 million in November 2021.

Dec 09, 2021

PRICES of HDB resale flats climbed for the 17th straight month in November 2021 while transaction volumes continued to see a steady uptrend, according to flash data released by real estate portal SRX on Thursday (Dec 9).

While November resale prices increased 1.3 per cent from the previous month, they were up 13.8 per cent on-year with price growth observed across all flat types as well as mature and non-mature estates.

There were 2,586 HDB resale transactions in November, representing a 3.2 per cent month-on-month rise and year-on-year growth of 10.9 per cent. 4-room HDB flats accounted for the largest proportion of transactions at 42 per cent, followed by 5-room and 3-room flats at 26.5 per cent and 21.5 per cent, respectively.

Some 29 HDB resale flats transacted for at least S$1 million, up from just 20 units transacted in October 2021. SRX said this marked the highest number of million-dollar flats ever sold in a month, accounting for 1.1 per cent of total resale volume for November 2021.

The latest figure brings the total number of million-dollar transactions for HDB resale flats in the year to date to 223, which is 209.7 per cent higher when compared to the same period last year.

A 5-room DBSS unit at City View @ Boon Keng was sold at nearly S$1.3 million, the highest transacted price for a resale flat in the month. Another 5-room premium apartment loft unit at Treelodge @ Punggol went for S$970,000, the highest transacted price among non-mature estates.

Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, is anticipating resale flat prices to rise by 10 to 12 per cent for the whole of 2021.

"Prices could climb further but at a slower pace of between 8 and 11 per cent next year due to the higher selling prices and some price resistance occurring at some locations. As prices continue to climb, the total resale volume may dip by around 13 per cent to between 25,000 and 27,000 units in 2022," she said in an e-mailed statement on Dec 9.

Sun is also expecting more million-dollar flat transactions as more flats are expected to reach their 5-year minimum occupation period. Based on her observations, some of these flats are located in mature estates Ang Mo Kio and Toa Payoh, which typically fetch higher resale prices.

She attributes the recent rebound in demand for HDB resale flats to long completion periods of recent build-to-order (BTO) flat launches, especially for projects in mature estates.

"Further, some construction firms have expressed concerns that their projects could be delayed further since employers are no longer allowed to make new applications for workers holding S Passes or work permits to enter Singapore via the Vaccinated Travel Lanes after Singapore imposed stricter measures on all travellers entering the country after detecting the Omicron variant. Some buyers may feel uncertain if the completion periods of BTO projects could be impacted by these changes."

Similarly, Huttons Asia's senior director of research Lee Sze Teck believes restrictions imposed on prime-location flats, as well as long construction periods, are responsible for diverting some demand to the resale market.

"Buyers bought flats in centralised locations, pushing up demand and prices in the process. The limited new supply of 5-room flats in centralised locations supported higher prices thus resulting in more flats breaching the S$1 million mark," he commented on the latest SRX data in a separate statement on Dec 9.

Lee is forecasting 2021 transaction volumes to reach 29,000 with price gains possibly exceeding 13 per cent, which would mark the best performance for the HDB resale market since 2010.