Private Housing Market Decoupling From HDB as Buyer Pools Diverge: NUS Survey

The NUS Ireus survey polled real estate industry senior executives and found that 31% of respondents said they expect the private market to eventually become “structurally decoupled” from the HDB market, driven by “distinct buyer profiles with differing capacities and capital outlays.” Another 29% said that ongoing supply scarcity will keep private home prices firm regardless of fluctuations in public housing.

The findings come amid a cooling market for both segments in Q1 2026. Transaction volumes in the private market fell nearly 20% in the quarter, while prices inched up just 0.9%. In public housing, resale prices dipped 0.1%, marking the first contraction in nearly seven years.

Professor Qian Wenlan, director of NUS Ireus, described the HDB resale market decline as a “salient milestone” for the public housing market. She noted that the fundamentals for eventual structural decoupling are present, particularly with the introduction of new income ceilings for Plus and Prime BTO flats set at S$14,000 for families and S$7,000 for singles. This demand-side policy effectively filters out high earners, reducing the demand pool for resale Plus and Prime flats.

The median HDB resale price rose 48.2% to S$630,000 in the first half of 2026 from S$425,000 in 2020. Over the same period, the median price of new OCR non-landed private homes excluding executive condominiums jumped 66.1% to just over S$2 million from S$1,211,980. The median price of resale OCR condos climbed 36.4% to S$1.5 million from S$1.1 million.

This widened the median price gap between HDB resale flats and new OCR condos to S$1.38 million in H1 2026, from S$786,980 in 2020. The gap between HDB resale flats and resale OCR condos also expanded, from S$675,000 in 2020 to S$870,000 in H1 2026.

Between 2020 and 2025, resale prices climbed 54.8% while median household incomes grew “more modestly” by 17%, contributing to a growing number of million-dollar HDB resale transactions.

Buyers with an HDB address accounted for a third of new non-landed private homes sold in the OCR in 2025, down from 48% in 2020. This group represented 18.7% of purchases in the core central region last year, compared with 20.6% in 2020, and 22.9% in the rest of central region, down from 36.5% five years earlier.

Despite the shrinking proportion, PropNex head of research and content Wong Siew Ying noted that HDB upgraders still represent a key source of demand for new home sales. Over 13,400 HDB flats will reach their minimum occupation period (MOP) in 2026, nearly double the 6,973 units in 2025. Some 49% of Ireus survey respondents predict this will “directly boost transaction volumes” in the private market, while about 27% expect upgrading demand to be highly targeted and channelled towards executive condominiums or suburban condos.

Professor Qian observed that the headline HDB resale price index has been flattening out over 2025, and that sellers are sitting on significant accumulated equity from relatively low-cost BTO entry points. “Housing mobility is an enduring feature,” Wong added.

Not all industry observers agree that a structural decoupling is underway. Dr Lee Nai Jia, director of property insights platform PropertyDoctors, argued that the two markets are unlikely to diverge completely since they remain linked by the HDB “upgrading chain.” If HDB resale prices and transaction activity softened, some flat owners may have less certainty over sale proceeds and could delay or scale down their private-home purchases. Dr Lee characterised the current situation as a “divergence in momentum” rather than a structural decoupling.

Wong Siew Ying of PropNex maintained that the private market will continue to be structurally linked to the HDB resale market. She cautioned that the impact of the new flat classification framework, which introduced income ceilings for Plus and Prime BTO flats, is likely to be gradual.

Dr Lee added that some households may increasingly define upgrading by the outcome achieved, such as additional space, a better location or stronger financial resilience, rather than solely by whether the home is public or private.