HDB prices mark 13th straight quarterly increase, rising 1.5% in 2Q2023

The HDB resale price index in Singapore increased by 1.5% in the second quarter of 2023, following a 1% increase in the first quarter. This marks the 13th consecutive quarter of rising prices in the public housing market. While prices have continued to rise, the pace of growth has slowed compared to last year’s average quarterly growth of 2.5%. Executive flats saw a price increase of 2.3%, while five-room flats increased by 1.9%. Geylang registered the highest quarterly price growth among the towns at 19.2%, followed by Ang Mo Kio, Central Area, and Bukit Panjang. Punggol, Woodlands, Sengkang, Yishun, and Bukit Batok were popular towns with high resale transaction volumes. Despite the price increase, overall resale transaction volumes fell by 6.7% in the second quarter compared to the first quarter due to cooling measures implemented in September 2022 and circuit breaker restrictions during the pandemic. The rise in demand can be attributed to more generous housing grants for first-time buyers purchasing resale flats and government efforts such as increasing BTO supply and implementing wait-out periods for private property owners downgrading to an HDB flat. However, there is buyer resistance towards purchasing million-dollar HDB flats as more buyers opt for four-room flats instead. HDB plans to launch around 13,000 BTO flats in the second half of this year across various towns such as Chua Chu Kang and Queenstown. This influx of supply is expected to help stabilize the HDB flat market but may not significantly affect resale prices due to higher replacement costs for upgraders moving into new condos or executive condominiums (ECs). Overall, while there has been a shift towards a more sustainable growth trajectory for HDB resale prices this year compared to previous years’ robust increases, prices are likely to remain resilient due to higher replacement costs for upgraders.

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