Homebuyers turn to resale market amid fewer BTO launches

Resale prices in April were up 0.9% MoM and 6% YoY. 

Property analysts said a lower volume of build-to-order (BTO) flat launches may have pushed homebuyers to the secondary market, contributing to the price increase of Housing and Development Board (HDB) resale flats in April. 

In a commentary, Christine Sun, chief researcher and strategist at OrangeTee Group, noted how HDB resale prices rose for the seventh consecutive month in April amid an across-the-board price increase in all flat types, except for the five-bedders.

Higher grants made available to first-time buyers also lured people in to the secondary market with the perks making it more affordable and accessible to purchase a resale flat, she said.

“Furthermore, it seems that the global economy has experienced an upturn, which gave prospective homebuyers the confidence to take the plunge and make their entry into the property market,” Sun explained.

Data from 99.co and SRX showed HDB resale prices went up 0.9% month-on-month and 6% year-on-year. This followed the increased activity in the HDB resale segment, with the volume of resales rising 16% MoM and 9% YoY in April.

READ MORE: HDB resale prices up 6.0% YoY in April

Wong Siew Ying, PropNex’s research and content head, said the rebound in resale transactions also helped boost prices, with the majority or 62% of the activity concentrated in non-mature towns, led by Woodlands and Jurong West.

Huttons CEO Mark Yip, said that unsuccessful applicants of the sole SBF exercise in February may have also turned to the resale market instead of waiting until 2025.

“In the next few months, the HDB resale market may see more transactions,” Yip said. “Huttons now estimate HDB resale volume to be between 26,000 to 28,000 flats compared to 25,000 to 27,000 previously.”

Resale HDB flat prices could grow by more than 5% in 2024, a tad higher than the 4.9% increase in 2023, he added.