Demand for HDB resale properties continues to soar

Supply may soon be outpaced by demand, according to analysts.

The HDB resale market continues to experience robust sales in January, according to data released by SRX in the HDB Flats Flash Report.

Resale volume in January increased by 30.3% YoY with HDB resale transactions amounting to 2,501, higher than the previous year. This represents a 0.5% increase from December.

According to real estate agency PropNex, there is keen demand for resale flats in the suburban areas. Units are being bought more quickly because they are more affordable than centrally located ones.

Rise in demand also propped up resale prices which saw an increase of 1.7% MoM in January 2021 with Mature and Non-Mature Estates prices increasing by 1.6% and 1.9%, respectively, compared to December 2020.

In terms of room types, three-room, four-room, five-room, and executive prices increased by 2.3%, 1.7%, 1.6%, and 0.6% respectively.

According to Wong Siew Ying, head of research and content of PropNex, they expect HDB resale prices to potentially grow by 3% to 5% whilst sales volume could exceed 25,000 units.

This was seconded by Orange Tee senior vice president of research & analytics, Christine Sun, who said they expect the demand to be sustained in the coming months with prices rising by 2%-5% this year.

However, Sun said the demand for resale flats threatens to outpace supply, as evident by the high subscription rates of recent BTO launches and increasing resale transactions.

Wong of PropNex said the continued market recovery is not without risk.

“Recently, the government has reiterated that it is monitoring the property market closely. We remain watchful of policy risk as any fresh cooling measures will likely have an impact on the HDB resale market, given that HDB upgraders form a sizable demand pool for private homes,” she added.