HDB resale prices rise 13.6% YoY in December

The increase in prices of HDB resale flats, however, will slow down in 2022.

HDB resale prices rose for the 18th consecutive month in December, recording a 13.6% year-on-year (YoY) and 0.8% month-on-month (MoM) growth, figures from SRX showed.

Based on the report, prices increased for both mature and non-mature estates by 12.6% and 14.3%, respectively, compared to December 2020.

In terms of room types, the YoY price growth was 15.8% for 3 Room, 12.9% for 4 Room, 13.9% for 5 Room, and 13.8% for Executive.

OrangeTee said the increase in prices in December were likely because “many deals were probably negotiated or closed” before the 16 December rollout of the government’s property cooling measures.

Amongst the measures imposed by the government were the tighter total debt servicing ratio threshold (55%) and lower loan-to-value limit (85%).

PropNex said these measures will “encourage buyers to be more prudent about their flat purchase” next year, thus leading to HDB resale prices losing “some steam” in 2022.

The analyst said HDB resale prices will likely rise by only around 6% to 8% this year.

OrangeTee, on the other hand, said these measures will only have a “minimal impact” on HDB resale prices and volume.

“Many buyers may not apply for a maximum loan. Others could have taken loans from financial institutions given their lower interest rates,” the analyst explained.

“Moving forward, some buyers may adopt a wait-and-see attitude and observe how the market will be reacting to the new measures. Sellers may also take time to access buyers' interests before making price adjustments,” OrangeTee added.

Meanwhile, HDB resale volume for December dipped 6.1% MoM and 2.4% YoY with total transactions at 2,429.

PropNex said the decline was probably due to “seasonality where sales and viewings tend to slow as people go on their year-end break.”

Despite this decline, the full-year HDB resale volume was still 24.6% higher than in 2020 at 29,182.

In 2022, PropNex said some 30,000 resale flats could be transacted.