Sluggish demand drags HDB resale prices in 12 towns 

Resale price growth seen moderating to 3% to 5% this year.

Prices of HDB flats in the resale market went down in 12 out of the 26 HDB estates in the fourth quarter due to muted demand and with homebuyers turning to the primary market which has enjoyed an abundance of new supply. 

An analysis of recent government data by OrangeTee & Tie showed the average price of HDB flats in 14 towns increased last quarter from the three months prior, although most of the gains were below 2%.

Bukit Timah recorded the steepest drop in HDB resale prices last quarter with a 10.4% quarterly plunge, followed by the Central Area, Geyland, Bishan and Jurong West. Meanwhile, Sembawang, Ang Mo Kio, Tampines and Woodlands recorded the sharpest quarterly price gain, respectively, ranging from 2% to 5%. 

“Sellers will continue to face intense competition for buyers this year. An additional 37,000 flats may be launched by the government these two years… and this may cause some demand to shift away from the resale market.

HDB resale prices rose to an estimated 4.8% in 2023, significantly lower than the 10.4% price jump in 2022 and the 12.7% spike in 2021, according to official flash figures released two weeks ago.

The lower resale volume helped temper prices last year with the volume of HDB flats sold in the secondary market dipping by 3.8% year on year to 26,628 units in 2023.

READ MORE: Cooling HDB resale market calls for review of wait-out period policy

OrangeTee said this is partly caused by homebuyers turning away from the resale market to the primary market for their housing needs after more than 12,000 BTO flats were launched for sale in the fourth quarter.

“Despite the increased competition from the BTO market, a significant drop in resale
prices is unlikely in the near term,” it said. “Nevertheless, the increase in BTO supply can help address the supply-demand imbalance and prevent further escalation of resale prices, leading to better price stability in the long term.”

OrangeTee projects resale prices to rise by 3% to 5% this year