Prices for resale apartments increased 1.4% year over year in 2Q2023

, ,

Grand Dunman showflat

According to the flash estimates published by HDB on July 3rd Resale flat prices increased 1.4% q-o-q in 2Q2023 which was higher than the 1% increase recorded in the 1Q2023 quarter. This also marks the third consecutive period of increase. However, it’s lower than the typical annual growth rate at 2.5% recorded in 2022, HDB states.

Grand Dunman showflat offers investors and homebuyers a once-in-a-lifetime chance to purchase real estate in a classic setting.

Flat transaction volumes for sales declined to 3.9% q-o-q in 2Q2023 to 6,409 units, 4.6% lower y-o-y and the lowest volume seen in the past three years following 3Q2020.

The higher rate of increase in resale flat rates in the 2Q2023 period is accompanied by a higher demand due to the increased incentives for first-time buyers, according to Christine Sun, senior vice director of research and analysis of OrangeTee & Tie.

In the Singapore’s Budget 2023 which was announced in February, families who buy four-room or smaller apartments at first will be eligible to receive a boost in Central Provident Fund housing grants of $80,000. This is an increase from $50,000 prior to. If you’re looking to purchase five-room flats, the grants have been raised to $50,000 from $40,000 before.

Due to the increased grant, the demand of private property downgraders could be channeled to four-room apartments, according to Sun. This is due to the fact that people over 55 years old can be exempt from the 15-month waiting period that is applicable to private property buyers who purchase a resales flat, if they decide to purchase four-room or smaller flats. According to the ERA’s Lim In 2Q2023 the proportion of four-room HDB sold transactions was 48.4%, higher than the 45.3% recorded in 1Q2023.

However, even though the grants have provided buyers an increase in their home budgets however, there’s an unbalanced price between buyers and sellers, which is the reason for the low volume of transactions in the last quarter, according to Lee Sze Teck, senior director of research at Huttons Asia. Teck suggests that a few buyers might opt to go to a Build-to-Order (BTO) flat as HDB has boosted the availability of flats, with a shorter wait period.

In 2Q2023 the estimated 90 resales of flats were purchased for more than a million dollars that Lee states was 12.6% lower than the flats that sold for 103 million dollars in during the prior quarter. The most expensive flat sold was a adjoining flat in Moh Guan Terrace, which changed hands for record $1.5 million in the month of June.

Despite the record-breaking sale, Lee notes that most of the million-dollar flats took place within the $1 million to $1.1 million price range. “Buyers might be rationalising a premium to purchase an HDB flat, but more are opting for flats with four rooms,” he says.

In the future, as increasing numbers of BTO flats are built in the near future The number of resales flats available for sale could increase since owners moving into an BTO flat will have to sell their existing property, Lee says. “The rise in the amount of launches for private residential properties could result in more HDB upgraders choosing to sell their homes prior to moving in order to not have to pay an additional 20% ABSD (additional stamp duty for buyers) at the beginning.”

In the meantime, some sales of flats for resales could be shifted towards market BTO market, since HDB continues to offer new flats in various estates. In August, during the BTO exercise 7,700 BTO flats are put up for sale, and 6300 BTO apartments will be sold in November.

Due to the rise for both BTO and resale flat supplies, Lee anticipates resale flat price growth to be moderate. He anticipates that the year-long price increase to be not over 5% which is based on an estimated amount of between 24,000 and 26,000.

1 reply

Trackbacks & Pingbacks

Comments are closed.