SINGAPORE – Prices of Housing Board resale flats inched up in the third quarter of 2023, rising by 1.2 per cent, but at a slower pace than the 1.5 per cent in the previous quarter.

This marks the 14th consecutive quarter of price increase since the second quarter of 2020, flash estimates from HDB showed on Monday. HDB noted that the price growth in the third quarter of 2023 was lower than the average quarterly growth of 2.5 per cent in 2022.

Property analysts said the resale market is showing signs of stabilising following several rounds of property cooling measures, but prices remain resilient owing to stable demand from home seekers.

Ms Christine Sun, OrangeTee & Tie’s senior vice-president of research and analytics, said the slower price growth indicates that price resistance from buyers could have set in, amid concerns over inflation and affordability.

She added that “affordability has been hit by rate hikes as interest rates have stayed higher (for) longer than anticipated”.

She said the overall price growth was driven mainly by four-room flats.

Citing HDB data, Ms Sun said the average prices of such flats increased the most across all flat types, rising by 1.8 per cent from $579,740 in the second quarter to $590,454 in the third quarter.

This was followed by executive flats, which grew 1.3 per cent from an average of $827,549 in the second quarter to $838,120 in the third quarter.

Buyers are willing to pay more for a flat without resale restrictions in mature estates, and this could also have led to the quarterly increase, said Huttons Asia’s senior director of data analytics Lee Sze Teck.

Under the reclassification of HDB flats that will kick in from the second half of 2024, Build-To-Order (BTO) flats in choicer locations will fall under the Prime and Plus categories, which come with stricter resale conditions.

These include a 10-year minimum occupation period before the flats can be sold, and a subsidy clawback under which flat owners return subsidies to HDB upon selling their flats.

PropertyGuru Singapore’s country manager Tan Tee Khoon said an estimated 128 flats changed hands for at least $1 million in the third quarter of 2023, up from the 105 million-dollar deals in the previous quarter.

There were an estimated 336 million-dollar flat transactions from January to September, compared with 369 for the whole of 2022, he added.

“Should the pace of million-dollar flat transactions continue, we are looking at another record-breaking year,” he said.

More HDB resale flats were sold in the third quarter of 2023, with the number rising by 2.9 per cent to an estimated 6,592 units, from 6,409 units in the second quarter.

Based on HDB’s flash data, resale volume was 9.7 per cent lower compared with the same period in 2022, when 7,298 units changed hands. It is also the lowest volume lodged in the third quarter compared with the same period from 2020 to 2022.

Ms Sun said more buyers opted for resale flats due to the August BTO sales launch being delayed to early October.

But more resale flats could come onto the market in the next few months, said Huttons’ Mr Lee. This is because more private homes are set to be completed, so HDB upgraders who are moving to their new homes will need to sell their existing flats.

“The increase in both BTO and resale flat supply may moderate prices in HDB resale flats to around 5 per cent in 2023,” he added.

HDB said it will launch about 6,800 BTO flats in Choa Chu Kang, Kallang/Whampoa, Queenstown and Tengah in early October.

Another 6,000 flats in towns such as Bukit Panjang, Jurong West, Woodlands, Bedok, Bishan, Bukit Merah and Queenstown will be launched in December – the final sales exercise of 2023.

HDB remains on track to launch 23,000 flats in 2023, and a total of 100,000 flats from 2021 to 2025.

Correction note: An earlier version of this article quoted Dr Tan Tee Khoon of PropertyGuru saying that as at Sept 29, there were a total of 354 million-dollar flat transactions in 2023. Dr Tan has clarified that from January to September 2023, there were an estimated 336 million-dollar flat transactions.