HDB resale volume slows in September; buyer resistance seen as prices hit new peak

This makes for 15 straight months that HDB resale prices have climbed.
This makes for 15 straight months that HDB resale prices have climbed.ST PHOTO: CHONG JUN LIANG

SINGAPORE - Resale Housing Board flat transactions slowed in September, with signs of resistance setting in as flat prices hit a record high.

There were a total of 2,518 HDB resale transactions last month, an 8.4 per cent drop from August, according to flash data from real estate portal SRX released on Thursday (Oct 7).

However, prices rose 0.9 per cent last month compared with August, surpassing the previous peak recorded in April 2013 by 0.8 per cent, according to SRX data.

This marks 15 straight months that HDB resale prices have climbed. Hikes were seen in both mature and non-mature estates, and across all flat types last month.

Twenty-three HDB flats were sold for at least $1 million last month, less than the 26 such transactions in August. However, they made up just 0.9 per cent of total resale transactions last month.

A total of 174 HDB flats have transacted for $1 million and up so far this year, a 278.3 per cent jump from the same period last year.

Ms Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, said that sales last month slowed as rising prices kept some would-be buyers on the sidelines.

She noted that other factors such as the Hungry Ghost month and viewing restrictions imposed in line with Singapore's stabilisation phase from Sept 27 may have contributed to the slower sales.

Huttons Asia chief executive Mark Yip also acknowledged the price resistance from buyers.

"The average monthly price gains over the last six months have been hovering around 1 per cent, lower than the average monthly price gains in the early part of 2021," he said.

HDB flash estimates released earlier this month showed that resale prices rose 2.7 per cent in the third quarter over the previous three-month period. This was lower than the 3 per cent increases recorded in the first and second quarters of this year.

Mr Yip said that construction delays are limiting the supply of flats put up for sale by HDB upgraders.

"Coupled with the higher demand for four-room and larger flats, there is supply and demand imbalance in the market giving sellers the edge in pricing," he added.

Even with sale momentum potentially slowing, the total number of resale flats sold this year will reach between 28,000 and 29,000 flats, Mr Yip forecast. This would be above the 24,748 resale applications registered last year, when Covid-19 curbs were tighter, but also the highest since 2010, when more than 32,000 resale flats were sold. 

Ms Sun said that prices of HDB flats may continue to rise if construction delays remain prolonged and young couples turn to the resale market for alternate housing, but also highlighted the price resistance demonstrated given that flat prices have risen to new highs in many locations.

"Therefore, it may take slightly more time to close deals, especially for pricier flats. Some buyers may also consider other housing types as price gaps seem to be narrowing between HDB resale flats and some older private condominiums or resale executive condos," she said.