Higher grants drive HDB resale market

Last month, 2,213 HDB resale flats changed hands, an 18 per cent increase from September, according to real estate portal SRX Property. ST PHOTO: LIM YAOHUI
Last month, 2,213 HDB resale flats changed hands, an 18 per cent increase from September, according to real estate portal SRX Property. ST PHOTO: LIM YAOHUI

Spike in number of HDB resale flats changing hands in October following new Enhanced CPF Housing Grant

There was a jump in the number of Housing Board resale flats sold in October, on the back of the higher grants and income ceilings for first-time buyers that took effect in September.

In all, 2,213 HDB resale flats changed hands last month, an 18 per cent increase from September's figure of 1,875, real estate portal SRX Property said yesterday. Compared with a year ago, the resale volume was also 10.6 per cent higher.

Analysts say that recent policy changes could have had an impact on the resale market.

In September, the Government announced a new Enhanced CPF Housing Grant (EHG) of up to $80,000, available to eligible first-time flat buyers regardless of whether they get a new or resale flat. There are also no restrictions on their choice of flat type and location.

ERA Realty's head of research and consultancy Nicholas Mak said: "Home buyers are probably capitalising on the (EHG) grant, as transaction volume increased in October. This figure is the highest since July last year, almost 21 per cent more than the 12-month average."

Ms Christine Sun, head of research and consultancy at OrangeTee said: "Demand for HDB resale flats has continued to strengthen after a number of new policies have been introduced progressively in recent months."

Four-room flats made up 40.8 per cent of the resale units sold last month. Five-room flats accounted for 24.3 per cent and three-room flats 25.4 per cent, while executive flats made up 7.5 per cent. The rest were multi-generation and two-room flats.

Resale flat prices last month fell by 0.2 per cent over September's figures, although this was still 0.1 per cent higher than a year ago. Compared with the peak in April 2013, the prices were 14.3 per cent lower.

Prices in non-mature estates rose by 1.1 per cent year on year. Those in mature estates fell 1.3 per cent.

The most expensive resale flat that changed hands last month was a five-room flat at The Pinnacle @ Duxton, which sold for $1.1 million. An executive maisonette unit in Hougang was sold for $850,000, the highest price in a non-mature estate.

SRX forecasts that in the next three months, 2,320 flats will be put on the resale market as they approach their five-year minimum occupation period.


Resale flat buyers last month paid what it estimates to be the market value for flats, neither overpaying nor underpaying. The overall median transaction over X-value (TOX) was zero last month.

TOX measures how much a buyer is overpaying (positive value) or underpaying (negative value) for a property based on SRX's computer-generated market value. The data includes only districts with more than 10 resale transactions.

HDB executive and five-room flats recorded positive median TOX values of $6,000 and $2,000 last month, while three-room and four-room flats both recorded a negative median TOX value of $1,000.

Flats in Serangoon recorded the highest median TOX at positive $9,500, while those in Queenstown recorded the lowest median TOX, at negative $12,000.

ERA's Mr Mak expects sentiment in the HDB resale market to improve in the coming months, with home buyers continuing to make use of various government housing grants.

OrangeTee's Ms Sun said that prices should remain stable despite the increased demand. "More flats will be reaching their five-year minimum occupation period and HDB is likely to increase the supply of flats in 2020. The increasing supply of flats is likely to keep prices in check in the coming months."

A version of this article appeared in the print edition of The Straits Times on November 08, 2019, with the headline 'Higher grants drive HDB resale market'. Print Edition | Subscribe