HDB resale prices will stabilise as more flats enter market, cooling measures take effect: MND
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High resale prices have caused concern among Singaporeans over the affordability of public housing.
ST PHOTO: LIM YAOHUI
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SINGAPORE - The Housing Board resale market will start to stabilise as more of such flats enter the market over the next few years and existing cooling measures continue to take effect, said National Development Minister Desmond Lee.
Citing a supply-demand imbalance as the reason for high resale flat prices, he pointed out that the Covid-19 pandemic had severely impacted construction of new flats and also caused demand to spike because people were concerned about housing delays.
High resale prices have caused concern among Singaporeans over the affordability of public housing.
These concerns were raised by Mr Xie Yao Quan (Jurong GRC) and Leader of the Opposition and Workers’ Party chief Pritam Singh (Aljunied GRC) during the debate on the Ministry of National Development’s budget on March 5.
Addressing these anxieties in Parliament, Mr Lee said there will be a significant jump in the number of new flats reaching their minimum occupation period (MOP), from 8,000 in 2025 to 13,500 in 2026. The number of flats meeting their MOP will steadily increase before hitting 19,500 in 2028, added Mr Lee.
Thus, “the supply tightness should start to recover next year”, he said, after noting that fewer flats had reached their MOP in recent years because fewer units were completed during the pandemic.
Taken together with cooling measures to curb prices, which will also continue to “work their way through the market”, the HDB resale market will stabilise, he said.
The MOP is the minimum amount of time that the owners of a new flat must live in the unit before they can sell it on the open market.
Prices of HDB resale flats grew 9.7 per cent in 2024.
In his speech, Mr Lee outlined the Government’s efforts in recent years to keep a range of flats affordable for Singaporeans with different housing budgets.
These include increasing subsidies for Build-To-Order (BTO) flats, and raising the Enhanced CPF Housing Grant for first-timer families, who can now receive up to $120,000 in grants.
Mr Lee said: “As a result, in 2024, more than eight in 10 first-timer families who collected the keys to their BTO flats were able to service their HDB loans using their CPF, with little to no cash outlay.”
He also cited the prime location housing (PLH) model introduced in 2021
The Government then took another “big step” by launching the new flat classification framework in October 2024
Under the new framework, Plus and Prime flats are priced with further subsidies but face stricter resale conditions and a longer MOP.
“This allows us to unlock new, choicer areas for affordable public housing,” said Mr Lee, who added that the first BTO project in the new Mount Pleasant housing estate
He pointed to the Alexandra Vale and Alexandra Peaks
This location is near the MRT station and currently built up with private residential properties that can be expensive, he added.
HDB will launch another two BTO projects in the area – one next to Alexandra Peaks, and the other along Tanglin Road – in July 2025, said Mr Lee.
He added that one of the blocks in Alexandra Peaks will also house public rental flats, which will allow lower-income households to rent homes in such prime areas.
