Don’t expect a significant drop in Singapore HDB resale prices soon: analysts

The supply-demand imbalance persists in the market.

HDB sellers in Singapore will continue to face intense competition for buyers this year. According to a report from OrangeTee, an additional 37,000 flats may be launched by the government these two years to meet the target supply of up to 100,000 flats from 2021 to 2025, and this may cause some demand to shift away from the resale market. 

Over 63,000 Build-To-Order (BTO) flats have already been launched from 2021 to 2023. 

Here’s more from OrangeTee:

Despite the increased competition from the BTO market, a significant drop in resale prices is unlikely in the near term. The scarcity of MOP (minimum occupation period) flats will help to support prices in certain locations. The number of flats reaching their five-year (MOP) has decreased from 30,920 units in 2022 to 15,549 units in 2023. The supply of MOP flats is projected to decrease further in 2024 to 11,952 units, resulting in fewer flats available for resale. 

Nevertheless, the increase in BTO supply can help address the supply-demand imbalance and prevent further escalation of resale prices, leading to better price stability in the long term. 

According to our estimations, resale prices are expected to rise modestly by 3 to 5 per cent for the entire 2024, which is comparable to or slightly lower than the 4.8 per cent increase observed in 2023.