Singapore HDB resale prices reach highest YoY growth since 2011

HDB resale prices rose 10.8% in Q2 2021.

The flash estimate released by the Housing and Development Board (HDB) showed that resale prices of public housing flats rose by 2.8% QOQ in Q2 2021. With an index reading of 146.2 in Q2 2021, the HDB resale price index is now 2.1% below the recent peak in Q2 2013.        

According to PropNex, the delays in the completion of new Build-to-Order flats, limited supply of resale flats, improved market outlook and confidence have helped to drive HDB resale prices higher in recent quarters. “While the 2.8% increase achieved in Q2 2021 is a marginal slowdown from the previous quarter’s growth, on a year-on-year basis, the HDB resale price has risen by 10.8% in Q2 2021 - which is the highest YOY growth since Q3 2011.”

Here’s more from Wong Siew Ying, Head of Research and Content, PropNex:

More than 6,600 resale flats were estimated to have been sold in Q2 2021, based on HDB resale transaction data so far. Q2 2021’s sales volume came in slightly lower than the 7,581 units resold in the previous quarter – due to the tighter safe management measures affecting property viewings in May 2021, and possibly some price resistance setting in.

Our market observations suggest that the strong demand for resale flats will likely continue to support HDB resale prices; we have seen some locations garnering cash-over-valuation of $20,000 to $30,000 or more amid competition for choice units.

In the first half of 2021, HDB resale prices have climbed by about 5.9% and we expect HDB resale values to grow by 9% to 10% for the whole of 2021.

As HDB resale prices continue to trend up, some flat owners may be motivated to sell their flat and recycle the capital to purchase a private home. In addition, an estimated bumper crop of over 25,500 HDB flats are due to exit their 5-year Minimum Occupation Period this year, making them eligible to be sold on the resale market should the owner decide to upgrade to a private property.