Singapore HDB sales to hit up to 26,000 units this year

And resale prices could climb by up to 8%.

In a recent report, OrangeTee Research said as housing affordability takes centre stage, small resale flats in Singapore will continue to find favour with buyers. 

In addition, since more grants will be given to first-timers purchasing 4-room and smaller flats, demand for small flats will likely rise faster than for big flats. 

Here’s more from OrangeTee:

Sales of 4-room and smaller flats have since risen by 8.2 per cent from 4,622 units in Q4 2022 to 5,000 units in Q1 2023. Year-on-year, volume is 6.1 per cent more than the 4,714 units sold in Q1 2022. 

At the lowest end of the housing market, sales of 2-room flats hit a record high with 196 transactions in Q1 2023, surging by 39 per cent from 141 units in Q4 2022. The high transaction volume may also be due in part to a huge ramp up in 2-room MOP flats last year. According to HDB data from data.gov.sg on completion status of HDB developments, 4,692 2-room resale flats obtained MOP in 2022, the second-highest number on record (5,577 MOP flats are projected for 2027). We expect more of such units to be transacted as there will be 3,763 units obtaining MOP this year. 

Sale of 3-room flats similarly rose by 12.8 per cent from 1,637 units to 1,847 units over the same period. The number of 3-room flats that reached MOP in 2022 is 5,970 units, the highest since 7,931 flats reached MOP in 1991. Another 2,940 units are projected to reach MOP this year. 

From August 2023, stricter rules will be imposed for the non-selection of BTO flats. First timers who lose their priority when they reject HDB's offer to pick BTO flats will likely turn to the resale market. Demand for resale flats may increase further in the second half of this year. 

Therefore, overall sales may rise over the next few months. The total sales volume may reach 23,000 to 26,000 units this year. Resale prices may continue to climb, but at a slower pace of 5 per cent to 8 per cent in 2023, compared to 10.4 per cent in 2022 and 12.7 per cent in 2021.