More home buyers seem to be setting their sights on resale flats as private home prices and mortgage rates remain high.
"In just the first three weeks of this month in January 2024, more than 60 'million dollar' HDB resale flats were transacted" said Kiwi Lim, real estate professional from the largest private real estate agency in Singapore - Huttons Asia. "if this trend continues, I expect to see close to 1,000 units of HDB resale flats sold above the million dollar mark this year in 2024."
Last year, in 2023, there were a total of 470 flats that were sold for S$1 million or more, which was 27.4 per cent higher than the number sold in the previous year of 2022. It is important to note that million dollar flats only accounted for a tiny portion - equivalent to 1.8 per cent of the total transactions in 2023.
4-room resale HDB near Buangkok MRT in Sengkang area sold for S$808,888
A record-breaker for 4-room HDB transactions in Sengkang Central near Buangkok MRT was recently sold for S$808,888. Situated near Buangkok MRT in Block 272A, this spacious 969 square feet 4-room flat is located on a high floor between the 13th to 15th floors at around S$834 per square foot. TOP in 2009, this 15 year old 4-room HDB flat still has 84 years of remaining lease left.
Sengkang may see its first million dollar flat transacted in the market soon, since its last 5-room premium transacted last month was at S$963k. Sengkang Central, specifically Buangkok area has attracted a lot of keen interest from buyers especially after the opening of Sengkang Grand shopping mall managed by Capitaland, the recently opened and very popular hawker center as well as the upcoming community centre and bus interchange. Buangkok vicinity has become a prime location with great accessibility with Buangkok MRT station within a stone's throw away and 24 hour NTUC supermarket and 24 hour Kopitiam plus lots of eateries and amenities.
Record $1.568 mil transacted for a 5-room HDB DBSS in Toa Payoh
A 5-room Design, Build and Sell Scheme (DBSS) at The Peak @ Toa Payoh which was completed in 2012 situated at 139A Lorong 1 Toa Payoh located between the 40th to 42nd floor was transacted for S$1,568,888 in January this year, breaking the record for the most expensive resale flat sold in Singapore. The Peak @ Toa Payoh consists of two blocks of 42 storeys each and three blocks of 40 storeys each, with a total of 1,203 units, ranging from three-room to five-room flats. A five-room unit at The Peak @ Toa Payoh ranges in size from 1,184 square feet (sq ft) to 1,259 sq ft.
The Design, Build and Sell Scheme (DBSS) was a public housing program in Singapore introduced by the Housing and Development Board (HDB). It was launched in 2005 to provide an alternative housing option for the middle-income population. The DBSS flats were built by private developers, in contrast to the typical public housing flats that are constructed by HDB.
The DBSS scheme faced criticism over the years due to various reasons, including concerns about the affordability of these flats and the perception that some projects were priced too high for their target audience. In 2011, the Singapore government announced a temporary suspension of the DBSS program to review its policies and there hasn't been any new development of DBSS flats since then.
There are currently 13 Design, Build and Sell Scheme (DBSS) projects in Singapore.
Over the last five years, prices of four-room flats in Singapore have risen by about 35 per cent, climbing slightly faster than that of five-room HDB resale flats. Despite the climbing price range, four-room flats are still more highly sought-after than other Housing and Development Board (HDB) flat types amid a booming property market.
Four-room flats are selling faster than five-room flats as 4-room flats are still relatively more affordable than the larger 5-room HDB flats, EM or EA flats. 4-room flats also appeal to younger families and some seniors who are looking to right size to a smaller home.
Home buyers who felt priced out of private residential homes may be switching their attention towards HDB resale flats as prices of private residential properties rose 6.8 per cent in 2023 which is slightly lower than the 8.6 per cent increase of private home prices the year before in 2022.
"I believe private home prices will stabilise in 2024 as home buyers are increasingly worried about macroeconomic uncertainty even though interest rates are not expected to rise" said Kiwi Lim "prices of private residential homes may see an average price increase of about 3% this year, however, I expect HDB resale prices to see a much higher percentage of price increase in 2024 as compared to private homes."