Last week, a three-room HDB flat located at 18B Holland Drive with a remaining lease of 87 years achieved a record-breaking $838,000 ($1,162 psf) strategically within a short 5 minutes walk to the Buona Vista MRT Interchange Station (Circle Line and East / West Line). The transaction for the 721 square foot HDB flat at Buona Vista Courts on the 31st floor was finalised last week and is the highest price ever paid for a three-room flat in the Holland Village vicinity.
Completed in 2012, the HDB flats in Buona Vista Courts is located in a convenient and vibrant neighborhood near the upcoming One Holland Village mixed development, The Star, Holland Village Market and Food Centre, Holland Road Shopping Centre and Ghim Moh Market cum Hawker Centre are all within a 500-metre radius of the blk 18B Holland Drive flat.
To date, at least 32 three-room HDB flats have been sold for more than $800,000 in the resale market this year, a sharp increase from only 4 three-room HDB flats transacted above $800,000 last year. Of the 32 HDB flats, three are located in Queenstown.
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Earlier this month, a four-room 1,001 square foot flat HDB flat completed in 2019 at 590B Ang Mo Kio Street 51 was sold for a record-breaking $1.08 million ($1,079 psf), the highest transacted price for a four-room flat in Ang Mo Kio that enjoys easy convenience to AMK Hub, Cheng San Market & Cooked Food Centre, Chong Boon Market and Food Centre and Ang Mo Kio Town Garden East.
The new buyers of this HDB four-room flat located on the 28th to 30th storey in block 590B Ang Mo Kio Street 51 can now enjoy the convenience of having Ang Mo Kio MRT Station within walking distance as well as good schools like Jing Shan Primary School, Anderson Secondary School within a 500m radius.
Analysts observed some of these million dollar flats may have undergone extensive renovations, making them comparable in quality and design to private condos. Modern interiors, premium fittings, and a ready-to-move-in condition increase their appeal and value.
Another possible reason for the spike in resale HDB prices is the declining supply of family-sized units, e.g. three bedroom condo units in resale condominiums and resale executive condo units that are priced below $1.8 million near eateries, amenities and MRT.
Source: HDB
Year on year, overall prices were up more than 7 per cent with mature and non-mature estate resale prices were up 6.7 per cent and 7.3 per cent, respectively as reported by The Business Times on 8 July 2024.
It was also mentioned in the news that across Singapore, four-room flats saw the highest increase in resale prices, at 7.5 per cent, followed by five-room flats at 7.3 per cent, three-room flats at 6.5 per cent, and executive flats at 6.2 per cent. The highest transacted price for a resale flat was $1.6 million for a five-room unit in Boon Tiong Road. In non-mature estates, the most expensive flat resold was $1.1 million for a five-room flat in Hougang Street 21.
"As private residential property prices have risen significantly in recent years, some buyers who might otherwise have purchased private condos are turning to high-end HDB resale flats, driving demand and prices up for resale HDBs. Buyers may also prefer the larger space offered by HDB resale flats when compared to private residential condos at a more affordable price quantum" said associate group director Kiwi Lim from Propnex Realty.
"The rise in million-dollar HDB flats in Singapore is a result of strong demand for well-located, larger, or upgraded public housing units, scarcity of supply in mature estates and evolving buyer preferences for homes in prime locations without being burdened by the many regulations of being classified as Plus or Prime HDB flats. We may see close to 1,000 units of million dollar HDB flats transacted this year in 2024."
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In an effort to make HDB flats more affordable for Singaporeans and PRs, HDB announced that from October 2024, new Build-To-Order (BTO) flats launched will be classified as Standard, Plus or Prime flats, to better reflect their locational attributes:
- Standard flats will come with the standard subsidies and restrictions that are applied to all BTO flats. They will continue to make up the largest proportion of the flat supply amongst the 3 categories in all locations.
- Plus flats will be in choicer locations across Singapore (e.g. near transport nodes, town centres).
- Prime flats are in the choicest locations (e.g. city centre and surrounding towns).
Due to their attractive locations and attributes, Plus and Prime flats would naturally command higher market values. They will be priced with additional subsidies to keep them affordable and enable a wider range of Singaporeans to purchase them.
Many buyers however may avoid Prime or Plus flats with a 10-year minimum occupation period (MOP) in addition to tighter resale and rental conditions, and such home buyers who are not keen on the longer MOP and tighter restrictions would gravitate towards the resale market, further driving up prices.
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