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HDB Resale Price Increase in March, Following a Period of Moderation in February

According to flash data released by SRX and on Thursday, April 6th, the prices of resale Housing and Development Board (HDB) flats increased in March 2023, after a decline in February. Overall, HDB resale prices rose by 0.5% on a month-on-month basis in March. Mature and non-mature estates experienced a slight increase of 0.7% and 0.5%, respectively.

Year-on-year, overall prices increased by 8.3% from March 2022, with mature estate prices increasing by 7.6% and non-mature estate prices rising by 8.5%. In terms of flat type, both five-room and executive flats saw an increase of 1.3% in prices month-on-month, while four-room flats saw a 0.5% increase. However, three-room flat prices decreased by 0.3% from February.

Head of Research at 99 Group, Pow Ying Khuan, suggested that some prospective private property buyers may have considered purchasing resale HDB flats, particularly five-room and executive units, as an alternative option if they were uncertain about taking out a home loan. This highlights the sustained demand for HDB resale flats in a property market that encourages sensible investments and expenditures.

Meanwhile, Wong Siew Ying, Head of Research and Content at PropNex Realty, proposed that the increase in sales from February to March could partially be attributed to the revised CPF Housing Grant that was introduced in Budget 2023.

The revised CPF Housing Grant for first-timer families purchasing two- to four-room HDB resale flats has increased from S$50,000 to S$80,000. Similarly, for those purchasing five-room or larger units, the grant has increased from S$40,000 to S$50,000.

First-timer singles who purchase four-room and smaller units can also receive a higher grant amount of S$40,000, up from S$25,000 previously, while those who buy five-room flats can obtain S$25,000, up from S$20,000.

In March, there was a 23.7% increase in resale volumes with 2,287 resale flats changing hands, and a 0.8% increase compared to the same period last year. Non-mature estates made up 57.8% of the total volume, while the remaining 42.2% consisted of flats in mature estates. Four-room flats were the most commonly traded, accounting for 44.7% of the resale volume in March, followed by three-room flats at 26.2%, five-room flats at 23.1%, and executive flats at 6%.

According to Christine Sun, the Senior Vice-President of Research and Analytics at OrangeTee & Tie, March saw a record number of million-dollar four-room flats sold in a single month, with nine such units transacted. She observed that this may be due to the recent exemption of the 15-month wait-out period for private homeowners aged 55 and above who purchase a four-room or smaller resale flat. Sun anticipates that more such transactions may occur throughout the year.

Furthermore, across all flat types, the number of million-dollar flat transactions in March increased by 62.5% compared to the previous month, with 39 such deals taking place. These transactions made up 1.7% of last month’s total resale volume.

Pow from 99 Group remarked that March 2023 was tied with October 2022 as the month with the third-highest number of million-dollar flats sold. PropNex's Wong commented that despite cooling measures implemented in September 2022 to temper demand, million-dollar flats continue to be in demand. She added that these flats have attractive features, are located in popular areas, and offer spacious living spaces, making them a good value proposition for buyers when compared to private homes in the same areas, which are more expensive.

In March, Toa Payoh had the most million-dollar HDB flat transactions, with eight deals, followed by the central area with six units. Other million-dollar HDB flats sold were located in Bishan, Kallang Whampoa, Serangoon, Clementi, Woodlands, Geylang, and Hougang.

The highest transacted price for a resale flat in March was S$1.4 million for a five-room unit at The Pinnacle @ Duxton. In non-mature estates, the most expensive HDB flat transaction involved an executive apartment at Woodlands Street 82, which changed hands for S$1.02 million.

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