RESIDENTIAL PROPERTY | Staff Reporter, Singapore

HDB resale prices up 2.1% in August

This is the third consecutive month that more than 2,400 units were moved.

HDB resale prices jumped 2.1% YoY in August compared to the previous year, data from the latest SRX Flash Report showed, although this is 0.7% lower compared to July.

Prices for all room types rose during the month compared to a year ago. Four-room HDB flats led the increase with a 2.7% increase, followed by executive flats with a 2.2% price raise. Three-room and 5-room resale prices climbed by 1.2% and 1.8%, respectively.

Overall, resale volumes surged 23.5% YoY last month compared to August 2019, with a total of 2,435 HDB resale transaction occurring during the month. However, this is 1.4% lower compared to July.

This is the third-straight month that more than 2,400 units were transacted, noted Christine Sun, Head of Research & Consultancy, OrangeTee & Tie—reflecting howmarket sentiment continues to recover after the circuit breaker period.

“The strong sales volume over the past three months is not likely to be a 'blip' after the circuit breaker period. Market sentiment could be slowly recovering since the virus outbreak is stabilising in Singapore and some sectors are starting to experience a business turn around after the circuit breaker period,” Sun said.

Sun also noted that the rise in demand may also be interest diverted from the BTO market.

“As August's BTO launch was heavily oversubscribed, unsuccessful candidates may have turned to the resale market to meet their housing needs,” Sun said, adding that with the BTO flats for August and November set to be completed years later, those who do not wish to wait long will likely opt for HDB resale flats as an alternative.

Likewise, Propnex Realty’s head of research and content Siew Ying Wong expects competition to grow stiffer in the HDB resale market.

“With more buyers entering the market, competition for choice resale flats would be stiffer. Anecdotally, some buyers may be prepared to pay a slightly higher price for their preferred unit and this could explain the marginal 0.7% month-on-month increase in HDB Resale prices in August,” Wong said.

Year-on-year, mature and non-mature estate resale prices edged up 0.2% and 3.3%, respectively.

The highest transacted price for a resale flat is achieved at over $1.18m for a 5-room unit at The Pinnacle@Duxton. Over five HDB resale flats were transacted for over $1m in August.

Both Wong and Sun expect demand to remain healthy and transaction volumes resilient.

“Sales demand may continue to be resilient should the COVID-19 situation continue to stabilize, and provided that the unemployment rate does not escalate in the coming months,” Sun said.

Meanwhile, Propnex’s Wong noted that HDB resale prices would remain fairly flat for the rest of the year, with marginal upside potential of 1% to 2% increase for the full-year 2020.

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