HDB resale prices may rise up to 6% in 2025

Price growth may surpass the 20-month record streak that has stood since 1996.

HDB resale prices are on track to achieve its longest growth streak in 2025, according to OrangeTee.

If no additional property cooling measures or unforeseen macroeconomic uncertainties are introduced, prices are projected to rise a further 4% to 6% in 2025, averaging a 1% to 1.5% growth per quarter.

Resale prices rose 2.6% in Q4 2024, the 19th consecutive quarterly rise, and just one quarter shy of the record 20-quarter streak of price raises from Q1 1991 to Q4 1996.

Consequently, prices are expected to reach their most prolonged continuous growth of 23 quarters by the end of this year, said Christine Sun, chief research & strategist for OrangeTee Group.

Whilst this is the longest streak, it is not the highest, thanks to cooling measures that curbed rapid price increases.

From Q4 1991 to Q4 1996, prices nearly quadrupled, surging 294.4% over 20 quarters or an average of 14.7% per quarter.

In contrast, the estimated cumulative increase from Q1 2020 to Q4 2025 will be 58%.

Whilst prices are set to increase, resale volumes are expected to dip as a result of a limited supply of MOP flats.

Resale volume is estimated to reach 25,000 to 27,000 units in 2025, according to Sun.

The number of flats obtaining their 5-year MOP is projected to fall for the third consecutive year to 6,974 units in 2025 from 30,920 units in 2022. This is the lowest MOP number in 11 years, according to Sun.

Efforts to reduce waiting times for BTO flats under three years may also encourage more potential buyers to purchase BTO flats instead.