Here’s why August sales broke the record for million-dollar HDB resale flats

A total of 54 HDB resale flats were sold for at least $1m during the month.

August marked a record-breaking month for sales of million-dollar HDB resale flats as buyer interest was driven towards well-located resale flats by the reclassification of new flats from H2 2025 because these flats would not be affected by the new framework, Wong Siew Ying, Head of Research and Content at PropNex said.

According to the latest SRX report, HDB resale volume improved from July to August, rising by 20.3% MOM to an estimated 2,473 units. When compared to August 2022, resale transactions were up by 6.4% YOY. Non-mature estates accounted for 59.7% of the monthly sales, led by Sengkang, Punggol, Yishun, and Woodlands. Meanwhile, overall HDB resale prices inched up by 0.6% MOM in August and were up by 7.2% YOY.

“We note that two records were rewritten in August 2023. First, there were 54 HDB resale flats sold for at least $1 million in August, marking the highest such sales in a month. The other was a record unit price achieved on a PSF basis for HDB resale flats, at about $1,394 psf for the sale of a 4-room flat at Pinnacle @ Duxton in Cantonment Road,” Wong said.

Wong added that the 54 “million-dollar” flats resold in August represent a 68.8% increase from 32 units transacted in July and is a record high – surpassing the previous record of 45 units in September 2022.  Wong said the number of such transactions has tapered since the introduction of new cooling measures in September 2022 but appeared to have found renewed strength last month, surging to 54 deals. The 54 transactions accounted for 2.2% of the overall resale volume in August, up from the 1.6% proportion in July.

The higher number of “million-dollar” resale flat transactions is not unexpected amidst the resilient HDB resale market. In addition, such flats have unique attributes and attractive locations, and present a strong value proposition for buyers with the means to purchase them. Compared to several years ago, “million-dollar” flats have gained more acceptance among buyers today, and are a new normal in the resale flat market,” Wong added.

“We think a couple of factors could potentially support the demand for flats in choice locations, and may prop up the number of “million-dollar” flats sold going forward. For instance, more buyers, who are former private homeowners, may gradually trickle into the HDB resale market after serving their 15-month wait-out period.”

Meanwhile, Mark Yip, CEO of Huttons Asia. the reclassification of flats to Prime and Plus may have a role to play in the spike in the number of million-dollar flat transactions in August. 

“Buyers are willing to pay more to buy a flat in the mature estates with no restrictions. 50 out of 54 million dollar flat transactions are in mature estates.” Yip said.

Resale climbs but at a slower rate

Meanwhile, resale prices saw a faster pace of growth at 0.6% in August compared to 0.3% in the preceding month. The price increase was primarily driven by big flats like 5-room flats where prices jumped by 1.5%, compared to the 0.3% decrease in the preceding month, and executive flats where prices rose by 1.6%. 

“Nevertheless, when we consider a longer time frame, prices are still rising at a slower pace when compared to the same periods over the last two years. For instance, prices rose by 4.8% from January to August 2023, a smaller growth than the 6.4% in the first eight months of 2022 and 9.2% in the first eight months of 2021,” Christine Sun, Senior Vice President of Research & Analytics said.

Yip added that this confirms that lease decay has a downward pressure on HDB resale prices. 

“Generally, older flats more than 20 years old have a median resale price lower than newer flats less than 20 years old. Buyers may want to take note when they are buying a resale flat,” Yip added.

However, Yip expects that an increase in both BTO resale flat supply may moderate prices in HDB resale flats to around 5% in 2023. HDB resale flat transactions are estimated to be in the range of 24,000 to 26,000 in 2023.