The HDB has announced that it will launch about 19,600 new flats this year over three Build-To-Order (BTO) exercises. This is the fewest number of new flats offered since 2021. For comparison, 17,100 flats were available in 2021; 23,200 flats in 2022; and 22,800 flats in 2023.

From 2024, HDB will conduct three BTO exercises and one Sale of Balance Flats (SBF) exercise a year. From the October 2024 BTO sales exercise, HDB will implement the new classification of flats under the Standard, Plus and Prime categories.

Of the 19,600 flats to be launched this year, 2,800 are slated to be completed in less than three years. This is up from 732 flats in 2023 with a similar completion time. Moreover, 75% of the BTO flats offered in 2024 are slated to be completed in four years or less, bringing down BTO wait times to pre-pandemic levels.

The reduction in the number of BTO launch exercises comes in response to the stabilisation of BTO application rates, says HDB.

Overall BTO application rates have stabilised since October 2023, after HDB started enforcing a “tighter ruling” of BTO sales exercises, says Eugene Lim, key executive officer of ERA Realty, in a press release on Jan 8. In the event of the non-selection of a flat, HDB will cancel any existing applications by the same applicant for subsequent BTO/Sale of Balance Flat (SBF) exercise.

(Source: HDB)

Previously, applicants could increase their chances of securing a BTO flat by applying in multiple sales launches. Under the current ruling, applicants can only select one town or estate and flat category at each BTO sales launch. 

Sale launches for October and December 2023 saw the median application rates for first-time applicants for three-room or larger flats fall to 0.9 and 0.8 respectively. This is a drop compared to the February and May 2023 application rates of 1.9 and 2.3, when the ruling was not in effect.

Lim says that a reduction in the number of BTO sales exercises may help applicants by providing “more flat options at each BTO sales launch, providing applicants ample choices of BTO flats”.

Spacing out BTO sales launches will also reduce the extent of overlap between the selection exercises and provide greater certainty for home buyers, says HDB. This will allow unsuccessful BTO applicants time to apply for the next sales launch.

HDB says that it has successfully delivered about 80% of pandemic-delayed projects, or a total of 73 projects from October 2020 to December 2023. The remaining 19 delayed projects remain under construction with an estimated completion date of early 2025.

The next BTO sales exercise is scheduled for February. HDB will offer about 4,100 BTO flats in Bedok, Queenstown, Choa Chu Kang, Hougang, Punggol and Woodlands. Approximately 1,500 SBF flats will be launched across various towns and estates.

SINGAPORE (EDGEPROP) - HDB resale prices continued to climb throughout 2022 despite housing affordability concerns and government intervention.

The most notable increases in demand and prices were recorded in non-mature estates like Bukit Batok, Sembawang, Yishun, Woodlands, and Jurong West, says Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie. 

“There were buyers looking for affordable flats in non-mature estates. Although prices of flats in these areas have risen, they are still lower compared to resale flats in mature estates,” she says.

A wider acceptance of hybrid working arrangements in light of the pandemic means that more people are working remotely from home, says Nicholas Mak, head of research and consultancy at ERA Realty.

“As a result, some home buyers may prefer larger flats, but the overall supply of five-room flats in the market remains low,” says Mak. For now, the government does not intend to offer five-room BTO flats in mature estates, he adds. “Hence, those who want to buy a five-room flat in a mature estate will turn to the resale market even if prices are higher.”

The upward trajectory of resale HDB prices this year was also fuelled by a spillover in demand from buyers who were put off by the longer project completion timelines for some BTO projects.

According to Ismail Gafoor, CEO of PropNex Realty, most first-time home buyers typically attempt to get a BTO flat since these flats are highly subsidised. “The competition for BTO flats tends to be stiff and new flats may take three to five years to complete,” Gafoor says.

This means that only buyers without a pressing need for housing are likely to continue to apply for BTO flats as their first home, says Gafoor. Applicants who repeatedly fail to secure a BTO flat may decide to turn to the resale market, he adds.

Supply-chain issues in the construction industry delayed the completion times for a handful of BTO projects in 2020 and 2021. According to the government, most of these project timeline issues had been resolved and the projects were back on track by the start of this year.

Read also: BTO flats priced to ensure affordability; not profit-driven: HDB

Upcoming BTO project Tampines Greenglade being built in September. In general, most BTO projects are on track to be completed within four years. (Picture: Samuel Isaac Chua/The Edge Singapore)

In addition, the government made it a point during the BTO sales launches this year to emphasise the shorter waiting time for some BTO projects in non-mature estates, says Mak.

As a result, there are some signs that the government’s efforts to divert more home buyers back to the BTO market are starting to bear fruit, says Sun. “As prices of resale flats have continued to rise and the government has launched more BTO projects for sale, we have seen more people turn to the BTO market over the past year,” she says.

The completion times of some BTO projects in some non-mature estates have fallen to about three to four years, she adds. These include BTO projects in Bukit Batok and Tengah.

In a rare move, HDB responded to rising concerns over housing affordability in a media statement this month. It reiterated that BTO projects are priced with affordability in mind, and it adopts a pricing approach that is different from private developers’ as HDB does not tag on a profit margin on top of the costs of BTO projects.

This year also saw the rise in the number of resale flats sold with high cash-over-valuation (COV). The COV is the difference between the sale price of the resale flat and its HDB valuation.

For example, at the start of this year, some buyers were paying COV of more than $600,000 for highly desirable flats in mature and some non-mature estates. “Typically, high COV is observed for flats which have multiple buyers competing for them,” says Gafoor.

Mak adds that most of the buyers who are willing to fork out a high COV tend to be condominium downgraders with more cash on hand to outbid most first-time buyers.

By 2H2022, however, price resistance had set in among home buyers. In a reply to Parliament this year, Minister for National Development Desmond Lee shared that between January and October, the proportion of flats sold with COV fell to one in four flats, from one out of three flats sold in 2021.

Other market watchers also concur. “In general, buyers seemed less willing to pay high COV after the September 2022 property cooling measures,” says Sun. She adds that a handful of buyers may also expect prices to fall after the last round of property market curbs.

The September measures included tightened stress-test interest rates for loan applicants, says Mak. This will start to limit the size of the housing loan buyers can take out, and they have to pay the excess out of their savings, he says.

The September measures also saw the implementation of a 15-month wait-out period for private property owners buying a resale flat. “These downgraders tend to have deeper pockets and the ability to pay a higher price and COV for choice flats. With this group of would-be buyers temporarily taken out of the equation, we could see COV coming down,” says Gafoor.

A record number of 31,325 HDB flats are expected to reach their minimum occupation period (MOP) this year. Next year, 15,784 flats are expected to reach MOP. This has contributed to the increase in resale flat prices, especially with more million-dollar flats transacted, says Gafoor. (Find HDB flats for rent or sale with our Singapore HDB directory)

“Such MOP flats tend to attract higher prices, given their longer balance lease and better physical condition of the flats. The sale of such units has helped to boost the overall pricing in the estate,” adds Gafoor.

For instance, in Sembawang, 3,962 flats will attain their MOP by the end of this year. Based on data compiled by PropNex, 35% of four-room and five-room flats resold in the estate have a remaining lease of more than 94 years.

The average resale price of five-room flats in Sembawang has risen to $583,000 in 2022, up by 20.4% from that of 2021 ($484,000). Meanwhile, prices of four-room flats in the area have risen to $502,000 in 2022, up by 20.1% from that of 2021 ($418,000), based on the PropNex research.

More resale flats have been sold for more than $1 million in recent years. In 2021, a total of 259 resale flats changed hands for at least $1 million — a record high since 2012.

“Most million-dollar flat transactions came from mature estates. From January 2012 to September 2022, there were only 13 flats sold for at least $1 million in non-mature estates. This is 1.6% of the total 838 million-dollar transactions recorded within that period,” says Sun.

The 2021 record was shattered this year when 342 million-dollar flats changed hands as of end-November. Of the 342 units sold, 323 flats (94.4%) are in mature estates, according to PropNex.

Based on HDB resale data compiled on Dec 11, the most expensive HDB resale transactions this year were for four- or five-room and larger flats.

For example, the most expensive HDB resale this year was for a 1,313 sq ft five-room unit at Skyterrace @ Dawson. The unit, at Block 92, is labelled as a premium apartment loft and fetched $1.42 million ($1,080 psf) in July this year.

This sale beats the previous record high set in that block, which involved another five-room premium loft apartment that was sold for $1.33 million ($1,011 psf) in December 2021.

The second highest resale occurred at the nearby City Vue @ Henderson and involved a 1,216 sq ft, five-room unit. The flat, in Block 96A, was sold for $1.4 million ($1,151 psf) in May.

In May, a 1,216 sq ft, five-room flat at City Vue @ Henderson was sold for $1.4 million. (Picture: EdgeProp Singapore)

This followed a resale transaction within the same block where another 1,216 sq ft five-room was sold for $1.38 million ($1,135 psf) in the same month.

Meanwhile, choice units at The Pinnacle @ Duxton continue to attract some of the highest HDB resale prices. This year, the most expensive unit was a 1,151 sq ft, five-room unit in Block 1F that fetched $1.39 million ($1,206 psf) in March.

 This block also saw the sale of a 1,000 sq ft, four-room unit for $1.23 million ($1,228 psf) in April this year.

The sales of million-dollar flats are not solely responsible for the “unsustainable price growth” in the HDB resale market in 2022, says Lee Sze Teck, senior director of research, Huttons Asia. “But they contributed to the impression that flats were getting unaffordable.”

This may have contributed to the government stepping in with property cooling measures in September, adds Lee.

Most of the resale flats that have crossed $1 million are located in the central areas, near amenities, particularly MRT stations.

“Dawson, Henderson, and Toa Payoh are in the city fringe, while Duxton is the heart of the city near the CBD. [The flats] have convenient access to amenities and are within easy reach of the MRT station. These are strong locational attributes,” ERA’s Mak.

OrangeTee’s Sun shares a similar sentiment, adding that “many of these flats may also be high-floor units that command good views. Some of these flats are very large, and flats of these sizes are no longer offered by HDB”.

At the same time, projects like The Pinnacle @ Duxton and Skyterrace @ Dawson are landmark HDB developments with attractive design, urban planning, and award-winning architecture, says Mak. For example, Skyterrace @ Dawson and its architect, SCDA Architects, won the President’s Design Award in 2016. The development was said to be an exemplar for future public housing in Singapore.

Choice units at The Pinnacle @ Duxton continue to attract some of the highest HDB resale prices. (Picture: Samuel Isaac Chua/The Edge Singapore)

Similarly, The Pinnacle @ Duxton is an iconic public housing development in Singapore. “With a combination of appealing attributes, it is unsurprising that these flats command million-dollar price tags,” says Gafoor.

The prevalence of million-dollar flats in these areas may also be correlated to the lack of new private residential projects in the vicinity. A study conducted by PropNex in September this year found that some buyers were unable to find comparable alternatives in the private residential market that met their needs and budget, and thus went for the million-dollar flats.

“Given the central location and unit size, a private condo in the same area would be priced significantly higher than the million-dollar flats. Therefore, apart from the appealing physical attributes of million-dollar flats, we think the lack of affordable private residential supply in these estates could be a con[1]tributing factor that drove demand for these flats,” says Gafoor.

HDB resale prices are expected to see a more muted growth in 2023.

“Due to rising interest rates and higher stress test rate for loans, economic uncertainties in 2023, and the latest cooling measures, home buyers may become more cautious,” says ERA’s Mak.

He adds that if resale flat prices continue to escalate, some home buyers’ monthly income may not meet the stringent requirements to take a housing loan for the flats that they want to buy. “The expectations of future interest rate hikes and economic uncertainties may incite a more conservative mindset among home buyers,” he says.

Gafoor says that PropNex expects HDB resale prices to grow 6%–8% in 2023, down from its forecast of 9%–10% for 2022. Similarly, Sun of OrangeTee & Tie expects price growth to moderate at 5%–8% next year.

For its November 2022 BTO sales launch, HDB released 9,655 flats. The upcoming February 2023 and May 2023 sales exercises are expected to see between 8,200 and 9,200 flats released.

Artist’s impression of Kallang Horizon, which was launched as part of the November BTO sales exercise. It is also a Prime Location Public Housing development. (Picture: HDB)

This ramped-up supply may help to cool HDB resale flat demand slightly, but it is unlikely to significantly alter the growth trajectory of the resale market in 2023, says Gafoor. “We still anticipate HDB resale prices to see some modest upside in 2023 — supported by demand from first-timers with urgent housing needs and buyers looking to upgrade to a bigger flat or relocate.”

 Sun says that other factors are more likely to moderate public housing demand, such as the overall local employment rate, income growth, economic growth, and the global economic condition. “For instance, if employment remains strong and income growth remains robust, the increased supply of BTO flats may not bring prices down next year,” she reckons.

Looking ahead, buyers are likely to be more prudent in their housing purchases amidst rising interest rates for mortgage loans, inflation, and economic headwinds, says Gafoor. According to Mak, the property cooling measures introduced in December 2021 and September this year will weigh on the market.

Check out the latest listings near Bukit Batok, Sembawang, Yishun, Woodlands, Jurong West, Skyterrace @ Dawson, City Vue @ Henderson, The Pinnacle @ Duxton

SINGAPORE (EDGEPROP) - A rare five-room Housing and Development Board (HDB) loft unit at SkyTerrace @ Dawson has been sold for $1.328 million. The price translates to $1,011 psf on the floor area. The Option to Purchase (OTP) was exercised on Nov 22 and the sellers were represented by Lois Ho, associate group director of PropNex Realty.

Read also: Dawson HDB flats cross million-dollar threshold soon after MOP

The sale of the 1,313 sq ft, duplex HDB unit is the most expensive resale flat sold so far this year, based on HDB resale caveats as of Nov 29. It also marks the most expensive resale flat that has ever been sold at SkyTerrace @ Dawson and neighbouring SkyVille @ Dawson. 

The HDB loft unit is at Block 92 Dawson Road and occupies the 42nd and 43rd floors. According to Ho, there are only 26 such loft units available in SkyTerrace @ Dawson, making them a rare type of unit in the 758-unit development.

PropNex agent Lois Ho in the living room of the HDB loft unit she sold. (Picture: Lois Ho/PropNex Realty)

“This is an uncommon unit type that is rarely included in recent HDB projects. Some interested buyers even wondered if the sellers had configured the layout by themselves. Loft units are typically found in private condos and this particular HDB unit boasts an impressively high 5.4m ceiling height,” says Ho. (Find HDB flats for rent or sale with our Singapore HDB directory)

The unit also benefits from its high floor position which provides an unblocked view of the landed housing estates in nearby Tanglin. The flat features two bedrooms on the lower floor and a bedroom on the upper floor.

According to Ho, the sellers decided to put up the unit for sale in the first quarter of this year, but the fluctuating Covid situation made it difficult to actively market the property. Ho also felt that it was important to arrange physical viewings for serious buyers.

“For a unique property such as this HDB loft unit, it is necessary for buyers to experience the space and the rare layout. I felt that factors such as the serenity of the unit and the impressive view were critical features those serious buyers needed to experience first-hand,” she says.

She adds that this helps buyers understand why they should be prepared to pay a high premium for this unit compared to other five-room flats in the development.

The bedroom on the upper floor of the unit which features a 5.4m ceiling. (Picture: Lois Ho/PropNex Realty)

By mid-October, she and the sellers felt that the Covid situation in Singapore had stabilised enough to start scheduling physical viewings.

Ho says that she received an overwhelming amount of interest for the HDB flat. Interest was so great that she was unable to schedule enough viewings to meet the number of viewing requests she received.

She says that the buyer of this loft unit submitted multiple offers to purchase the property. “The buyer was wowed by the double volume space and spacious living room when they came to visit the flat”.

The initial offers did not cross the $1.3 million price threshold as only two other low-floor loft units had been transacted before at SkyTerrace @ Dawson. The most recent was another 1,313 sq ft unit in the same block that fetched $1.095 million ($834 psf) on June 23 this year.

“Eventually, a firm belief in the value of the property and the physical viewings paid off because the sellers accepted the $1.328 million offer. The transaction was also a nice birthday gift for the seller’s wife, and in Cantonese, the digits of the price translate to ‘Easy to prosper throughout life,” says Ho.

Many of the serious buyers were aware that they would be paying a premium for the unit, given the property’s outstanding attributes such as its central location, spacious size, penthouse lifestyle and rarity, says Ho.

The view of the Tanglin landed housing areas from the top of SkyVille @ Dawson. (Picture: Albert Chua/The Edge Singapore)

While the actual Cash Over Valuation (COV) paid by the buyer is confidential, the amount is likely around $100,000, says Ho. COV represents the difference between the resale price of an HDB flat and the actual valuation by HDB.

The sale of this five-room loft will likely spur some sellers at SkyTerrace @ Dawson and SkyVille @ Dawson to increase their price, however, there are very few five-room units in these developments that are up for sale. Most of the units from these two developments that are on the resale market are four-room units,” says Ho.

Check out the latest listings near SkyTerrace @ Dawson

SINGAPORE (EDGEPROP) - In May this year, a 1,206 sq ft HDB flat at Block 9B Boon Tiong Road was sold for $1.14 million ($945 psf). This five-room flat had just reached its Minimum Occupancy Period (MOP) at the start of this year. The transaction was successfully concluded on July 6, chalking up the highest price a resale flat in this block has ever achieved. 

According to Petrina Koh, a senior marketing director at ERA Realty and the agent representing the seller, the flat was valued at $1.03 million ($854 psf) when it was put up for sale in February 2020. She says that the flat, which is on the 14th floor, was offered at a price of about $1.2 million.

Blk 9B Boon Tiong Road (centre) is one of the four HDB blocks that make up Tiong Bahru View (Picture: Albert Chua/The Edge Singapore)

The HDB flat had been home to a young family for five years, but the owner decided to sell it in order to move to a location closer to the children’s primary school, says Koh. She adds that the owner felt it would be easier to sell the flat as soon as it reached its MOP, since more buyers would be attracted to a new resale flat.

Thus, Koh says that she had received a few million-dollar offers for the flat. “Even during the circuit breaker period, the flat continued to attract interest from a handful of buyers. This isn’t common because the unit’s size, pricing and location means that it tends to attract a rather exclusive group of buyers,” says Koh.

Eventually, the flat was sold to a family with teenage children. The family was on the lookout for a resale flat in a central location and she reckons that they are “upgrading” from a flat outside the central area.

The five-bedroom HDB flat was listed in February this year, and attracted a few million-dollar offers (Picture: Petrina Koh/ERA Realty)

The five-room flat is in one of the four HDB blocks that make up Tiong Bahru View, specifically 9A, 9B, 10A and 10B Boon Tiong Road. Tiong Bahru View comprises three 40-storey blocks and a 25/30-storey block with a total of 700 units, including studio apartments, and three- to five-room flats. 

According to HDB’s website, Tiong Bahru View is a replacement housing site under the Selective En-bloc Redevelopment Scheme (SERS) for the now-demolished blocks at 110, 111, 113 and 114 Bukit Merah View.

The four blocks are bounded by Tiong Bahru Road and Jalan Bukit Ho Swee in the Tiong Bahru residential neighbourhood. Tiong Bahru View is beside Central Plaza, a 20-storey office building, as well as Tiong Bahru Plaza shopping mall which is connected to the Tiong Bahru MRT Station.

According to Koh, flats in Tiong Bahru View are able to command relatively high prices due to their proximity to the CBD and the MRT station, as well as its central location within the Tiong Bahru area. This affords residents at Tiong Bahru View convenient accessibility and connectivity to many parts of Singapore, she says.

The flat was bought by a family who want to live in a central location like Tiong Bahru (Picture: Petrina Koh/ERA Realty)

Last year, it was reported that a 1,206 sq ft, five-room flat at 9A Boon Tiong Road within Tiong Bahru View was sold for $1.2 million ($995 psf). It is the most expensive resale flat in Tiong Bahru View so far. Block 9A has also recently recorded the sale of two 4-room flats  for $935,000 ($944 psf) and $950,000 ($959.6 psf), while a five-room flat changed hands for $980,000 ($812 psf).

Based on HDB data, a 1,184 sq ft, five-bedroom unit at Block 19 Jalan Membina was sold for $950,000 ($802 psf) in June this year. The HDB block is directly opposite Tiong Bahru Plaza and Tiong Bahru MRT Station.

“Tiong Bahru is a relatively ‘pricey’ neighbourhood because it is such a highly desirable area to live in,” says Koh. There is also a limited supply of available resale units in the area, including Tiong Bahru View, because most residents tend to stay in their homes for many years. This means it is rare to find new, family-sized HDB flats in the Tiong Bahru area, says Koh. 

Check out the latest listings near Block 9B Boon Tiong Road, Tiong Bahru View, and Tiong Bahru MRT Station

For price trends, recent transactions, other project info, check out these projects' research page: Block 9B Boon Tiong Road

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