Record number of million-dollar HDB flats resold in June

The number of million-dollar Housing Board flats resold hit an all-time high in June, nearing 100 units, while resale prices clocked record gains.

Flash estimates from SRX and 99.co released on July 8 showed that HDB resale prices jumped 1.8 per cent in June, extending gains for the ninth straight month.

Resale prices rose across all room types and in both mature and non-mature estates from the previous month.

Resale volumes, however, were down 13.1 per cent on the month to 2,184 flats resold, compared with the 2,513 flats that changed hands in May. Compared with the corresponding period a year ago, resale volumes were 17.5 per cent higher.

ERA Singapore head of research and market intelligence Wong Shanting noted that HDB’s June Build-to-Order (BTO) launch diverted some demand away from the resale market, resulting in lower resale volumes.

She added that as the June launch was the last one not impacted by HDB’s reclassification of BTO units into Standard, Plus and Prime flats, application rates were driven up.

The June school holidays were likely another reason for the drop in volume, as buyers and sellers were away on vacation, said OrangeTee chief researcher and strategist Christine Sun.

HDB flats sold for at least $1 million accounted for 4.4 per cent of total resale volumes, rising 29.7 per cent on the month to 96 units in June, compared with 74 units transacted in May.

Mogul.sg chief research officer Nicholas Mak attributed the sharp rise in prices to higher demand for flats in attractive locations, namely those in the Central region or near MRT stations likely to be classified as HDB Prime or Plus locations.

As BTO flats in these locations would be classified as Prime or Plus flats with a 10-year minimum occupation period (MOP), homebuyers who are not keen on the longer MOP would gravitate towards the resale market here, driving up prices.

Another possible reason for the jump in resale prices is the declining supply of family-sized resale condominiums and resale executive condo units priced between $1 million and $1.65 million each. Family-size units are typically 3-bedroom units, said Mr Mak.

Echoing the sentiment, SRI’s head of research and data Mohan Sandrasegeran said larger families or those with school-going children are likely to prioritise space and the convenience that five-room flats in mature estates offer.

Meanwhile, Ms Sun believes robust consumer confidence and positive buying sentiment resulted in the jump in million-dollar resale flat deals. This comes amid recent improvements in Singapore’s economy and job market outlook.

“This trend may be more apparent among the upper-middle-income group who have experienced consistent wage growth, and may have the financial capacity to pay higher prices for attractive resale flats,” she said.

“Others may be home owners downsizing from private properties who have used cash from their previous property to buy a spacious million-dollar resale flat.”

SRX and 99.co noted that Kallang Whampoa recorded the most million-dollar transactions with 18 units changing hands, while 11 units each were sold in Geylang and Bukit Merah.

Ms Wong Siew Ying, head of research and content at PropNex, observed that among the 18 units, eight were located at St George’s Towers, where owners likely met the MOP recently.

Former private home owners returning to the HDB market after serving out their 15-month wait-out period could have also contributed to the increase in million-dollar flat transactions, Ms Wong added.

Overall, by room type, four-room flats were the most popular during the month, raking in 44 per cent of total volumes.

Meanwhile, demand for three-room resale and five-room resale flats were evenly matched, accounting for 24.8 per cent and 24.2 per cent of resale volumes, respectively. Around 6.9 per cent of resale transactions involved executive flats.

More than half (57.7 per cent) of resale flat transactions were from non-mature estates.

When it came to resale prices, four-room flats registered the highest month-on-month increase at 1.8 per cent, followed closely by three-room resale and five-room resale prices, which each added 1.6 per cent. Executive flat resale prices, meanwhile, were up 1.1 per cent.

Resale prices were up 2.6 per cent in mature estates and 1.3 per cent higher in non-mature estates compared with May, based on SRX and 99.co data.

Year on year, overall prices were up 7.3 per cent. Mature and non-mature estate resale prices were up 6.7 per cent and 7.3 per cent, respectively.

Four-room flats had the highest increase in resale prices, at 7.5 per cent, followed by five-room flats at 7.3 per cent, three-room flats at 6.5 per cent, and executive flats at 6.2 per cent.

The highest transacted price for a resale flat was $1.6 million for a five-room unit at Boon Tiong Road. In non-mature estates, the most expensive flat resold was $1.1 million for a five-room flat at Hougang Street 21.