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4Q 2024 HDB Quarterly Report – Resale Prices Peaked Amid Tight Supply of Resale Flats

Research by ERA Singapore

SINGAPORE, 24 January 2025 – According to the Housing and Development Board (HDB), the HDB resale price index rose to 197.9, a 2.6% increase quarter-on-quarter (q-o-q) in 4Q 2024. For the whole of 2024, HDB resale prices have risen at a faster pace of 9.7% y-o-y compared to 4.9% in 2023. Resale price has risen faster on the back of strong demand for HDB resale flats and fewer flats meeting the Minimum Occupation Period (MOP) in 2024 compared to 2023.

In 4Q 2024, HDB resale transactions totalled 6,424 units, a 21.1% q-o-q decrease due to the seasonal lull. This figure is 1.9% lower than in 4Q 2023. For the whole of 2024, some 28,986 HDB resale transactions were recorded, marking an 9.4% increase year-on-year (y-o-y) and the highest number of HDB resale transactions seen since 2021 (31,017 units).

Faster Price Growth Driven by Fewer MOP Flats in the Year

The growth in transaction prices observed in the quarter, as well as the entirety of 2024 can be attributed to the lower number of flats that have recently completed their Minimum Occupation Period (MOP). HDB resale buyers are often willing to pay a premium for these flats with longer balance leases, particularly if they are in mature estates with good connectivity and amenities. With a lower number of MOP flats available, sellers tend to demand higher prices for homes with these attractive attributes.

“The HDB resale market saw continued price growth, reaching an all-time high, driven by a strong demand across all flat types in 2024. Flats that have just attained their MOP status remain in high demand as they are considered new; with long unexpired lease and require no renovation.” said Eugene Lim, KEO, ERA Singapore.

“Some of these MOP flats fell within the million-dollar price range, prompting sellers across the board to raise their price expectations. This trend combined with the tight supply of resale units for sale, has driven resale price across the market. Despite this, some 76.1% of resale transactions were below $750k. 

Furthermore, the new classification of Plus and Prime classification BTO flats since Oct may have driven more homebuyers to seek out HDB resale homes in central locations. These buyers are reluctant to accept the resale restrictions such as a 10-year Minimum Occupation Period, rental restrictions after MOP, subsidy clawback upon resale and resale income cap on future buyers.”

“For the whole of 2024, we have seen 1,035 million-dollar flats, amounting to 3.6% of total resale applications. More than 100 units of million-dollar flats were sold respectively in mature locations such as Kallang/Whampoa, Toa Payoh, Bukit Merah and Queenstown. Compared to 2023, where these locations saw between 40-60 million-dollar transactions each.”

“We expect MOP flats in 2025 to fall to an estimated 7,000 units. Between 2021 and 2024, we have seen nearly 81,000 MOP units and not all were immediately listed for sale upon meeting their MOP. Some of these units could still be gradually entering the market, ensuring a steady supply of resale flats for sale.”

“Alongside the supply of BTO and SBF, we expect to see the demand HDB flats stabilise in 2025. With that we can expect price for resale flats is expected to climb at a slower pace in 2025 due to the higher base seen in 2024. Much of the growth will be led by the resale homes with longer balance lease in mature estates. The February BTO sales launch is expected to draw some buyers away from the resale market”

Upgraders Turning to the HDB Market

2024 saw elevated housing interest rates across most of the year as well as notable retrenchments for the first half of the year. With private residential prices continuing to rise, some HDB owners may have chosen to upgrade within the HDB market instead; moving from smaller to larger flats; or from older to newer flats.

Such buyers could have a more comfortable budget allowing them to upgrade to larger, more centrally located homes with longer leases, which in turn helped to boost resale prices. In 4Q 2024, some 285 units million-dollar flats were transacted, bringing the total number of HDB flats surpassing the million-dollar mark in 2024 to a historical high of 1,035. This represents 3.6% of total resale transactions; compared with 1.8% in 2023.

HDB Rental Statistics

The number of approved applications to rent out HDB flats fell further by 5.6% from 9,118 cases in 3Q 2024 to 8.603 cases in 4Q 2024. Compared to 4Q 2023, the number of approved applications in 4Q 2024 was 12.1% lower. This can be attributed to the seasonal lack of demand in the fourth quarter, where tenants are normally waiting to renew their leases at the start of a new year – hence holding off on signing new rental contracts during this period.

In 2024, the total number of approved applications to rent out HDB flats decreased by 6.3% y-o-y, from 39,138 cases to 36,673 cases.

Fewer HDB units are available for rent due to the dwindling number of MOP units and more HDB upgraders in the market. With that, this could push HDB rental prices further in the coming months.

BTO Flat Supply and ERA’s Outlook for 2025

In total, 21,225 new flats were launched in 2024. This consisted of 19,637 BTO flats and 1,588 Sale of Balance Flats (SBF). 2025’s new flat supply will consist of 19,600 flats in confirmed towns such as Kallang/Whampoa, Bukit Merah, Queenstown, Mount Pleasant, Woodlands, Yishun, and Sembawang.

2025 will also see an increase in the number of Short Waiting Time (SWT) flats. These flats with a completion time of under 3 years will provide an additional option for homebuyers with more urgent housing needs, as they can consider temporary housing arrangements while waiting for their flats – an alternative to purchasing directly from the resale market.

This will kick off in February, which will offer over 10,000 units with the launch of 5,000 BTO flats in Kallang/Whampoa (Tanjong Rhu), Queenstown, Woodlands and Yishun (Chencharu), alongside the largest ever SBF exercise with more than 5,500 flats.

Except for flats launched as part of the October 2024 BTO exercise, the flats offered in the upcoming SBF exercise will not follow the new BTO classification framework. Additionally, 4 in 10 of the units in this exercise are already completed, providing applicants expedited access to a new flat. As a result, we should see a strong demand for these flats, especially for those located in prime location.

2024 closed out with a 9.7% y-o-y price growth, as well as reaching 28,986 transactions. This is close to ERA’s forecast for 2024 of 6-9% price growth and 28,000 to 29,000 transactions.

For 2025, ERA expects resale prices to grow at a more measured pace due to the higher price base in 2024 and a reduced supply of MOP flats in 2025, which have been a key driver of price growth in recent years. We anticipate an overall 3% – 6% price growth, with 26,000 – 27,000 resale HDB units expected to move by end-2025.

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