Sales of HDB resale flats hit 8-year high in 2020 as prices climb 5%

HDB resale flats

SINGAPORE – The Housing Board resale market finished 2020 on a solid note with level prices edging up in numerous areas and purchaser request remaining light in spite of the Covid-19 pandemic.

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Prices of HDB resale flats rose for a third sequential quarter, climbing 3.1 percent in the last three months of 2020 contrasted and the past quarter, according to information released by the HDB on Friday (Jan 22).

This denotes the highest quarterly increase since the second from last quarter of 2011 when prices rose 3.8 percent.

For the entire of 2020, prices rose 5 percent, the steepest increase since the final quarter of 2012 when prices rose 6.5 percent.

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HDB resale flats
HDB resale flats

This is additionally higher than the 0.1 percent value gain in 2019.

Sales of HDB resale flats arrived at an eight-year high in 2020 with the quantity of resale exchanges up 4.4 percent to 24,748 units, from 23,714 units in 2019.

The highest number on record was in 2012 when 25,094 HDB resale flats changed hands.

In the final quarter of 2020, resales plunged: 7,642 units were sold, 1.9 percent lower than 7,787 units in the past quarter. Year on year, however, sales were up 20.6 percent from the 6,339 units sold in the final quarter of 2019.

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Ms. Christine Sun, senior VP of exploration and investigation at OrangeTee and Tie, said the ascent in prices was unforeseen against the financial emergency welcomed on by Covid-19 and a growing stock of HDB flats.

In any case, the large number of improvement measures dispatched by the Government, for example, the Jobs Support Scheme to help the economy, has assisted with propping up the HDB market, she said.

“Most laborers had the option to keep their earnings with the assistance of different plans. A few purchasers were sure that they can support their housing credits and continued with their new home purchases,” said Ms Sun.

She noticed that Singapore is currently “reaping a gather of market strength” because of exacting measures, for example, the all out obligation servicing proportion, contract servicing proportion and dealer’s stamp obligation that were set up throughout the long term.

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“On hindsight, these measures have planted great seeds of financial judiciousness and adequacy in the financial framework, which have kept most purchasers from over-leveraging and assembled a cushion against immense credit misfortunes in the midst of market uncertainties,” she said.

Ms Sun said that notwithstanding the value climbs, she accepts the HDB market isn’t in danger of a housing bubble for the time being.

“Run of the mill indications of an asset bubble include the decoupling of prices from housing income, and extreme speculative buying exercises… Numerous measures have just been set up to keep a portion of these situations from occurring,” she said.

She likewise noticed that HDB resale level prices are as yet 7.6 percent beneath their top in the second quarter of 2013. HDB resale prices rose for 17 continuous quarters since the second quarter of 2009 to arrive at that top.

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PropNex head of exploration and substance Wong Siew Ying said the 5 percent value development in 2020 is likely “welcome news” for HDB level proprietors as prices had fallen for six straight years from 2013 to 2018.

“Given that HDB resale home estimations have remained quieted for quite a while, we think the cost increase in 2020 is measured and we anticipate that prices should conceivably climb by another 3 to 5 percent this year,” she said.

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On the HDB rental market front, affirmed applications to lease HDB flats increased by 3.4 percent, from 8,196 units in second from last quarter of 2020 to 8,472 units in the final quarter of 2020.

The quantity of endorsed applications was 29.9 percent lower than the 12,079 units affirmed in the final quarter of 2019.

Toward the finish of 2020, a sum of 59,092 HDB flats were leased, a slight increase of 0.05 percent over the past quarter.

While the HDB resale market has endured the pandemic genuinely well, the equivalent can’t be said about the HDB rental market, said ERA Realty head of examination and consultancy Nicholas Mak.

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For the entire of 2020, the HDB rental volume contracted 19.5 percent year on year to 38,798 flats, the biggest pace of decline since such information was made openly accessible in 2006, he noted.

Said Mr Mak: “The leasing interest for HDB flats was seriously influenced by the lull in the neighborhood economy and work market.”


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