In 2023, Singapore witnessed a modest increase in Housing Development Board (HDB) resale prices, marking a 4.9% rise compared to the previous years. This increment represents the smallest growth since 2019, highlighting a significant slowdown from the 10.4% gain observed in 2022 and the 12.7% surge in 2021.
Factors Influencing the Slowdown
The deceleration in HDB resale prices can be attributed to various factors, including:
- Cooling Measures: The Singapore government’s implementation of cooling measures in September 2022, including a 15-month wait-out period for private homeowners purchasing HDB resale flats, contributed to the slowdown.
- Stricter Borrowing Criteria: Enhanced borrowing criteria and tighter HDB loan limits aimed at ensuring prudent borrowing amidst rising interest rates also played a role.
- Global Economic Trends: A broader easing of global economic activities expected in 2024, coupled with sustained high domestic mortgage rates, urged households to exercise financial caution in their property purchases.
Transaction Trends
The year also saw a slight decline in resale transactions, with a 2.2% drop in the fourth quarter compared to the previous one. This decrease brought the total number of resale transactions in 2023 to 26,735, marking a 4.2% fall from 2022.
Price Ranges Across Towns
The median resale prices for HDB flats varied significantly across different towns. In the fourth quarter of 2023:
- Three-room flats: Median resale prices ranged from S$345,000 to S$481,500.
- Four-room flats: The highest median resale price was observed in Queenstown at S$928,000, while the lowest was in Jurong East at S$497,500.
- Five-room flats: Bukit Merah recorded the highest median resale price at S$959,000, with the lowest in Jurong West at S$588,000.
Rental Market Insights
The HDB rental market also experienced a slight decrease in approved applications for renting out flats, falling by 0.7% in the fourth quarter of 2023. Despite this, the overall number of approved applications for the year saw a 15.5% increase compared to the same period in 2022, indicating a robust rental demand.
Looking Ahead
As Singapore steps into 2024, the property market remains under the influence of government policies, economic trends, and household financial prudence. The moderate increase in HDB resale prices in 2023 reflects a market adjusting to new norms and regulations, with potential buyers and sellers carefully navigating their decisions amidst evolving economic conditions.
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