In Singapore today, the Prices of resale Housing and Development Board (HDB) flats increased by 1.5 % and resale transactions fell to hit the lowest in two years in Q2 of 2023.
The Resale Price Index (RPI) for Q2 of 2023 is 176.2, an increase of 1.5 % from the previous quarter, in the data released by HDB on Friday (July 28).
As we all know, it’s 2023 and it is clear how expensive it is to get an HDB resale flat in Singapore. The HDB Resale Price Index saw price growth of 1.5% from 173.6 points in Q1 2023 to 176.2 points in Q2 2023.
Due to the increase in HDB resale prices that has gradually been attributed to the high cost of living, HDB Build To Order (BTO) flats resale flats serve as a first option for individuals. “To meet the increased housing demand, HDB has ramped up the supply of BTO flats by 35%, from 17,100 flats in 2021 to 23,200 flats in 2022, and 23,000 flats in 2023,” it said. The completion time ranges for these packages may be shortened as well.
However, BTO flats may receive more attention because it is cheaper. You can tailor your house to your needs and preferences and you get a longer lease and a cheaper renovation cost. However, if you look at it from a cost-effective point of view, you realize you spend more and you get to wait longer for your home to be ready and this makes HDB resale flats a second and better option.
Buyers or Sellers?
With high records of prices in HDB resale prices, it would pose a problem to buyers and better opportunities as sellers. Why would this happen?
For buyers, it means that individuals would have to pay more for their desired HDB resale flats of interest. Buyers may also face competition from other buyers because there is a limited supply of these flats and the demand is up the roof as people may not be able to afford them. Buyers now may have to seek housing grants and loans as well. They would also have to look out for measures that governments have put in place to limit excessive borrowing of funds. Even at that, they still have to face renovating the flats and, that involves extra expenses aside from other taxes they will pay.
For sellers, they have a higher bargaining ground here especially if the seller buys low. They sell higher when the supply is low and the demand is high and make loads of profits. They also choose who they can sell as more buyers are in the market than sellers. In as much as they have the upper hand, they also have to face the regulations and minimum occupation period of the flats they’re selling. They would also have to, when buying factor in the cost of buying another property when selling their previous flats e.g. Stamp duties, resale levy, renovation cost, etc.
Because there are demands in the housing sector in Singapore, purchasing an HDB resale flat now would be a better time as there would be an increase of up to 2.0 % to 3.5 % in months to come, due to the less supply and higher demand of flats in the community.
If you’re thinking about buying property and finding yourself navigating the complexities of financial planning, loan evaluation, and the ever-changing landscape of bank interest rates, our dedicated team of experienced mortgage consultants is here to assist you every step of the way.
Armed with a wealth of knowledge accumulated over years of guiding individuals through these pivotal financial decisions, we are committed to offering you personalized mortgage advice that directly addresses your unique circumstances and aspirations. We understand that property ownership is a significant and transformative journey, and we’re here to ensure that your journey is characterized by well-informed decisions and confidence.