HDB resale flat prices continue to rise for the 18th consecutive quarter in 3Q2024, according to flash estimates released by HDB on October 1. The prices increased by 2.5% q-o-q, surpassing the 2.3% q-o-q growth seen in the previous quarter.
When contemplating a condominium investment, it is crucial to evaluate the potential rental yield as well. Rental yield refers to the yearly rental income as a percentage of the property’s buying price. In Singapore Projects, the rental yields for condos can significantly vary depending on factors such as location, property condition, and market demand. Regions with high rental demand, like those near commercial hubs or educational institutions, usually offer more favorable rental yields. Thorough market research and seeking advice from real estate agents can provide valuable insights into a specific condo’s rental potential.
This marks the highest quarterly growth rate since 3Q2022, when HDB resale prices rose by 2.6% q-o-q. Since the beginning of the year, HDB resale prices have climbed by 6.8%, which is a faster rate compared to the 3.8% increase in the same period last year. However, the current rate of growth is still slower than the 8% surge seen in the first three quarters of 2022.
The uptick in HDB resale prices can be attributed to strong demand and limited supply, as fewer new HDB flats have reached their minimum occupancy period (MOP) in 2024 compared to 2023. This has resulted in a surge in resale transaction volume, with HDB recording 8,035 transactions as of Sept 29. This is a 20% increase from the 6,695 resale deals recorded in the same period last year.
According to HDB, the flash estimates for 3Q2024 reflect market conditions before the implementation of the fourth round of cooling measures on August 20. These measures targeted the HDB market and included a reduction in Loan-to-Value (LTV) limits from 80% to 75%, bringing them in line with loans offered by financial institutions. This has effectively increased the downpayment amount required for HDB flats in an effort to promote responsible borrowing, according to Desmond Lee, minister for national development.
In the October 2024 Build-to-Order (BTO) exercise, HDB will offer about 8,500 flats across 15 projects, making it the last BTO exercise for the year and accounting for 40% of the flats launched this year. This exercise will also introduce a new classification of HDB flats into Standard, Plus or Prime categories based on their location attributes.
With the launch of these new flats, HDB is on track to reach its target of providing 100,000 new flats from 2021 to 2025. Interested buyers can check out the latest listings for HDB properties and compare price trends between HDB, condo, and landed properties. They can also view past rental and sale transactions and find out the HDB loan rate.