Balancing the aspirations of homebuyers with the broader goals of the community, Singapore is making its public housing system more inclusive and accessible than ever.
A flotilla of new supply, the biggest since 2017, berthed at the market last year with the completion of 21,400 Housing and Development Board (HDB) flats, the country’s public homes, in addition to 20,400 units from private developers. State land tenders or Government Land Sales (GLS) last year are expected to yield 9,250 residential units, a decade-high record for the land-scarce island nation.
For property seekers and sellers, this likely means that we’ll have a steady supply of new homes coming to the market in the coming years, reducing the kind of fluctuations we’ve experienced, for instance, in the rental market which took off between mid-2021 and late 2023.
Property seekers found recourse in HDB’s resale marketplace during the pandemic when construction delays undermined the completion of the board’s highly desired Build-To-Order (BTO) offerings.
That demand continues, buoyed in part by private homeowners hoping to downgrade to a public flat. Around 185 resale flats were sold for at least SGD1 million in Q1 2024, breaking a record that had just been set in the previous quarter, according to flash estimates from the board.
Larger HDB flats emerge as a value proposition, especially when compared to private homes of similar size and location, which command a substantially higher price. This trend reflects a broader market behaviour where buyers prioritise value and affordability amidst economic uncertainties.
Still, in the spacious, suburban areas of OCR (Outside Central Region), some 1,275 new private homes were sold in Q1, the highest quarterly sales in the neighbourhood since 2021, reports real estate agency OrangeTee.
“Although the pace of sales in the private residential market has quietened from the heady days in 2021 and 2022, with homebuyers no longer showing the frenetic urgency on the back of limited options and fear of missing out, buyers are still able to identify value opportunities and acquire suitable properties for owner-occupation,” says Leonard Tay, head of research at real estate advisor Knight Frank Singapore.
Prices of private condominiums and apartments increased by one percent in the first quarter, but that is down from the 2.3 percent expansion in Q4 2023, according to flash estimates by the Urban Redevelopment Authority (URA). Those of their landed counterparts slowed down from 4.6 to 3.4 percent, too.
Absent tighter monetary policies, private home prices could still grow by around three to six percent this year, with HDB resale prices rising by up to five percent, OrangeTee predicts. The US Federal Reserve, which typically influences Singapore interest rates, announced in January that rates would hold steady at a range of 5.25 to 5.5 percent.
In addition to downgraders, demand for HDB resale homes also stemmed from first-time buyers unwilling to wait for BTO sales launches, which now happen thrice a year instead of four. That could now change with the imminent launch of 19,600 BTO flats this year—and a tectonic shift in public housing policy.
Starting H2 2024, BTO projects are classified according to Standard, Plus, and Prime tiers, the former being the cheapest and most ubiquitous and the latter being the choicest in terms of location. The framework, the prime minister says, should “maintain a good social mix in every town and every region.”
The new framework could be a boon to an oft-overlooked segment of Singaporean society: singles. The dramatic reshuffle allows singles to buy two-room flexi flats across all types of BTO projects; they were previously forbidden from buying flats in mature estates.
