New Launches NEWS: Due to flat prices, HDB's resale price growth slows to 10.4% for 2022

The red-hot housing market may finally show signs of cooling off, analysts say, with New Launches prices flat and sales falling in the fourth quarter of 2022. Data from the Commission The Housing and Development Board (HDB) showed resale prices rose 2.3 per cent from three months ago – the slowest growth in the past year.

It's also the smallest quarterly gain since Q3 2020, when prices rose 1.5%, said Christine Sun, senior vice president of research and analysis at OrangeTee & Tie. For all of 2022, resale prices rose 10.4%, slower than 2021's record 12.7% growth. But Sun noted that this is still well above the 5% growth announced in 2020. The 2.3% increase in the fourth quarter announced on Friday (January 27) was slightly higher than the previous estimate of 2.1% published on January 3.

PropNex Realty's head of research and content, Wong Siew Ying, said that the property cooling measures implemented in September had slowed to limit demand, as well as "market activity". muted due to seasonal lulls”.

She added: “Market observations suggest that the supply of HDB resale apartments available for sale remains limited amid steady demand for them.”

Wong also noted that the number of multimillion-dollar resale units has skyrocketed to 370 units in 2022, from 259 units in 2021.

New Launches - HDB's resale price growth slows to 10.4% for 2022

“(This) contributes to raising concerns about housing affordability,” she said. “To put the numbers in context, 370 units accounted for only 1.38% of HDB’s total resale transactions last year.”

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Meanwhile, New Launch Property resale volume fell 12.6% in Q4 to 6,597 units, from 7,546 units in the previous quarter. Compared to the same period last year, this is a decrease of 16.9%. The resale volume for the whole year of 2022 reached 27,896 units, 10.1% lower than the previous year's 31,017 units.

The decline in the fourth quarter was partly due to the build-to-order (BTO) activity that took place in November, said Mohan Sandrasegeran, senior analyst for research and content creation at One Global Group. Nearly 10,000 units have since been launched, making it the largest offering in a single launch to date. Sandrasegeran noted: “Homebuyers may be attracted to BTO as it offers a wide selection of apartments in both mature and immature areas.

Other homebuyers may have chosen not to sell their apartments in Q4, he said, choosing instead to wait for market conditions to improve or continue to monitor the impact of cooling measures in September.

The HDB town with the highest median 3-room apartment price is in Punggol at S$451,000, while the lowest is in Geylang with S$335,000. For a 4-room apartment, the highest average price recorded in Kallang Whampoa was S$788,000, while the lowest average price recorded was in East Jurong at S$465,000.

For 5-room apartments and luxury apartments, the highest median prices were in Bukit Merah with S$899,000 and Hougang with S$845,900. The lowest average prices are in Jurong East at S$566,000 and Choa Chu Kang at S$679,000.

OrangeTee & Tie's Sun found that 10 out of 26 towns experienced an average price drop in the past quarter. The biggest declines were in Serangoon and Jurong East at 6.5% each, followed by Toa Payoh at 6%.

On the other hand, 17 towns recorded a negative percentage point change when comparing the Q3 to Q4 price change with the Q2 to Q3 change.

“(This shows) many towns have seen prices rise more slowly or fall after cooling measures,” said Sun.

Besides, New Launch Condos the HDB rental market, there were 56,647 HDB apartments rented, a slight increase of 0.5% compared to Q3. HDB approved 8,476 apartment rentals of HDB, up 3.5% QoQ and down 19.7% YoY. The number of HDB apartment rental applications approved for the whole of 2022 decreased by 15.1% to 36,166 cases, from 42,623 cases in 2021.

Based on the latest HDB data, the highest average rent is for a 5-room apartment in Queenstown at S$4,200, while the lowest average rent is for a 3-room apartment in Bukit Panjang in 2,000 Singapore dollars.

In February, HDB will deliver approximately 4,400 BTO apartments in Jurong West, Kallang Whampoa, Queenstown and Tengah. Another 3,800 to 4,800 units will be offered for sale in May. In total, HDB said it will launch up to 23,000 BTO units by 2023. HDB added that it is "prepared to roll out up to 100,000 units between 2021 and 2025 if needed".

Nicholas Mak, head of research and consulting at ERA Realty, emphasized that the government's effort to boost the supply of BTO apartments demonstrates its determination to "conquer rising HDB resale prices" at the same time. meet the housing needs of Singaporeans.

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