Your search results

ANALYSIS: Unveiling the HDB Towns with the Steepest and Lowest Price Surges!

Posted by Jayson Ang on August 17, 2024

| 0

TLDR

The real estate market for HDB flats in Singapore has witnessed significant growth, with prices reaching new highs. The West Region saw the highest price increase, particularly in Bukit Batok, which experienced a remarkable surge. On the other hand, Kallang/Whampoa saw a decline due to increased BTO flat launches. Four-room flats remain popular, with Bukit Batok and Bukit Timah showing notable price growth. Clementi lagged behind due to its higher prices and older flats. Factors influencing buyers’ decisions include MOP completion, connectivity improvements, and BTO launches. Strategic real estate advice and understanding market trends are crucial for making informed decisions in the dynamic real estate landscape of Singapore.

The real estate market for HDB flats has been on a constant upward trajectory, with prices soaring to new heights. Last year, the overall average resale price for these flats hit a staggering $564 per square foot (psf), representing a 6% jump from the previous year’s $532 psf and an astounding 27.9% surge from 2014’s $441 psf.

Thanks to robust demand and a steady rise in household income, experts predict that HDB resale prices will continue to climb, albeit at a slower pace. In fact, 2021 saw a record-breaking 29,065 resale transactions, only to dip to 26,805 in 2022 before slightly decreasing to 25,990 last year. This is in stark contrast to the years between 2014 and 2020, where the number of transactions remained below the 24,000 mark.

But what’s fueling this fervent demand for HDB resale flats, you ask? Look no further than the two government policies that are giving the market a much-needed boost. The first is the 15-month wait period imposed on individuals who have previously owned private residential properties and are now seeking to purchase a resale HDB flat as their replacement home. For those who sold their private properties when the regulation was first introduced, the wait period has just come to an end. And for potential buyers eyeing the upcoming Prime and Plus categories for Build-to-Order (BTO) flats, the longer minimum occupation period (MOP) of 10 years may just push them towards the resale market. This is in contrast to resale flats, where the MOP remains at five years, making it a more attractive option for buyers looking for a quicker move-in option.

Through our thorough analysis in this article, we unravel the top and bottom performing HDB towns and regions in terms of resale price growth, empowering potential buyers with valuable insights to guide their decision-making process.

West Region Tops The Growth Chart

In the past year, the Central Region showed modest price growth of 5.2% year-on-year, while the West Region soared with the highest increase of 7.2%. Despite this, the Central Region claimed the crown for highest average price at $684 per square foot, leaving the West and North Regions trailing behind with average prices of $524 psf and $511 psf, respectively.

Bukit Batok: Sitting At The Top Of The Growth Chart

Last year, the West Region of Singapore saw an impressive surge in resale HDB flat prices, with the charming town of Bukit Batok leading the pack with a remarkable 14.1% year-on-year growth. Trailing behind in second and third place were the prestigious Central Region towns of Bukit Merah and Bukit Timah, boasting respective growth rates of 10.7% and 9%.

What’s truly remarkable is that Bukit Batok has consistently maintained its position among the top three HDB towns with the highest price growth over the years 2014, 2021, and 2022. This unwavering upward trend has undoubtedly propelled the West Region to claim its well-deserved spot at the top of the price growth chart.

The skyrocketing prices and demand for flats in Bukit Batok can be attributed to the town’s rising popularity. Last year, a record-breaking 1,415 HDB transactions were recorded, thanks to the buzz surrounding the neighboring new town of Tengah and the government’s ambitious plans to transform the nearby Jurong Lake District into a bustling regional center.

Furthermore, the numerous flats in Bukit Batok that reached their Minimum Occupation Period (MOP) last year also contributed to the surge in demand. With a longer remaining tenure, these newer flats are highly coveted by eager homebuyers, willing to pay a premium for the added convenience and comfort. In fact, a staggering 42,000 flats in Bukit Batok obtained their MOP in the previous year alone, adding to the town’s already alluring appeal.

Not only is Bukit Batok one of the smaller HDB towns, but it also boasts a unique charm that sets it apart from the rest. According to the latest HDB annual report, a mere 4.3% of the total HDB stock in Singapore can be found within its boundaries, with a total of 45,261 flats as of March 31, 2023.

But that’s not all – the allure of this town is set to skyrocket with the imminent improvements in connectivity. With only two MRT stations, Bukit Gombak and Bukit Batok, serving the entire town, it may seem modest in comparison to other bustling areas. However, with the upcoming Jurong Region Line, both stations will be a single stop away from an interchange station, providing easy access to other parts of Singapore.

To add to the convenience, Bukit Gombak MRT Station is just one stop away from Choa Chu Kang MRT Station, while Bukit Batok MRT Station is a mere hop away from Jurong East MRT Station. With such seamless connectivity, it’s no wonder that Bukit Batok is quickly becoming a sought-after destination for both residents and visitors alike.

Why Did Kallang/Whampoa Underperform?

Despite its popularity as a desirable HDB town, Kallang/Whampoa experienced a rare decline in its average price last year. The unexpected 1% year-on-year drop can be attributed to a weakening demand for resale flats within the town. This was evident in the decrease of sale volume, from 929 units in 2022 to just 790 units last year.

But what caused this decline in demand? It seems that the answer lies in the bumper crop of approximately 5,000 BTO flats launched in Kallang/Whampoa last year. With the option of purchasing a more affordable BTO flat, buyers without an immediate need for housing were drawn to this option instead of a resale flat. This trend is further reinforced by the fact that all BTO flats launched in the town were oversubscribed, a true testament to Kallang/Whampoa’s enduring popularity.

Meanwhile, in contrast to the bustling activity in Kallang/Whampoa, the neighboring town of Bukit Batok saw no new BTO launches last year. Could this be a contributing factor to its stagnant real estate market? Only time will tell.

A Deep Dive Into Four-Room Flats

HDB flats in Singapore come in a variety of sizes, but the four-room flats reign supreme as the ultimate choice for many homebuyers. They strike the perfect balance between spaciousness and affordability, making them the most sought-after flat type. In the bustling town of Bukit Batok, these four-room flats have been the talk of the town, with a whopping 13.5% year-on-year price growth. Unsurprisingly, this vibrant town has emerged as one of the top three areas with the highest price growth for all flat types. However, not all regions saw a rise in prices for these four-room abodes, as the West Region had two towns with the lowest price growth last year.

In the previous year, the four-room apartments nestled in Bukit Timah experienced a remarkable 13% increase in prices, marking it as the second-highest growth in the city-state. This can be accredited to its central location in a prime district, making it a desirable living space for many. However, the HDB’s latest annual report reveals that this well-positioned town only boasts a mere 2,554 apartments, out of which a meager 920 are four-room units, accounting for a mere 0.2% of all four-room flats in Singapore.

In stark contrast, the four-room abodes in Clementi lagged behind with a meager 1% price growth. Similarly, sluggish price growth was also observed in other areas, such as Choa Chu Kang (1.3%) and Kallang/Whampoa (1.5%).

As of March 31, 2023, the total number of four-room apartments in Clementi stood at 10,513, making up 2.4% of the total four-room flats in the country. Despite its popularity due to its abundant amenities and convenient connectivity through public transportation, the average age of 39 years for HDB flats in this town may have deterred some potential buyers. This is evident in the low sales figures, with only 227 and 221 four-room apartments being sold in 2022 and last year, respectively.

It is believed that those seeking newer living spaces may have applied for BTO apartments in neighboring towns instead. The adjacent town of Tengah, which witnessed the launch of several BTO projects last year, could have also drawn some buyers away from Clementi. Additionally, the buzz surrounding the transformative plans for Jurong Lake District may have swayed buyers towards Jurong East, a town in close proximity to Clementi.

Moreover, the average prices of four-room flats in Clementi are substantially higher than in Jurong East, with last year’s figures standing at $675 psf and $477 psf, respectively. This could have prompted budget-conscious buyers to opt for Jurong East instead of Clementi.

In a surprising turn of events, the modest town of Bukit Batok claimed the highest price growth, thanks to a multitude of apartments reaching the Minimum Occupation Period (MOP), imminent improvements in connectivity, and an increase in buzz surrounding the area.

On the other hand, the HDB flats in Kallang/Whampoa are expected to offer weaker capital appreciation. This can be attributed to the numerous BTO apartments in the area, which may have diverted potential buyers away from the resale market. Similarly, demand and price growth were also lackluster for four-room apartments in Clementi, with buyers possibly being drawn towards the more affordable BTO apartments in nearby Tengah and the promising plans for the nearby Jurong Lake District.

Should You Buy, Sell or Wait?

If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?

It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.

I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.

I can help you by:

Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.

You May Also Like …

Buying Tips Mandarin Top 5

5 Qualities to Look for in an Agent to Ensure a Smooth Transaction

Jayson Ang – June 23, 2023 –

5 Qualities to Look for in an Agent to Ensure a Smooth Transaction Here are 5 qualities to look for...

All Buying Tips

Why It’s Not Financially Sensible to Pay Off Your HDB Flat Home Loan in Advance

Jayson Ang – April 29, 2024 –

TLDR When deciding whether to repay your HDB flat loan early, consider the limitations of not being able to obtain...

Mandarin Top 5

Top 5 Best Unique Nighttime Experiences in Singapore

Jayson Ang – December 13, 2024 –

Singapore, a vibrant city-state known for its stunning skyline and diverse culture, truly comes alive at night. As the sun...

All Blog Posts

3 Steps to Protect Yourself from Real Estate Scams in Singapore

Jayson Ang – December 17, 2022 –

Lately, there has been an increase in scams related to real estate. Scammers are pretending to be real estate agents...

Mandarin Top 5

5 Pros Of Buying A Resale Property

Jayson Ang – March 6, 2024 –

Luxury properties in Districts 9 and 10 of Singapore are highly coveted, and for good reason. From stunning views and...

All Blog Posts Buying Tips

When a Property Seller Pulls Out of the Deal : What Now?

Jayson Ang – April 2, 2023 –

TLDR When a property deal is not yet formalized, sellers can withdraw without consequences. However, once an Option to Purchase...

All Blog Posts Buying Tips Reports

Are Cluster Landed Homes Still a Good Investment? Analyzing Their Performance Over the Past Decade

Jayson Ang – October 19, 2024 –

TLDR When it comes to cluster housing, freehold properties like Bishopsgate Residences command top prices, whereas bargains can be found...

Mandarin Top 5

Top 5 : Best Architectural Marvels in Singapore

Jayson Ang – December 7, 2024 –

Singapore, a vibrant city-state known for its diverse culture and stunning skyline, is also home to some of the most...

All Buying Tips Opinion

6 Unexpected Property Warning Signs That Can Be Negative for Some, But Beneficial for Others

Jayson Ang – February 29, 2024 –

TLDR When considering property preferences, what may appear as a disadvantage to some buyers could be a unique opportunity for...

Mandarin Top 5

Top 5 Art Galleries in Singapore for Contemporary Art

Jayson Ang – May 24, 2024 –

Singapore, known for its modern architecture and vibrant culture, has a thriving art scene that showcases the best of contemporary...

All Blog Posts Buying Tips

6 Essential Factors HDB Upgraders Should Be Aware Of Before Purchasing a Condo in 2023

Jayson Ang – June 12, 2023 –

TLDR When upgrading your property, consider factors like rental rates, Buyer's Stamp Duty adjustments, higher interest rates for bank loans,...

All Blog Posts Opinion

Don’t Miss Out: Take Control of Your Life in Your 30s and 40s

Jayson Ang – December 28, 2022 –

TLDR The stages of wealth management vary from ages 30 to 80, with different focuses and considerations at each stage:...

All Blog Posts Opinion

Invest During the Bearish & Exit During the Bullish

Jayson Ang – December 27, 2022 –

TLDR A comprehensive overview of the real estate market trends, emphasizing the importance of strategic property analysis and investment decisions....

Mandarin Top 5

Top 5 Secrets : Foreign Investors Are Rarely Told About Singapore’s Real Estate Market

Jayson Ang – November 19, 2024 –

Singapore's real estate market has been a popular choice for foreign investors due to its stable economy, strategic location, and...

Mandarin Top 5

The Best Time to Invest in Singapore’s Property Market: Timing is Everything

Jayson Ang – April 30, 2024 –

Investing in the property market is a significant decision that requires careful consideration and analysis. One crucial factor that determines...

Mandarin Top 5

5 Tips To Spot Winning Investment Properties In Singapore

Jayson Ang – September 6, 2024 –

Investing in real estate is an exciting and potentially lucrative venture. In Singapore, a thriving property market attracts both local...

Mandarin Top 5

Top 5 Reasons Why Singapore’s Luxury Property Market Is Booming – Expert Analysis!

Jayson Ang – October 17, 2024 –

Singapore's luxury property market has been experiencing a significant boom in recent years, attracting the attention of investors and high-net-worth...

Mandarin Top 5

Top 5 Best Hidden Photography Locations in Singapore

Jayson Ang – October 3, 2024 –

Singapore, a vibrant city-state known for its iconic landmarks and bustling urban landscape, is also home to numerous hidden gems...

All Opinion

Housing Affordability in 2023: Is Singapore Property Truly Unaffordable?

Jayson Ang – November 4, 2023 –

TLDR Singapore’s property market faces challenges with high prices, especially in private housing. While public housing remains more affordable, the...