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[SINGAPORE] The pace of growth in resale prices of public housing flats slowed in the first quarter of 2025, growing 1.6 per cent over the previous three months on a higher supply of units.

This is lower than the 2.6 per cent price increase in the fourth quarter of last year, and the average quarterly growth of 2.3 per cent in 2024, data released by the Housing and Development Board (HDB) on Friday (Apr 25) showed.

The 1.6 per cent growth also marks the slowest pace of price increase since Q1 2024, suggesting that prices may be stabilising, pointed out Huttons Asia’s senior director of data analytics Lee Sze Teck.

“Since bottoming out in Q2 2019, the prices of HDB resale flats have gained 53.7 per cent, and from the circuit breaker in April 2020, prices have appreciated by 52.4 per cent,” he noted.

Year on year, prices rose 9.4 per cent, almost three times faster than the 3.3 per cent price growth of private residential properties, said Nicholas Mak, chief research officer at Mogul.sg.

Transaction volumes of resale flats rose 2.6 per cent in Q1 to 6,590 units, from the 6,424 units in the previous quarter. Year on year, however, this was a 6.8 per cent decrease.

Market watchers attributed the softer performance of resale prices and volumes to a higher supply of flats through public housing exercises.

Lee said that the largest Sale of Balance Flats (SBF) exercise in February diverted some buyers away from the resale market. More than 20,000 applications were received for the 5,590 flats.

With more options available, demand for resale flats eased, leading to a smaller price hike in Q1, he added.

Policy changes also contributed to the slower growth, said Lee, who noted that more singles have been applying for two-room flexi Build-To-Order (BTO) flats. As a result, prices of two-room resale flats grew more slowly, rising 1.6 per cent in Q1.

Additionally, seasonal effects such as the Chinese New Year festivities, dampened activity in the secondary market, said Mohan Sandrasegeran, head of research and data analytics at Singapore Realtors.

More flats sold for S$1 million and up

Lee estimates that 348 resale flats were sold for S$1 million and above in Q1, up 22.1 per cent from the previous quarter. The figure also represents the “highest number of million-dollar flat transactions in a single quarter”.

Eugene Lim, ERA Singapore’s key executive officer, said that the increase in million-dollar deals was mainly due to private property right-sizers and HDB upgraders, who prefer larger, centrally located flats with longer leases. Desirable locational traits, such as strong transport connectivity and proximity to reputable schools, further support this demand, motivating buyers to pay premium prices for these homes,” he explained.

Towns such as Bukit Merah, Bishan and Queenstown have a higher share of such deals, said Huttons’ Lee. “Toa Payoh has the highest proportion of million-dollar flat transactions, at 28 per cent, due to more flats fulfilling the five-year minimum occupancy period (MOP).”

On the rental market front, 59,567 HDB flats were rented out as at the end of Q1, up 0.9 per cent from Q4.

HDB approved 9,662 cases to rent out the flats, a 12.3 per cent jump quarter on quarter and 2.8 per cent rise year on year.

OrangeTee’s chief researcher and strategist Christine Sun said that rental demand usually picks up after the year-end holidays and festive season. She observed an increase in foreign students and expats returning to Singapore, mainly driven by the country’s stable employment outlook and easing inflationary pressures.

“Some landlords were also more flexible and open to negotiating rents, given the intense competition for tenants from the private rental market,” she added.

The highest median rental price was for five-room flats in Bukit Merah and Queenstown at S$4,200; the lowest median rental price was for two-roomers in Punggol and Sengkang at S$2,300.

Market to remain resilient

Analysts believe that resale prices will continue climbing at a moderate pace as demand remains firm amid macro clouds.

Mogul’s Mak said that the ongoing trade tensions could push up demand for new and resale HDB flats. “This is because during periods of economic and job market uncertainty, some eligible homebuyers would gravitate towards more affordable housing choices,” he pointed out.

OrangeTee’s Sun also noted that demand may hold steady as the market is primarily bolstered by domestic buyers. But she cautioned that the mid-term outlook would depend on how the ongoing trade war might escalate. “Amid an atmosphere of heightened caution, many potential buyers may exercise greater restraint to avoid overstretching their budgets.”

The conservative approach could, therefore, result in slower price growth in the upcoming months.

Still, Huttons’ Lee thinks that the resale market is “relatively insulated” against the impact of tariffs as it “fulfils an essential need”.

The HDB resale market caters predominantly to Singaporean households and owner-occupiers, said PropNex’s head of research and content Wong Siew Ying, who expects demand to be fairly resilient and prices to remain stable, notwithstanding uncertainties brought on by the US tariffs.

As demand remains firm, analysts project prices to rise at a moderate pace as the government rolls out more public housing.

In July, HDB will launch about 5,400 BTO flats in Bukit Merah, Bukit Panjang, Clementi, Sembawang, Tampines, Toa Payoh and Woodlands. It will also run a concurrent SBF exercise offering about 3,000 units, bringing the total supply this year to about 8,500 units.

More resale flats will enter the market as the number of new flats reaching the MOP will rise, from about 8,000 this year to 13,500 in 2026 and 19,500 in 2028, said HDB.

Sandrasegeran said: “While price pressures may persist in certain segments due to limited inventory, especially for spacious flats in central locations, the broader expansion of public housing supply is likely to ensure price stability and support long-term housing affordability.”