As the first quarter of 2025 came to a close, data revealed that the growth of HDB resale prices has experienced a notable slowdown. The official figures indicated that prices rose by only 1.6% during this period, a significant decrease compared to the previous quarters that had seen more robust growth. This deceleration in price appreciation has raised concerns among stakeholders in the housing market, particularly amidst a backdrop of increasing interest rates and economic uncertainty.
The slowdown in resale price growth comes despite a record number of million-dollar flats being transacted in the HDB market. During the first quarter, a total of 145 flats were sold for at least a million dollars, reflecting a growing trend among buyers willing to invest heavily in certain locations. These million-dollar transactions, however, have not been sufficient to counterbalance the overall decline in price growth. Many analysts noted that the concentration of such high-value transactions in specific neighborhoods failed to stimulate broader market activity.
Market dynamics have shifted significantly in recent months, influenced by various economic factors. Rising interest rates have made borrowing more expensive, leading potential buyers to adopt a more cautious approach. As home loan costs increase, affordability becomes a critical issue for many families, which in turn affects demand. Consequently, this cautious sentiment has contributed to the overall moderation in resale price growth across the HDB sector.
Additionally, external economic pressures, including inflation and supply chain disruptions, have also played a role in shaping the housing landscape. As the cost of living rises, many prospective homeowners are reevaluating their purchasing decisions. This has led to a more restrained approach towards property investment, further impacting the resale market. The interplay of these factors has created an environment where price growth, while still positive, has diminished.
Moreover, the supply of new flats continues to play a crucial role in the market. The government has ramped up its efforts to increase the availability of new Build-To-Order (BTO) flats to meet demand. With more new flats entering the market, buyers have more options, which can create downward pressure on resale prices. This influx of new housing stock may have contributed to the slowdown in price growth, as buyers weigh their choices between new and resale properties.
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News Source: Edgeprop
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