Singapore HDB Resale Flat Prices
In Singapore, most people typically go for public housing, built by the Housing Development Board (HDB), for their first home. These houses, commonly known as HDB flats, can be purchased directly from HDB when they are newly built, or from the open market from other HDB owners (henceforth referred to as resale flats).
While keeping my options open on how I will buy a house in the near future, I decided to look around to find out the market price for a resale flat. I am glad to chance upon a rather comprehensive data set on data.gov.sg which lists details of resale flats sold all the way from 1990 to 2018. The following outlines some of the insights I found from the data
Feel free to access the underlying visualisation here.
Current Resale Flat Prices Are Lower Than They Used to Be
In this post, I have based my analysis on the prices of 4-Room flats due to the following reasons
- They are one of the most commonly purchased flats according to the data, and one of the most commonly found flat types in most towns and locations
- 4-Room flats lie in the middle in terms of size and pricing among all the options available, and hence I believe it will be less prone to outliers
This chart shows how the median resale prices for 4-Room Flats increase from 1990 to 2017. We can immediately see resale prices first peaked in 1997, after which prices started dropping due to the Asian Financial Crisis. Prices started gradually to increase again from 2004 onwards and hit a new high in 2013 before decreasing again. The decrease coincides with several cooling measures implemented in the same year, such as the TDSR framework and adjustment of the ABSD. You may read more here and here.
By 2017, median prices for a resale 4-Room flat was 11% below that in 2013.
Convenience Matters
We know that the price of a resale flat will be greatly determined by its location. Convenience is subjective as well, as it involves how far a house is from the nearest MRT station, or how far that MRT station is from the downtown area or the individual’s workplace. We can attempt to obtain some of these information from Google Maps APIs.
After trying around several APIs , I decided to use Raffles Place MRT as a proxy for downtown area. Using Google Maps APIs, I query the travelling time required from Raffles Place MRT to the address associated with each Resale Flat unit in the data. Why I decided to do it this way will be explained later in the post.
HDB categorises each address in the data under a Town, which most Singaporeans should be familiar with. In the chart, a 4-Room flat in Central Area (consisting of places like Marina, Outram, Newton and several others) requires median travelling duration of less than 20 minutes to Raffles Place MRT and has a median resale price of $800k. This decreases as we look at towns with longer travelling times to Raffles Place MRT. A same 4-Room flat in Sembawang cost less than half of that, and probably has a longer flat lease as well.
Price Increases (or Decreases) at Different Rates Across Towns
We have seen in the first chart that prices have increased from 1997, and decreased from 2013. Let’s look at another view where we see how prices change by town.
The two charts show how prices have changed from 1) 1997 to 2017, 2) 2013 to 2017. While prices have generally seen an increase across all towns from 1997 to 2013, the price increase was greater for the more centrally located houses, and Central Area homes have registered an increase by double, compared to 15% for Pasir Ris.
The chart for 2013 to 2017 shows an interesting pattern as well. While prices for most places decreased, prices in Central Area increased by 44% within the four years!
Conclusion
In this post, we can see while resale flat prices have generally increased since 1990s and went down slightly after cooling measures imposed in 2013, price appreciation is not uniform across the board. This exercise has also helped me have an estimate of how much I should pay for a resale flat in areas that I am interested in. I hope this will be useful information for you if you are considering getting a resale flat!
Notes
Why travelling duration from home address to Raffles Place MRT is used
- Raffles Place MRT is one of the major MRT interchange in Singapore, and located within downtown Singapore. Hence, this is a proxy which I believe is suitable to be used to determine how central a house is
- Although a person may consider a house in Sembawang to be convenient if he stays 5 minutes from where he works, I believe the resale flat price will be largely affected by how majority of the population views the convenience of Sembawang in general
- By simply using Raffles Place MRT and the home location as inputs for Google Maps API, the API will help me determine the best route to get from the house to Raffles Place. This will be a good enough proxy for the optimal route a person would probably take to travel to Raffles Place MRT
