Housing Board resale prices climbed for an eighth consecutive quarter to fresh highs, though there were signs that some price resistance could be setting in.

Resale prices of flats rose 2.3 per cent in the first quarter of this year from the previous three months – a slower pace compared with the 3.4 per cent increase in the fourth quarter of 2021, according to HDB’s flash estimates released on Friday (April 1).

This was also the lowest price growth since the third quarter of 2020, when prices rose 1.5 per cent. Compared with a year ago, HDB resale prices have risen by 12 per cent.

Ms Christine Sun, senior vice-president of research and analytics at OrangeTee and Tie, said: “Last quarter’s slower price growth was not unexpected. As prices have already risen for eight consecutive quarters and is at a new record last quarter, some price resistance could be setting in.”

Ms Sun said 82 resale flats were sold for at least $1 million in the first quarter, almost on a par with 85 such transactions in the previous quarter.

Of the million-dollar transactions, more flats breached the $1.3 million mark and could soon be breaking the $1.4 million level, she said.

But Ms Sun added: “Middle- and lower-income Singaporeans, who form the bulk of HDB flat purchasers, may be more affected by the higher cost of living.

“Should inflation worsen, more people may opt for smaller flats or flats in non-mature estates, which tend to be lower priced. We anticipate that resale prices may continue to rise but at a slower pace of between 5 and 8 per cent this year.”

HDB resale prices rose 12.7 per cent in 2021, the highest annual growth since 2010.

Mr Nicholas Mak, head of research and consultancy at ERA Realty Network, said he expects the HDB resale market to remain buoyant as the supply of new flats remains an issue.

He added that about 35,000 HDB flats will reach the end of their minimum occupation period (MOP) this year and could potentially be sold in the resale market.

“These newer flats typically command higher prices than the older flats in the same neighbourhood, which would contribute to an increase in HDB resale prices,” he said.

Mr Mak estimates that HDB resale prices could still rise by about 3 per cent to 7 per cent for the whole of 2022.

Mr Lee Sze Teck, senior director of research at Huttons Asia, said that December’s property cooling measures may have held back some buyers who are still assessing the measure’s impact on prices.

But as Covid-19 measures are eased and construction companies are allowed to bring in more workers to quicken the completion of new flats, the supply issues may be alleviated soon.

Like Mr Mak, Mr Lee said the large volume of flats reaching their MOP may also drive price increases, as newer homes command higher prices.

HDB will release the final resale price index for the full quarter, along with more public housing data, on April 22.

Next month, the board will offer about 5,300 Build-To-Order (BTO) flats in towns and estates such as Bukit Merah, Jurong West, Queenstown, Toa Payoh and Yishun.

Then in August, about 6,300 to 6,800 BTO flats will be offered in towns and estates such as Ang Mo Kio, Bukit Merah, Choa Chu Kang, Jurong East, Queenstown and Woodlands. This figure is subject to review and more project details will be firmed up closer to the launch date, said HDB.

More information on the BTO flats is available on the HDB InfoWEB.

HDB said it will continue to monitor housing demand and adjust the plans where necessary.

Originally published in Straits Times.