Affordable 4-Room and 5-Room Resale Flats Exist, But Where Are They?

In real estate, the phrase “location, location, location” is a frequently-heard mantra echoing the importance of location when buying a new property. While that’s undeniably true, the next most-important consideration for the conscious homebuyer is most assuredly, price.

After all, with ongoing concerns about HDB resale flats hitting the million-dollar mark – one of the latest, and also priciest, being a $1.45m Cantonment Road 4-room unit– it isn’t surprising that some homeowners are feeling discouraged about finding their dream HDB flat for an affordable price on the secondary market.

Turning back the clock to 2012, news about the first-ever million-dollar HDB flat broke when it was reported that an executive flat in Queenstown was sold for seven figures. And ever since, the number of resale HDB flats sold at the million-dollar mark has steadily risen. 

In 1Q 2024, a total of 183 resale HDB flats were sold in the million-dollar range based on lodged transactions, with a further 236 units recorded for 2Q 2024.

Should you be worried?

In a vacuum, these figures are daunting for anyone concerned about affordable homeownership in Singapore. Be that as it may, this perspective deserves a second look, this time on a wider scale. 

Based on the total number of 13,203 resale HDB flats sold in 1H 2024, only 419 of them were transacted at over the million-dollar mark; this amounts to only 3.2% of all resale HDB transactions.

Or put another way, for every million-dollar HDB flat sold during the first half of 2024, there were approximately 31 other HDB flats transacted across a spectrum of prices – all below the seven-figure benchmark. 

Hence, in response to the million-dollar question of whether you can find affordable resale HDB flats in the market today, we are inclined to give a firm “yes”. 

Still, the proof of the pudding is in the eating (yum!). Below, we spotlight several locations in Singapore where not just 4-room resale HDB flats, but also their 5-room counterparts, are available for less than a million dollars. 

But first, how did the resale HDB flat market fare for the first half of 2024? 

Before we start exploring where affordable resale HDB flats can be found, here are some quick facts about the current market as of 1H 2024: 

• More resale HDB flats were transacted in the first six months of 2024 compared to the same period last year

As of 30 June, based on transactions lodged, resale HDB flat sales had achieved modest year-on-year growth in the first half of 2024. With 13,203 resale HDB flats sold in 1H 2024, this marks a 2% increase in transaction volume over 1H 2023, which had 12,940 resale HDB transactions recorded. 

This year-on-year increase indicates a steady growth in demand for resale HDB flats. 

• The average price for a 4-room resale flat was $608,299 whilst the average price for a 5-room resale flat was $712,604 in 1H 2024. 

Hence, referring to these average prices, we’ve set the thresholds for what qualifies as “affordable prices” at $650k for 4-room flats and $750k for 5-room flats.

• There were 5,663 4-room resale HDB flats sold in the first six months of 2024

In the first half of this year, there were a total of 5,663 4-room resale flats transacted. Amongst them, 4,244 units (or roughly 75% of them) were sold for under $650k. 

Let us examine the segment of affordable flats by flat age: 

Chart 1: Breakdown of 4-room resale HDB flats sold for under $650k in 1H 2024 by ages than a million dollars.

Source: data.gov.sg (as of 3 July 2024), ERA Research and Market Intelligence

Units that are 15 years and below (32%) made up the bulk of 4-room resale HDB flats transacted under the $650k mark. This is followed by units that are 36 – 45 years old (27%) and 26 – 35 years old (20%).

• There were 3,050 5-room resale HDB flats sold in the first six months of 2024

As for 5-room resale HDB flats, 3,050 units changed hands in the first half of 2024. And of this number, 2,133 units (or approximately 70% of them) were transacted with a price tag that’s less than $750k.

Below, a more detailed overview by flat age:

Chart 2: Breakdown of 5-room resale HDB flats sold for under $750k in 1H 2024 by age

Source: data.gov.sg (as of 3 July 2024), ERA Research and Market Intelligence

Unlike the 4-room resale HDB market for 1H 2024, the majority of affordable 5-room HDB homes sold are between 16 – 25 years in age (38%); this is followed by units between 26 – 35 years (25%) and 36 – 45 years (18%) age brackets.

Where can you find affordable 4-room resale HDB flats for less than $650k? 

Of the 26 towns where 4-room resale HDB flats under $650k can be found, the top three towns with the greatest number of such resale units in 1H 2024 are Yishun (416 units), Woodlands (406 units), and Sengkang (373 units).

Map 1: Locations of 4-room resale HDB flats sold for under $650k in 1H 2024

Source: data.gov.sg (as of 3 July 2024), ERA Research and Intelligence

In these satellite towns, residential properties tend to be sold at more pocket-friendly prices than those in the heart of Singapore. 

However, that isn’t to say that your odds of finding 4-room HDB flats for under $650k in mature towns are poor. In 1H 2024, Tampines, Bedok, and Pasir Ris each saw 277, 144, and 113 units sold, but take note: the clock may be ticking on these units as a large number of them are likely to be 35 years old and above. 

Which towns saw the most sales of 5-room resale HDB flats under $750k? 

Similarly, amongst the 21 towns where 5-room resale HDB flats under $750k can be found, the bulk of sales activity mainly took place in suburban locales. 

Map 2: Locations of 5-room resale HDB flats sold for under $750k in 1H 2024

Source: data.gov.sg (as of 3 July 2024), ERA Research and Intelligence

In 1H 2024, Sengkang (292 units) emerged as the town with the highest number of 5-room units sold for less than $750k. Tailing closely behind are Woodlands (265 units) and Jurong West (259 units), which also saw significant volumes of 5-room resale flat transacted below the $750k price point. 

And once again, Tampines, Bedok, and Pasir Ris topped the charts for mature towns with the most number of 5-room HDB units transacted for under $750K, clocking in at 158 units, 60 units, and 70 units respectively. 

In which towns can you find affordable 4-room and 5-room resale HDB flats that are also relatively young (15 years old and below)?

While price is definitely on the minds of most resale HDB flat buyers in Singapore, it’s also crucial that they consider the age of the homes that they are interested in. Ideally, a resale property that offers good value should be 15 years old or younger; this is to ensure that it has a longer remaining lease, and thus retains its worth in the future.

Map 3: Resale 4-room HDB flats, 15 years and below, sold for under $650k in 1H 2024

Source: data.gov.sg (as of 3 July 2024), ERA Research and Intelligence

In the case of 4-room resale HDB flats that are 15 years old and younger, these units are most likely to be available in non-mature towns. Topping this list is Punggol with 254 units, followed by Sengkang with 211 units, and Yishun with 191 units.

Map 4: Resale 5-room HDB flats, 15 years and below, sold for under $750k in 1H 2024 

Source: data.gov.sg (as of 3 July 2024), ERA Research and Intelligence

Compared to other towns where 5-room HDB flats sold for below $750K in 1H 2024, Yishun, Punggol, and Choa Chu Kang stand out for having the greatest number of transacted units that are 15 years old or younger; Yishun accounted for 58 of such units, Punggol had 52, and Choa Chu Kang had 50.

Or in other words, budget-conscious homebuyers have a greater chance of finding a resale HDB flat with more time left on its lease in the abovementioned non-mature estates, and for a reasonable price too! 

So, what can aspiring resale HDB flat buyers take away from these findings?

To sum it all up, if you’re in the market for an affordable 4-room or 5-room HDB resale flat, you’d do best to start your search in suburban Singapore. This is due to generally lower home prices in these newer, less-developed estates, making it easier to find an HDB resale flat that suits your budget there. 

Also, finding a resale HDB flat that’s relatively young will give you the most value for your money. This matters, since remaining tenure is a key determinant of a leasehold property’s sale value – especially if you have plans to upgrade down the road. 

And finally, not to forget what could be the most important takeaway of all: Don’t lose hope. Because even with the constant buzz surrounding million-dollar housing transactions, affordable resale HDB flats do exist out there somewhere. 

Disclaimer

This information is provided solely on a goodwill basis and does not relieve parties of their responsibility to verify the information from the relevant sources and/or seek appropriate advice from relevant professionals such as valuers, financial advisers, bankers and lawyers. For avoidance of doubt, ERA Realty Network and its salesperson accepts no responsibility for the accuracy, reliability and/or completeness of the information provided. Copyright in this publication is owned by ERA and this publication may not be reproduced or transmitted in any form or by any means, in whole or in part, without prior written approval.