HDB Resale Prices Up 1.5% in Q1 2025: Slowest in 5 Quarters

In the first quarter of 2025, Housing and Development Board (HDB) resale prices in Singapore rose by a modest 1.5%, marking the slowest growth in five quarters and a notable departure from the robust 2.6% increase seen in the previous quarter. This deceleration, accompanied by a 7.7% year-on-year drop in transaction volume to 6,392 units by late March, signals a market responding to a deliberate influx of supply through Build-to-Order (BTO) flats and the largest-ever Sale of Balance Flats (SBF) exercise in February 2025. Far from a sign of weakness, this shift underscores a calculated effort to temper a heated market, raising questions about whether Singapore’s public housing landscape is entering a phase of sustainable moderation or merely pausing before another surge.

The primary driver behind the 1.5% growth lies in the government’s aggressive push to bolster housing supply. Over 50,000 BTO flats are slated for launch between 2025 and 2027, a move designed to alleviate pressure on the resale market by offering first-time buyers and upgraders affordable alternatives. The February 2025 SBF exercise, with approximately 3,000 flats, further diverted demand, contributing to the slowdown from the 2024 quarterly average of 2.3%. This supply injection comes at a time when only 8,000 flats are reaching their minimum occupation period (MOP) in 2025, a figure set to rise significantly to 13,500 in 2026 and 19,500 by 2028, promising a gradual easing of supply constraints that have long fueled price escalation.

Despite the supply-driven slowdown, demand for HDB resale flats exhibits remarkable resilience, particularly for specific segments of the market. Executive flats, which saw an 11.5% sales increase in 2024, and four-room units in mature estates—where median prices have crossed $500,000—continue to attract buyers willing to pay premiums for space and location. This persistent demand reflects a broader trend of HDB upgraders leveraging strong resale proceeds to fuel their housing aspirations, a cycle that sustains market activity even as overall growth slows. The 2024 annual sales volume of 28,986 units, up from 26,735 in 2023, underscores this durability, despite the Q1 2025 dip.

To fully grasp the significance of Q1 2025, it’s worth stepping back to the broader trajectory of HDB resale prices. The past five years have seen relentless growth, with prices climbing 9.7% in 2024 alone, doubling the previous year’s gains and outpacing the 2.5% quarterly average over 23 quarters. This boom was fueled by supply tightness, with MOP completions lagging demand, and a surge in domestic buying power as households capitalized on low interest rates and pandemic-era savings. The current 1.5% growth, while a stark contrast, aligns with forecasts of 4-6% annual increases for 2025, suggesting a shift toward normalization rather than a collapse.

The moderation in HDB resale prices carries significant implications for housing policy in Singapore, a nation where public housing shapes both social equity and economic stability. The government’s supply strategy—ramping up BTO launches and SBF exercises—appears poised to enhance affordability, particularly for younger buyers squeezed by rising costs in recent years. As MOP flats increase from 8,000 in 2025 to 19,500 by 2028, the resale market could see greater fluidity, reducing the premium on existing stock and potentially narrowing the affordability gap that has widened since 2020.

The Q1 2025 slowdown in HDB resale price growth offers a glimpse into a future where Singapore’s public housing market may prioritize stability over unchecked escalation. This shift holds promise for improving affordability and access, particularly as supply ramps up over the next few years, but it also demands vigilance to ensure that demand hotspots do not derail these gains. For prospective buyers, this moment suggests a window of opportunity—considering resale flats in less central areas could yield better value as the market stabilizes, while those eyeing prime locations might brace for sustained competition.