HDB Market Forecast for 2023

Very seldom do we talk about HDB but I intend to do a holistic overall view of the Singapore Property Market for 2023. The HDB market is also an indication of how the overall residential market will perform next year. It will also has a spill over effect on the private condominium market as well. For example, if more resale HDBs are sold, there will be more upgraders, and with more upgraders, the demand for private residential condos will also increase.

Current Situation

HDB resale prices have been on an upwards trend since Q3 2019 after the circuit-breaker with 28% growth despite Covid. In fact, prices of HDB have continue to rise for 29 months straight. Compared to last year, prices has increase by 10% since last year.

However, due to the recent cooling measure in October 2022 targeting million dollar HDBs, the cooling measure is effective, bringing down the total volume of million dollar HDBs transacted. The number of million-dollar HDB flats sold comprises of 1.2% of the total resale volume in November.

The 15 month period that private property downgraders have to sit out before buying a resale flat after selling their private properties reduces the number of million dollar transactions. This is because downgraders, who got a big profit from selling their private properties are the main buyers of million-dollar HDBs and are willing to bid higher, thus driving up the overall price for bigger units.

342 resale flats have changed hands for at least $1 million in 2022, far exceeding the 259 transactions in 2021.

Although HDB resale prices is expected to grow in 2023, it should be lower than the increase in 2022 (9-10%). The continuous increase in HDB pricing for 2023 is mainly down to 4 reasons:

a. Limited Supply of new BTO Flats

b. Increase in Household Income

c. Increase in demand due to more marriages

d. Fewer BTOs reaching MOPs


1. Limited Supply

Over subscribe of BTO Application for 2022

Build-to-Order (BTO) flats are still in very limited supply and facing very high demand. Above is the recent number of application to 4rm BTO flats. Even if we were to look at non mature location such as Yishun or Woodlands, you will see the that application rate is above 10. For example, for every 1000 new BTOs release to the public for balloting, there is a total of 12,200 applicants. Your chance of getting a unit is less than 8.2%! And if you were to look into Tampines, your chance to get a BTO is less than 4.5%!

If this group of homebuyers are not able to buy a new BTO or if they can’t wait for the long building period, likely they will turn to the resale market, driving up the demand and thus the cost of a HDB. When more resale HDB flats are sold, the upgraders will turn to the private market, this driving up the demand and pricing.


2. Increase in Income

Singaporean Income increase in 2022
Increase in Singapore Household Income

The real median income growth for household income rose to 2.1% in 2022 despite higher inflation. Ministry of Manpower’s (MOM) director forecasted that wage growth will continue to exceed inflation in 2023. Unemployment rate has also dropped to pre-pandemic level of 2%. Even lower wage workers also saw a stronger income growth.

2023 will be an interesting year as although we may be facing a recession, we will have stronger job growth and increase in income growth due to labour shortages. Wage growth and low unemployment rate will cushion the impact of rising interest rates and inflation. Hence, homebuyers’ affordability budget may not be significantly affected. In fact, homebuyers (due to inability to get a BTO flat as above) are more willing to pay more to secure a resale HDB flat or private condominium as they need a place to stay. A roof over their head is of the out outmost importance.

This can be seen in strong take-up rate of recent BTO launches and also recent project launches such as Copen Grand EC (which is 100%) and also Tenet EC, which is 75% sold on day 1 and is also expected to be fully sold when slots are open up to second timers.


3. Increase in Marriages

Increase in Number of Marriages in 2023

The number of marriages in 2022 has hit above 28,000 and is expected to continue to maintain this number in 2023. What this means is the number of marriages has return to pre-pandemic level.

The age range of this group of homebuyers are likely to be between 28-35 years old and likely will also be planning for a baby in the next 2-3 years. With a limited supply in Build to Order (BTO) flats (which we will discuss above in point 1), and an increase in household income (which we discuss in point 2), together with an increase in number of young homebuyers, the demand will continue to be strong in 2023 with no sign of slowing.


4. Number of BTOs reaching MOP

Last year, I predicted that HDB prices should stabilize in 2022 as more than 30,000 BTO flats reaches their Minimum Occupancy Period (MOP) of 5 years. I believe that 30,000 newly MOP flats that potentially be possibly be sold in the open market will meet the demand of HDB flats and this will cushion the price of HDB flats pricing. However, due to an overall stronger demand than expected, prices grew by 10% in 2022 instead.

For 2023, this will be scarier as the number of newly MOP flats will drop to 15,363. This is almost half of what is available in 2022. If the demand remains and the supply of newly MOP flats is halved, this will cause price to continue to go up! What is scarier is if you look into 2024 to 2026, there is even fewer newly MOP flats in the range of 6964 to 13,484. New MOP flats supply is expected to remain very low.



In Summary, increase of household income, low unemployment number, long construction wait time of BTOs and increase in marriages will lead to a strong and high demand for residential properties. Meanwhile, limited BTOs, and fewer newly MOP HDB flats will cause a limited or decrease in supply in housing.

This high demand and low supply concept will surely lead to a increase in pricing for 2023. However, the negative expectation of incoming recession, increase in interest rate and inflation may cause homebuyers to be more prudent.

Homebuyers still need to buy a home but will be more careful. Hence, I believe as stated earlier that prices will continue to go up but not as much as 10% as in 2022.

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