Resale flat prices for 2023 in Singapore is only rising less than half in 2022
Even if the government is building most of the supply, home price cannot be fixed yeah
Imagine the government selling a property unit which you bought. A few years after that, you wanted to upgrade to a bigger property. You wanted to sell the property which you bought a few years ago. What price would you sell? Same price as you bought? Lower price than what you paid for? Or higher and following market price? Or, the government tells you the price you should sell?
Once you read this, then you should realise this is why governments can build properties and they can sell but they cannot and should not be the one determining the price increase yeah. Let’s take a look at the property price for HDB flats in Singapore. Good news is that the increase is much lower in 2023 versus 2022. Bad news is that the percentage rise is as high if not higher than the typical salary increase per year.
Article in channelnewsasia.com Resale flat prices for 2023 rose by 4.8 per cent, less than half of the 10.4 per cent increase in 2022, according to the Housing and Development Board (HDB)’s flash estimates.
The resale price index, which reflects the general price movements in the resale market, grew to 180.2 in the fourth quarter – an increase of 1.0 per cent over the previous quarter, HDB’s flash estimate showed.
The rate of increase in resale prices has continued to moderate following the government’s implementation of a strong pipeline of supply, as well as the introduction of cooling measures to promote a stable and sustainable property market, said HDB.
HDB launched a total of 24,447 flats in 2023, of which 22,780 were Build-To-Order (BTO) flats for sale. 1,500 and 167 flats were offered under the Sale of Balance Flats (SBF) exercise and open booking of flats respectively. Please do read the full article here: Article in channelnewsasia.com
4.8 percent per year is still high in my personal opinion
The salary increase could be 5 percent but the salary increase is based on the salary. The property price increase can be just 4,8 percent which is lower than the the percentage for the salary increase but this is based on the property price. Which do we think is a bigger amount? Our salary or the property price? If we assume the property price to be just S$500,000 and an increase of 4.8 percent, that’s already S$24,000 per year or an extra S$2,000 every month.
If the person is earning S$5,000 then this S$2,000 extra is an increase of 40 percent! (impossible yeah)
If the person is earning S$10,000 then this S$2,000 is an extra increase of 20 percent! (maybe possible for one year due to job hop but EVERY YEAR??)
This is why I do not mind if the home price increase just at an average of 2 percent every year for 10 years or even forever yeah. What’s the typical property price increase in Singapore? Here’s some numbers from tradingeconomics.com
Happy noting that property price will always be market driven. When market is not doing well, the property price may drop too and this has happened on numerous occasions. So, please do not think that property prices may increase every year or to simply buy any property or at any price yeah.
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