estimate
On January 16, Minister for National Development Desmond Lee announced that Housing and Development Board (HDB) plans to launch more than 25,000 new flats by 2025. This was according to a press release jointly issued by HDB and the Ministry of National Development (MND).
This launch will include approximately 19,600 Build-to-Order (BTO) flats across three sales exercises and more than 5,500 Sale of Balance Flats (SBF) in one SBF sale exercise. These units will be categorized as Standard, Plus, and Prime BTO flats in line with the new classification framework.
The February BTO launch will offer around 5,000 flats situated in Kallang/Whampoa, Queenstown, Woodlands, and Yishun areas. Additionally, HDB will also hold its largest-ever Sale of Balance Flats (SBF) exercise next month, with over 5,500 flats available in various estates. Approximately 40% of these flats are completed units, while the rest are at different stages of construction and are expected to be completed between 2025 and 2028.
In total, more than 10,000 new flats will be made available under the February BTO and SBF exercises. Over the past four years, from 2021 to 2024, HDB has launched about 82,700 BTO flats. With a projected pipeline of 19,600 BTO flats in 2025, HDB is set to exceed its commitment of 100,000 units over five years by a significant margin.
The increase in BTO supply has resulted in a decline in application rates. In 2024, the average application rate for first-time homebuyers for BTO flats across all types was 2.1, compared to 3.7 before the pandemic in 2019. For three-room and larger flats, the average first-timer application rate last year was 2.2, a significant decrease from 4.0 in 2019.
Minister Lee assures that HDB will continue to release a steady pipeline of flats in the next few years to meet housing demand. Over 50,000 flats are projected to be launched between 2025 and 2027, bringing the total to approximately 130,000 flats from 2021 to 2027.
Out of the 19,600 new flats planned for launch in 2025, 3,800 will be Shorter Waiting Time (SWT) flats with a waiting time of less than three years. This represents a significant increase from the 2,876 SWT flats offered in 2024 and exceeds the committed annual supply of 2,000 to 3,000 SWT flats.
Huttons Asia’s Senior Director of Data Analytics, Lee Sze Teck, says that these SWT flats will provide additional options for buyers and may divert some demand from the resale market. In 2025, it is estimated that roughly 7,000 HDB flats will reach the end of their minimum occupation period (MOP), resulting in the lowest supply of such resale flats since 2015. This scenario, coupled with HDB’s assurance of releasing more BTO and SBF flats to meet demand, is expected to offer more choices for buyers and stabilize the resale market.
Huttons’ Lee estimates that the number of HDB resale flat transactions in 2025 will range between 26,000 to 28,000, lower than the 28,876 units recorded last year. Resale flat prices are projected to grow at a slower pace of 5% to 8% this year, as compared to the 9.6% increase reported in HDB’s flash estimate for 2024.