The Road to a Higher HDB Resale Value

For many Singaporeans, their HDB flat is not just a home. It is also a significant investment. As an HDB homeowner, you may be wondering how to maximise the resale value of your property, especially if you plan to sell it in the future. The good news is that the HDB resale market has been on an upward trend, with prices rising for six consecutive months as of March 2024, according to data from real estate portals SRX and 99.co.

The recent surge in HDB resale prices can be attributed to factors like the growing demand for larger units and the increasing number of flat transactions involving millions of dollars. This trend is particularly encouraging for homeowners who are planning to sell their flats in the near future, as it suggests that there is a strong potential for them to achieve a higher HDB resale value.

Let’s discuss the different factors contributing to a higher HDB resale value and learn practical tips for improving your home’s value, including knowing the answer to the question, “Can the best interior designer in Singapore contribute to increasing your HDB flat’s resale price?

Key Factors that Drive Value

Location

Here’s why location is among the most significant factors driving HDD resale value in Singapore.

Proximity to MRT Station and Public Transportation

HDB flats that are located near MRT stations and bus interchanges command higher prices. This is because of the convenience of public transportation. This makes it easier for residents to travel to work, school, and other parts of the city. Shorter commutes, check!

For example, the Toa Payoh Crest project is well-situated and in close proximity to MRT stations. Its location could be the reason why it recently saw several million-dollar flat transactions.

Mature vs. Non-mature Estates

Mature estates refer to established neighbourhoods with well-developed infrastructure. On the other hand, non-mature estates mean newer, developing areas. This just implies that HDB flats in mature estates are generally more expensive than those in non-mature estates.

Mature estates like Toa Payoh, Kallang/Whampoa, Bukit Merah, and Clementi are well-established neighbourhoods with a wide range of amenities – name anything, shopping malls, hawker centres, schools, and healthcare facilities. So expect that flats in these areas often fetch higher resale prices.

Proximity to Amenities

It would be greatly advantageous for you if your HDB flat’s location gives people access to amenities like schools, shopping centres, supermarkets, and recreational facilities. Potential buyers could be families with children and people who like to shop and do recreation.

Neighbourhood Reputation

HDB flats found in areas with good reputations and lower crime rates tend to be more sought-after. For instance, you have a flat in an area undergoing redevelopment or benefiting from government initiatives, such as the Urban Redevelopment Authority’s Master Plan. You may see an increase in property values in this very area. You know, buyers are willing to pay a premium for flats in neighbourhoods with a promising future because they anticipate potential capital appreciation.

Size

As much as this implies common sense, it’s still best to clarify it. Larger HDB flats (4-room, 5-room, and executive apartments) offer more space and flexibility than smaller units like 2-room and 3-room flats, so they generally fetch higher resale prices.

In recent months, we’ve seen a growing demand for larger HDB flats, particularly from private homeowners who have served their 15-month wait-out period and are now entering the HDB resale market.

And in March 2024, 5-room flats recorded the highest price increase of 1% compared to February. The prices of 3-room flats dipped by 0.1%. This suggests that larger flats are experiencing greater price appreciation due to higher demand.

Layout

If you are planning to sell your flat in the future and it has a functional layout, you might be pleased with the news that HDB flats with well-designed, efficient layouts are more attractive to potential buyers. Now, maybe you’re wondering what a functional layout looks like. It is when your space has good ventilation and natural lighting and if it provides great comfort and a sense of privacy.

Not only that but the more flexibility for renovation work and customisation the layout offers, the more desirable it is. Buyers prefer layouts that allow them to reconfigure the space; they might want to combine rooms or create an open-concept living area.

Another reason the layout is a considerable factor is that some HDB flats, particularly in older estates, may have unique or rare layouts. And they might no longer be available in newer developments. The last factor is the balcony space. Layouts that incorporate well-positioned balconies might be more preferred than those without. With this, it’s possible to have additional outdoor space for relaxation and activities.

Age and Remaining Lease

Age of the Flat

Generally speaking, newer HDB flats tend to fetch higher resale prices compared to older units. The reason for this is that newer flats often feature more modern designs, better amenities, and are in better condition.

Older flats also depreciate because their physical condition may deteriorate over time due to daily wear and tear, faster if not well-maintained or renovated regularly. You must also understand that buyer preferences evolve. Newer flats may offer features and layouts that are more aligned with current trends and demands.

All these reasons make older flats less desirable in comparison.

Remaining Lease

HDB flats in Singapore are usually sold with 99-year leases. An HDB resale market value may decline as the remaining lease decreases. This is because buyers are essentially buying the right to use the flat for the remaining years of the lease. And a shorter lease translates to a lower value.

Also, flats with shorter remaining leases may face financing restrictions. For example, the Housing & Development Board does not provide loans for flats with less than 20 years of remaining leases. This can limit the pool of potential buyers and affect the resale value of such flats.

Buyers may also be less willing to pay high prices for flats with shorter remaining leases. Their concerns must be about the diminishing value of their investment over time. Flats with a remaining lease of 90 years and above made up a higher proportion of overall transactions in March 2024. This is the impact of newer flats; they tend to have longer remaining leases and fetch higher prices, so they help support overall resale prices in the market.

Strategies to Increase Your HDB Resale Value

Implement the following strategies to increase your HDB flat’s resale value. Take note that these tips are not black and white; these only serve as guidelines that you can carry out to maximise the resale cost.

Regular Maintenance and Repairs

1. 1. Service your flat regularly and repair essential systems (e.g., plumbing, electrical wiring, and air conditioning).
   2. Address visible damage/wear and tear as soon as you notice them.
   3. Make sure that your home is always clean and tidy to leave a positive impression on potential buyers.

Home Improvements and Renovation

1. 1. Invest in home improvements that help improve the aesthetic appeal and functionality of your flat.
   2. Focus on areas that offer the highest returns, such as the kitchen and bathrooms. You might want to update the fixtures, countertops, and tiles.
   3. Remove non-structural walls to create an open and spacious layout.
   4. Attract environmentally-conscious buyers by installing modern and energy-efficient appliances and lighting.

Enhance Storage Solutions

1. 1. Start maximising space utilisation by embracing smart storage solutions.
   2. Your storage spaces should be designed well to appeal to buyers that your flat is not only about functionality but also aesthetics.

Upgrade Flooring and Paint

1. 1. Replace old/damaged flooring with modern, durable options like wood laminate, vinyl, or tiles.
   2. Apply a fresh coat of paint in neutral colours to allow buyers to envision their own style.

Improve Air Ventilation and Lighting

1. 1. Make sure that your flat has enough ventilation. Install fans or air conditioning units to regulate temperature and air quality.
   2. Keep windows clean and unobstructed to maximise natural lighting. Also consider installing light shelves or reflective surfaces to enhance brightness.

Emphasise Unique Selling Points

1. 1. When the time comes that you sell your flat, highlight the unique features or improvements in your flat that set it apart from others in the market (e.g., rare layout, a large balcony, or a picturesque view).
   2. Showcase them during viewings and in marketing materials.

   Declutter and Depersonalise

   1. The more spacious and neutral the flat is, the more that it is ready for resale. You should give the opportunity to the buyers to visualise themselves living in the flat.
   2. Consider hiring a professional home stager to present your flat in the best possible light.

   Leverage Technology and Smart Home Features

   

   1. You may want to appeal to tech-savvy buyers, so assess whether your flat can accommodate smart home tech, such as automated lighting, temperature control, and security systems.
   2. These features may affect the perceived value and convenience of your flat.

   Timing and Market Awareness

   1. Probably one of the best actions to take is to stay updated on HDB resale market trends and prices. Doing so can help you make informed decisions on when to sell your flat.
   2. Consider factors such as the supply of new flats, changes in HDB policies, and overall economic conditions. All these may impact resale values.

   Conclusion

   In treading the road to a higher HDB resale value, your main considerations must be on making strategic improvements that appeal to your buyers. But see to it that you stay within your budget and, at the same time, comply with HDB regulations.

   The best interior design in Singapore can also make or break your strategies. An interior design company can create unique features that make your flat distinctive from other market options. Want to work with a skilled Singapore interior designer now? Style+Space might open a window of opportunity for your HDB flat. Contact us now!