Dear readers, recently, it was reported in the news that a five-room HDB resale flat in Sengkang and Punggol was sold for at least $1 million each. I was surprised in reading the news for the following reasons:
- $1 million or more for a HDB resale flat is considered to me, expensive
- Million-dollar HDB flats normally come from districts considered more premium like Toa Payoh and Whampoa. Sengkang and Punggol are relatively newer districts
- There seems to be more and more HDB resale flats sold for at least $1 million: we had 470 such flats in 2023 and just in the 1st half of 2024 alone, there were already 419 such million-dollar flats. I wonder has it become a trend where HDB resale flats have become more pricier?
Despite the high price tag of million-dollar HDB flats, there are still buyers and takers, why?
Well, Warren Buffet has said “Price is what you pay. Value is what you get”. Obviously the buyers of million-dollars HDB resale flat see value in their purchases.
And when it comes to value, I believe the value of such purchases is personal to the buyers of the flats.
The Sengkang flat that was sold for a $1 million has an area of 1,205 sq foot and the price per sq foot (psf) of the flat was $829.90
The Punggol flat that was sold for more than $1 million (at $1.228 million) has an area of 1,603 sq foot and the price per sq foot (psf) of the flat was $766.10. Hence, the Punggol flat sold was much cheaper on a psf basis than the Sengkang flat.
Being relatively new estates, features of the 2 million-dollars flats could easily resemble new condos. At price tags of $766.10 or $829.90 psf, I would think that the buyers of these million-dollar HDB resale flats found value in the psf of these resale HDB flats when their point of comparison or reference is condominiums in general where psf are much higher.
And the value they see led them to paying the price for these million-dollar HDB resale flats notwithstanding many especially HDB flat owners find these prices high.