
Following last week’s paper, Has lease decay set in for HDB flats?, this week’s analysis focuses on the performance of older HDB flats across different locations.
A similar panel analysis methodology — combining both time series and cross-sectional data — was employed.
To control for the effect of building height on transacted prices, the upper bound of prices was excluded. This is because higher-floor flats tend to command higher prices, which could skew the average transacted prices upward.
For instance, flats in Jurong West are typically built up to 10 storeys, while those in Bukit Merah, Kallang and Whampoa, Queenstown and Toa Payoh can rise as high as 20 storeys.
Assuming a price increment of $5,000 per floor, the price difference between flats in these higher-rise towns and those in Jurong West could be as much as $50,000.
As such, the analysis focused primarily on the lower bound of transacted prices.
The first HDB flats sold under this programme were primarily located in central areas such as Bukit Merah (pictured above), Kallang, Whampoa, Queenstown and Toa Payoh (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Does location matter in lease decay?
In its early years, the Housing and Development Board (HDB) did not sell the flats it built. That changed in 1964 with the introduction of the Home Ownership for the People Scheme. The first HDB flats sold under this programme were primarily located in central areas such as Bukit Merah, Kallang, Whampoa, Queenstown and Toa Payoh.
In 1971, HDB further liberalised the market by allowing flat owners to sell their units in the resale market after fulfilling the Minimum Occupation Period (MOP).
At the time, HDB priced flats differently depending on whether they were located in urban areas, suburban estates, or new towns.
Fast forward to today: Over the past decade, have flat prices across different locations diverged significantly?
For the period of analysis from 2015 to 2025, flats with leases commencing between 1966 and 1970 had an average age of around 51 years.
From 2015 to 2025, two-room flats in mature estates were sold for between $150,000 and $185,000, while similar flats in non-mature estates transacted at around $175,000:
- Although the volume of two-room flat transactions in non-mature estates was low, it is noteworthy that there was little price difference between locations.
- Centrally located estates like Geylang and Toa Payoh did not command higher prices than Jurong West, despite being closer to the city centre.
- One possible reason is that the two-room flats in Geylang and Toa Payoh are slightly older than those in Jurong West, which may have contributed to the lower prices.
For three-room flats, prices in mature estates ranged from $170,000 to $200,000, while those in non-mature estates were between $175,000 and $200,000:
- Similarly, there was little price differentiation between mature and non-mature estates.
- Prices in centrally located areas such as Geylang and Toa Payoh were comparable to those in Jurong West, a non-mature estate further from the city.
- Again, the slightly older age of flats in Geylang and Toa Payoh could explain their relatively lower prices.
- Notably, while the three-room flats in Jurong East are the oldest among those studied, prices may have received a boost from the upcoming Pandan Reservoir MRT Station.
For larger flats, four-room units sold for between $302,000 and $503,000, while five-room flats were sold for between $330,000 and $636,000.
- Due to their proximity, four-room flats in Bukit Merah and Queenstown were priced similarly, at around $350,000.
- However, the limited number of transactions for both four-room and five-room flats made it difficult to draw meaningful conclusions about pricing trends in these segments.
The key finding was that prices for two-room and three-room flats were relatively close across different parts of the island. The slight variations may be attributed to factors such as longer remaining lease tenures or improved transport infrastructure.
Flats with leases commencing from 1971 to 1980
For flats with leases starting between 1971 and 1980, the average age during the study period was 43 years.
Flats in Bishan, Bukit Timah, Kallang and Whampoa, Marine Parade, Toa Payoh and Queenstown were relatively older, at around 46 years.
Meanwhile, those in Ang Mo Kio, Choa Chu Kang, Clementi, Jurong East and Pasir Ris were relatively younger, at around 41 years.
Two-room flats
These flats had average selling prices ranging from $160,000 to $220,000:
- Prices of two-room flats in Jurong West, a non-mature estate, were similar to those in mature estates such as Ang Mo Kio, Bedok, Bukit Merah, Marine Parade and Toa Payoh.
Three-room flats
Prices ranged from $140,000 to $300,000:
- Bukit Timah, the Central Area and Marine Parade saw significantly higher prices than the rest of the island, mainly due to scarcity. The opening of Farrer Road MRT Station may have contributed to higher prices in Bukit Timah.
- The Central Area commands a premium for its city-centre location, while Marine Parade flats benefit from proximity to the sea and the opening of the Thomson-East Coast Line stations.
- In contrast, there were minimal price differences among three-room flats in other mature and non-mature estates.
- Geylang and Toa Payoh appeared to underperform compared to some non-mature estates, despite having similar age profiles.
Prices of two-room flats in Jurong West (pictured), a non-mature estate, were similar to those in mature estates such as Ang Mo Kio, Bedok, Bukit Merah, Marine Parade and Toa Payoh (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Four-room flats
The resale prices of four-room flats hovered around the $300,000 range across many estates:
- Bukit Timah, the Central Area and Marine Parade again stood out with higher prices, for reasons similar to the three-room flat segment.
- Flats in Queenstown also saw higher prices, largely due to their proximity to Holland Village and the Holland Village MRT Station, which opened in 2011.
- A cluster of flats along Lorong Lew Lian recorded substantially higher prices, attributed to the limited supply of flats near Serangoon MRT Station.
Five-room flats
To meet the demand for larger flats, HDB began constructing five-room units during this period, particularly in point blocks in estates like Marine Parade.
- A divergence in pricing emerged between mature and non-mature estates:
- In mature estates, buyers could expect to pay more than $400,000 for a five-room flat.
- In contrast, similar flats in non-mature estates were priced at around $300,000.
- Bukit Timah, the Central Area, Marine Parade and Queenstown recorded higher prices compared to other mature estates.
- In these mature estates, executive flats were typically priced above $600,000.
Key findings include:
- Prices of two-room and three-room flats were largely similar between mature and non-mature estates.
- Three-room and four-room flats in Bukit Timah, the Central Area, Marine Parade and Queenstown outperformed those in other mature estates.
- A clear price differentiation was observed between mature and non-mature estates for five-room and larger flats.
Four-room and five-room flats in Bukit Timah, the Central Area, Marine Parade (pictured) and Queenstown consistently stood out with higher prices compared to other towns (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Concluding observations
The analysis revealed two key findings that buyers should take heed of:
- There is little price differentiation in the older two-room and three-room flats across locations; and
- Four-room and five-room flats in Bukit Timah, the Central Area, Marine Parade and Queenstown consistently stood out with higher prices compared to other towns.
The flats studied are, on average, more than 40 years old. If these trends continue in the years ahead, buyers considering younger two-room and three-room resale flats should be cautious about paying a premium for location. As flats age, prices across different locations may converge, especially for smaller flat types.
The same caution applies to buyers planning to apply for two-room and three-room Prime or Plus BTO flats — unless they intend to sell after the 10-year Minimum Occupation Period (MOP). Otherwise, they may be better off choosing Standard BTO flats and investing the cost savings elsewhere.
Conversely, four-room and five-room flats in Bukit Timah, the Central Area, Marine Parade and Queenstown have shown strong price resilience over time. Resale buyers and BTO applicants may want to keep these locations in mind when making purchase decisions.
For policymakers, the resale market appears to be bifurcating into two tiers:
- Owners of two-room and three-room flats are falling behind in capital appreciation;
- Larger flats in mature estates are outperforming those in non-mature estates.
- This disparity is likely to widen over time.
- Although recent policy changes aim to reduce the “lottery effect”, it remains to be seen whether the new Prime, Plus and Standard flat classification will effectively address the issue.
Lee Sze Teck is the senior director of data analytics and research, Huttons Asia