![](\"http:\/\/i2.wp.com\/www.siamlandbank.com\/propertynews\/wp-content\/uploads\/2016\/08\/GV-104-01.png?fit=530%2C378\")
\nThe iconic Pinnacle @ Duxton has led to an uptick in million dollar flats sold per quarter.
\nAs we see recurring headlines of sky-high resale HDB transactions, should Singaporeans worry that such prices are becoming mainstream? We take a look in this issue of the Guru View.
\nBy Chang Hui Chew
\nAs we were doing the research for this article, two resale HDB flats, one in Boon Keng and the other in Clementi, sold for record prices. The Clementi unit, part of a HDB mixed-use development above Clementi Mall, sold for just over $1 million. The Boon Keng unit sold for $1.1 million, the current record for a 5-room HDB flat. These prices run counter to the argument that only rare, city centre flats like Pinnacle @ Duxton can command such prices.
\nThese headlines make the news because the numbers are simply mind-boggling. An asset, one\u2019s home, that is ostensibly a state-subsidised home, likely bought with grants, has made these homeowners overnight millionaires. Furthermore, Clementi is part of the suburban heartlands, eight MRT stops away from the city centre and Tanjong Pagar where the Pinnacle is located, if one wanted to be pedantic about it.
\nPerhaps one of the reasons why these headlines cause so much furor is that these are supposed to be affordable public housing, and most Singaporean families would be hard-pressed to muster even half of a million dollars for their home purchases. The situation begins to beg the question: \u201cIs even public housing becoming unaffordable?\u201d
\nMany commenters on PropertyGuru\u2019s social media channels have said when such stories appear, that it is a case of \u201cwilling seller, willing buyer\u201d. A seller decides that the property they want to put on the market is worth this price and a buyer is willing and able to meet that price.
\nLet\u2019s therefore take a look at the numbers, and see how the situation bears out.
\nBy the numbers
\nWe\u2019ll use $900,000 as the benchmark for sky-high prices, rather than $1,000,000. This is because we understand that many sellers would set prices at the \u201cmagic\u201d price of $1,000,000, but are often negotiated down. This is especially so in a market where the government has implemented the Mortgage Servicing Ratio (MSR) of 30 percent of the borrowers\u2019 gross monthly salary, regardless of whether the loan was taken from the HDB, or banks and financial institutions.
\nFigure 1 shows the number of resale flats per quarter since 2012, split by flat type. Interestingly, prior to 2015, volumes of resale flats exchanging hands for more than $900,000 were less. Most of these were executive flats (including executive maisonettes) or 5-room units, with a large bulk from the city fringe estates of Queenstown and Bishan.<\/p>\n