Demand for smaller flats up, boosted by changing demographics

Ageing population, smaller households and shifting buyer sentiments among factors

- Joyce Lim

When Mr Lim put his three-room HDB flat in Tampines on the market in September 2023 after it reached its minimum occupation period (MOP), he was not expecting the overwhelming interest it received.

Listed at $470,000, the flat attracted three groups of viewers on the first day alone. By the end of the week, at least 10 groups had viewed the unit.

The property was eventually sold at $480,000 to a woman who is single, said Mr Lim, a 34-year-old information technology executive who wanted to be known only by his surname.

Mr Lim, who sold his unit because he wanted to upgrade to a four-room flat, said the buyer exercised the option the following week.

His experience is an indication of how demand for smaller flats has surged over the past four years, which industry watchers say could reflect changing demographics and shifting buyer sentiments as larger flats get more expensive.

Ms Christine Sun, chief researcher and strategist at Orange Tee Group, said that from January to November, 740 two-room flats were sold, almost double the 388 such units sold in the same period in 2020.

For the same period, three-room flat transactions rose by 30 per cent, while sales of four-room flats rose by 27.7 per cent and five-room units by 13.7 per cent.