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HDB Living for Young Couples: Should You Choose a 3-Room or 4-Room Flat?

An important question that many young couples face when looking to purchase their first HDB flat – should they opt for a 3-room or 4-room HDB flat?

Buying your first home is a significant milestone, and it is crucial to make the right decision. There are various factors to consider when making this decision, such as your budget, lifestyle, future plans, and family size.

So, whether you are a newlywed couple looking for your first home or an existing couple considering an upgrade, keep reading to weigh the pros and cons of each option to see which is best for you!

HDB flat prices per town: 3-room vs 4-room

Interact with this table to find out how much 3-room and 4-room flats cost in all 28 HDB towns in Singapore.

Buying a 3-Room HDB Flat

Price appreciation

Once your flat has reached the 5-year MOP, you can sell your HDB flat on the open market for a potentially tidy profit. But are 3-room HDBs worth the appreciation in value over time? According to HDB data, the median price for 3-room HDBs have grown over the past 15 years, from 2007-2022, ranging from $140,000 on the low end to $240,000 on the high end.

Median resale price of 3-room flats in Q2 2007 vs Q4 2022

TOWNS3-Room Price in Q2 20073-Room Price in Q4 2022Median Capital Gain
ANG MO KIO$172,000$378,000$206,000
BEDOK$172,000$360,000$188,000
BUKIT BATOK$160,000$360,000$200,000
BUKIT MERAH$200,000$400,000$200,000
BUKIT PANJANG$155,500$375,000$219,500
CLEMENTI$185,000$378,000$193,000
GEYLANG$162,500$335,000$172,500
HOUGANG$166,500$380,000$213,500
JURONG EAST$168,000$360,000$192,000
JURONG WEST$151,500$358,000$206,500
KALLANG/WHAMPOA$173,000$380,000$207,000
MARINE PARADE$240,000$430,000$190,000
QUEENSTOWN$186,500$390,000$203,500
SERANGOON$169,000$386,500$217,500
TAMPINES$192,000$410,000$218,000
TOA PAYOH$195,000$340,000$145,000
WOODLANDS$152,500$395,000$242,500
YISHUN$159,000$372,000$213,000

However, it’s important to note that factors such as limited supply, a good location and connectivity to transport infrastructure all play a major role in the price appreciation.

Cost

3-room flats are generally more affordable than 4-room flats. This is true whether you’re looking at BTO flats or resale flats. However, there are some differences in pricing depending on whether the flats are located in mature or non-mature estates. For BTO flats, 3-room flats tend to be more expensive in mature estates than in non-mature estates. This is likely due to the higher demand for flats in mature estates, which offer more amenities and are closer to the city centre. However, even in mature estates, 3-room flats are still generally more affordable than 4-room flats.

Flat prices of 3-room HDBs in February 2023 BTO exercise

TownProjectFlat TypeSelling Price (Excluding Grants)Selling Price (Including Grants^)
Transacted Prices of Resale Flats Nearby #
Non-Mature Towns
Jurong WestJurong West Crystal3-roomFrom $187,000From $112,000
$348,000 – $363,000
TengahBrickland Weave3-roomFrom $190,000From $115,000
$391,000 – $450,000
Mature Town
Kallang/ WhampoaRajah Summit3-roomFrom $326,000From $266,000
$490,000 – $580,000
Kallang/ WhampoaFarrer Park Fields3-roomFrom $356,000From $296,000
$533,888 – $568,000
QueenstownUlu Pandan Glades3-roomFrom $372,000From $312,000
$602,000 – $730,000

Looking at the table of flat prices in the February 2023 BTO exercise, we can see that 3-room flats in non-mature towns like Jurong West and Tengah are priced lower than 3-room flats in mature towns like Kallang/Whampoa and Queenstown.

However, even the most expensive 3-room flats in mature towns are still priced lower than the cheapest 4-room flats in those same towns. This suggests that if you’re looking for a more affordable option, a 3-room flat in a non-mature estate might be a good choice.

For resale flats, there is little price difference between mature and non-mature estates for both 3-room and 4-room flats. This is because resale flats are already built, and their prices are largely determined by market forces rather than government policy.

Read more: The Complete Guide to HDB Grants for Couples

Practicality of purchasing a 3-room HDB for own-stay

When you’re thinking about getting a 3-room HDB flat, it’s important to think about your living situation and how much space you really need. Sure, 3-room flats are cheaper than 4-room flats, but they’re also smaller, and that might be a problem if you’re family is rapidly growing or you just like to have plenty of space to move around in.

While it’s true that renovation for 3-room HDB flats can be more challenging due to the limited space, it is still possible to achieve your desired renovation outcome. One way to make it work is to carefully choose your interior designer and ensure that you plan well. By doing so, you can make sure that you use the space efficiently and that the renovation is cost-effective.

When choosing a 3-room HDB flat, it’s also important to think about its location and surrounding area. Consider factors such as accessibility to public transportation, proximity to amenities like schools, markets, and lifestyle facilities, and the overall livability of the neighbourhood. Choosing a well-connected and convenient location can not just enhance your daily living experience but also contribute to higher resale value in the future.

Buying a 4-Room HDB flat

While 4-room HDB flats are generally more expensive due to their larger size and more versatile layout, they also offer a higher potential for price appreciation compared to 3-room HDB flats.

So, even with the higher monthly mortgage payments and maintenance costs, the potential capital gains from 4-room flats are significantly higher than 3-room HDBs.

Price appreciation

The key differentiator is that 4-room HDBs are far more likely to hit higher price marks, with the highest median resale price being Toa Payoh $780,000 in 2022.

In general, you would also be making larger capital gains in the range of $250,000 – $300,000, which is an additional $100,000 in profit compared to what 3-room HDBs experience.

According to the median resale prices of 4-room HDB flats from 2007-2022, these flats have the potential for significant price appreciation over time. For example, in Ang Mo Kio, the median capital gain for a 4-room flat is $295,000 over 15 years. In Bukit Merah, the median capital gain is an impressive $404,400.

Median resale price of 4-room flats in Q2 2007 vs Q4 2022

TOWNS4-Room Price in Q2 20074-Room Price in Q4 2022Median Capital Gain
ANG MO KIO$260,000$555,000$295,000
BEDOK$224,500$480,000$255,500
BUKIT BATOK$234,000$514,000$280,000
BUKIT MERAH$371,000$775,400$404,400
BUKIT PANJANG$220,500$480,000$259,500
CLEMENTI$302,200$574,900$272,700
GEYLANG$265,000$576,500$311,500
HOUGANG$235,000$518,000$283,000
JURONG EAST$237,000$465,000$228,000
JURONG WEST$223,000$481,500$258,500
KALLANG/WHAMPOA$295,000$788,000$493,000
PUNGGOL$252,500$575,900$323,400
QUEENSTOWN$388,000$870,000$482,000
SEMBAWANG$240,000$535,000$295,000
SENGKANG$245,000$548,000$303,000
SERANGOON$242,000$539,000$297,000
TAMPINES$263,000$536,500$273,500
TOA PAYOH$337,500$780,000$442,500
WOODLANDS$225,500$495,000$269,500
YISHUN$200,000$474,000$274,000

Another factor to consider is if you want to buy a resale flat, you’ll have to consider the remaining lease and how long you’re going to stay in the flat.

The value of a flat generally decreases as the lease gets shorter, particularly when it falls below 60 years. This is because the remaining lease affects the amount of CPF that can be used to purchase the flat, as well as the amount of loan that can be obtained from banks.

In addition, the shorter the lease, the more difficult it is to find a buyer when you want to sell the flat in the future. Therefore, it’s important to consider the remaining lease when making a decision to buy a resale flat, and to ensure that the lease is long enough to cover your needs.

When considering a 4-room HDB flat, it’s important to think about all the factors, including cost. While these flats may have the potential for significant price appreciation over time, they may not be the best choice for everyone.

Cost

In the February 2023 BTO Exercise, the selling price for a 4-room flat in non-mature towns like Jurong West and Tengah starts from $288,000, excluding grants, and $228,000, including grants. The transacted prices of resale flats nearby range from $460,000 to $566,800.
 
In mature towns like Kallang/Whampoa and Queenstown, the selling price for a 4-room flat in the February 2023 BTO Exercise starts from $459,000 and $541,000, respectively, excluding grants. With grants, the prices start from $414,000 and $496,000, respectively. The transacted prices of resale flats nearby range from $660,000 to $996,000.
 
Flat prices of 4-room HDBs in February 2023 BTO exercise
TownProjectFlat TypeSelling Price(Excluding Grants)Selling Price(Including Grants^)
Transacted Prices of Resale Flats Nearby #
Non-Mature Towns
Jurong WestJurong West Crystal4-roomFrom $288,000From $228,000$460,000 – $520,00
TengahBrickland Weave4-roomFrom $291,000From $231,000$480,000 – $566,800
Mature Town
Kallang/ WhampoaRajah Summit4-roomFrom $459,000From $414,000$690,000 – $795,000
Kallang / WhampoaFarrer Park Fields4-roomFrom $484,000From $439,000$660,000 – $790,888
QueenstownUlu Pandan Glades4-roomFrom $541,000From $496,000$860,000 – $996,000

It’s worth noting that the cost of purchasing a 4-room HDB flat can be high, especially in mature estates or prime locations. Buyers should carefully consider their budget and affordability before making a decision. In addition to the selling price, there are other costs to consider, such as mortgage payments, renovation costs, and other fees associated with buying a property.

However, despite the higher price tag, 4-room HDB flats remain a popular choice for families or those who need more space. They offer more versatility in terms of layout and design, and tend to appreciate in value over time, especially in prime locations.

Read more: How Will the Prime Location Public Housing (PLH) Model Affect Me?

Practicality of Purchasing a 4-room HDB for own-stay

A major advantage of a 4-room HDB is the flexibility in space that it provides for future needs as a family grows. With more room to work with in 4-room HDBs, homeowners can create stylish and modern living spaces that meet their unique needs and preferences. A larger kitchen can provide more space for cooking and entertaining, while a more spacious living area can accommodate larger furniture and more guests. This additional space can makes a big difference in comfort and convenience.

More room to customise & renovate

A 4-room HDB flat also provides more opportunities for renovation and customisation. With more space to work with, homeowners can create unique and stylish living spaces that reflect their personal tastes and preferences. Homeowners can invest in customised storage solutions that maximise the use of available space and make it easier to keep the home tidy and organised.

While a 4-room flat may be more expensive than a 3-room flat, the long-term benefits of owning a larger home can make it a worthwhile investment. By providing the extra space and flexibility needed to accommodate changing needs over time, a 4-room flat can provide a comfortable and functional living environment for years to come.

So, which should you choose?

If you’re a young couple just starting out, a 3-room flat may be a good choice if you’re looking for a more affordable option. However, if you’re planning to start a family or you just like to have plenty of space to move around in, a 4-room flat may be a better option.

On the other hand, if you’re looking for a flat that has the potential for significant price appreciation over time, a 4-room flat might be a better choice. While they may be more expensive, they offer more living space, flexibility in terms of layout and design, and tend to appreciate higher in value over time.

Read more: The Complete Guide to Purchasing a New HDB Flat

This article was originally published on Ohmyhome.

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