HDB resale flat prices resume slide with 0.2% dip in Q3

Prices of resale HDB flats are down 0.2 per cent from the second quarter, when it had inched up 0.1 per cent.
Prices of resale HDB flats are down 0.2 per cent from the second quarter, when it had inched up 0.1 per cent.PHOTO: ST FILE

The prices of resale Housing Board flats declined 0.2 per cent in the third quarter of this year after inching up 0.1 per cent in the second, according to HDB flash estimates released yesterday.

The second-quarter increase, coming after nine quarters of decline, had raised expectations that HDB resale prices may have bottomed out.

Going by yesterday's flash data, resale prices for the third quarter are down nearly 1 per cent from the same period a year ago.

Property firm ERA Realty Network said yesterday that the level of decrease is "within expectations", noting that July's cooling measures have had an impact on the HDB resale market.

"Resale flats remain an attractive option to buyers... (and) are also the only way for buyers to pick a flat in their location of choice," it said. "There is also no income ceiling for buying resale flats, if no grants are taken and if the buyer does not take an HDB loan."

Mr Nicholas Mak, executive director of real estate consultancy firm ZACD Group, said the weakness in HDB resale prices could be caused by factors other than the cooling measures, such as concerns over declining leases. "The downward pressure on resale prices could be partly due to the uncertainty around the value of the older flats as (HDB resale flat) leases shorten over time."

Referring to the flash estimates, OrangeTee & Tie research and consultancy head Christine Sun said the 0.2 per cent drop is "very marginal" and that prices are holding steady. "HDB upgraders may not be in a hurry to offload their flats, as not many are collecting their keys in the near term since there have been few condominium and executive condominium completions in recent months."

Also, many current HDB owners may have received lower sales proceeds from existing flats and may thus be less inclined to pay more for another HDB resale flat, she added.

HDB announced yesterday that about 3,800 Build-To-Order (BTO) flats would be offered for sale next month-in Sembawang, Sengkang, Tampines, Tengah and Yishun. Home buyers can expect waiting time of 2.5 years for BTO flats in Sembawang, Sengkang and Yishun. This is shorter than the typical three to four years, HDB said. It added that there will also be a concurrent Sale of Balance Flats exercise.

The HDB will release finalised figures for the third quarter and more detailed public housing data on Oct 26.

A version of this article appeared in the print edition of The Straits Times on October 02, 2018, with the headline 'HDB resale flat prices resume slide with 0.2% dip in Q3'. Subscribe