Fewer speculators have been snapping up Housing Board resale flats following a rule change designed to keep them out of the market.
Fresh figures show the number of private property owners buying HDB units has been gradually falling over the past three years.
It follows a change to the regulations in 2010 that required them to sell off their existing private homes within six months of buying an unsubsidised resale flat.
The move was aimed at keeping out speculators, who have been blamed for pushing up prices by buying flats as investments.
Since the move was introduced, the proportion of resale units bought by private property owners has fallen from 11.8 per cent in the first eight months of 2010 to 4.3 per cent between January and June this year.
Analysts say the trend shows these buyers are now looking to occupy their HDB flats long-term - unlike those in the past, who often wanted to invest while hanging on to private homes.
"This policy has curtailed speculators," said PropNex chief executive Mohamed Ismail. "The profile of downgraders now is generally elderly people whose children might have moved out, or those who are in urgent need of money."
R'ST Research director Ong Kah Seng said in the past, private property owners typically bought resale flats for their high rental yields of around 6 per cent. But now, with prices of private homes holding firm, they might be unwilling to lose out on potential capital gains by selling up to get a resale unit.
Instead, those who can afford it typically go for a small suburban condo apartment, which will not leave them having to part with their main property.
Mr Ong added that stamp duty of up to 16 per cent - which was introduced in 2011 - could also be discouraging private property owners from selling their homes and entering the HDB resale market.
Retiree Johnathan Wong, who sold his condo in Bukit Timah last year to buy a three-room HDB flat in Clementi, said the policy helped downgraders like him by keeping resale prices under control.
"Many private property owners had the finances to fork out big cash premiums to buy a choice flat, which ultimately drives up prices overall," said the 64-year-old retired engineer. "At least now there seems to be a more realistic demand."
Meanwhile, private property owners who want to sell up and buy subsidised HDB flats have to wait 30 months from the date they sell their homes. This has led to complaints from downgraders, who are forced to rent in the interim.
Last year, the HDB received 4,700 appeals to waive the 30-month debarment. An HDB spokesman said the policy was necessary because subsidised flats are "safeguarded for first-time home buyers who are in more urgent need of housing".