HDB resale prices moderate in Q4
by Joanne Chan 04:47 AM Jan 04, 2012
SINGAPORE – The tide could be turning in favour of buyers, with home prices in Singapore showing signs of moderating.
Prices of resale Housing and Development Board (HDB) flats grew 1.7 per cent in the last quarter of last year, compared to the 3.8 per cent growth seen in the third quarter.
This brings the HDB Resale Price Index – which provides information on the general price movements in the public residential market – to 190.4.
The figures confirmed what the market had been expecting – a moderation in home prices following a year of policy tweaks by the Government to cool the red-hot property market, while home buyers are becoming more cautious in light of the uncertain economic outlook.
Market watchers also pointed out that cash-over-valuation – the cash premium paid upfront for resale flats – is showing signs of softening, dropping between S$5,000 and S$8,000 in the last quarter of last year, and could bottom out at around S$20,000 to S$30,000.
Mr Mohd Ismail, CEO of PropNex, said buyers could have more bargaining power in areas where prices are very high, where houses are on low floors, or affected by ethnic ratios.
“And when such houses are put on the market, you don’t even get a buyer at zero cash-over-valuation. Therefore, if you say are there possibilities of picking houses today without paying any cash … yes there are. But they may not have the best of the panoramic view and so on,” he said.
Some expect HDB resale prices to correct by up to 3 per cent this year, with the ramped-up supply of Build-To-Order (BTO) flats expected to continue to draw first-time home buyers away from the resale market.
Said Mr Eugene Lim, executive officer of ERA Realty: “The success rate is higher now. It is a lot better. In fact, any first-timer who applies for a flat is almost certain of getting one. So, this improved success ratio … translates into lower demand in the resale market.”
Last year, the HDB offered about 28,000 flats – 25,000 under the BTO system and about 3,000 units under the Sale of Balance Flats exercise.
This year, buyers can look forward to 25,000 BTO flats coming on the market.
The HDB said “these projects will have a good geographical spread in the various towns”.
It will offer nearly 3,900 BTO flats in Choa Chu Kang, Punggol, Sengkang and Tampines this month.
Source : TODAYonline – MediaCorp Press Ltd’s copyright