HDB resale prices down 0.9% in 2018

Romesh Navaratnarajah2 Jan 2019

HDB flats in Ghim Moh

HDB resale flats in the Ghim Moh area.

Resale prices of HDB flats dropped by 0.9 percent for the whole of 2018, revealed the Housing and Development Board (HDB) on Wednesday (2 Jan).

For the fourth quarter of 2018, resale flat prices dipped by 0.2 percent from the previous three-month period.

“The Resale Price Index (RPI) for the full quarter, together with more detailed public housing data, will be released on 25 January 2019,” it said.

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Despite the drop in prices, property agency ERA Realty still expects HDB resale demand to be resilient this year.

This comes as the lease decay issue, which was in the spotlight last year, had been largely addressed by the introduction of VERS and the new HIP programmes.

The property cooling measures introduced by the government, which mostly affects the private residential market, are also expected to drive more buyers to the HDB resale market.

Moreover, the Lease Buyback Scheme has been expanded to include all flat types starting from 1 January.

“Resale flats are still an attractive option to buyers. The maximum amount of grants available to eligible buyers is $120,000 (Up to $30,000 Proximity Housing Grant, up to $50,000 Family Grant, up to $40,000 Additional Housing Grant), and processing time has been shortened with the new resale portal,” said Eugene Lim, key executive officer at ERA.

Aside from being the only way for buyers to purchase a flat in their location of choice, there is also no income ceiling for buying resale flats.

“Accordingly, this has led to million-dollar flats, where some buyers are willing to pay top dollar for flats with exceptional attributes and location, as seen from the recent report on four-room Tiong Bahru flats breaching the million-dollar barrier,” he noted.

“However, these high-priced transactions remain the exception rather than the norm. Majority of resale HDB flats that have been transacted are supported by valuation; and this points to a very stable public housing market.”

With this, Lim expects HDB resale prices to increase very marginally by up to one percent for the whole of 2019.

Meanwhile, HDB said it will launch about 15,000 new flats in 2019. The first Build-To-Order exercise in February will see about 3,100 flats being offered in Kallang Whampoa, Jurong West and Sengkang.

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Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg


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