Demand for resale HDB flats has remained strong last quarter. Although prices have fallen, the rate of decline is now slower in comparison with the same period last year.
Older HDB flats fared as well as younger ones
Older resale flats may have been shunned for a period of time when subsidies and eligibility exceptions were few. In recent months, however, sentiments towards these properties seem to have improved.
Prices for older flats (aged 40 years and above) fell 0.9% in Q3 while in the same period last year, prices for this segment fell 3.4%. In comparison, prices of younger flats (aged 10 years and below), fell 2.5% from Q2 to Q3, compared to a 4.8% decline in 2018. 1,247 new resale units were sold last quarter; a 12.4% increase from the previous quarter and the highest number of transactions in a single quarter since Q3 of 2010.
Flats in non-mature estate sold better
In recent years, the number of flats sold within 10 years of completion has increased and that may have accounted for the price weakness as competition would have been fierce. Analysts are expecting the demand for younger flats to remain steady as more flats are reaching their 5-year minimum occupation period (MOP) soon.
There were also more resale HDB flats sold in non-mature estates and this could have accounted for the decline in the prices of younger flats. This may also be an indication that more families are selling their flats as soon as they can and moving to larger HDB flats or private properties. Others may also have sold their flats in fear of value depreciation as they flats age.