Though resale HDB flat prices fell by 0.3 per cent in January and is 0.1 per cent lower in comparison with the same month last year, industry players remain confident of a stabilising market for the rest of the year.
Resale flat prices have already fallen 11.2 per cent since its peak in 2013, though prior to that, prices have already risen considerably within 3 years. Straining from the continued price decline were the 5-room and executive flats segments, in which prices rose 0.4 and 0.9 per cent respectively. And again moving in the opposite direction, while 3-room and 4-room flat prices were expected to remain mostly flat, they have fallen 0.6 and 0.5 per cent respectively.
Resale flat prices in mature estates also fell 0.7 per cent, which comes as a little of a surprise since they have always maintained their demand despite falling numbers. Could the fall be due to the government ramping up the supply of new build-to-order (BTO) flats in mature estates over the past few years? Possibly. The trickle-down effect works just as well in both private and public property sectors.
As the price gaps between private and public homes close, the pool of options for property buyers becomes bigger and while some HDB owners are holding on to their units in wait of better times, some may be forced to sell as they move on to their new BTO units or to private properties they are upgrading to. The increase in resale units may put some pressure on prices and sales volume. Already the volume of resale units have fallen 13.9 per cent from last December. Tampines and Geylang registered the highest number of resale transactions closed with above-market prices of $4000 and $5,500 respectively.
