The price for HDB resale and private properties is now at ease but they are still standing below the grid. This standing, according to market experts, is brought about by the holding power of developers and private home possessors.
To the consultants, the above condition does not necessarily mean that the prices for private properties have bottomed out but instead could mean thinning of sale’s volume and maintenance of buyer’s asking price. Also they could even lead to a slow rate of price correction!
The Urban Redevelopment Authority has released a flash estimate on the price of private residential properties last Wednesday. The price index revealed that the price for both non-landed and landed properties fell by 0.6% over the 3rd quarter. On the second quarter this year, it was noted that their price slipped 1% off. With such, it can be concluded that the prices have continuously fell off for FOUR consecutive quarters by 3.8%!
The same fate is also standing at the door of HDB resale. Resale has slowed for quite sometime. This was thought to be caused by the pressure built by MSR or Mortgage Servicing Ratio. The MSR significantly decreased the pool of HDB buyers, most especially to those who wish to have larger units. Additionally, the continual demand and supply for built-to-order flats have pushed down the demand for reselling of flats.
According to the statistics presented by HDB, the resale price fell 1.6% this third quarter after falling 1.4% from the second quarter. Records show that since the third quarter last year (2013), HDB resale has fallen off the chart by 6.8%.
To Ong Tech Kui, the research Director of JLL, the increasing gap between private home price and HDB resale price could make the dream of HDB residents unrealistic (dream of owning a private property). Furthermore, the weak support to HDB resale could also worsen the softening of the private market.