HDB resale prices rose a slight 0.2 per cent in November compared to October this year, driven by a 0.8 per cent price increase in mature estates, versus a 0.3 per cent dip in non-mature estates. But resale volume fell in November. According to HDB resale data compiled by SRX Property, some 1,585 flats were resold in November 2016, representing a 5.3 per cent drop from 1,673 transacted units in October.
Contrasting this, public flats in non-mature estates often have to compete with a huge supply of newly launched condominium and executive condominium (EC) projects. Upcoming executive condo launches include Yio Chu Kang EC, Choa Chu Kang EC, Anchorvale Lane EC, while existing ones include Terrace EC, Brownstone EC, The Vales EC, Parc Life EC , Sol Acres EC, The Visionaire, Bellewoods EC, Signature at Yishun, The Criterion EC, Treasure Crest, Northwave EC Waterwoods EC, Skypark Residences, Wandervale EC, The Amore EC, Bellewaters EC.
On a year-on-year comparison, the trend is reversed. Resale prices have fallen 0.7 per cent from November 2015, while transactions have increased by 7.1 per cent compared to 1,480 units resold in November 2015.
R’ST Research director Ong Kah Seng noted that resale prices have largely stayed flat since August. The trend is tending towards stabilisation now, he said.
He thinks that the slight uptick in November could be a trickle-down effect from the exuberant demand for the recent batch of build-to-order (BTO) flats launched by HDB.
The November launch was the biggest BTO launch this year, and flats in Kallang/Whampoa and Bidadari reportedly met with the highest demand.
Mr Ong said: “The exciting bumper crop of flats released in November via BTO and the sale of balance flats exercise has spurred flat-buying interest at large, and filtered positively to the resale market. . . It energised buying sentiment in the resale flat segment, although BTO and resale flats are fairly different public housing market segments.”
He was also not surprised by the price increase in mature estates, which he attributes not just to their good geographical locations, but also the strong leasing demand for and limited supply of such flats.
In comparison, not many new private projects are built in mature estates.
SRX Property data also shows that within the resale market, prices of three-room, four-room and five-room flats rose 0.2 per cent, 0.2 per cent and 0.3 per cent respectively.
On the other hand, the resale prices of the larger executive flats (that are no longer built today) fell 0.3 per cent.
Mr Ong believes that resale flat prices will move within a range of zero per cent to a 0.5 per cent increase for the whole of 2017, if the existing cooling measures that affect HDB flat buyers such as the mortgage servicing ratio that caps borrowing, remain in place.
Year to date, SRX Property’s index shows that HDB resale prices have fallen 0.7 per cent.
Meanwhile, HDB’s resale price index shows that from the first quarter to third quarter of 2016, prices have dipped 0.1 per cent.