The Singapore Housing and Development Board (HDB) released its residential market estimates for the first quarter of 2019. According to the report, the resale price index (RPI) has declined by 0.3 per cent on a quarterly basis – a trend that’s been observed for some time already.
RPI provides general information about price movements in the Singapore resale public housing market.
As per the official release, the RPI has seen a slight drop but more detailed information on the movement and public housing developments will be released on April 26, 2019.
Currently, the RPI stands at 131.0. The downward trend has been consistent over the past two quarters. In the third quarter of 2018, prices went down 0.1 per cent. A slight decrease of 0.2 per cent was also registered over the final quarter of 2018.
Still, the HDB resale market is in a good condition and it maintains a degree of stability. Things were much more volatile during the same period of 2018. In the first quarter of 2018, the decline was set at 0.8 per cent.
Prices have decreased by approximately two per cent over the past two years, Singapore property experts state. Still, the decline is slowing down and the resale residential market is demonstrating signs of stabilisation at the time being.
The overall demand for resale transactions in 2018 reached 23,099.
There will be new supply and demand dynamics that will affect the availability of homes for sale in Singapore and their prices in 2019.
One of the most prominent trends is the fact that 30,000 HDB flats will reach their minimum occupation period (MOP) in 2019. The maturity of MOP flats will add to the supply side and public housing prices will not experience much of a change in 2019 (a slight increase of approximately one per cent is anticipated), Chanel News Asia reported.
To add to the market dynamics, the HDB has made an announcement about the availability of new BTO flats that will be released in 2019.
As per the HDB announcement, the offering will consist of approximately 3,400 new BTO apartments in Whampoa, Kallang, Tengah and Woodlands. The offering will become available in May, 2019. There will also be a concurrent sale of balance flats exercise.
HDB has announced that it plans to launch a total of 15,000 new flats for sale in 2019. In addition, HDB announced shorter waiting periods and regulatory changes that will enhance the application process.
Apart from the quarterly information, there has also been some data about resale flat market dynamics on a monthly basis since the start of the year.
In January, there was an increase in resale transactions. The high was followed by a downward trend in February. There were 1,313 resale transactions – a decrease of 15.8 per cent on a monthly basis. The good news, however, is that on an annual basis, there has been an increase of 9.9 per cent in comparison to the volume of transactions for February 2018.
HDB resale flat prices remained unchanged from January to February. In comparison to the February 2018 prices, there is a decline of 0.5 per cent. Resale flat prices reached an absolute peak in April 2013. The drop since then is set at 13.9 per cent.
According to real estate professionals, resale HDB flat prices have gone down more rapidly than the prices of private homes for sale. This is one of the reasons why the gap between the two types of residential property has become even wider.
The supply of flats reaching their five-year occupational period also increased. This fact cannot be underestimated when it comes to high supply and a reduction in the HDB resale flat prices.
The condition of the flat and its size are two of the factors deemed determining for the resale price. Analysis suggests that newer flats in attractive locations throughout Singapore command the highest prices. Buyers are more willing to spend a larger amount on a smaller, well-maintained flat. Larger apartments are currently less in demand and more time is required to close a deal on this type of resale apartment.
Buyers are increasingly becoming more cautious. They’re not in a hurry to purchase and they draw a detailed comparison between the available options. Prices are easing and the supply is high. The competition for the same flat is reduced, which means that buyers don’t have to rush and close the deal as soon as possible.
Older resale flats are the ones that currently spend the most time on the market.
Real estate professionals, however, anticipate a change in mindset that will affect the fate of such HDB resale flats in the future.
The new VERS and HIP programs aim to increase the attractiveness of those residential properties. While these have not produced an immediate effect on resale prices, the impact is anticipated to become much more pronounced as time goes by.
As additional policies continue being implemented, the mindset towards older HDB flats will also likely undergo a massive shift.
If you own an older HDB flat, you may be unhappy about the current market dynamics and the price reductions.
There are things you can do to increase the attractiveness of the property and contribute to its intrinsic value.
Such improvements can be carried out without breaking the bank. At the same time, they will make it possible to sell the apartment at a higher price.
Home Guide’s experienced Singapore interior design team can guide you through the process of home interior design and renovation and freshening up an older flat. We will examine the condition of the apartment and pinpoint the renovations that are affordable and that will yield the highest return on investment.
Contact Home Guide today to start enhancing your older flat and giving it a modern facelift. As the market trends favour buyers right now, you will need to work hard in order to finalise a deal that will make you happy and give you exactly what your resale flat is worth.
