HDB resale flats prices continue to rise

Resale prices of HDB flats have increased 2.9 per cent in the second quarter of this year compared to the previous quarter.

Flash data released on Friday by the Housing and Development Board (HDB) shows that its resale price index in the second quarter this year came in at 179.9.

The rate of price growth in the second quarter is higher than the previous quarter’s 1.6 per cent hike.

HDB said it is on track to offer 22,000 Build-to-Order (BTO) flats by September, and another 3,000 BTO flats in the last quarter of this year.

Prospective buyers can check the HDB website for details of the projects scheduled for sale from July to September.

To further enhance the supply for third quarter this year, HDB said it plans to launch 2,000 flats under a Sale of Balance Flats Exercise scheduled in August.

HDB said this exercise will offer some flats in the mature estates.

Key Executive Officer of ERA Realty Network, Eugene Lim, said the higher increase in prices of HDB resale flats last year was due to a supply shortage.

Many HDB upgraders who had intended to upgrade to private property are postponing their plans as private property prices, particularly mass market condo prices have increased beyond their reach.

Also, Mr Lim said those that are able to afford to buy a private property after fulfilling the minimum occupation period of five years without selling their HDB flats; as they can sublet the whole unit and get a good return.

He said demand however continues to be strong due to upgraders, downgraders, Permanent Residents and private property owners who have cashed out.

This has driven Cash-Over-Valuation (COV) upwards.

Based on ERA’s transactions for the last three months, Mr Lim said the median COV has risen from S$30,000 in April to S$37,000 in June.

Source : Channel NewsAsia – 1 Jul 2011

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