HDB resale costs increases for the first time in nine quarters

The most recent round of property controls is predicted to make home buyers rely on the HDB resale market, where properties are less expensive.

Costs of resale Housing Board apartments increased 0.1 % in the 2nd quarter of 2018 – the first major rise following nine quarters of slump – suggesting that HDB resale costs could be on the decline

The resale transactions of HDB increased 33.3% from 4,458 cases recorded in the first quarter of 2018 to 5,941 in the second quarter of 2018, revealed HDB statistics.

Christine Sun, the head research and consultancy department, OrangeTee & Tie, is convinced that the robust demand for resale homes might be “ driven by supply since additional units had been completed recently  and are being offered for resale after they attained the five year  minimum occupation period (MOP)” .

She disclosed that the number of completed HDB apartment increased 124 % to 15,456 units between 2011 and 2013 from 6,902 units recorded between 2008 and 2010. As a matter of fact, she anticipates the resale quantity “to increase in the coming years because thousands of apartments, totaling 25,323 HDB flats were constructed from 2014-2017 and will attain MOP from next year”.

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“Resale apartments continue to be the only opportunity for buyers to choose an apartment in a prime location, and in contrast to BTO apartments, the eligibility terms are considerably less rigid; particularly if the buyer is not seeking CPF Home Grants; or not getting a home loan through the HDB,” he stated.

“Nevertheless, since buyers who desire to get loans must pick between bank loans, will be influenced by the reduce HDB or LTV loans, that have higher rates of interest, transaction volume of resale apartments is equally expected to be affected.”