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SRX: HDB resale prices dip 0.3% in Feb
HDB resale prices were down 0.3 per cent in February compared to January, according to the SRX Property Price Index for HDB Resale.
HDB resale prices were down 0.3 per cent in Februarycompared to January, according to the SRX Property Price Index for HDB Resale. And resale transactions fell 8.5 per cent to about 1,074 HDB resale flats sold in February, down from 1,174 transacted units in January.
But property consultants remain confident that HDB prices have reached a price equilibrium and continue to be stabilising.
R'ST Research director Ong Kah Seng believes that the price drop was due to a strong supply of build-to-order (BTO) flats sapping demand from the HDB resale market. Also, the property market in February could still be in a lull following the festive season in end-January.
"Buyers, agents and flat owners are still on a festive slumber mode in February, and have yet to return to actively arranging, negotiating and concluding property deals proper."
The price drop was led by resale prices for transactions in non-mature estates. These fell 0.8 per cent. In comparison, HDB resale prices in mature estates rose 0.4 per cent.
Mr Ong said this shows that mature estates' resale flat prices are still much better supported by their positive property fundamentals.
"There was a substantial number of BTO flats released in February 2017, but the application rates were so high. Buyers generally understand that they can only try their luck in balloting for a mature estate BTO flat, so they continued to buy resale flat which match their requirements," he said.
Among the flat types, resale prices of HDB four-room, five-room and executive flats fell 0.2 per cent, 0.5 per cent and 1.7 per cent respectively, while those of three-room flats rose 0.2 per cent.
Overall, year-on-year, prices have decreased by 0.6 per cent from Feb 2016, and fallen 11.5 per cent since the peak in April 2013.
Year-on-year, resale volume fell 10.9 per cent compared to 1,205 units resold in Feb 2016. Resale volume was also down by 70.6 per cent, compared to its peak of 3,649 units resold in May 2010.
Mr Ong expects HDB resale prices to stay flat for the whole of 2017, barring any lifting of the current property cooling measures.
"We can expect prices to recover marginally from March onwards," he said. "Flat buyers will also tap on the Proximity Housing Grant which was recently introduced to help them better afford a flat. This will be a key demand driver for resale flats in 2017 too."