The softening HDB resale market did not stop homeowners from selling their flats last year, with one in 10 flats sold within a year of reaching the five-year Minimum Occupation Period (MOP), revealed housing board figures and reported in the media.
In 2013, only 5.5 percent of flats were resold within one year of reaching the MOP, a significant drop from previous years.
HDB resale prices only started to fall in 2H2013, and homeowners may have decided to wait on the sidelines to see where the market was headed, according to experts.
But as resale prices posted a full-year drop of six percent last year, “things became much clearer”, said PropNex Realty Chief Executive Mohamed Ismail.
Fearing that flat values would decrease further, owners might have decided to accept current prices, noted OrangeTee Research Manager Wong Xian Yang.
Their fear was in line with predictions of a single-digit drop in prices this year.
Nonetheless, Wong highlighted that sellers who purchased their flats directly from HDB are still “sitting on large profits of at least over 70 percent”.
Prices of private homes also fell last year, enabling sellers to upgrade, stated Ismail.
“In 2014, we saw the greatest discounts in many new private launches,” he said.
Meanwhile, of the 8,521 newly eligible flats, 470 were resold in 2013.
Last year, 485 of the much smaller pool of 4,497 eligible flats were resold, thus representing a higher proportion.
The similar figures mirror the number of units that can be absorbed by the resale market, explained R’ST Research Director Ong Kah Seng.
Overall, there were 17,318 resale deals in 2014, or down 4.3 percent from 2013.
Also, there may have been owners in 2013 who wanted to sell their flat but failed.
However, he noted that these are just secondary reasons.
“The main reason is still due to owners who are increasingly realistic about the selling price of their flat.”
Romesh Navaratnarajah, Singapore Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@propertyguru.com.sg
