SINGAPORE — The property listing of a "jumbo flat" in Sengkang has caught the attention of the authorities, which called the advertisement misleading.

The Council for Estate Agencies (CEA), the government regulator for Singapore's real estate industry, will investigate the matter — an ad for a “jumbo flat” in Sengkang, listed at S$2 million (US$1.47 million).

In a joint statement issued on Wednesday (May 8) in response to media queries, the Ministry of National Development (MND), Housing and Development Board (HDB) and CEA also addressed the listing of a S$2 million 5-room Design, Build and Sell Scheme (DBSS) HDB flat in Toa Payoh.

SENGKANG 'JUMBO FLAT'

The property listed on the online portal PropertyGuru was not a "jumbo flat", but in fact two adjacent 5-room flats that cannot be converted and sold as a single unit, said MND, HDB and CEA.

There are no existing jumbo flats in the address stated in the listing, Blk 314C Anchorvale Link.

At S$2 million, the listing price for the "jumbo flat" was also well above the recent transacted prices in the precinct, said the authorities.  

"Over the last six months, 5-room flats in the precinct transacted for around S$580,000. The S$2 million listing price is therefore more than $800,000 above the combined value of the two 5-room flats," said MND, HDB and CEA in their joint statement. 

The property agent who posted the listing has since taken it down after CEA pointed out the misleading advertisement to the agent's property agency. 

"CEA is investigating the matter and will take firm action if any breaches are established," said the authorities.

S$2 MILLION LISTING FOR TOA PAYOH FLAT

MND, HDB and CEA also addressed the recent listing of a DBSS flat in Toa Payoh. At S$2 million, the listing price is almost half a million dollars above the highest transacted price in the area.

DBSS flats are built by private developers on land bought from HDB. They are still classified as HDB flats. The scheme, which began 2005, has been suspended since 2012.

The three government bodies said they were aware that the agent who listed the flat had described it as value for money.

However, many property experts consider this unrealistic, even with the attractive attributes of the unit, the joint statement said. 

"Currently, there is no Intent to Sell registered with HDB for this particular flat, which means that the potential seller/s of this flat are not able to grant any Option to Purchase (OTP) at this stage," MND, HDB and CEA said.

They also reminded property agencies and agents to uphold the integrity and professionalism of the real estate industry.

The authorities also noted that industry players have an ethical obligation to act not only in the best interests of their client but also the public, including prospective buyers. "

"To protect the interests of the public and promote information transparency to facilitate informed decisions by prospective buyers, CEA will also look into the information presented by property agents when they market HDB flats" said the authorities.

In 2023, more than eight in 10 first-timer families who collected keys to their new flats or bought resale flats had a mortgage servicing ratio (MSR) of 25 per cent or less upon key collection.

This means that they can service their monthly HDB loan instalments with their CPF contributions, with little to no cash outlay.

At the current listed prices, the DBSS flat and the two 5-room flats in Sengkang will come with significant cash-over valuation (COV), which has to be fully paid in cash upfront.

Resale flats that were transacted at S$1 million or more form a small minority of all resale transactions, said MND, HDB and CEA, noting that such flats hold attributes such as good locations and their proximity to amenities and MRT stations.

These units cater to a small group of Singaporeans with unique preferences and better financial means, the joint statement said.

MND, HDB and CEA strongly advised prospective buyers to evaluate their finances and housing options carefully and be rational and prudent in their purchasing decisions. 

"While the HDB resale market transacts on a ‘willing buyer-willing seller’ basis, the Government will not condone behaviour, whether by agents or sellers, that seek to disrupt the market or fan consumer sentiment," MND, HDB and CEA said in their joint statement. 

"We should not expect housing prices to increase indefinitely amidst global economic uncertainty and geopolitical instability." CNA