Public housing resale market continues to soften

SINGAPORE — The public housing resale market continued to soften for the eighth consecutive month, with prices hitting a 20-month low as property curbs and a healthy stream of Build-to-Order flats continue to crimp activity.

Now that the Hungry Ghost Festival has come to an end, transaction volume has picked up, though not in the rental market, showed a flash report by the Singapore Real Estate Exchange (SRX) for last month, which was released yesterday. HDB resale prices last month dipped 0.5 per cent compared with August and has dropped 8.9 per cent since its peak in April last year.

Driving down the overall index were three-, four- and five-room flats, with the biggest price decline of 1.6 per cent registered in five-room units.

Prices for three- and four-room flats dipped 0.2 per cent, while prices for executive flats inched up 0.1 per cent, the SRX said. With resale prices down 4.6 per cent so far this year, property analysts were not surprised by the latest softening, adding that the projected total decline this year could fall within the 5 to 8 per cent range.

Century 21 chief executive officer Ku Swee Yong expects the downward trend to stretch for three more years, given the “avalanche of supply” in BTO flats, as well as the number of Executive and Private Condominium projects nearing completion.

The 1,469 resale flats sold last month marked a 10.7 per cent increase in transaction volume from August. Meanwhile, rental volume saw a 6.7 per cent decrease last month. An estimated 1,483 HDB flats were rented compared with 1,590 units in August. Rental prices also posted a small decrease of 0.3 per cent, mostly due to declines in three-, five-room and executive flats.

Manager of research and consultancy at OrangeTee Wong Xian Yang said demand for rental flats have fallen in the wake of tightened foreign worker policies. Mr Ku added that falling rents for private property have led to some “cannibalisation” on HDB units.