Resale prices will slip by as much as 7%.
A bleak resale market awaits families looking to sell their HDB flats. HDB resale volume is expected to hit a ten-year low this year, with volume hovering around 16,500-17,000 units.
According to PropNex, HDB resale prices will continue heading south and are expected to soften 6-7% for the full year 2014.
Prices will remain impacted by a looming flood of new homes and the continued impact of property measures such as lower mortgage servicing ratio, shorter loan tenure and a minimum three-year waiting period for PRs wanting to buy HDB resale flats.
The outlook for 2015 also looks bleak with a possible 5 to 6 per cent full year drop. This is mainly due to the increased number of 2nd timers collecting their keys to their new BTO flats, and they will have to sell their existing flats within 6 months. This figure is expected to be about 6,000 annually for the next 2 years.
“Home buyers are more restrained if their MSR is over 30 per cent or TDSR is near 60 per cent. Loan curbs and softer prices will ultimately mean that HDB upgraders will find it more prohibitive to upgrade to a private property,” noted PropNex CEO Mohamed Ismail.