Signs point to stabilising HDB resale market

More signs are emerging that the Housing Board (HDB) resale market is stabilising, with prices edging up last month.

This was on the back of the highest transaction volume in two years, according to flash figures from SRX Property yesterday.

Resale prices were up 0.2 per cent in April compared to March.

But while the slight rise bucks the downward trend, analysts said that it is far from certain if a turnaround is around the corner.

ERA Realty key executive officer Eugene Lim expects prices to “decline moderately” in the coming months.

But he added: “The good thing to note is that the rate of price decline seems to be slowing down and that is a sign that we may see prices stabilise by year end.”

Prices might fall by less than 5 per cent for the full year, he said.

The slight uptick last month supports the picture of a stabilising market.

In the first three months of the year, the official HDB price index fell by 1 per cent – the smallest quarterly fall since the downward trend began in 2013.

Last month, the price rise was driven by a 0.3 per cent increase in three-roomer prices and a 0.9 per cent rise for four-roomers.

This more than made up for falls in five-room and executive HDB prices of 0.8 per cent and 2 per cent respectively.

Prices were up 0.6 per cent in mature estates but down 0.2 per cent in non-mature estates.

R’ST Research director Ong Kah Seng said that buyers are returning precisely because prices are lower, and are therefore unlikely to push prices back up.

But he expects flats in mature estates to maintain their value, with prices staying flat for the full year.

For flats in non-mature estates, he sees full-year price falls of up to 6 per cent.

Despite the slight rise in prices, the resale market is still 6 per cent lower, compared to April last year. Placed against the peak in 2013, it is 11 per cent lower.

In contrast, resale volumes reached a two-year high, with 1,610 flats changing hands.

This was 19.3 per cent higher than the 1,349 sales in March and 8.5 per cent higher than the 1,484 sales in April last year.

As prices continue to stabilise, buyers are becoming more confident about buying from the resale market, said Mr Lim.

OrangeTee research manager Wong Xian Yang noted that with more Build-To-Order and executive condominium units being completed, second-timers face pressure to dispose of their HDB flats before the deadline.

They may thus accept lower prices, resulting in more deals being completed, he added.

One such seller is Mr Antono Lee, 40, who needs to sell his Sengkang five-room flat as he is upgrading to an executive condominium.

“My unit is well-maintained, on a high floor and a corner unit, so I’m optimistic,” said the IT consultant, who hopes to sell the flat for about $500,000.

“But if the market is really that bad, then I’ll have to lower my price,” he added.

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