- POSTED: 01 Oct 2013 10:28
- UPDATED: 01 Oct 2013 23:56
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HDB resale flat prices fell for the first time in over four years, with the index dipping 0.7 per cent in the July-September quarter from the preceding three months.
SINGAPORE: HDB resale flat prices have fallen for the first time since 2009.
This is according to the latest flash estimates released by the Housing and Development Board (HDB) on Tuesday.
According to the HDB Resale Price Index, prices fell by 0.7 per cent in the third quarter of this year.
The last time resale flat prices dipped was in the first quarter of 2009, when prices dropped by 0.8 per cent.
Prices have been on the upward trend since then, although they have shown signs of moderating.
Resale flat prices reached a peak in the second quarter of this year, when prices went up by 0.5 per cent.
Property analysts say since the introduction of the total debt servicing ratio in the last two months, potential buyers have been lowering their expectations of what they can buy.
This is due to their inability to obtain a loan quantum as large as they had hoped for.
Ku Swee Yong, chief executive officer of International Property Advisor, said: "People who were looking at five-room HDB or executive HDB may now be setting their sights on four-room or three-room.
“So cash-over-valuations on the more expensive HDB resale properties have been dropping, and recently, there were more cases of cash-over-valuation going down to zero.
“When cash-over-valuations go down to zero and you start giving discounts, even valuations will start going down and so this has led us to a slight dip in HDB resale prices.
“For the next few quarters, I believe prices will continue to sort of dip a little bit more.”
Mr Ku added that in the last three years, the HDB has been launching over 20,000 new Build-To-Order flats each year.
He said the flats come as an alternative supply source, which is providing competition for resale HDB flats.