princess_morbucks
26-04-14, 09:32
http://www.todayonline.com/singapore/hdb-resale-prices-fall-more-expected-q1?utm_content=bufferd5ed0&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
SINGAPORE — Prices of Housing and Development Board (HDB) resale flats fell more than expected in the first three months of the year, figures released yesterday showed. The Resale Price Index (RPI) fell by 1.6 per cent, slightly more than the flash estimate of a 1.5 per cent drop released earlier this month.
Resale transactions also fell in the first quarter of the year — 3,781 flats changed hands between January and March, 5 per cent fewer than the 4,001 transactions in the last three months of last year.
The HDB yesterday also said it has ceased the publication of the quarterly median Cash-Over-Valuation (COV) figures by town and flat type, in line with changes the authority had made to resale procedures on March 10 that were aimed at reducing the focus on COV during the negotiation of a resale flat. Buyers and sellers of resale flats now have to agree on a price before getting an official valuation, in contrast to the previous long-standing practice where negotiations were determined by a unit’s valuation report and how much a buyer was willing to pay above valuation.
Property analysts felt the change in the resale process may have affected the market in the first three months of the year.
“The fall in volume could be partly due to the festive season lull, as well as the abolishment of COV, which has introduced additional uncertainty into the resale market, causing buyers and sellers to hold back,” said Ms Christine Li, head of research and consultancy at OrangeTee.
With yesterday’s latest move by the HDB, some property analysts expect buyers to adopt an even more cautious attitude when buying a re-sale flat. “Buyers may take a bit of a wait-and-see attitude,” said Mr Chris Koh, director of Chris International, a small property firm here. He pointed out that the fall in resale prices last quarter was the third consecutive quarterly fall and buyers may expect prices to fall further.
PropNex Realty chief executive Mohamed Ismail said buyers have become more cautious with their offers, especially for units that do not come with a valuation report, since the new resale procedures kicked in last month.
Director of research and consultancy at Suntec Real Estate, Mr Colin Tan, felt the policy now favours buyers, as some property agents had previously use the COV as a “scare tactic” to close deals with clients. “Some people would be prone to panic, but once you remove this (COV data), this so-called tactic is no longer available,” he said. “So, people focus on the price and that is where it should be.”
Mr Eugene Lim, Key Executive Officer of ERA Realty, expects the lacklustre resale market to appeal to some buyers with immediate housing needs. “As prices continue to moderate, and once buyers and sellers get used to negotiating based on price and not COV, the resale HDB market will become increasingly appealing as home buyers need not wait the three years for BTO (Build-to-Order) units to be completed,” he said.
In contrast, the number of subletting transactions rose to 8,485 in the first three months of the year, up 17 per cent from 7,268 in the previous quarter. OrangeTee’s Ms Li said a possible reason for the surge could be the weakened sentiment in HDB resale market.
“As a result, more HDB owners have decided to rent out the HDB flats instead of selling, especially if they are not able to get a good price on their HDB flats,” she added.
SINGAPORE — Prices of Housing and Development Board (HDB) resale flats fell more than expected in the first three months of the year, figures released yesterday showed. The Resale Price Index (RPI) fell by 1.6 per cent, slightly more than the flash estimate of a 1.5 per cent drop released earlier this month.
Resale transactions also fell in the first quarter of the year — 3,781 flats changed hands between January and March, 5 per cent fewer than the 4,001 transactions in the last three months of last year.
The HDB yesterday also said it has ceased the publication of the quarterly median Cash-Over-Valuation (COV) figures by town and flat type, in line with changes the authority had made to resale procedures on March 10 that were aimed at reducing the focus on COV during the negotiation of a resale flat. Buyers and sellers of resale flats now have to agree on a price before getting an official valuation, in contrast to the previous long-standing practice where negotiations were determined by a unit’s valuation report and how much a buyer was willing to pay above valuation.
Property analysts felt the change in the resale process may have affected the market in the first three months of the year.
“The fall in volume could be partly due to the festive season lull, as well as the abolishment of COV, which has introduced additional uncertainty into the resale market, causing buyers and sellers to hold back,” said Ms Christine Li, head of research and consultancy at OrangeTee.
With yesterday’s latest move by the HDB, some property analysts expect buyers to adopt an even more cautious attitude when buying a re-sale flat. “Buyers may take a bit of a wait-and-see attitude,” said Mr Chris Koh, director of Chris International, a small property firm here. He pointed out that the fall in resale prices last quarter was the third consecutive quarterly fall and buyers may expect prices to fall further.
PropNex Realty chief executive Mohamed Ismail said buyers have become more cautious with their offers, especially for units that do not come with a valuation report, since the new resale procedures kicked in last month.
Director of research and consultancy at Suntec Real Estate, Mr Colin Tan, felt the policy now favours buyers, as some property agents had previously use the COV as a “scare tactic” to close deals with clients. “Some people would be prone to panic, but once you remove this (COV data), this so-called tactic is no longer available,” he said. “So, people focus on the price and that is where it should be.”
Mr Eugene Lim, Key Executive Officer of ERA Realty, expects the lacklustre resale market to appeal to some buyers with immediate housing needs. “As prices continue to moderate, and once buyers and sellers get used to negotiating based on price and not COV, the resale HDB market will become increasingly appealing as home buyers need not wait the three years for BTO (Build-to-Order) units to be completed,” he said.
In contrast, the number of subletting transactions rose to 8,485 in the first three months of the year, up 17 per cent from 7,268 in the previous quarter. OrangeTee’s Ms Li said a possible reason for the surge could be the weakened sentiment in HDB resale market.
“As a result, more HDB owners have decided to rent out the HDB flats instead of selling, especially if they are not able to get a good price on their HDB flats,” she added.