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13-03-15, 18:16
http://www.businesstimes.com.sg/real-estate/hdb-resale-prices-dip-on-lower-volume-in-february-srx
HDB resale prices dip on lower volume in February: SRX
Resale volume fell 8.5 per cent to 1,148 flats sold in February, down from 1,255 transacted units in January
By Lee Meixian
[email protected]@LeeMeixianBT
6 Mar
HDB prices continue to decline in February, as their transaction volume also shrunk month on month, according to flash data from SRX Property released on Thursday.
Overall, HDB resale prices fell 0.6 per cent in February, confirming the 0.2 per cent increase in January to be a blip. Year on year, prices have fallen 5.7 per cent from February 2014.
The biggest factors driving prices down were: the tightened credit situation (a 30 per cent mortgage servicing ratio), the three-year wait-out period before newly minted permanent residents can buy resale flats, and more recently, the creeping up of the Singapore interbank offered rate (Sibor), to which mortgage rates are pegged.
The current practice requiring buyers to secure the option to purchase before obtaining the valuation report also makes buyers more conservative when negotiating a price, Eugene Lim, ERA Realty's key executive officer said.
Resale volume fell 8.5 per cent to 1,148 flats sold in February, down from 1,255 transacted units in January.
But year on year, resale volume rose by 20.7 per cent in February, compared with just 951 units resold in February 2014. This was seen as a sign of buyers returning to the resale market, drawn by lower prices and the awareness that fewer new build-to-order flats will be launched this year.
Resale prices fell 0.6 per cent and 0.7 per cent in mature and non-mature estates, respectively. On a year on year basis, resale prices for mature and non-mature estates fell 3.2 per cent and 7.6 per cent from Feb 2014.
"This is a testament to the resilience of mature estate prices in a bearish market, and shows that the market is moving back to fundamentals," said Wong Xian Yang, manager of research & consultancy at OrangeTee.
The other indicator of the weak public housing market was the negative median transaction-over-X-value (TOX), a computer-generated value by SRX to replace the defunct cash-over-valuation (COV), which measures whether people are overpaying or underpaying relative to the properties' estimated market value (or X-value).
What SRX found was that overall median TOX was negative S$4,000 in February, widening from negative S$1,000 in January, meaning that most buyers were paying S$4,000 less than what the properties should have been worth on the market.
Among relatively active towns, Jurong West, Sembawang, and Jurong East posted the most negative median TOX at negative S$8,000, negative $8,000, and negative S$7,500 respectively.
Most consultants expect HDB resale prices to fall 5-8 per cent for the whole of 2015 as the government continues its current policy of providing affordable public housing. Some 18,000 to 20,000 HDB homes could also change hands for the whole year as prices stabilise.
HDB resale prices dip on lower volume in February: SRX
Resale volume fell 8.5 per cent to 1,148 flats sold in February, down from 1,255 transacted units in January
By Lee Meixian
[email protected]@LeeMeixianBT
6 Mar
HDB prices continue to decline in February, as their transaction volume also shrunk month on month, according to flash data from SRX Property released on Thursday.
Overall, HDB resale prices fell 0.6 per cent in February, confirming the 0.2 per cent increase in January to be a blip. Year on year, prices have fallen 5.7 per cent from February 2014.
The biggest factors driving prices down were: the tightened credit situation (a 30 per cent mortgage servicing ratio), the three-year wait-out period before newly minted permanent residents can buy resale flats, and more recently, the creeping up of the Singapore interbank offered rate (Sibor), to which mortgage rates are pegged.
The current practice requiring buyers to secure the option to purchase before obtaining the valuation report also makes buyers more conservative when negotiating a price, Eugene Lim, ERA Realty's key executive officer said.
Resale volume fell 8.5 per cent to 1,148 flats sold in February, down from 1,255 transacted units in January.
But year on year, resale volume rose by 20.7 per cent in February, compared with just 951 units resold in February 2014. This was seen as a sign of buyers returning to the resale market, drawn by lower prices and the awareness that fewer new build-to-order flats will be launched this year.
Resale prices fell 0.6 per cent and 0.7 per cent in mature and non-mature estates, respectively. On a year on year basis, resale prices for mature and non-mature estates fell 3.2 per cent and 7.6 per cent from Feb 2014.
"This is a testament to the resilience of mature estate prices in a bearish market, and shows that the market is moving back to fundamentals," said Wong Xian Yang, manager of research & consultancy at OrangeTee.
The other indicator of the weak public housing market was the negative median transaction-over-X-value (TOX), a computer-generated value by SRX to replace the defunct cash-over-valuation (COV), which measures whether people are overpaying or underpaying relative to the properties' estimated market value (or X-value).
What SRX found was that overall median TOX was negative S$4,000 in February, widening from negative S$1,000 in January, meaning that most buyers were paying S$4,000 less than what the properties should have been worth on the market.
Among relatively active towns, Jurong West, Sembawang, and Jurong East posted the most negative median TOX at negative S$8,000, negative $8,000, and negative S$7,500 respectively.
Most consultants expect HDB resale prices to fall 5-8 per cent for the whole of 2015 as the government continues its current policy of providing affordable public housing. Some 18,000 to 20,000 HDB homes could also change hands for the whole year as prices stabilise.