HDB resale market hits a new high

Source : AsiaOne – 23 Jul 2010

Prices of HDB resale flats have hit a new high in the second quarter of this year.

According to the latest statistics released by the Housing Development Board (HDB), the resale price index in the second quarter this year rose 4.1 per cent over the previous quarter, compared to the increase of 2.8% in the first quarter of this year.

The median Cash-Over-Valuation (COV) amount amongst all resale transactions also increased to $30,000, with the proportion of resale cases transacting above valuation increasing to 96%.

Units in the Bishan area garnered the highest median COV amount as compared to other towns, with flats going for $40,000 above valuation on average in Q2.

However, Singaporeans seem undeterred by the jump in prices, as resale transactions rose by about 7% this quarter, from 8,484 cases.

Increase in supply of flats to meet demand

HDB says it is ramping up its new flat supply this year to meet the demand from first-timer households. More Design, Build and Sell Scheme (DBSS) flats and Executive Condominiums (EC) units will also be launched.

It will hopefully provide more choices for first-timer households, and divert some demand from the HDB resale market, said the HDB.

The Built-to-Order (BTO) projects in the second half of the year will located in towns such as Woodlands, Yishun, Punggol and Sengkang, for a “good geographical spread”.

For this month, flat buyers can look forward to about 1,000 BTO flats in Jurong West and Bukit Panjang.

To provide more choices for higher-income earners, 4,700 upcoming units are to be launched under the Design, Build and Sell Scheme (DBSS) and Executive Condominium (EC) Housing Scheme:

They are:

* The Yishun DBSS site awarded in May 2010 has an estimated yield of 700 units;
* Another DBSS site at Tampines PH2, launched on 23 Jun 2010 for sale by public tender, has an estimated yield of 580 units;
* Two new DBSS sites in Bedok Reservoir and Upper Serangoon, to be launched later this year, will yield another 1,000 flats;
* Four EC sites in Sengkang, Yishun and Punggol yielding an estimate of 1,985 units had been awarded in 1H2010; and
* One EC site in Jurong with an estimated yield of 460 units was launched on 2 Jul 2010 with tender closing on 12 Aug 2010.

There are also four sites in the pipeline for EC supply located in Punggol, Pasir Ris, Bukit Panjang and Tampines, expected to yield another 1,900 units.

HDB says it is prepared to launch more sites for DBSS development if there is sustained demand.

HDB rental market

Subletting transactions increased by about 15% from 6,606 cases in the first quarter of 2010 to 7,595 cases in the second quarter of this year.

The median rental price for a five-room flat is about $2,000, with median rent on executive units at $2,100. The median rental price for a 2-room, 3-room and 4-room unit is $1,200, $1,500 and $1,800 respectively.

The total number of HDB flats approved for subletting rose to about 30,500 units in Q2, compared to about 27,300 units in Q1 2010.