Feb 06, 2015

    Gloomy outlook even as HDB resale prices rise

    AFTER a year of consecutive monthly declines, Housing Board resale prices edged up 0.6 per cent last month, according to SRX Property flash figures yesterday.

    But experts do not take this as a sign that the market is rebounding. Instead, they expect prices to continue sliding.

    The last time HDB resale prices rose was in January last year. They have fallen 5.7 per cent since then.

    "We cannot read the monthly price a sure sign of turnaround in HDB resale flat prices, as the increase was very marginal," said R'ST Research director Ong Kah Seng.

    Added ERA Realty key executive officer Eugene Lim: "The increase has more to do with the up and down fluctuations that are associated with tracking prices on a monthly basis."

    Last month's rise was driven by four- and five-roomers, with their prices increasing by 1.1 per cent and 1.5 per cent respectively.

    This more than made up for a 0.9 per cent fall in three-room flat prices and a 0.6 per cent fall for those of executive flats.

    Both mature and non-mature estates saw price increases of 0.5 per cent and 0.7 per cent respectively.

    The tepid uptick could be partly due to the units sold at the Pinnacle@Duxton premium HDB project last month, said Mr Ong.

    Units there have fetched prices ranging from $818,000 to $1.03 million and may have pulled up overall prices, he added.

    But analysts see the overall downward trend continuing. Mr Ong expects prices to fall by up to 4 per cent in the first half of the year, while HSR International Realtors expects falls of up to 1 per cent each quarter.

    But sellers such as Madam Safiah, 50, hope last month's marginal climb in prices will not be the exception.

    "Hopefully, the prices will really go up. Last year, they already came down a lot," said the housewife, who has been trying to sell her flat since November.

    She had initially thought her four-room flat in Hougang could fetch $460,000, but now hopes to get $430,000 instead.

    Price aside, there has also been a lack of serious buyers, she said.

    Resale volumes fell for the fourth straight month last month with 1,255 flats sold, down from 1,295 in December.

    However, this was still 15.3 per cent more than the 1,088 units sold in January last year.

    This year-on-year increase "is an encouraging sign that more buyers are entering the market as prices become more attractive", said HSR.

    Noting that January and February are traditionally quiet months in the resale market due to Chinese New Year festivities, Mr Lim expects the pace of deals to pick up from March.

    "The pace we see in March to May will set the tone for the year. So if we are hoping for the overall resale volume for this year to increase, March, April and May are very important months for the HDB resale market," he added.