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    Jul 11, 2014

    Resale flat prices hit two-year low

    PRICES of resale Housing Board flats fell for the fifth consecutive month, a new two-year low since April 2012, according to flash estimates released by the Singapore Real Estate Exchange yesterday.

    HDB resale prices fell by 0.6 per cent overall last month as compared to May, with prices of three-, four- and five-room flats dipping by 0.3 to 0.8 per cent.

    While executive-flat prices inched up by 1.3 per cent, they were still 5.1 per cent lower than the peak in February last year.

    Declining resale flat prices aside, rentals also fell while resale flat sales were lacklustre.

    Last month, 1,315 HDB flats were sold in the resale market, a shade fewer than May's 1,320 units. Meanwhile, 1,590 HDB flats were rented last month, a 2 per cent dip from May's 1,622 units.

    Property experts said prices are likely to head further south in the coming months, as cooling measures and strong Build-to-Order flat supply continue to drive down demand.

    Key executive officer Eugene Lim of ERA Realty said: "(The Mortgage Servicing Ratio) limits the loan a buyer can afford and (shrinks) the pool of buyers."

    Sellers have also become more realistic about the selling prices, he said.

    Mr Lim also pointed out that demand has been slowed down by the measure, which allows newly minted permanent residents to buy resale flats only after three years.

    SLP International executive director Nicholas Mak said the Government is unlikely to ease up on the HDB financing curbs so soon, and he does not expect a drastic change in the market unless a financial crisis occurs.

    Mr Mak said those who are most likely to be feeling anxious about the fall in prices would be those collecting the keys to their new flats. "They will be desperate to sell (their present flats) and will feel pressured to sell at a low price," he said.

    Commenting on the stagnant resale flat transaction volume, Denka Wee, DWG's head of business services, explained that it could have been due to last month being a school holiday, with many Singaporeans likely to have gone overseas.

    He noted that this month would likely see more transactions, before dropping again with the onset of the Chinese seventh month.