Tuesday, April 3, 2012

HDB resale prices post smallest rise since 2009

Straits Times: Tue, Apr 03
PRICES of HDB resale flats rose 0.6 per cent in the first quarter, in the latest sign that it has hit a ceiling and might even correct down the road.

The estimate, released by the Housing Board (HDB) yesterday, is less than half the 1.7 per cent increase in the last quarter of 2011, and could mark the tail end of a spectacular bull run that saw prices spike 84 per cent in the past five years.

The 0.6 per cent rise is the lowest registered since the first quarter of 2009, when the bull run took a breather and prices corrected by 0.8 per cent in the aftermath of the 2008 financial crisis.

Property analysts said HDB resale flats have hit a price ceiling due to the Housing Board injecting a record number of homes in the market and relaxing eligibility rules for buyers. Its latest initiative was to set aside 15 per cent of new flats in non-mature estates, up from 5 per cent, for second-time buyers.

ERA Realty key executive officer Eugene Lim said more buyers have flocked to the new-home segment - a trend reflected in the lower number of resale transactions.

ERA estimates that 4,700 resale flats were transacted in the first quarter, a 20 per cent drop from the previous quarter's 5,921. Compared to the first three months of last year, the fall is 24 per cent...

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