SINGAPORE: Resale prices of public housing flats rose by 2 per cent in the third quarter over the second quarter to hit a record high.
The Housing and Development Board (HDB) said on Monday that its flash estimate of the 3rd Quarter 2012 Resale Price Index (RPI) stood at a new peak of 197.9.
The rise was also the sharpest increase so far this year for the RPI, which tracks the general price movements in the public residential market.
In Q2, the RPI rose by 1.3 per cent to 194, after climbing 0.6 per cent to 191.6 in Q1.
One analyst attributed the Q3 increase partly to recent news of record resale flat prices last month, including an executive condominium in Queenstown which sold for S$1 million.
Donald Han, HSR Property Consultants' special advisor, said: "The two per cent is quite reflective of market sentiments. It is also the highest rate of increase for the last few quarters.
"It's probably being driven, particularly in the last four weeks ... after news of HDB resale (flats) hitting one million (dollar) total quantum. I think that sent a ripple effect, especially towards the vendors of HDB resale.
"Most of them would keep to their selling price, and I think that probably had an upward pressure in terms of the final price hitting towards the two percent increase over the last quarter."
Chief executive officer of Propnex Realty, Mohamed Ismail, said the 2 per cent increase in the third quarter came as a bit of a surprise, in the wake of a greater supply of Build-to-Order (BTO) flats since last year and the moderation of HDB resale prices in the first two quarters of this year.
He added: "The only reason I would probably attribute for a 2 per cent growth here is the demand is still relatively strong for public housing, and usually the third quarter tends to be more robust compared to other quarters as activity generally increased in the second half of the year."
Last year, the third quarter also brought in the highest price increment for the year with an increase of 3.8 per cent.
For the whole year, Mr Mohamed Ismail said he expects a five to six per cent price increase for the entire year.
He attributed it to HDB's announcement to ramp up the supply of BTO flats to meet the housing needs of first-time buyers.
HDB is offering a record 27,000 BTO flats this year, 2,000 units more than the original 25,000 planned for the year.
HDB has also offered a total of 7,153 flats in the two Sale of Balance Flats (SBF) exercises this year.
The current HDB sales exercise for BTO and Sale of Balance Flats, which started on September 27, will close on October 3.
As at 5pm on Monday, 106 applicants are gunning for a single Pinnacle@Duxton unit -- equivalent to a 5-room HDB apartment -- under the SBF.
In comparison, the highest application rate was 35 to one for a 5-room BTO flat in Bedok.
The exercise also includes several new projects in mature estates like Ang Mo Kio and Tampines. These are seeing application rates of between 2.1 and 2.3 for a 5-room flat.
HDB has advised young couples looking to set up their first homes to consider applying for BTO flats.
First-timer households may make use of the various housing grants to help them own a new flat.
HDB said with the grants, young couples buying their first homes would be able to buy a 4-room flat for as low as S$219,000.
In November, HDB will offer 6,400 BTO flats in Queenstown, Bedok, Toa Payoh, Sengkang and Choa Chu Kang.
Property analysts said it would take some time before the effect of the increased supply is felt. As such they expect the Resale Price Index to go up by another two per cent in the fourth quarter.
Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G)
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