Prices in the HDB resale market have seen rapid improves despite the economic downturn which started in 2008. Although the Housing Growth Board (HDB) has moved to improve the supply of new flats to meet demand in current months, I will still count on rates to increase between 5 to 8% in the months ahead as demand carries on to outstrip supply.
Currently, the median Income In excess of Valuation (COV) for an HDB flat is about $thirty,000 to $35,000. I foresee that even with the ramped up deliver of flats from HDB, the COV for HDB resale flats will carry on to rise, despite the fact that at a much more average pace. This is simply because it will take some time before the supply crunch is eased as new flats consider time to be constructed. Some consumers might also choose to get from the resale industry as the new flats may possibly not be in appropriate places. Ultimately, with the implementation of the cooling steps, HDB house owners who presently individual personal residence might not want to market their HDB flat as they will not be ready to buy a HDB flat yet again except if they promote their personal qualities.
As for mass industry residences, my forecast is that mass market prices will increase by amongst 3 to 5% this yr. For more mature qualities, costs may possibly improve about eight% as they are nevertheless comparatively inexpensive although rates in the Core Central Area (CCR) could rise amongst one to two%. With regards to new launches, I anticipate charges to drop by about eight% as the value of many new launches have gone above $one thousand psf - the limit of affordability for a mass market house.
Bearing in brain the 40% downpayment that purchasers have to pay out to obtain a second piece of house, consumers may consider the purchase of units with a more compact quantum as the pitfalls are lower and the yield, much better. This will drive desire to the Rest of Central Area (RCR), thus pushing costs there up between five to eight%. For landed houses, charges could rise amongst five to 8% because of to low provide.
Other elements that will keep on to engage in a element in ongoing growth in costs for the landed home portion contain:
one) Continued power of the Singapore economic system, and
two) Land scarcity in Singapore
As most buyers of landed homes acquire these homes for home-stay functions, there will be nominal speculation in this home market portion.