12 Apr 2017
Unlike in the private residential market where emphasis is placed on timing for investment purposes, the HDB resale market is much less speculative. Here’s why there is no perfect time to enter or exit the HDB resale market.
Should I buy a resale flat now?
The number of buyers in Singapore is on the rise. Prices have fallen from their peak in 2013 and have been stable since mid-2015. It is unlikely that HDB resale prices will register huge drops in the near future, as buying activity is already picking up at current price levels. Given the limited downside risk, buyers can be more confident in their purchase.
Also, HDB resale transactional information is available publicly. Buyers can avoid getting a bad deal by “overpaying” a premium above the flat’s valuation. They can easily check against HDB’s database, which is updated daily, prior to any negotiations. Hence, buyers can arm themselves with such information before discussion and committing to a purchase.
Should I be selling my flat now?
In 2016, resale HDB flat prices only decreased by 0.1 percent over the course of the year. In the same period, the number of HDB resale transactions increased to 20,813 units. Amongst these transactions, 20 units that changed hands were above the S$1 million mark. Evidently, resale flats are popular choices amongst buyers.
However, sellers should be cautioned against rashly increasing their asking prices for their flats in view of the recent higher grant amounts, especially if the change is not backed by transaction data. Choices of HDB flats are plentiful and buyers can easily switch to another seller who sets a reasonable pricing.
Pro Tip: As such, our advice to any prospective buyer and seller is to focus on need instead of speculating. There is simply no perfect timing.
