The property price slump continues…
News came out last week that the transaction prices of private property in Singapore fell by 1.3% during the period of July-September, compared to the previous quarter, whilst prices in the HDB resale market were faring relatively steady, slipping only 0.3%. Zooming out a little, we can see that the private property prices are down 8% from its previous peak in the third quarter of 2013, while their HDB counterparts have fallen 9.8% since its highest peak in the second quarter of 2013.
The sorry state of both markets in the last couple of quarters have widely been attributed to factors such as the high vacancy rates, the ample supply of new residential units and of course the always-contentious cooling measures.
Yet this does not explain the discrepancy in recent performance. Looking at the price trajectory in both markets, we see that the decline of 1.3% in private property prices is up from the 0.9% decline the market experienced in the second quarter, while the HDB resale market price had its smallest decline in 9 quarters.
HDB resale vs private residential market; how come the discrepancy?
As noted in The Straits Times, the stabilising of the HDB resale market is mostly attributed to the availability of transaction information, which means that buyers are better taking recent transaction prices into account when purchasing their homes.
This is great news, creating more transparency stands high on our to-do list here at 99.co and comprises a cornerstone of our overarching mission to change the marketplace for the better.
Solutions come in many shapes and sizes, and sometimes we stare at problems for too long and overlook the easiest of ways to solve for them; simply pointing people into the right direction is a case in point. Through your input, we have realised that many people actually do not know that detailed transaction prices are publicly available. We thus highly encourage every prospective buyer (and renters too!) to check out the goldmine that is the latest transaction data of the Urban Redevelopment Authority (URA) here
How to make use of the information
When interpreting the data on the URA website it is important to control for as many variables as you can. You cannot compare apples with oranges and neither can you compare a 3-room HDB around woodlands, 7 bus stops from the mrt, to a 5-room condo at City Hall. So, make sure the units you are comparing are all as similar as possible (same location, if not building; same size, same type of room, same number of rooms, same tenure, same everything!)
Next on, you should make a shortlist of all the transactions that have gone down in the not-so-distant past which include units that you deem similar-enough to be relevant.
Use the shortlist of relevant transaction data as a benchmark to which to compare the prices of the houses you are looking into, and if the difference is strangely large, then think again.
At 99.co, we aim to make the property market a more transparent place so as to empower people to make more informed decisions. Don’t be fooled by exorbitant prices anymore. The Information is out there, and now you know where to look. 🙂
If you enjoyed this article, you might be interested inCondos launched in 2018 & 2019 to cost 7-13% more and What can we expect for the HDB resale flat market in 2017? .
Find the home of your dreams today at Singapore’s largest property portal, 99.co!