Residential

Slowdown in HDB resale prices growth in Q1

The Resale Price Index (RPI) for HDB flats saw a 1.2% increase to 205.4 in Q1 2013, compared to the 2.5% increase in Q4 2012. Reasons for the slowdown include the capping of MSR at 30% and 35% of gross monthly income for loans granted by financial institutions and HDB, respectively, the large supply of alternative housing options in the forms of BTO flats and ECs. Another possible reason was a fall in demand from singles, who are now eligible to purchase new 2-room BTO flats in non-mature estates. However, supply of HDB resale flats could remain limited since singles are not eligible for ABSD concessions and PRs may be reluctant to sell their flats given the increased ABSD rates and the new rule that require them to sell their HDB flats within six months of buying a ...