Downward Pressure for HDBs with Supply Increase
HDB at peak prices in 9 years & return of Cash Over Valuation (COV)
Demand from PRs, buyers looking for space and those affected by delayed BTOs
To curb skyrocketing HDB prices, HDB is ramping up the supply of BTOs
Estimated launch of 100,000 BTO flats from 2021 to 2-25
120% more supply of ready flats from HDB reaching 5-year MOP for the next 8 years
From 2020 – 2030, there will be ~20,000 MOP flats annually, compared to 9,000 flats previously
OUR TAKE
It is a good time for HDB sellers looking to sell their flats to upgrade or cash out now.
If this opportunity is missed, it is likely that sellers will need to wait for the next cycle when the market corrects.
Are there still good deals in the New Launch Market?
High PSF Prices, but Reasonable Price Quantum
In terms of psf, new units are indeed more expensive, prices at an average of 31% higher than resale units. However, interns of absolute price, there are still areas and unit types where new units are priced lower than the older, resale units.
Opportunity
Market Gaps in the CCR/RCR
While this price gap might be due to smaller floor areas, this also means we are able to buy brand new condos at an affordable price range and at a good value. For example, in The Central regions, the price of a brand new 3BR/4BR+ could be similar or even lower than its resale counterparts,
