In a commentary in the Business Times, two executives from Bona Real Estate said that buyers who are willing to adjust their expectations will still be able to "pick up the pieces" in the resale HDB market and find a comfortable home without going over budget.
The main reason why resale HDB flats are in demand is that buyers can move in quickly, unlike pre-buying HDB flats where they have to wait an average of four to five years.
Coupled with the allowance (up to $190,000) offered by the authorities for first-time buyers of resale HDB flats, demand for resale HDB flats is expected to remain steady.
The HDB flats at Waterway Terraces in Punggol, completed in 2016, will have 60 four-bedroom HDB flats for sale in 2022 at an average resale price of $588,000. (Straits Times)
Many homeowners choose to buy resale HDB flats that have just reached the five-year minimum residence age in order to move into their new homes sooner. Although the price of these HDB flats is relatively higher, they still have about 94 years of lease remaining.
The average resale price of a four-bedroom HDB flat in Punggol, Sengkang or Yishun is between $510,000 and $580,000.
More than 15,000 resale flats are expected to reach the minimum age of occupancy this year, including Cheng San Court in Ang Mo Kio and Toa Payoh Apex between Toa Payoh Lane 6 and Toa Payoh East Road.
However, Ang Mo Kio and Toa Payoh are both popular areas for buyers, so those looking for more affordable resale HDB flats may have to consider areas such as Jurong West, Sembawang, Woodlands and Yishun.
Bona executives noted that a number of five-bedroom resale HDB flats with at least 70 years remaining are still changing hands for under $500,000.
Although they are located in HDB areas outside of the city, they are spacious, relatively inexpensive and have quite long leases remaining, so the owners may resell their HDB flats again in the future.
An example of this is a five-bedroom HDB flat on Woodlands Road 6, a 120 sq m flat near the Admiralty MRT station, which changed hands for $400,000 in July last year.
Even in popular locations such as Redhill, Central and Queenstown, some four-bedroom HDB flats are changing hands at prices that won't break the bank. One such example was a four-bedroom HDB flat on Klang Lane, which was sold in February last year for $535,000.
The HDB flat is 85 square metres in size, has a remaining lease of over 79 years and is also within walking distance of the Little India MRT station.
The public transport network is expanding and business activities are gradually dispersing to different areas. Therefore, instead of caring whether a HDB flat is located in an established area, buyers should perhaps focus on their own housing needs and budget.
While the government has increased the number of pre-purchased HDB flats, resale HDB flats are still popular with buyers because of their high subsidies, greater choice and the ability to move in quickly.
In addition, buyers can save money on renovation costs if the resale flat is already fully furnished.
In conclusion, even though resale HDB prices are still on an overall upward trend, buyers can still find a HDB flat that suits their needs and budget, provided that they may need to adjust their expectations and consider buying a HDB flat that is located a little further away from the Central District and on a lower floor.
