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Prices of certain flats fell slower in Q3, resale demand still strong

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Prices for certain Housing Board flats fell at a slower pace in the third quarter compared with the same period last year, a new report said yesterday.

It noted that demand for HDB resale flats remained strong, thanks to recent policies. But prices of younger flats - under 10 years old - and older ones, which are defined as being at least 40 years old, fell quarter on quarter.

But the rate of depreciation had slowed significantly compared with a year ago, OrangeTee & Tie noted.

Prices for older flats fell 0.9 per cent from Q2 to the Q3, as opposed to a 3.4 per cent dip in the preceding year.

"The slower price depreciation seemed to indicate that sentiment towards older flats might have improved in recent months," the report said.

Prices of younger flats tumbled by 2.5 per cent quarter on quarter, compared with a 4.8 per cent decline a year earlier.

This price weakness was mainly due to more flats being sold within 10 years of completion in recent years, OrangeTee said. It added that there were also more flats sold in non-mature estates, which may have brought down the overall average price of younger flats in recent years.

There were 1,247 flats sold in the quarter, up 12.4 per cent on the 1,109 moved last year. This was the highest number of new resale flats transacted in a single quarter since the Q3 of 2010.

"The data may indicate that more families could be 'cashing out' on their flats earlier to upgrade to private property or a bigger HDB flat," the report said. "Some owners may have sold their flats early for fear that the value would fall with age.

"With more flats reaching their five-year minimum occupation period, we may expect the number of younger flat transactions to rise further in the coming months.

"As competition for potential buyers may intensify with the rising supply of flats, there could be some downward pressure on the prices of younger flats." - THE STRAITS TIMES