HDB Property Resale Market Stabilising

RESIDENTIAL MARKET

Signs of HDB resale market stabilising: Khaw

The HDB resale market has shown signs of stabilising, National Development Minister Khaw Boon Wan said in Parliament yesterday.

He cited latest figures that showed how the annual Resale Price Index (RPI) growth had fallen from 14.1 per cent in 2010, to 10.7 per cent last year and to 3.9 per cent in the first nine months of 2012.

He was responding to queries by MP Lee Bee Wah (Nee Soon group representation constituency), who had asked whether there was any cause for concern due to HDB resale prices hitting a high in the third quarter of this year.

In his reply, Mr Khaw added that while the uptick in quarterly RPI growth to 2 per cent in the third quarter of this year showed that the situation was improving, there was still much more to be done.

"We have implemented a number of measures but they will take some time to work their way through the market. For example, the huge supply of new housing units will be available only over the next 2-3 years," said Mr Khaw.

Separately, the minister was also quizzed by MP Lim Biow Chuan (Mountbatten) on the success rate for HDB loans in the last three years.

Mr Khaw said that just 2 per cent of a total of 178,000 applications - or 3,500 cases - were rejected from January 2010 to September this year.

They were turned down because the applicants had already taken two or more HDB loans previously.

"The rejection rate is rather low, but in any case we do exercise discretion and provide sympathy where we can," said Mr Khaw.

He shared that the success rate for appeals for HDB loans was currently about one in three, or 36 per cent - a figure which he described as "pretty high" and "quite good".

Mr Khaw later said that while home ownership was a social objective for the government, this had to be "underpinned by prudence" as well.

"Let's not forget that (there was) a huge problem in the US with the sub- prime (mortgage) crisis. While we will try to make sure everyone can afford to own a home, I think that for everyone to get a loan is a bit unrealistic," said Mr Khaw.

Source: Business Times –15 November 2012