Industry watchers expect HDB rentals and resale prices to rise in the fourth quarter due to a surge in demand. This is despite HDB's plans to offer 4,500 new flats in the next six months.
In its latest annual report, HDB said it has also succeeded in clearing its stock of unsold flats, with the aim of reducing it to 2,200 units by year-end.
There has been a flurry of activity in the public housing market in the past year.
Among them is the easing of the subletting policy to allow elderly home owners to generate income by renting out their flats.
"Our scheme has enabled more rental flats, more HDB flats to be available in the open market for subletting. Our figures showed that the number of HDB flats in the rental market has gone up by 30% from 12,000 last year to about 16,000 now," said HDB's CEO Tay Kim Poh.
Despite the added supply, rentals of HDB flats have ironically also gone up. This trend could continue because rentals for private residential property are rising at a faster rate - up to 50% in some cases.
Donald Han, MD of Cushman & Wakefield said: "A lot of tenants, particularly the expats who have to renew the premises, may not find the private property meeting their housing budget, so they may have to downgrade to HDB as potential option.
"As a result there will be more demand for HDB rental property and as a result of the increase in capital values, rental will also rise in tandem with the market. Rental will probably rise 2% to 3% on a quarter basis."
Rental flats aside, HDB said it will roll out 4,500 new flats over the next six months under its Build-To-Order scheme.
Another 1,500 units will be built by private developers under three upcoming Design, Build and Sell Scheme projects.
Property agents have welcomed the move, saying increased supply will stabilise prices in the resale market.
"I believe the resale prices will continue to climb in the next few quarters for a few reasons. First, demand is going up. Next, the spillover from the en bloc fever. For the 4th quarter this year, it should be in the region of about maybe 5% to 7%, and after 4th quarter, it should grow in the region of 3% to 5%," said David Poh, Director, Strategic Planning & Development, PropNex.
HDB also revealed that it halved its deficit to S$740 million in the last financial year, due to lower impairment losses. - CNA /ls
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