Out of 8,521 eligible units, only 470 HDB flats were sold over 12 months after achieving the five-year minimum occupation period (MOP) in 2013, according to media reports citing housing board data.
This means only 5.5 percent put their units on the resale market within a year of meeting the MOP last year, compared to nearly 20 percent who did so in 2012.
It’s not surprising that fewer flats are being transacted due to the weak HDB resale market, said Chris Koh, Director, Chris International. In fact, transactions in this segment sank to just 18,100 units last year, its lowest level since 1997.
Owners are also holding on to their flats amidst low resale prices and cash-over-valuation (COV). Prices dropped 0.6 percent in 2013, marking its first annual decline since 2005, while COVs were eliminated from the resale process in March after falling to a median of zero in February. Previously, the cash premiums could be as high as six figures for a prime unit.
“Flat owners whose homes are ready for resale realise they can no longer make a windfall from high COV when they sell their flat,” noted R’ST Research Director Ong Kah Seng.
In addition, the total debt servicing ratio (TDSR) framework has made it harder to get an ample loan quantum. The maximum tenure for public housing loans has also been cut since August and buyers can only utilise up to 30 percent of their income to repay their loan, down from 35 percent previously.
Ong added that flat owners are less keen on upgrading to a private property or resale flats, as the design and quality of new HDB flats improves.
Furthermore, demand for resale flats has softened since the government announced that newly-minted PRs have to wait three years before buying a HDB flat.
“Some HDB sellers could take up to several months before finding a buyer,” said Christine Li, Head of Research at OrangeTee.
Management / Investment / Relocation 
Fewer resale flats making it to market | Management / Investment / Relocation