What affect HDB price?
If you are a HDB owner, you might be expected to gain a windfall from your home. This might be true 10 years ago. The chart below has indicated that HDB price index has rose tremendously by about 100% from 2006 to 2013. Thereafter, it has stabilised after a dip of 11%.
One reason that affect this is the implementation of Mortgage Service Ratio (MSR). MSR is the proportion of your monthly gross income that is spent on mortgage repayment. This includes debt obligation secured by properties. Currently, the MSR policy is capped at 30% and is applicable to HDB flat and EC. For example,
Another reason is the incoming supply of BTO flats and the number of balance flats that are already in the market. Just for the month of May 2017, HDB has plan to build about 4600 BTO flats and 3000 balance flats. With the upcoming 24th HDB Town at Tengah, another 30,000 units of HDB flats will be available in the market at a new region.
Lastly, HDB flat has a 99 year lease tenure. At the end of the lease, HDB flats will revert back to the landowner (HDB). The land will then be turned over to the state. This means the value of a HDB flat at the end of the lease is zero. There are news articles stated that not all old HDB flats will be automatically under the Selective En bloc Redevelopment Scheme (Sers) program. As a HDB flat owners, plan and manage your property to ensure that your home purchases or investment remains healthy.