Misleading and unrealistic: Authorities flag listings for HDB resale flats worth $2 million, including one for a jumbo unit in Sengkang, Singapore News

Authorities have flagged listings for two HDB flats that were put up for sale for $2 million: one was for two adjacent five-bedroom flats in Sengkang marketed as a jumbo flat, while the other was a five-bedroom flat in Toa Payoh. with an “unrealistic selling price.”

In a joint statement on May 8, the Ministry of National Development, the Housing Board and the Council of Estate Agencies (CEA) said the CEA is aware of the listings posted by two estate agents and is investigating.

The listing on the PropertyGuru platform for a giant 2,400-square-foot apartment in block 314C Anchorvale Link with six bedrooms and four bathrooms was “misleading” as there are no such apartments in the block, officials said.

“The giant flat listed is actually two adjacent five-bedroom flats, which cannot be converted or sold as a single unit,” they added.

Authorities said the listing was removed after CEA submitted the misleading ad to the agent’s real estate agency.

“The CEA is investigating the matter and will take firm action if any non-compliance is found,” they added.

Officials said five-bedroom apartments in the district changed hands for about $580,000 over the past six months, and that the $2 million asking price is more than $800,000 higher than the combined value of two apartments in five rooms.

The real estate agent who posted the advertisement, Mr Andrew Nair of ERA Realty Network, told The Straits Times that the owners of the two flats, who are related, had received approval from HDB to cut the living room wall and combine both units when I bought it about six years ago.

“The owners are looking to sell them together, but the requirement is that there be two buyers,” he said.

Nair added that he had removed the listing after ERA’s legal and compliance team told him to market the flats as two separate units. He will put the flats back up for sale after getting approval.

Separately, authorities said a five-bedroom Design, Build and Sale Scheme (DBSS) apartment at The Peak@Toa Payoh, which was also listed for $2 million, has no intention of being sold on HDB registration. This means that the potential seller cannot grant a purchase option to the buyers at this stage. HDB flat sellers must register their intention to sell before putting their flat on the market.

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Officials noted that the $2 million listing price is nearly half a million dollars higher than the highest transaction price in the area, and said many real estate experts consider it an “unrealistic asking price.”

Estate agent Joyce Lim, who works at ERA, told ST that the owner of the 1,258 sq ft apartment at Lorong 1A Toa Payoh plans to register with the intention of selling.

The listing, which ran on April 16, announced that the apartment was on a “super high floor” with “open city views.”

The highest transaction in the development was $1,568,888 for a five-bedroom, 1,258-square-foot unit between the 40th and 42nd floors, and it sold in January 2024.

At the listing price of $2 million, both the Sengkang and Toa Payoh flats will be significantly overvalued in cash (COV), officials said. COV is the amount a buyer has to pay cash when a second-hand flat sells above its HDB valuation.

“While the HDB resale market operates on a ‘willing buyer-willing seller’ basis, the Government will not tolerate behaviour, whether by agents or sellers, that seeks to disrupt the market or stoke consumer sentiment,” they said. The authorities. They urged buyers to plan their budget carefully and be prudent to avoid overburdening their finances.

“We should not expect house prices to rise indefinitely amid global economic uncertainty and geopolitical instability.”

Under the code of conduct for real estate agents, real estate agencies and agents have a duty to uphold the integrity and professionalism of the real estate industry and act responsibly in the conduct of their work, officials added.

The CEA will examine the information submitted by real estate agents when marketing HDB flats, to protect the interests of the public and to enable buyers to make informed decisions, officials said.

Nicholas Mak, research director at property search portal Mogul.sg, said if real estate agents are aware that the $2 million asking price is unrealistic, they should advise sellers to reduce it.

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“It is very obvious that the asking price of $2 million for an HDB flat in the current market, regardless of whether it is a DBSS flat or a jumbo flat, is significantly above recent transaction prices for similar flats in the respective HDB cities. ”He added.

Officials added that Singaporeans have a wide range of affordable flats to choose from, such as build-to-order (BTO) flats, which are heavily discounted in the market.

Most four- and five-bedroom BTO apartments offered in 2023, which do not fall under the prime location public housing model, were below $600,000 before the subsidies, they noted.

Seven in 10 five-bedroom or smaller resale apartments changed hands for less than $600,000 before subsidies, they added.

This article was first published in The Straits Times. Permission required for reproduction.