Mohan Sandrasegeran, senior analyst for research and content creation at One Global Group said that the 15 month wait-out period is a surprising turn of events, but it will likely serve as a form of deterrence for buyers with deep pockets.
The ruling comes after more million-dollar flats, including in Woodlands, made headlines in recent months.
Many homeowners hoping for a quick profit and enticed by HDB's fixed interest rate to right-size or downsize to a HDB resale flat will likely be more hesitant now, according to Mr Sandrasegeran.
Private property owners who are looking to sell their private home and buy HDB resale units have to be prepared for a long wait. It is worth considering before you pull the trigger on these purchases.
The ruling will likely curb demand for private property owners who are looking for larger spaces in the HDB resale market, and possibly reduce demand for high-value transactions and deter buyers from going out for a bigger space in the HDB resale market, according to Mr Sandrasegeran.
Executive flats and loft units, for example, are a form of premium unit that has a lot of interest. The buyers of these flats are often unaffected by the excessive pricing and have ample liquidity. Their hands are forced with the 15 month wait-out term for private property owners, and they may think twice about buying a flat. The ruling could result in a holdback in some private property owners putting up their units for sale, as well as a potential drop in volume in the condominium resale market, according to Tricia Song, head of research for Southeast Asia at CBRE, which said the latest cooling measures, including the 15 month wait-out period, could have a negative impact on the HDB resale market, particularly the larger five-room and executive HDB flats.
These flats could see lower demand from private home downgraders or en bloc sellers, and in turn prices would be moderated, she said.
The lower HDB resale prices could also moderate upgraders ability and thus demand into private homes, which may lead to lower HDB resale prices. She said that HDB sellers who had decoupled from selling their HDB flats at high prices and using these proceeds to buy investment private property would also be impacted.