14% price differential – BTO vs Resale Index?

3,770 BTO flats launch

I refer to the article “3,770 BTO flats, 5,170 balance flats in mature and non-mature estates launched for sale” (Straits Times, May 24).

The price for Sembawang EastCreek@Canberra BTO 4-room HDB flats starts from $235,000.

BTO price increased by 4.4%?

In the May 2013 BTO launch – Sembawang Eastbank, Eastbrook and Eastwave@Canberra were selling 4-room flats from $225,000.

This is an increase in the lowest priced 4-room flats by 4.4 per cent ($235,000 divided by $225,000).

URA index fell 9.4%?

But, the URA resale price index fell by about 9.4 per cent during the similar period (134.7 20161Q divided by148.6 20131Q).

Have BTO prices really “stabilised”?

So, have BTO prices really “stabilised”?

Please explain 13.8 % price differential?

If so, shouldn’t prices have fallen by about 9.4 per cent, instead of having increased by 4.4 per cent?

How do we explain the 13.8 per cent (9.4 + 4.4) price differential?

Leong Sze Hian

About the Author

Leong Sze Hian has served as the president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), Hotel Mumbai (associate producer), invited to speak more than 200 times in about 40 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of 2 countries. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.