Property expert raises critical questions on HDB’s removal of unrealistic resale flat listings

Approximately 50 listings for resale Housing Board (HDB) flats were recently removed from the HDB Flat Portal due to unrealistic pricing or misleading information. This accounted for about 5% of the total active listings as of 26 June, according to HDB’s announcement on 10 July.

Since the portal’s soft launch on 13 May, around 1,000 resale flats have been listed. HDB explained that about half of the removed listings had unrealistic pricing, though specifics were not provided. Following revisions to their asking prices, eight listings were reinstated by their users.

The delisting of these flats has raised several critical questions about the criteria used to define “unrealistic” pricing and the potential impact on the market.

Speaking to Gutzy, Ku Swee Yong, CEO of International Property Advisor Pte Ltd, highlighted several concerns.

He questioned how HDB defines “unrealistic” pricing, whether the rules are applied consistently to both “above valuation” and “below valuation” listings, and whether HDB would provide guidance on price bands when creating new posts on the portal.

“How is ‘unrealistic’ defined? Is it 20% away from the last transaction? Are they applying the rules consistently to both ‘above valuation’ and ‘below valuation’?” asked Mr Ku.

He also questioned whether HDB considers interior quality, renovations, and equipment in determining realistic pricing and whether similar pricing guidelines would be enforced on other platforms like PropertyGuru and 99.co to protect buyers and sellers alike.

The HDB emphasized its right to moderate listings on the resale flat service, removing inappropriate or inaccurate content without prior notice. Sellers or their agents must adjust pricing or correct any misleading details to have their listings reinstated.

Although HDB did not specify the nature of misinformation leading to removals, its website’s terms allow the removal of listings containing discriminatory content, false advertisements, or irrelevant material.

However, some property agents and netizens have expressed concerns that the delisting of high-priced HDB flats could counter the initiative’s expectation that agents would lose their jobs to the HDB-run property portal.

They argue that owners seeking higher prices may still have to rely on property agents, as HDB may restrict the prices based on prevailing market demand or willingness to pay. This could mean that even if sellers stand to save on agent commissions, they might not get their expected price through the portal.

HDB reported over 366,500 visits to the portal from 30 May to 18 June, averaging more than 18,300 visits daily. “HDB will continue to monitor the listings closely and will not hesitate to remove listings with unrealistic pricing as well as inappropriate and/or inaccurate content,” it added.

The new Resale Flat Listing (RFL) service, integrated into the HDB Flat Portal, is designed to empower flat owners by providing them with the option to list and market their flats independently or through a property agent.

The portal aims to offer a more transparent and secure marketplace, allowing sellers to list their flats for free. It includes a feature where sellers are automatically prompted if their listing price is “at least 10 per cent more than the highest transacted price for nearby units of the same flat type sold in the past six months.”

This is intended to help sellers make more informed decisions about their resale price, thus creating “a more sustainable property market in the long run,” according to HDB.

Buyers must possess an HDB Flat Eligibility letter to arrange viewings, confirming their eligibility to purchase a flat and access grants and financing options.

In his earlier comments on the portal, Mr Ku noted a growing trend among younger and more educated users who prefer to manage transactions independently to save on commissions.

However, he cautioned that resale transactions involve complexities such as negotiation over handover logistics and property conditions, which might require HDB’s intervention in some cases.

Despite the move towards digital transactions, Mr Ku asserts the enduring need for skilled real estate agents, particularly for handling non-standard transactions involving legal complexities like divorce or inheritance.

He predicts that while the demand for agents might diminish among a certain demographic, expert agents capable of navigating complex cases will continue to be valuable in the HDB resale market.