The profile of buyers looking to buy these flats in the resale market will be more restricted than typical resale flats, which means limitations not just on the people who will ballot for these homes next month, but can purchase from the current owners once the MOP has passed.
While these factors mean that the PLH does an excellent job in what it has set out to do – keeping home prices low in the CCR for genuine homebuyers that intend to stay for an extended period of time, this will have ripple effects on the real estate market.
The biggest implication of this, we predict, is the increase in home prices of those on the periphery of these prime areas. Homes around these prime HDBs, whether they are public housing or private property, are sure to see an increase in demand and subsequently price, as they become more attractive to homeowners who do not wish to be limited by the MOP time or other resale restrictions. In addition to these housing limitations, buyer profiles who do not fall under the demographics of those limited by HDB but still want to live in these prime locations (perhaps for work purposes), will also naturally turn towards other flats that lie on the edge of these prime areas.
Existing prime HDBs not affected by PLH model, such as Pinnacle at Duxton, Tiong Bahru, Redhill, Queenstown, and Little India-Farrer Park will also see demand as the specifications in this model will apply only to future projects and not retrospectively to existing public housing.