Source: Today Online

Many of those who sold their HDB flats in the fourth quarter of last year had plenty to cheer about: Not only were they able to sell their flats at even higher prices; the owners also received more cash upfront from their buyers.

Prices of resale HDB flats rose 3.9 per cent between October and December, bringing the full year increase to 8.2 per cent. The latest statistics from the Housing Board show that 93 per cent of resale transactions in the fourth quarter were above valuation. And the median cash-over-valuation (COV) paid by home buyers jumped by 100 per cent – from $12,000 in Q3 to $24,000 in Q4.

Real Estate lecturer at Ngee Ann Polytechnic, Mr Nicholas Mak, said the increase may be due to more sales involving larger flats.

“There seems to be more families that are going in to buy larger flats — your four-room and five-room flats. As a result, these larger flats also come with higher cash-over-valuation amount which, in a way, pulls up that median cash-over-valuation.”

But this increase is unlikely to continue indefinitely. The HDB noted that the median COV amount had stabilised in recent months. The cash premium for the first half of this month (subs: Jan) has come down slightly to $22,000.

Some analysts believe this may indicate that the market is approaching a limit. Mr Mak said: “Our salary is still not catching up at such a high rate, there will be a certain time when the affordability issue will come into play. “As the sellers start to demand higher and higher COV … there may come a stage when there will be some buyer resistance.”

Efforts by the Government to raise the supply of new homes will also gradually help to cool the market once the flats are completed, said Mr Colin Tan, head of Research for Chesterton Suntec International.

“The Government’s efforts at pushing out the BTOs (build-to-order) and DBSS (Design, Build and Sell Scheme), and all the executive condos, that may have helped to allay some of the panic buying. And this probably resulted in some people actually shifting the demand from the resale market to the new flats,” Mr Tan added.

To meet demand, the HDB said that it will be offering nearly 7,000 new flats in the first half of this year. The flats will be built in areas such as Sengkang, Sembawang, Punggol, Yishun and Jurong West.

Updated on 22 January 2010, press release. HDB Resale Price Index at 150.8(0.1 point higher than flash estimate) in 4th Quarter 2009. Not so good news for buyers, sellers expectations remain high probably causing contraction in resale deals by 23%. HDB Housing Data is great but general info, median prices, median COVs, delayed etc … I hope there will be more real time data. The best estimate is to mashup Resale Transactions & Public Housing Data. At the end of the day it still bogs down to your affordability. So calculate before commit.

Source: Channel NewsAsia

SINGAPORE: Prices of Housing and Development Board (HDB) flats are at their highest on record.

According to preliminary estimates from the HDB on Monday, the Resale Price Index of public flats stood at 150.7 in the fourth quarter of 2009 – highest on record since data was compiled in 1990.

Extra(updated 22-01-2010):

Estimates show that prices of resale flats rose 3.8 per cent in the last three months of 2009, the fastest pace of growth since the third quarter of 2008. For the whole of last year, prices of resale flats rose about 8 per cent.

HDB said flat buyers can look forward to 1,300 build-to-order (BTO) flats in Choa Chu Kang and Hougang, which will be offered for sale on Tuesday.

The housing board said it will continue to launch more BTO projects this year if there is sustained demand for new flats, and will ensure that there is an adequate supply of flats to meet prevailing housing needs.

The HDB is due to release detailed resale price data and public housing data for the fourth quarter on January 22, 2010.

HDB Urges Caution

Cash-over-Valuation making headline again. Stories of $50K to $100K COV give news organisation added sensations. First, it did not happen. Second, if such transactions do occur, they do not represent the entire HDB Resale activities. Genuine buyers and sellers should not get emotionally excited. Latest Prices is our attempt to aggregate/source actual resale transactions. However success depends on your willingness to share.

Source: Channel News Asia

Housing analysts said it is a sellers’ market right now, with resale flats being a hot commodity lately.

But the Housing and Development Board (HDB) has urged buyers to exercise caution when paying high cash premiums, and to do their homework to determine if a house is truly worth its asking price.

A 4-room flat in Bishan was recently put up for sale. It was valued at S$460,000 by an independent valuer appointed by HDB, and the owners are asking for an additional S$100,000 cash-over-valuation (COV). The owners, who declined to be named, are a young couple in their 30s who run an F&B business. They claimed to have received three offers so far, but all were rejected.

“The COV is too low. There are those who are asking for S$50,000 to S$60,000. There was one offer which was close, about S$95,000. We are not in urgent need to sell. In a way, it’s to test the market. If we sell, we sell. If we don’t sell, we will just continue to stay,” said the owner of the 4-room flat in Bishan. Analysts said with a continued strong demand for resale flats, owners are taking advantage of the situation to increasingly ask for higher prices.

Based on the latest HDB figures, 78 per cent of home sales transacted in the third quarter of last year were above valuation. That is a 22 percentage-point jump from the second quarter of last year’s figure of 57 per cent. The median COV is also on the rise – jumping from S$3,000 in the second quarter to S$12,000 in Q3. With HDB resale flat prices hitting an all-time high, housing agents said most flats now command at least S$20,000 to S$30,000 cash-over-valuation.

Units situated at good locations, close proximity to an MRT station and good renovation can see COV go up to S$50,000 to S$70,000. But there is a limit to how much buyers are willing to pay. “If it’s not to my liking, then I’d have to do up, (renovate) it again. So how much (am I willing to pay)? About S$50 to S$60,000,” said one member of the public.

“It’s too high for me. Because of my income, I don’t think I can afford it,” said another.
HDB said only four out of the 13,000 4-room flats sold last year had premiums higher than S$70,000. Analysts cautioned against jumping into deals that require high cash premiums.

“COV is a premium. Five years down the line, the renovation will deteriorate. And there’s no guarantee that you can sell at S$100,000 above the then value. Therefore, buyers should exercise discretion as far as how high you want to pay,” said Mohamed Ismail, CEO of PropNex.

HDB said it does not control resale flat prices as they are the result of negotiations between willing buyers and sellers. It added that intervening in COV means forcing people to buy and sell at fixed prices. HDB also urge buyers to have the relevant information before negotiating with sellers, and to offer a price within their means.

This site does not plug into HDB’s IT System and extract real time resale transaction prices. We request for info from buyers, sellers and agents upon the exercise of Option to Purchase(OTP). Kindly provide following details:

1. OTP exercise date
2. Valuation
3. Cash-over-Valuation
4. Street Name
5. Block Number
6. Flat Type
7. Estate(e.g. Bedok, Jurong East …)
8. Your Name & Contact number(for verification)

If the deal is nullified subsequently is immaterial, because by exercising the OTP, sellers and buyers transact at an agreed price in consideration of the deposit. It becomes a binding contract, a done deal.

Please provide details through the comment link and we will expand this section accordingly when more information become available through public submission.

Received a call this morning from a lady, sorry line got cut off. Her question was “Can a foreigner who is single purchase a HDB Resale flat?”

The answer is “No”. Single, foreigner or Singapore PR is not allowed to purchase HDB Resale flat even though he/she is above 35 years old. Singapore permanent resident is not “permanent”, subject to approval and Re-Entry permit renewal. Singapore PR is a Foreigner with a PR Status and eligibility in relation to buying HDB Resale has remained unchanged.