Monday, December 1, 2008
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Buyers paying less cash for HDB resale flats
by Sunday Times, November 30, 2008, HDB resale flats buyers are paying less cash above valuation (COV). This may be yet another sign that the financial crisis would eventually impact all market segments. The private property market is at a standstill and prices have fallen as the global financial crisis scares buyers away.
While HDB resale flat market remains active and prices are still fairly strong, there are increasing signs that this segment of the market is no longer immune to the economic slowdown.
While prices have not dropped, the cash amount that buyers typically pay on top of the flat’s valuation has fallen more significantly, according to market analysts. ‘In view of the current sentiment, HDB resale flat valuations should stay flat going forward. If COV is coming down, prices will eventually come down.’ said Mr Eugene Lim, associate director of ERA Asia Pacific
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
HDB Resale Flats Buyers Paying Less COV
According to the report,Buyers paying less cash for HDB resale flats
by Sunday Times, November 30, 2008, HDB resale flats buyers are paying less cash above valuation (COV). This may be yet another sign that the financial crisis would eventually impact all market segments. The private property market is at a standstill and prices have fallen as the global financial crisis scares buyers away.
While HDB resale flat market remains active and prices are still fairly strong, there are increasing signs that this segment of the market is no longer immune to the economic slowdown.
While prices have not dropped, the cash amount that buyers typically pay on top of the flat’s valuation has fallen more significantly, according to market analysts. ‘In view of the current sentiment, HDB resale flat valuations should stay flat going forward. If COV is coming down, prices will eventually come down.’ said Mr Eugene Lim, associate director of ERA Asia Pacific
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
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2 comments:
Hi Smart Buyer,
My bf and i are renting seperately
he pays $600 in jurong west and i'm paying $650 in tampines (boh central)
we are both PRs
now my landload want to increase my rent
so bf say, let's buy a resale at boonly mrt
my question is:
1. would valuation ever come down?
2. if yes, when would it be? if no... would cov go down?
3. should we buy it now? or wait?
bcoz now valuation is $100k more han begining of 2007... exactly the same unit >.< so like... we missed it
now dunno wad to do.. renting seems wasteful
pamm
Dear Pamm,
My gut feel is that for HDB flat's supply to catch up with demand will take a few years and that's provided HDB build agressively. HDB resale flats buyers like face competition not only from other new citizens, PRs and new couples; but also HDB rental housing demand from foreigners. Further, HDB, being the cheapest housing type in spore, may see more downgraders as economy worsens.
My guess:
1. HDB valuation will come down only if there's massive unemployment;
2. Even there's massive-unemployment, you've to see which sector is badly hit. At this moment, the lower-paying jobs seem to be holding, while the bigger earners like bankers seem to be hit first. If this trend continues, you may even have more competition from downgraders to the HDB resale market.
3. You'll have to assess the risk of each option yourself.
Best wishes
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