View Full Version : Second Duxton resale flat sold for S$918,000
http://www.businesstimes.com.sg/real-estate/second-duxton-resale-flat-sold-for-s918000
Second Duxton resale flat sold for S$918,000
9 Jan
A SECOND Pinnacle@Duxton unit has been sold on the resale market, The Straits Times Online has reported.
The five-room, 106 square metre flat on the fifth floor of the iconic Housing Board project at Tanjong Pagar went for S$918,000 on Monday.
A 43-year-old DWG agent who handled the transaction said the buyers - who paid fully in cash - are a local couple in their 60s and their daughter who are downgrading from a private property. The sellers are a local couple in their mid-40s, with two young children.
"The flat is on a very low floor, so the current owners were more realistic with the price," said the agent, who declined to be named. "They bought the flat for under S$400,000, so they are quite happy with the selling price."
This sale comes after the five-year minimum occupation period for most home owners at the project ended last month. Last week, The Straits Times reported that a four-room flat between the 34th and 36th storeys was sold for S$900,000.
http://www.straitstimes.com/premium/singapore/story/2nd-flat-pinnacle-sold-918000-20150109
2nd flat at Pinnacle sold - for $918,000
Buyers of 5-room unit on low floor paid fully in cash
Published on Jan 9, 2015 1:18 AM
By Yeo Sam Jo
A SECOND unit at the Pinnacle@Duxton has changed hands on the resale market, barely a week after the first was sold for $900,000.
The five-room, 106 sq m flat, located below the sixth floor, went for $918,000 on Monday.
Although some industry observers expect five-room units at the unique Housing Board project in Tanjong Pagar to fetch over $1 million, the agent who handled the transaction said the sellers were more "realistic" with their pricing as their flat is on a "very low floor".
"They bought the flat for under $400,000, so they are quite happy with the selling price," said the 43-year-old agent from real estate firm DWG, who declined to be named.
He said the sellers are a couple in their mid-40s with two young children. They started looking for buyers early last month, with an initial asking price of $960,000. There were seven to eight viewings.
The Straits Times understands that the buyers, who paid fully in cash, are a couple in their 60s who are downgrading from a private property.
On Dec 29, a four-room flat in the development, located somewhere on the 34th to 36th floor, was sold for $900,000. Flats there are starting to come on the market, as the five-year minimum occupation period for most of the project's home owners ended last month.
Property analysts said the high prices are due to the project's central location, young age and unique design. Some believe properties there will hit the $1 million mark soon.
"So many owners are asking for $1 million and above, it's only a matter of time before it happens," said Mr Nicholas Mak, research head for SLP International Property Consultants.
While property cooling measures are still in force, R'ST Research director Ong Kah Seng said "there are some buyers with higher liquidity, but this group will be spoilt for choice with other public and private projects".
[email protected]
Wow pay cash for property. Cash rich Baby boomers generation can do it.
http://www.businesstimes.com.sg/real-estate/second-duxton-resale-flat-sold-for-s918000
Second Duxton resale flat sold for S$918,000
9 Jan
A SECOND Pinnacle@Duxton unit has been sold on the resale market, The Straits Times Online has reported.
The five-room, 106 square metre flat on the fifth floor of the iconic Housing Board project at Tanjong Pagar went for S$918,000 on Monday.
A 43-year-old DWG agent who handled the transaction said the buyers - who paid fully in cash - are a local couple in their 60s and their daughter who are downgrading from a private property. The sellers are a local couple in their mid-40s, with two young children.
"The flat is on a very low floor, so the current owners were more realistic with the price," said the agent, who declined to be named. "They bought the flat for under S$400,000, so they are quite happy with the selling price."
This sale comes after the five-year minimum occupation period for most home owners at the project ended last month. Last week, The Straits Times reported that a four-room flat between the 34th and 36th storeys was sold for S$900,000.
Regulators
10-01-15, 08:23
Buyers are paying premium for an hdb flat which I think is totally not worth it. With that amount, you can just about buy a 3 bedroom resale condo in the OCR and enjoy the facilities and status of living in a condo. Pinnacle does not even have a security gate to the units, any tom dick or harry can just lurk around your unit.
Property is still about location. Look at how non matured hdb estate falls.
Buyers are paying premium for an hdb flat which I think is totally not worth it. With that amount, you can just about buy a 3 bedroom resale condo in the OCR and enjoy the facilities and status of living in a condo. Pinnacle does not even have a security gate to the units, any tom dick or harry can just lurk around your unit.
Allthepies
10-01-15, 09:50
The power of downtown core planning area : )
Imagine no need to squeeze or rush or caught in jam when going to office and back home.
Imagine the peace and quiet weekend with unlimited amenities minus the crowd.
Property is still about location. Look at how non matured hdb estate falls.
The intrinsic and absolute value of something is a separate thing from its perceived value.
By the sheer number of supply in non matured estates versus matured estates, the difference is to be expected. Nonetheless, all non matured estates will one day become matured in my opinion. Bearing in mind the size of our tiny city state.
What the Govt is doing at the background is the massive building of mrt and expressways. If the transport lags during peaks can be solved, living anywhere will not be a problem. CCR and places like JLD will benefit in smoothness of flow with lesser density in the core. But that day has not arrived yet.
Regulators
10-01-15, 13:09
The method of appraising hdb has been flawed some the beginning. The price comparison method should never be employed for public housing. The cost method which factors in inflation and economic factors should be used to value hdb properties instead. If buying price for the 4rm flat at pinnacle is $300k, after mop, the fair value given to the property should actually be $5xxk. If buyers see the value in the flat, they can go ahead and pay $400k above valuation but that should not affect future valuations of that development. Subsequent sellers selling a similar unit should be getting the same kind of valuation and if another crazy buyer wants to fork out another $400k COV for the unit, they can still go ahead and pay. Such a system will keep property valuations low all the time.
Property is still about location. Look at how non matured hdb estate falls.
The method of appraising hdb has been flawed some the beginning. The price comparison method should never be employed for public housing. The cost method which factors in inflation and economic factors should be used to value hdb properties instead. If buying price for the 4rm flat at pinnacle is $300k, after mop, the fair value given to the property should actually be $5xxk. If buyers see the value in the flat, they can go ahead and pay $400k above valuation but that should not affect future valuations of that development. Subsequent sellers selling a similar unit should be getting the same kind of valuation and if another crazy buyer wants to fork out another $400k COV for the unit, they can still go ahead and pay. Such a system will keep property valuations low all the time.
Agree, but humans like to make decisions based on price comparison - for example, they would compare the price of private property in the vicinity to decide if the HDB they are getting is cheap; they also like to compare the prices of comparable cities to decide the position of local property prices.
I think the HDB is wising up in some ways to implement pricing systems closer to value. For example, new suburb BTOs I am aware of are selling at close to half a million, while those in mature estates could be about 600 to 700K. There was a Duxton flat sold by HDB at that kind of prices just a few months back if I don't remember wrongly.
Nonetheless, the gap should still persist, just able to manage it.
Bro, Duxton @ pinnacle is the first and last of the kind of hdb flats that is built in the CBD. People willing to pay for uniqueness. Can still get good yield after staying for 5 years.
Agree, but humans like to make decisions based on price comparison - for example, they would compare the price of private property in the vicinity to decide if the HDB they are getting is cheap; they also like to compare the prices of comparable cities to decide the position of local property prices.
I think the HDB is wising up in some ways to implement pricing systems closer to value. For example, new suburb BTOs I am aware of are selling at close to half a million, while those in mature estates could be about 600 to 700K. There was a Duxton flat sold by HDB at that kind of prices just a few months back if I don't remember wrongly.
Nonetheless, the gap should still persist, just able to manage it.
Bishan is still Bishan and sengkang is still sengkang after two years after both estates are considered mature estates. That will never change and people mindset will not change.
The intrinsic and absolute value of something is a separate thing from its perceived value.
By the sheer number of supply in non matured estates versus matured estates, the difference is to be expected. Nonetheless, all non matured estates will one day become matured in my opinion. Bearing in mind the size of our tiny city state.
What the Govt is doing at the background is the massive building of mrt and expressways. If the transport lags during peaks can be solved, living anywhere will not be a problem. CCR and places like JLD will benefit in smoothness of flow with lesser density in the core. But that day has not arrived yet.
Bishan is still Bishan and sengkang is still sengkang after two years after both estates are considered mature estates. That will never change and people mindset will not change.
Hi bro, what you are saying is true somewhat but I was thinking along a much longer time frame. Massive changes has already taken place over the last decade in terms of perceived value of both estates you mentioned.
Also, based on hdb definition at the moment Sengkang will still be non mature after two years but Bishan is regarded as mature. Yishun still non mature due to the large scale of new BTOs.
http://www.propertyguru.com.sg/question/192099/hi-guru-where-is-the-mature-and-no-mature-estates-
http://forums.hardwarezone.com.sg/27341663-post1344.html
http://blog.iproperty.com.sg/yishun-old-town-rising/
Distance from epic centre is still of importance even with more regional centres being developed. It has great implication on the type of tenants for rental and quantum. Look at the article today in ST on the types of tenants attracted to interlace. A three bedder unit has four tenants sharing it. Total rental is probably only max at $4000 with 4 of them. One of them staying in a 20square meter room and the other in. 400sqft room.
Hi bro, what you are saying is true somewhat but I was thinking along a much longer time frame. Massive changes has already taken place over the last decade in terms of perceived value of both estates you mentioned.
Also, based on hdb definition at the moment Sengkang will still be non mature after two years but Bishan is regarded as mature. Yishun still non mature due to the large scale of new BTOs.
http://www.propertyguru.com.sg/question/192099/hi-guru-where-is-the-mature-and-no-mature-estates-
http://forums.hardwarezone.com.sg/27341663-post1344.html
http://blog.iproperty.com.sg/yishun-old-town-rising/
Distance from epic centre is still of importance even with more regional centres being developed. It has great implication on the type of tenants for rental and quantum. Look at the article today in ST on the types of tenants attracted to interlace. A three bedder unit has four tenants sharing it. Total rental is probably only max at $4000 with 4 of them. One of them staying in a 20square meter room and the other in. 400sqft room.
Interlace is too unique to be used as a basis to compare hdbs.
1. Design choices too overwhelming - research of buying behavior indicates that it is generally a bad idea to overwhelm the customer with too many choices.
2. Lack of town facilities and amenities in proximity - I think you have explained before that most tenants don't drive. Therefore this can be seen as another critical weakness.
Distance to epic Centre is definitely still relevant and there will still be a gap. What I am suggesting is the dynamic balance between the distance, change in infrastructure such as transport nodes and roads, and price points. All three factors should be considered.
Regulators
10-01-15, 22:03
That is why i say hdb valuation method has been flawed from the beginning. Govt keeps talking about keeping prices under control but they are taking the leading to increase prices. The valuation of hdb properties should not n cannot be based on sale comparison if prices are to be controlled. Transactions prices can still continue to be high with people paying high covs (if they can afford the cash) but why should the govt support crazy people in getting a loan by inflating public housing values 3 to 4 times the purchase price in a matter of a few years?
Agree, but humans like to make decisions based on price comparison - for example, they would compare the price of private property in the vicinity to decide if the HDB they are getting is cheap; they also like to compare the prices of comparable cities to decide the position of local property prices.
I think the HDB is wising up in some ways to implement pricing systems closer to value. For example, new suburb BTOs I am aware of are selling at close to half a million, while those in mature estates could be about 600 to 700K. There was a Duxton flat sold by HDB at that kind of prices just a few months back if I don't remember wrongly.
Nonetheless, the gap should still persist, just able to manage it.
Regulators
10-01-15, 22:18
An hdb flat is an hdb flat, what so unique? Any tom dick or harry can stand outside your house or ease their bladder at the staircase as and when they wish. Would you pay condo price for a property with no security and no facilities? Location is relative to the person's needs n is just one aspect to buying a property.
Bro, Duxton @ pinnacle is the first and last of the kind of hdb flats that is built in the CBD. People willing to pay for uniqueness. Can still get good yield after staying for 5 years.
I am sorry to disagree with you but in terms of absolute intrinsic value, HDB is still perhaps the best class of property for starters in Singapore especially.
It is an imperfect substitute for condo in economic terms but still a reasonable one. If not, there wouldn't be people paying a million for HDBs here and there.
People who choose to buy the resale might have other considerations, such as living to their children and grandchildren (I understand that the purchasers were downgraders who were retirees). Other considerations might also apply. Therefore the way value is perceived differs from one person to another.
Condo has other intrinsic values that people ascribe to it, for example facilities and additional security; as well as other perceived values such as prestige. Then of course if the society has other associations or perceptions about it that are stable or which improves over time, some of the perceived values can transit into intrinsic values in terms of the preservation of capital, appreciation etc.
An hdb flat is an hdb flat, what so unique? Any tom dick or harry can stand outside your house or ease their bladder at the staircase as and when they wish. Would you pay condo price for a property with no security and no facilities? Location is relative to the person's needs n is just one aspect to buying a property.
I am using the interlace as an example to compare location and not to hdb. Interlace is a new condo with great design and yet not able to secure great rental and differeng kind of tenants as compared to those with better location.. The tenants are not like. I agree with you on those 3 those factors are critical. People being people will have changing needs but given a choice will want to upgrade to private properties especially in Singapore.
Interlace is too unique to be used as a basis to compare hdbs.
1. Design choices too overwhelming - research of buying behavior indicates that it is generally a bad idea to overwhelm the customer with too many choices.
2. Lack of town facilities and amenities in proximity - I think you have explained before that most tenants don't drive. Therefore this can be seen as another critical weakness.
Distance to epic Centre is definitely still relevant and there will still be a gap. What I am suggesting is the dynamic balance between the distance, change in infrastructure such as transport nodes and roads, and price points. All three factors should be considered.
I am using the interlace as an example to compare location and not to hdb. Interlace is a new condo with great design and yet not able to secure great rental and differeng kind of tenants as compared to those with better location.. The tenants are not like. I agree with you on those 3 those factors are critical. People being people will have changing needs but given a choice will want to upgrade to private properties especially in Singapore.
Just feel I have to say something. I think you are slightly mistaken about Interlace. Interlace does not have 1 bedder. Most are big 3 and 4 bedders which in today's rental market is relatively harder to rent out. The 2 bedder units are equally spacious and from what I know in high demand. It is the unsold big units that are being rented out by developer.
Regulators
11-01-15, 11:40
You still don't get my point. I am not against how much people pay for hdb flats, i am against the high hdb valuations that support high purchase prices. When flats were sold to the first buyers, they were subsidised by taxpayers indirectly and the govt does not need to incur land cost, unlike private developers. The govt has to exercise social responsibility in the valuation methods they choose to adopt for hdb properties. As i have suggested, cost method of appraisal factoring in economic growth and inflation is the best way forward for hdb properties. If people want to pay $400k cov on top of a $500k valuation, that is their problem, but hdb will take the lead by not supporting it. The only reason i can think of why the govt loves high property valuations is because they can collect more stamp duty and property tax and will pave the way for higher land sale cost.
I am sorry to disagree with you but in terms of absolute intrinsic value, HDB is still perhaps the best class of property for starters in Singapore especially.
It is an imperfect substitute for condo in economic terms but still a reasonable one. If not, there wouldn't be people paying a million for HDBs here and there.
People who choose to buy the resale might have other considerations, such as living to their children and grandchildren (I understand that the purchasers were downgraders who were retirees). Other considerations might also apply. Therefore the way value is perceived differs from one person to another.
Condo has other intrinsic values that people ascribe to it, for example facilities and additional security; as well as other perceived values such as prestige. Then of course if the society has other associations or perceptions about it that are stable or which improves over time, some of the perceived values can transit into intrinsic values in terms of the preservation of capital, appreciation etc.
In all truthfulness I do get your point.
The problem is simply this: even if valuations were artificially adjusted to the lowest level, it will not alter the current situation where HDBs can be rented for condo level rent. Ie one of the major components of the intrinsic value cannot be removed.
For the Duxton example I believe the loan is minimal or all cash.
If the Govt were to force that HDB cannot be rented out, the prices and valuations will automatically sky dive. But the political impact and effects on low income families depending on the rent will be too heavy.
I once rented a room in a 3rm flat shared by a family with two non working parents and four schooling children.
You still don't get my point. I am not against how much people pay for hdb flats, i am against the high hdb valuations that support high purchase prices. When flats were sold to the first buyers, they were subsidised by taxpayers indirectly and the govt does not need to incur land cost, unlike private developers. The govt has to exercise social responsibility in the valuation methods they choose to adopt for hdb properties. As i have suggested, cost method of appraisal factoring in economic growth and inflation is the best way forward for hdb properties. If people want to pay $400k cov on top of a $500k valuation, that is their problem, but hdb will take the lead by not supporting it. The only reason i can think of why the govt loves high property valuations is because they can collect more stamp duty and property tax and will pave the way for higher land sale cost.
When rental starts to fall, hdb will face competition fm condos if difference is small. HDB in ocr already having difficulty to find tenants unless they drop rental further.
In all truthfulness I do get your point.
The problem is simply this: even if valuations were artificially adjusted to the lowest level, it will not alter the current situation where HDBs can be rented for condo level rent. Ie one of the major components of the intrinsic value cannot be removed.
For the Duxton example I believe the loan is minimal or all cash.
If the Govt were to force that HDB cannot be rented out, the prices and valuations will automatically sky dive. But the political impact and effects on low income families depending on the rent will be too heavy.
I once rented a room in a 3rm flat shared by a family with two non working parents and four schooling children.
Allthepies
11-01-15, 16:01
Sadly until Singaporeans learn to create things for the global economy (eg Facebook, Microsoft, Apple, LinkIn, WhatApps), land is the only asset that Singapore has. As such state lands should be sold at market valuations.
Regulators
11-01-15, 20:34
You are obviously on a different frequency cause i was talking about how hdb valuations should be independent of market transacted prices.
In all truthfulness I do get your point.
The problem is simply this: even if valuations were artificially adjusted to the lowest level, it will not alter the current situation where HDBs can be rented for condo level rent. Ie one of the major components of the intrinsic value cannot be removed.
For the Duxton example I believe the loan is minimal or all cash.
If the Govt were to force that HDB cannot be rented out, the prices and valuations will automatically sky dive. But the political impact and effects on low income families depending on the rent will be too heavy.
I once rented a room in a 3rm flat shared by a family with two non working parents and four schooling children.
Simply put, the Duxton buyers in this thread are retirees who do not need to look at valuation at all. They pay in cash probably in full and value the flat at the rate they would pay to rent or purchase an adjacent private property. It does not matter to them if HDB values the flat at $1.
You are obviously on a different frequency cause i was talking about how hdb valuations should be independent of market transacted prices.
Regulators
11-01-15, 21:24
Doesn't this enforce what I have been saying? If retirees or anyone has the cash to pay high prices for their hdb flats, the govt should just let them pay. That high transaction price should not however affect the way the next flat is valued since it is the govt's job to keep prices under control. If the govt valuer values a duxton 4 bedroom for $500k, there is nothing stopping cash rich individuals from paying $1 million, but why should the flat be valued at $800k artificially (more than twice the purchase price in a few short years) just to encourage lending to that amount if someone chooses not to pay cash? If a pinnacle 4 rm flat is valued at $500k, you may have a couple of people willing to pay $400k cov for that kind of pty, but do you think all subsequent buyers would do that? As mentioned before, sale comparison method should not be applied to hdb valuations.
Simply put, the Duxton buyers in this thread are retirees who do not need to look at valuation at all. They pay in cash probably in full and value the flat at the rate they would pay to rent or purchase an adjacent private property. It does not matter to them if HDB values the flat at $1.
HDB already sold Duxton flat up to 600+K.
What you mentioned had already been catered for by the MSR, which is stricter than TDSR.
OK, so Govt should deny the actual value and fix HDB just to support private prices in your opinion? Like pick a figure from the air?
Doesn't this enforce what I have been saying? If retirees or anyone has the cash to pay high prices for their hdb flats, the govt should just let them pay. That high transaction price should not however affect the way the next flat is valued since it is the govt's job to keep prices under control. If the govt valuer values a duxton 4 bedroom for $500k, there is nothing stopping cash rich individuals from paying $1 million, but why should the flat be valued at $800k artificially (more than twice the purchase price in a few short years) just to encourage lending to that amount if someone chooses not to pay cash? If a pinnacle 4 rm flat is valued at $500k, you may have a couple of people willing to pay $400k cov for that kind of pty, but do you think all subsequent buyers would do that? As mentioned before, sale comparison method should not be applied to hdb valuations.
Regulators
11-01-15, 23:44
I have suggested for the government to move away from sales comparison method of valuing properties and adopt the cost method that takes into account inflation and economic growth. In this way valuations are done independent of the market forces to guard against runaway prices. It takes only a few rich individuals to create disequilibrium in the hdb market by paying ridiculously high prices based on current valuation methods, don't you agree? You may be thinking why they allow that. They are using market freedom as an excuse to collect more tax revenue and other forms of property revenues based on higher property valuations.
HDB already sold Duxton flat up to 600+K.
What you mentioned had already been catered for by the MSR, which is stricter than TDSR.
OK, so Govt should deny the actual value and fix HDB just to support private prices in your opinion? Like pick a figure from the air?
I have suggested for the government to move away from sales comparison method of valuing properties and adopt the cost method that takes into account inflation and economic growth. In this way valuations are done independent of the market forces to guard against runaway prices. It takes only a few rich individuals to create disequilibrium in the hdb market by paying ridiculously high prices based on current valuation methods, don't you agree? You may be thinking why they allow that. They are using market freedom as an excuse to collect more tax revenue and other forms of property revenues based on higher property valuations.
These few individuals do not influence the overall valuation significantly. Most estates HDBs for four rooms are still about 400K. Most HDB sellers and upgraders are also selling at that value but don't make it to the news. I wonder what is your issue for these few individuals whose properties entice cash rich buyers who can buy without referring to valuation or depending on loans.
Also, sellers and buyers of HDBs must agree on a price first before valuation assessment for loan. This is the current protocol.
Valuation (even professional valuation) is not true value, that's all I wanted to say. True value is how you make sense and make use of that value.
You still don't get my point. I am not against how much people pay for hdb flats, i am against the high hdb valuations that support high purchase prices. When flats were sold to the first buyers, they were subsidised by taxpayers indirectly and the govt does not need to incur land cost, unlike private developers. The govt has to exercise social responsibility in the valuation methods they choose to adopt for hdb properties. As i have suggested, cost method of appraisal factoring in economic growth and inflation is the best way forward for hdb properties. If people want to pay $400k cov on top of a $500k valuation, that is their problem, but hdb will take the lead by not supporting it. The only reason i can think of why the govt loves high property valuations is because they can collect more stamp duty and property tax and will pave the way for higher land sale cost.
The issue you brought up is actually not so much an issue with the valuation method. Rather, it's an issue of social equality.
In fact, I agree with you HDB is interfering too much into HDB valuation. Without HDB stepping in, I reckon HDB valuation by private valuers would be higher.
For a fair market, there cannot be 2 different valuation methodology. Both private and public houses should use the same valuation method. For inequalities, we should use other schemes to adjust for it. The yardstick has to be constant.
Regulators
12-01-15, 10:22
Private developers bid for land to build, incurring actual land cost. Hdb is an arm of govt and the govt does not incur real land cost. To summarise, Hdb can afford to use a different method of valuation for 3 simple reasons:
1) govt has a social responsibility to keep hdb prices low and affordable;
2) all land used by the govt to build public housing is owned by the govt and Singaporeans collectively are stakeholders;
3) to prevent individual buyers from creating a disequilibrium in the hdb market.
The issue you brought up is actually not so much an issue with the valuation method. Rather, it's an issue of social equality.
In fact, I agree with you HDB is interfering too much into HDB valuation. Without HDB stepping in, I reckon HDB valuation by private valuers would be higher.
For a fair market, there cannot be 2 different valuation methodology. Both private and public houses should use the same valuation method. For inequalities, we should use other schemes to adjust for it. The yardstick has to be constant.
To summarise, what regulators means is this:
1. Loan quantum for private development must be as regulation-free as possible. Allow them to loan as much as can be imagined to support extremely high private prices. This is to prevent a few extremely rich individuals to buy multiple properties.
2. Valuation for HDBs must be as low as possible to minimise the loan and price as much as possible. This is because HDB is a social goods.
Regulators
12-01-15, 11:25
Absd n tdsr are the main deterence in the pte pty mkt to keep pxs in control. Think of it this way, when hdb valuations are low, covs would naturally come down. When hdb upgraders cannot upgrade, private property prices in the mass market will naturally drop with the greatly reduced demand.
the issue is much, much deeper than "valuation". If HDB is allowed to be sold on open market, at this point it becomes an open market commodity, and open market would require open market practice. This would immediately mean the HDB pty is allowed to follow market price. (e.g., a bank is always willing to lend you as long as he thinks this flat is indeed worth 1 mil. If there is a market bid at 1mil, it is worth 1mil, whether the bid comes with a loan or not.)
This is a policy intention. Every one (who is eligible) is given a free bonus. This is a form of grand scale redistribution.
If you disagree, you have to disagree completely with the concept of "HDB to be sold at market" in the 1st place.
Regulators
12-01-15, 12:05
Hdb valued at market has been a flaw since the beginning.
that's the most powerful "tool" to hold the market ...
when someone sold a unit below "valuation" ... it's printed big big in newspaper
but in actual fact, the owner is making few hundreds thousands profit
Hdb valued at market has been a flaw since the beginning.
Regulators
12-01-15, 13:23
Most powerful for the govt to earn more money.
that's the most powerful "tool" to hold the market ...
when someone sold a unit below "valuation" ... it's printed big big in newspaper
but in actual fact, the owner is making few hundreds thousands profit
Close to a decade ago, I overheard a conversation between two strangers probably, in which a young man (probably less than 30) spoke to a middle-aged man (probably around 45).
The younger man had just obtained the keys to his new flat and shared with the middle-aged man how excited he was to obtain a new flat in walk-in-selection, a 5-RM flat roughly 100K lesser than his neighbours living just above him. Flats then were really affordable, and the young man mentioned a figure under 200K (maybe 150 or 190K). Guess the response of the older man?
Allthepies
13-01-15, 11:11
"Don't look at price, look at value."
"Don't look at price, look at value."
Nope. He said,"That's why I think the HDB is unsympathetic. Why must they price it at 150K and make you all young people work so hard? Why can't they price it at 50-100K? They should just cover cost of building (HDBs), why make you pay more?"
Fast forward to a decade later. Is there a right price? If there is, what is it?
Another food for thought is what the older man asked, should HDB just cover bare costs of building?
Private developers bid for land to build, incurring actual land cost. Hdb is an arm of govt and the govt does not incur real land cost. To summarise, Hdb can afford to use a different method of valuation for 3 simple reasons:
1) govt has a social responsibility to keep hdb prices low and affordable;
2) all land used by the govt to build public housing is owned by the govt and Singaporeans collectively are stakeholders;
3) to prevent individual buyers from creating a disequilibrium in the hdb market.
I do not think the the phenomenon of some high HDB prices is caused by irrational "individual buyers" or the valuation system.
For me, I use my own, simple criterion to decide which one to buy: between HDB at a convenient location and a remote CONDO, I will choose the convenient location no matter whether the fomer is cheaper or more expensive than the remote condos becuase I believe I will sell higher if I have to buy higher. Instead, I always belive that HDB is in general under valued. By buying the location, I will save time and feel less stressful. Between a 500sqf condo and a 1200sqf HDB at similar location, I will choose the HDB if I cannot afford a bigger condo because I may not use the condo facilities, but I will surely need the inside space of the HDB.
I do not care whether the HDB has a valuation or not because I will use the nearby condo price as a yardstick, considering past transactions and the supply pipe as well.
Regulators
13-01-15, 14:05
If the pinnacle 4rm flat is valued at $500k, do you think anyone intending to take a loan would pay $400k cov? Valuation is important to those seeking a loan.
I do not think the the phenomenon of some high HDB prices is caused by irrational "individual buyers" or the valuation system.
For me, I use my own, simple criterion to decide which one to buy: between HDB at a convenient location and a remote CONDO, I will choose the convenient location no matter whether the fomer is cheaper or more expensive than the remote condos becuase I believe I will sell higher if I have to buy higher. Instead, I always belive that HDB is in general under valued. By buying the location, I will save time and feel less stressful. Between a 500sqf condo and a 1200sqf HDB at similar location, I will choose the HDB if I cannot afford a bigger condo because I may not use the condo facilities, but I will surely need the inside space of the HDB.
I do not care whether the HDB has a valuation or not because I will use the nearby condo price as a yardstick, considering past transactions and the supply pipe as well.
If the pinnacle 4rm flat is valued at $500k, do you think anyone intending to take a loan would pay $400k cov? Valuation is important to those seeking a loan.
First, how can be a pinnacle 4rm flat valued at only S$500k when the similar sized private condo nearly is sold above S$1.8M.
Secondly, if it were sold at only S$500k, I assure you, there are many people willing to pay cash immediately to secure the transation, no need to bother the bank at all.
Might as well valuate at 250k. Or $1.
Goes back to the conversation between the young and middle aged man. What value should Govt set at? What basis?
First, how can be a pinnacle 4rm flat valued at only S$500k when the similar sized private condo nearly is sold above S$1.8M.
Secondly, if it were sold at only S$500k, I assure you, there are many people willing to pay cash immediately to secure the transation, no need to bother the bank at all.
Regulators
13-01-15, 21:20
I don't think you get the drift of my earlier posts. Please read carefully then come back n discuss.
First, how can be a pinnacle 4rm flat valued at only S$500k when the similar sized private condo nearly is sold above S$1.8M.
Secondly, if it were sold at only S$500k, I assure you, there are many people willing to pay cash immediately to secure the transation, no need to bother the bank at all.
I don't think you get the drift of my earlier posts. Please read carefully then come back n discuss.
Your drift is bizarrely out of context. If Duxton 4rm flat valued at 500k, so many non mature estates hdb owners will sell to "migrate" over. Even if they sell at 250k, they will be more than willing to loan 250k in today's prices to take over this one. Not to mention that in today's prices, youngsters are loaning half a million to buy in Sengkang. What can stop them from buying over here?
It's good to have a dream, but must be a reasonable one.
Regulators
14-01-15, 14:55
Hdb values and transacted prices need not be the same. There is nothing stopping buyers paying $500k cov if they wish n if the flat is indeed worth that much in the eyes of the buyer. Not valuing to market is the only way to control prices coz not many crazy people would want to pay $500k cov for an hdb flat. Govt housing should be govt housing n should not be valued the same way as pte pty.
Your drift is bizarrely out of context. If Duxton 4rm flat valued at 500k, so many non mature estates hdb owners will sell to "migrate" over. Even if they sell at 250k, they will be more than willing to loan 250k in today's prices to take over this one. Not to mention that in today's prices, youngsters are loaning half a million to buy in Sengkang. What can stop them from buying over here?
It's good to have a dream, but must be a reasonable one.
Hdb values and transacted prices need not be the same. There is nothing stopping buyers paying $500k cov if they wish n if the flat is indeed worth that much in the eyes of the buyer. Not valuing to market is the only way to control prices coz not many crazy people would want to pay $500k cov for an hdb flat. Govt housing should be govt housing n should not be valued the same way as pte pty.
So if you are the owner with hordes of buyers willing to bid higher prices up to 700k or 800k, you will choose to sell to the one that offers you 500k?
Regulators
14-01-15, 15:42
Which part of valuation does not equal to transacted price don't you understand? Govt has social responsibility to keep public housing cost down by not valuing high. As i have said umpteen times before, that doesn't mean people have to buy at valuation price, if they can afford more cash they can pay $500k cov if they wish but the govt should not support runaway prices in public housing.
So if you are the owner with hordes of buyers willing to bid higher prices up to 700k or 800k, you will choose to sell to the one that offers you 500k?
Which part of valuation does not equal to transacted price don't you understand? Govt has social responsibility to keep public housing cost down by not valuing high. As i have said umpteen times before, that doesn't mean people have to buy at valuation price, if they can afford more cash they can pay $500k cov if they wish but the govt should not support runaway prices in public housing.
The best scenario for you is the Govt values all HDB at $1. Then all HDB have to be paid in cash. Only condo can loan. It will surely create the scenario you described.
Artificial undervaluation with the intrinsic value (utilities value or rental value) unchanged is your proposal. Realistic bo? Seller unhappy (low transaction), buyer unhappy (can't loan), Govt unhappy. Just feels like a sabotage scheme. Who wins?
If you are the owner of something that buyers value at 800K but HDB values at 500K, will you sell if the buyers proposing don't have enough cash or CPF? Most likely just hold, that's why the transaction numbers for such flats is extremely low.
Regulators
15-01-15, 00:11
What is your definition of artificial undervaluation? I can also say the prices of HDB flats have been artificially inflated all these years. I think the govt is recognising it which is why they have come up with measures to curb speculation in hdb flats. Pinnacle@duxton flats were sold to first time buyers at subsidised rate in the name of affordable housing. This subsidy from government is subsidised by taxpayers, then where you think the money comes from? So you are advocating that taxpayers should subsidise public housing so that private individuals can enrich themselves? If the PAP govt dare admit this fact, WP will be the next govt for sure. I have made a valid suggestion that valuations should be pegged to cost, inflation and economic growth and should not be determined by individuals who play the market. Valuations by hdb have been done wrongly from the very start not because they havent realised the mistake, but because they intentionally let it be that way. As I have mentioned before, high valuations lead to higher revenue for
them and it also spurs the way for higher land sale price. They have allowed a situation whereby people are stretched in their loans so that more of their CPF will be utilised for housing which translates to more sovereign fund for investments. Whatever value you have in your hdb flats is just what they want people to believe and to give people a false hope and impression of wealth, you think that is the real value? Please look beyond just supply and demand.
The best scenario for you is the Govt values all HDB at $1. Then all HDB have to be paid in cash. Only condo can loan. It will surely create the scenario you described.
Artificial undervaluation with the intrinsic value (utilities value or rental value) unchanged is your proposal. Realistic bo? Seller unhappy (low transaction), buyer unhappy (can't loan), Govt unhappy. Just feels like a sabotage scheme. Who wins?
If you are the owner of something that buyers value at 800K but HDB values at 500K, will you sell if the buyers proposing don't have enough cash or CPF? Most likely just hold, that's why the transaction numbers for such flats is extremely low.
Thanks for confirming your thoughts, which is largely similar to that of the old man in my story.
You are absolutely right in some ways. Most assets in SG have been inflated due to loans. I propose we ban loans and see what happens to the whole property market. I'm seriously wishing for it, even though it will never happen realistically.
What is your definition of artificial undervaluation? I can also say the prices of HDB flats have been artificially inflated all these years. I think the govt is recognising it which is why they have come up with measures to curb speculation in hdb flats. Pinnacle@duxton flats were sold to first time buyers at subsidised rate in the name of affordable housing. This subsidy from government is subsidised by taxpayers, then where you think the money comes from? So you are advocating that taxpayers should subsidise public housing so that private individuals can enrich themselves? If the PAP govt dare admit this fact, WP will be the next govt for sure. I have made a valid suggestion that valuations should be pegged to cost, inflation and economic growth and should not be determined by individuals who play the market. Valuations by hdb have been done wrongly from the very start not because they havent realised the mistake, but because they intentionally let it be that way. As I have mentioned before, high valuations lead to higher revenue for
them and it also spurs the way for higher land sale price. They have allowed a situation whereby people are stretched in their loans so that more of their CPF will be utilised for housing which translates to more sovereign fund for investments. Whatever value you have in your hdb flats is just what they want people to believe and to give people a false hope and impression of wealth, you think that is the real value? Please look beyond just supply and demand.
Allthepies
15-01-15, 07:02
The "HDB" policy has served the nation and its people well. It is structured around a core value of encouraging residents to work hard for their HDB and be rewarded later on for their hardwork. It allows almost all residents to own their home; it facilitates mobility for residents to upgrade from HDB to private; it provides retirement income through downsizing or rental of rooms; it provides basic cheaper rental to house foreign contributors.
With all the goodness of HDB, why do we still want to destroy this very excellent framework? Is it because we have failed to realize its goodness? Is it because the grass is always greener on the other side? Is it because we can only realize what is good for us after we have lost it?
For the record, I'm not a owner of any HDB flat and have never enjoy monetary benefits from public housing policy.
I'm just stating an unbiased view of HDB policy.
Strongly agree with you at every point.
The ultimate aim of Govt is slow, gradual appreciation of all assets benchmarked to income. It has indeed served us well whether you prefer it that way.
Several friends I know quit their jobs the moment they paid up or almost paid up their HDB loan, which was easy to do for younger people (maybe around 35-40 years old) who bought at last generation's prices but earns the incomes of this generation - it's a "loss" to economy and productivity as a country in my opinion.
The "HDB" policy has served the nation and its people well. It is structured around a core value of encouraging residents to work hard for their HDB and be rewarded later on for their hardwork. It allows almost all residents to own their home; it facilitates mobility for residents to upgrade from HDB to private; it provides retirement income through downsizing or rental of rooms; it provides basic cheaper rental to house foreign contributors.
With all the goodness of HDB, why do we still want to destroy this very excellent framework? Is it because we have failed to realize its goodness? Is it because the grass is always greener on the other side? Is it because we can only realize what is good for us after we have lost it?
For the record, I'm not a owner of any HDB flat and have never enjoy monetary benefits from public housing policy.
I'm just stating an unbiased view of HDB policy.
.. while we are at this HDB story, over at HK 3 days ago, 60,000 ppl queued under freezing rain to ballot for their "HDB". with chances of 67:1.
How blessed Singaporeans are. Hope everyone knows about it.
Strongly agree with you at every point.
The ultimate aim of Govt is slow, gradual appreciation of all assets benchmarked to income. It has indeed served us well whether you prefer it that way.
Several friends I know quit their jobs the moment they paid up or almost paid up their HDB loan, which was easy to do for younger people (maybe around 35-40 years old) who bought at last generation's prices but earns the incomes of this generation - it's a "loss" to economy and productivity as a country in my opinion.
just curious, why do they quit their jobs after hdb paid up? unless they have some other source of income.
Regulators
15-01-15, 10:51
If HDB policy is that good, why would they come up with measures to curb speculation and bring down prices of hdb? so hdb policy is good because it facilitates hdb upgraders and keep private property prices up to benefit people like you? with rising hdb prices, it benefits one singaporean hdb seller but places a heavy burden on the next singaporean hdb buyer and this goes on transaction after transaction till it is almost reaching breaking point now so how can this be a sound policy? Dont forget that when hdb prices increase, private property prices do not stagnate and will move upwards in tandem as well, so how much do you think the upgrader to private pty can save?
The "HDB" policy has served the nation and its people well. It is structured around a core value of encouraging residents to work hard for their HDB and be rewarded later on for their hardwork. It allows almost all residents to own their home; it facilitates mobility for residents to upgrade from HDB to private; it provides retirement income through downsizing or rental of rooms; it provides basic cheaper rental to house foreign contributors.
With all the goodness of HDB, why do we still want to destroy this very excellent framework? Is it because we have failed to realize its goodness? Is it because the grass is always greener on the other side? Is it because we can only realize what is good for us after we have lost it?
For the record, I'm not a owner of any HDB flat and have never enjoy monetary benefits from public housing policy.
I'm just stating an unbiased view of HDB policy.
just curious, why do they quit their jobs after hdb paid up? unless they have some other source of income.
Part time work or free lance. Insurance agent, tuition teacher, one partner work and the other relax.
yongyong85
08-05-16, 17:18
The world’s tallest residential building featuring 50 stories and 2 sky bridges in none other than Pinnacle@Duxton (http://www.propertyhunt.sg/pinnacle-duxton/).
Located at Cantonment Road, Singapore is the world’s first housing project that has two sky bridges built with such perfection that they connect seven towers of the building.
This leads to the formation of the sky garden that gives an eye-catching and panoramic view of the city.
Please read my article regarding The Success Story of Pinnacle@ Duxton: - http://www.propertyhunt.sg/pinnacle-duxton/.
If HDB policy is that good, why would they come up with measures to curb speculation and bring down prices of hdb?
They did not come up with measures to curb speculation and bring down prices of hdb. In the eyes of untrained mind this is what they want you to know. In the eyes of the trained mind, they simply restrict those who don't earn the income from buying bigger home.
so hdb policy is good because it facilitates hdb upgraders and keep private property prices up to benefit people like you? with rising hdb prices, it benefits one singaporean hdb seller but places a heavy burden on the next singaporean hdb buyer and this goes on transaction after transaction till it is almost reaching breaking point now so how can this be a sound policy? Dont forget that when hdb prices increase, private property prices do not stagnate and will move upwards in tandem as well, so how much do you think the upgrader to private pty can save?
The price up is due to the printing of money, no one can move the market. The market is the result of things that happen.
All control measure are calibrated to the money printing.
What is your definition of artificial undervaluation?
From the day HDB starts valuation, it has been artificial undervaluation.
Valuation of HDB is done by a selected group of property Valuers. They value the resale HDB and then give the value to HDB for approval. HDB then reply them whether the valuation is approve or not, if they refuse to change they are out from the next group of Valuer which HDB tender every year.
When the cow say the new resale procedure, I already say HDB is removing control on valuation of resale HDB.
Now market decide what is the value of the resale HDB and the Valuer just need to adjust according to the buyer price.
If HDB policy is that good, why would they come up with measures to curb speculation and bring down prices of hdb? so hdb policy is good because it facilitates hdb upgraders and keep private property prices up to benefit people like you? with rising hdb prices, it benefits one singaporean hdb seller but places a heavy burden on the next singaporean hdb buyer and this goes on transaction after transaction till it is almost reaching breaking point now so how can this be a sound policy? Dont forget that when hdb prices increase, private property prices do not stagnate and will move upwards in tandem as well, so how much do you think the upgrader to private pty can save?
Even so, Goh believed that a public housing programme should be financially self-supporting, stating: “There are certain principles on
which the public housing scheme should be managed if it is not to be a liability to the nation. First, because it is not intended to be profit-making, the scheme should be undertaken by a government authority. But it is essential that, while not making profits, it should give a reasonable return to capital invested. The scheme should not be run on a subsidised basis. Next, it should cater to a large number of people … to reduce costs to a minimum, design and finishing must be functional and reduced to austere standards. But all the necessities of water, electricity and modern sanitation should be provided. Fourth, an essential factor to cost
reduction is mass production of standard types of apartments
http://www.clc.gov.sg/documents/uss/USS_Financing_a_city.pdf
From the day HDB starts valuation, it has been artificial undervaluation.
Valuation of HDB is done by a selected group of property Valuers. They value the resale HDB and then give the value to HDB for approval. HDB then reply them whether the valuation is approve or not, if they refuse to change they are out from the next group of Valuer which HDB tender every year.
When the cow say the new resale procedure, I already say HDB is removing control on valuation of resale HDB.
Now market decide what is the value of the resale HDB and the Valuer just need to adjust according to the buyer price.
The valuation of an HDB flat is carried out by a valuer from OUR PANEL of VALUERS. http://www.hdb.gov.sg/cs/infoweb/business/estate-agents-and-salespersons/buying-a-resale-flat/flat-valuation
The flat valuation is used to determine the financing limits for:
CPF usage (control)
Housing loans (control)
Cash payment (market)
If a buyer willing to pay 1 million dollar cash (market) for a HDB, who can stop him.
The next phase, we will see people cashing out of HDB as some upgrade to private property.
It's not easy to get a new BTO of choice or an affordable resale HDB at desired location.
It's even harder to qualify for multiple property ownership.
Will we see a proper delinking of public versus private housing going forward? Let's see...
file:///C:/Users/teose_000/Downloads/51888819-MIT.pdf
HDB is a cash cow, why cash out.
If I sell my 5 room HDB for 700k, valuation 640K by a group of control valuers, with a remaining lease of 80 years.
Current rental 2.6k a month, 31,200 a year, 312,000 for 10 years, 2,496,000 for 80 years.
Let me ask will anyone want to sell it for 700k or collect rent until zero leases for 2,496,000 and the rent increase iaw inflation.
Singapore Land going to be more expensive, labour cost, material cost going up. Can anyone tell me what is going down.
I only know I go for my last hair cut for 7 dollars instead of 10 dollars, 8 years 8 month ago, my wife ask me to go for the 3.80.
People need to move for all kinds of reasons. It's very ccomplicated nowadays to change and nowadays people are actually very receptive to change.
Have you noticed they don't build certain types of HDBs nowadays?
HDB is a cash cow, why cash out.
If I sell my 5 room HDB for 700k, valuation 640K by a group of control valuers, with a remaining lease of 80 years.
Current rental 2.6k a month, 31,200 a year, 312,000 for 10 years, 2,496,000 for 80 years.
Let me ask will anyone want to sell it for 700k or collect rent until zero leases for 2,496,000 and the rent increase iaw inflation.
Singapore Land going to be more expensive, labour cost, material cost going up. Can anyone tell me what is going down.
I only know I go for my last hair cut for 7 dollars instead of 10 dollars, 8 years 8 month ago, my wife ask me to go for the 3.80.
If you have the money to pay 10% ABSD for another private property, would you?
HDB is a cash cow, why cash out.
If I sell my 5 room HDB for 700k, valuation 640K by a group of control valuers, with a remaining lease of 80 years.
Current rental 2.6k a month, 31,200 a year, 312,000 for 10 years, 2,496,000 for 80 years.
Let me ask will anyone want to sell it for 700k or collect rent until zero leases for 2,496,000 and the rent increase iaw inflation.
Singapore Land going to be more expensive, labour cost, material cost going up. Can anyone tell me what is going down.
I only know I go for my last hair cut for 7 dollars instead of 10 dollars, 8 years 8 month ago, my wife ask me to go for the 3.80.
Lastly, there is the neighbourhood (8%) and block (11%) quota for rental to non-Malaysian foreigners.
Once these have been reached, can only rent to Malaysians and Singaporeans.
Purely from potential of rent, these are risks that HDB owners looking for long term rent have to be aware of.
Supposing the 5-rm HDB of 700K can be exchanged for a 1-BR private FH or LH condo fetching comparable rent of 2.6K without NC quota restrictions, why is the exchange not feasible from a rental perspective?
HDB is a cash cow, why cash out.
If I sell my 5 room HDB for 700k, valuation 640K by a group of control valuers, with a remaining lease of 80 years.
Current rental 2.6k a month, 31,200 a year, 312,000 for 10 years, 2,496,000 for 80 years.
Let me ask will anyone want to sell it for 700k or collect rent until zero leases for 2,496,000 and the rent increase iaw inflation.
Singapore Land going to be more expensive, labour cost, material cost going up. Can anyone tell me what is going down.
I only know I go for my last hair cut for 7 dollars instead of 10 dollars, 8 years 8 month ago, my wife ask me to go for the 3.80.
If you have the money to pay 10% ABSD for another private property, would you?
Yes, if Bank can loan me the money.
Lastly, there is the neighbourhood (8%) and block (11%) quota for rental to non-Malaysian foreigners.
Once these have been reached, can only rent to Malaysians and Singaporeans.
Purely from potential of rent, these are risks that HDB owners looking for long term rent have to be aware of.
Supposing the 5-rm HDB of 700K can be exchanged for a 1-BR private FH or LH condo fetching comparable rent of 2.6K without NC quota restrictions, why is the exchange not feasible from a rental perspective?
I did think of the exchange, but TDSR stop me from doing it.
I did think of the exchange, but TDSR stop me from doing it.
I see. But for couples who are not limited by TSDR, they can actually "decouple" by doing so and avoid ABSD till their third property. Why not?
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