mr funny
10-05-10, 17:21
http://www.businesstimes.com.sg/sub/news/story/0,4574,384613-1273262340,00.html?
Published May 7, 2010
40% of resold flats had COV below $20,000
HDB releases COV figures amid worries caused by reports of sky-high resale flat prices
By EMILYN YAP
(SINGAPORE) As resale flat prices continue to climb, is it still possible to secure a home by paying a cash premium of $20,000 or less? According to the Housing & Development Board (HDB), some 40 per cent of buyers in the last six months managed to do so.
HDB yesterday released fresh figures on the amount of cash-over-valuation (COV) buyers fork out, in a bid to calm nerves frayed by reports of sky-high flat prices.
Of 7,907 resale transactions in Q1, 39 per cent involved COVs of $20,000 or less. In another 31 per cent of cases, COVs ranged from $20,001-$30,000. For the remaining 30 per cent, COVs exceeded $30,000.
There were no details on what the highest COV in Q1 was, or what the profile of buyers who paid COVs of more than $30,000 are.
The breakdown was similar in Q4 2009. Of 8,297 resale cases, 41 per cent involved COVs of $20,000 or less. COVs went up to $30,000 for another 33 per cent of deals, and exceeded $30,000 for the remaining 26 per cent.
HDB revealed these numbers after reports of high COVs surfaced. Last month, owners of a penthouse maisonette in Bishan were said to have sold their flat for $900,000, which included a cash premium of $170,000.
Another penthouse in Queenstown almost changed hands for $950,000 - inclusive of a COV of $75,000 - but the deal fell through.
These reported cash premiums are astounding compared with the norm. The median COV for all resale transactions in Q1 was $25,000, slightly higher than the $24,000 a quarter ago.
The median COV was as low as $3,000 in Q2 last year, when the financial crisis was at its worst.
Regardless of whether the reported transactions go through, such news have encouraged some flat owners to demand higher cash premiums, said HSR executive director (agency) Jeffrey Hong. Flats with COVs of 'less than $20,000 are still quite hard to find'.
Those in popular areas tend to command larger COVs. According Q1 HDB statistics, median cash premiums are highest in areas such as Bishan and Queenstown.
Mr Hong notes that home seekers who can afford a cash premium of $20,000 - $22,000 will probably have to settle for a flat in the outskirts of town, such as Marsiling, Ubi or Jurong West.
The attributes of the flat also matter, said ERA Asia Pacific associate director Eugene Lim. He observes that COVs for four to five-room flats, as well as for newer flats in good condition, are usually higher.
According to both agents, COV levels have stabilised recently. ERA's Mr Lim said that flat valuations are high, and that has put a cap on how much buyers can pay in all.
HDB gives out housing grants to help eligible home seekers buy a flat. It said that last year, it disbursed about $360 million in grants to some 9,100 resale flat buyers.
http://www.businesstimes.com.sg/mnt/media/image/launched/2010-05-07/BT_IMAGES_EYCOV7.jpg
Published May 7, 2010
40% of resold flats had COV below $20,000
HDB releases COV figures amid worries caused by reports of sky-high resale flat prices
By EMILYN YAP
(SINGAPORE) As resale flat prices continue to climb, is it still possible to secure a home by paying a cash premium of $20,000 or less? According to the Housing & Development Board (HDB), some 40 per cent of buyers in the last six months managed to do so.
HDB yesterday released fresh figures on the amount of cash-over-valuation (COV) buyers fork out, in a bid to calm nerves frayed by reports of sky-high flat prices.
Of 7,907 resale transactions in Q1, 39 per cent involved COVs of $20,000 or less. In another 31 per cent of cases, COVs ranged from $20,001-$30,000. For the remaining 30 per cent, COVs exceeded $30,000.
There were no details on what the highest COV in Q1 was, or what the profile of buyers who paid COVs of more than $30,000 are.
The breakdown was similar in Q4 2009. Of 8,297 resale cases, 41 per cent involved COVs of $20,000 or less. COVs went up to $30,000 for another 33 per cent of deals, and exceeded $30,000 for the remaining 26 per cent.
HDB revealed these numbers after reports of high COVs surfaced. Last month, owners of a penthouse maisonette in Bishan were said to have sold their flat for $900,000, which included a cash premium of $170,000.
Another penthouse in Queenstown almost changed hands for $950,000 - inclusive of a COV of $75,000 - but the deal fell through.
These reported cash premiums are astounding compared with the norm. The median COV for all resale transactions in Q1 was $25,000, slightly higher than the $24,000 a quarter ago.
The median COV was as low as $3,000 in Q2 last year, when the financial crisis was at its worst.
Regardless of whether the reported transactions go through, such news have encouraged some flat owners to demand higher cash premiums, said HSR executive director (agency) Jeffrey Hong. Flats with COVs of 'less than $20,000 are still quite hard to find'.
Those in popular areas tend to command larger COVs. According Q1 HDB statistics, median cash premiums are highest in areas such as Bishan and Queenstown.
Mr Hong notes that home seekers who can afford a cash premium of $20,000 - $22,000 will probably have to settle for a flat in the outskirts of town, such as Marsiling, Ubi or Jurong West.
The attributes of the flat also matter, said ERA Asia Pacific associate director Eugene Lim. He observes that COVs for four to five-room flats, as well as for newer flats in good condition, are usually higher.
According to both agents, COV levels have stabilised recently. ERA's Mr Lim said that flat valuations are high, and that has put a cap on how much buyers can pay in all.
HDB gives out housing grants to help eligible home seekers buy a flat. It said that last year, it disbursed about $360 million in grants to some 9,100 resale flat buyers.
http://www.businesstimes.com.sg/mnt/media/image/launched/2010-05-07/BT_IMAGES_EYCOV7.jpg