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Ice
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Joined: 31 Mar 2006
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PostPosted: Sat Aug 24, 2013 8:34 pm    Post subject: Reply with quote

That will be gd...otherwise there will be no place to stay if we were to sell e house first. Very Happy
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Kon
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PostPosted: Mon Aug 26, 2013 11:09 am    Post subject: Reply with quote

Ice wrote:
Meaning that I can hold on to the current hdb flat until e almost completion of e EC? Nod


I thought you have 6 months from the EC TOP date, i.e. you collect your EC keys on TOP, you must sell your HDB within 6 months

There is also option for normal payment scheme (progress payment) or defer payment (pay the initial 20%, then pay nothing until you receive key, but more expensive) scheme with EC
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RN53
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PostPosted: Sun Sep 08, 2013 11:34 am    Post subject: COV for HDB resale flats drops - EA goes below COV! Reply with quote

COV for HDB resale flats drops to 4-year low

The overall Cash-Over-Valuation for HDB resale flats dropped to S$18,000 in August, the lowest level since July 2009.

http://www.channelnewsasia.com/news/s...flats/804516.html

SINGAPORE: The cash premium, or Cash-Over-Valuation (COV), for Housing and Development Board (HDB) resale flats has reached a four-year low.

According to the Singapore Real Estate Exchange (SRX) monthly flash report, overall COV dropped to S$18,000 in August, the lowest level since July 2009.

For the first time since 2006, SRX said HDB resale flat prices have fallen for the fourth straight month. Overall HDB resale prices slipped 0.7 per cent in August.

This can be partly attributed to the decline of cash premiums being paid for HDB resale flats.

The overall COV was S$20,000 in July. This fell by S$2,000 or 10 per cent to reach S$18,000 in August.

Some property analysts attributed this to the ramped up supply of new flats being launched by the HDB and the introduction of various loan restrictions like the Total Debt Servicing Ratio which was announced in June where only 60 per cent of one's income can go towards servicing a loan.

International Property Advisor's chief executive officer, Ku Swee Yong, said: "The downward trend of COVs is partly influenced by the new measures at the end of June called the Total Debt Service Ratio (TDSR).

"Many home buyers find that they are unable to borrow as much as expected, so it has affected the larger size resale HDBs a little bit more than the three-room and four-room HDB (flats).

"In fact, more young couples are probably shifting their sights down one notch -- instead of stretching themselves for a five-room resale or an executive resale, they're going after a four-room HDB."

According to SRX, executive flats in Punggol registered the lowest median COV of negative S$13,000, which means they are sold at S$13,000 below valuation.

Out of three transactions recorded, two were sold below valuation.

On the flip side, executive flats in Bishan saw the highest premium. The median COV was S$120,000.


Nicholas Mak, executive director of research and consultancy at SLP International Property Consultants, said: "There has been a huge supply of BTO flats offered in the Punggol area in the last two to three years.

"Because of that, it has drawn away potential buyers from the resale market to the BTO market. The BTO flats are all priced lower than the resale flat prices.

"While in Bishan area, it's still quite a popular area... there are a few very popular primary and secondary schools in the area. Furthermore, there is a very thin supply of new flats. As a result, it's still a seller's market in that town."

With tighter loan measures and home buyers being more cash strapped as a result, property analysts expect COVs to continue to trend downwards. They also expect more HDB resale flats to be sold without a cash premium, or at below valuation.

This is already starting to show. Zero-COV transactions made up just one per cent of all HDB resale transactions in January. This went up to 5.3 per cent in August.

As for resale transaction volume, flash estimates showed that while the numbers remained roughly the same in July (1,286) and August (1,280), this was a 29 per cent drop year-on-year.

Property analysts said this is likely due to more home owners choosing to rent out their HDB flats.

- CNA/fa

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Jessica Lim
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Joined: 19 Apr 2012
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PostPosted: Sun Sep 08, 2013 1:47 pm    Post subject: Re: COV for HDB resale flats drops - EA goes below COV! Reply with quote

RN53 wrote:
COV for HDB resale flats drops to 4-year low

The overall Cash-Over-Valuation for HDB resale flats dropped to S$18,000 in August, the lowest level since July 2009.

http://www.channelnewsasia.com/news/s...flats/804516.html

SINGAPORE: The cash premium, or Cash-Over-Valuation (COV), for Housing and Development Board (HDB) resale flats has reached a four-year low.

According to the Singapore Real Estate Exchange (SRX) monthly flash report, overall COV dropped to S$18,000 in August, the lowest level since July 2009.

For the first time since 2006, SRX said HDB resale flat prices have fallen for the fourth straight month. Overall HDB resale prices slipped 0.7 per cent in August.

This can be partly attributed to the decline of cash premiums being paid for HDB resale flats.

The overall COV was S$20,000 in July. This fell by S$2,000 or 10 per cent to reach S$18,000 in August.

Some property analysts attributed this to the ramped up supply of new flats being launched by the HDB and the introduction of various loan restrictions like the Total Debt Servicing Ratio which was announced in June where only 60 per cent of one's income can go towards servicing a loan.

International Property Advisor's chief executive officer, Ku Swee Yong, said: "The downward trend of COVs is partly influenced by the new measures at the end of June called the Total Debt Service Ratio (TDSR).

"Many home buyers find that they are unable to borrow as much as expected, so it has affected the larger size resale HDBs a little bit more than the three-room and four-room HDB (flats).

"In fact, more young couples are probably shifting their sights down one notch -- instead of stretching themselves for a five-room resale or an executive resale, they're going after a four-room HDB."

According to SRX, executive flats in Punggol registered the lowest median COV of negative S$13,000, which means they are sold at S$13,000 below valuation.

Out of three transactions recorded, two were sold below valuation.

On the flip side, executive flats in Bishan saw the highest premium. The median COV was S$120,000.


Nicholas Mak, executive director of research and consultancy at SLP International Property Consultants, said: "There has been a huge supply of BTO flats offered in the Punggol area in the last two to three years.

"Because of that, it has drawn away potential buyers from the resale market to the BTO market. The BTO flats are all priced lower than the resale flat prices.

"While in Bishan area, it's still quite a popular area... there are a few very popular primary and secondary schools in the area. Furthermore, there is a very thin supply of new flats. As a result, it's still a seller's market in that town."

With tighter loan measures and home buyers being more cash strapped as a result, property analysts expect COVs to continue to trend downwards. They also expect more HDB resale flats to be sold without a cash premium, or at below valuation.

This is already starting to show. Zero-COV transactions made up just one per cent of all HDB resale transactions in January. This went up to 5.3 per cent in August.

As for resale transaction volume, flash estimates showed that while the numbers remained roughly the same in July (1,286) and August (1,280), this was a 29 per cent drop year-on-year.

Property analysts said this is likely due to more home owners choosing to rent out their HDB flats.

- CNA/fa



A lot of people who are selling their flats or force to sell their flats have to curse and swear.

Haizzzzzz.....it should bring up the COV and bring down the price of the bto flats.

In this case both the buyers and the seller are happy.

Furious Furious Furious Furious Furious Furious Furious Furious

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RN53
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PostPosted: Mon Sep 09, 2013 3:27 pm    Post subject: Reply with quote

Sometimes, it is very conflicting indeed. Smile

Let's take it that the unit's valuation is fairly evaluated as compared to other properties recently valued and transacted in the Resale Market. The other factor to agree on is willingness of the buyer and seller to commit.

COV is the amount buyer is willing to foot vis-à-vis the buyer's evaluation of the unit's interiors and conditions at the time of viewing and as compared to the buyer's personal attributes of the unit viewed. In other words, it is something like a perfect match. And. the buyer will be willing to pay a high cash over valuation.

The most important of all attributes is the ability of the buyer to move in immediately. Nod

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RN53
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PostPosted: Mon Sep 16, 2013 11:41 pm    Post subject: Why developers can sell at future prices. Reply with quote

Have you guys any comments regarding these "professional business practises"? Sly

Why developers can sell at future prices

http://propertysoul.com/2013/08/17/wh...-prices/#comments

Do you ever wonder why new projects from developers are able to command a large premium in asking price, sometimes up to fifty percent higher than nearby projects built in recent years?

Below is an abstract from my interview with a VIP customer (as compared to the usual retail buyers).

Me : How do you manage to buy before everyone do?

VIP: After developers set the prices, easily twenty to forty percent higher than nearby projects, they need to test the water. They will invite us to a project preview where we can pick our preferred units. Whatever price we are willing to pay, the developers can use it to convince the market that it is a reasonable market price.

Me : How do you make a profit?

VIP: Say, if we buy at $1,000 per square foot, developers can sell at $1,100 during actual launch. Phase two comes a few weeks later with prices increased to $1,200, and so on and so forth. Since we’ve chosen the best units, we can offload with at least twenty percent profit.

Me : And the developer has just successfully set a new high for property prices in the district!


There are three major factors that set the stage for developers to market uncompleted projects at future prices:


1. The advantages of market domination

The property developer industry is an oligopoly. It is dominated by a few big players which are often large conglomerates.

The entry barrier for new players in this industry is exceptionally high. With limited supply and high cost of land, it is not easy for small developers to raise sufficient fund or obtain financing from the bank. They also cannot compete with the big guys in terms of branding and their track record in past projects.

Bigger players have strong financial muscle to build their own land bank. They can drive construction of projects in time to capture a booming market. They enjoy the benefits of economies of scale or cost leadership from a large number of ongoing projects. They have handsome budget for marketing and for hiring a good marketing agent. They have enough cash reserve to hedge against poor sales during bad times.

It is therefore not surprising to see a high percentage of private housing projects all supplied by the top few developers. The advantages of market domination allow them to set their list prices at the highest possible level and to reap a huge profit.


2. Collaboration among big players

The big players have good connections among themselves to make the most of a mutually beneficial partnership. They can collaborate with each other by forming joint ventures to bid for land parcels, to secure borrowings from banks, or to diversify their investment.
Among the top property developers, they can seek consensus and alignment on many decisions, for instance,

• when to launch or re-launch in a quiet or recovering market;

• which type of projects to launch in different locations; or

• what projects to hold back to avoid unnecessary competitions for similar projects.

When they are setting prices for a new launch, they don’t have to make reference to the average transacted prices of existing development in the same district. They can benchmark against each others list prices in other districts in order to set their prices at a new high in a hot market.

Of course, no developer can move new properties off the shelves without the support of local banks to provide buyers the necessary financing. It is not uncommon to see developers tying up with a few banks to offer housing mortgage packages to buyers at the sales galleries.

In order to secure business from home buyers, banks work with their valuers to ensure that valuation of the uncompleted property matches with whatever the selling price, so that they can dispend the exact amount of housing loan required by the buyers.


3. Willing sellers willing buyers

In the past few years, property developers have paid a high price for land parcels sold by the government or from en bloc sales. Likewise, the tight supply and spiraling costs of construction manpower and building materials have taken a toll on the bottom line of developers.

It is arguable that developers have no choice but to markup considerably to ensure their profitability, although how big a safety margin is reasonable is entirely up to their discretion. Afterall, if they don’t make hay while the sun shines, who can tell what will happen when market direction changes?

In the end, the matter boils down to market response and customer acceptance. Developers can’t sell new flats at future prices if buyers are unwillingly to pay a premium price.

It doesn’t matter whether the selling price is twenty or fifty percent higher than the most recent transacted price of a resale flat in the same area, so long as everyone believe that the market price will be even higher by the time the new flats are ready for occupation.

Believing in the future — that is the magic pill of getting buyers to pay future prices in a booming property market!

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Zeny
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PostPosted: Tue Sep 17, 2013 10:58 am    Post subject: Reply with quote

that is why MAS is scared...need to put in so many measure ... cos too many pple think the economy is still bed of roses and they are to overcommit
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Ice
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PostPosted: Tue Sep 17, 2013 9:08 pm    Post subject: Reply with quote

Wondering whether there will be any EC or private condo launch in Sengkang or Punggol anot? Quite a number of these housing already sold...
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Zeny
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PostPosted: Wed Sep 18, 2013 1:39 pm    Post subject: Reply with quote

Ice wrote:
Wondering whether there will be any EC or private condo launch in Sengkang or Punggol anot? Quite a number of these housing already sold...


surely there will... the developers bid so high for the land must quick sell when the iron is still hot Sly

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RN53
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PostPosted: Mon Oct 07, 2013 8:45 am    Post subject: Reply with quote

http://www.channelnewsasia.com/news/s...ns-on/838528.html

Zero COV transactions on the rise: SRX

The number of resale flats that have been sold without a cash premium (cash-over-valuation or COV) in July and August has exceeded the numbers seen in the first and second quarters of 2013.

SINGAPORE: The number of resale flats that have been sold without a cash premium (cash-over-valuation or COV) in July and August has exceeded the numbers seen in the first and second quarters of 2013.

According to the Singapore Real Estate Exchange (SRX), there were 111 zero COV transactions in the third quarter, excluding September -- that is almost triple the number seen in the first quarter of this year (38 zero COV transactions). There were 77 of such transactions in the second quarter.

SRX data also showed that four-room resale flats saw the most number of zero
COV transactions from January to August out of all the flat types -- with 82 cases recorded. There were 67 three-room flats and 57 five-room units transacted at zero COV during the same period.

Property analysts said the increase is a sign that measures like the total debt servicing ratio are taking effect.

While SRX did not reveal the number of resale flats sold below valuation, some property analysts expect there to be more of such cases in at least the next two quarters.

Ku Swee Yong, CEO of International Property Advisor, said: "We'll definitely see in the next two quarters at least, more and more cases of negative COVs. And when negative COV transaction data adds up, then the authorities will be adjusting the value, and so valuations will start to go down.

"When valuations start to go down, then Cash-Over-Valuations being negative will actually be reduced. So 12 months from today, I believe overall market COV may turn out to be plus minus zero, but with the value trending down by five to 10 per cent."

- CNA/ac

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Zeny
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PostPosted: Mon Oct 07, 2013 9:13 am    Post subject: Reply with quote

in 2015 prices are expected to drop up to 20% so ... keep money and chiong in 2015 Very Happy
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Lowem
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PostPosted: Mon Oct 07, 2013 9:51 am    Post subject: Reply with quote

Looks like the property bubble will be deflating. Good for buyers especially younger folks.
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