Effective 10 March 2014, came a new shocker – the valuation request for a HDB Flat prior to putting it up for sale was removed. This change in resale procedure was announced by Mr Khaw Boon Wan (Minister for National Development), to bring about to draw away attention on Cash-Over-Valuation (COV) and focus instead on negotiating based on recent transacted prices.
So more than two months on, how has this impacted us? First time buyers are elated of course! So let’s take a look at the actual figures of the resale prices for the month of March, April 2014.
From the HDB website, for example – median resale prices for Ang Mo Kio in the 1st Quarter are $345,000 and $482,000 respectively for 3-room and 4-room HDB Flats.
Based on latest transacted prices thus far in May 2014, median resale prices have fallen to $376,000 (15 transactions 1st – 14th May) for 3-room and risen to $507,000 (4 transactions 1st – 14th May) for 4-room flats. Apparently from this, eliminating pre-marketing Valuation Report has not moderated the price tags of 4-room flats.
Like all new measures adopted by our government, the market needs some time to assess the uncertainty. Generally speaking, prices are still strong in ever-popular mature estates such as Bishan, Toa Payoh and Central Area, etc.
To truly conclude if this new measure is pro-buyer, we will need to evaluate the resale
transacted prices later in the 3rd quarter of 2014, as the new measure allows the Valuation Reports done prior to its implementation, (which are still within their validity period) to be used for buyers’ home loans. In addition, new measures has an eerie way of causing a buying frenzy, and this too can distort figures.
For me, its been far so good, my HDB buyers are over-the-moon! Sellers are more reasonable and plentiful, most are asking ZERO COV or even NEGATIVE COV. Got a steal for one of my clients, at -$5k for the highest floor, best condition and location unit!
Stay tuned for 3rd quarter evaluation…