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Cash premiums for HDB resale flats dive 30%
http://sg.finance.yahoo.com/news/cash-premiums-hdb-resale-flats-050404202.html
By Romesh Navaratnarajah: Cash-over-valuation (COV) for resale flats has dropped significantly in both mature and non-mature estates, making them more affordable to home buyers.
Data from property agencies shows that overall cash premiums fell 30 percent in the first quarter of 2012, compared with a 10 percent drop seen in Q4 2011. This comes as prices of resale flats edged up 0.6 percent in Q1, reflecting the slowest pace of growth since 2009.
Meanwhile, 5,892 resale flats were transacted in the first quarter of this year, down 0.5 percent from the 5,921 recorded in the same period last year.
The bumper crop of 8,000 new units announced for sale this year and the additional 5,000 units scheduled for release next month have impacted the market.
Observers said that last month's announcement to reserve a higher percentage of new executive condo (EC) units for second-timers also shifted buyers' sentiment.
"If people can buy Build-to-Order (BTO) flats, they will buy," said Lee Sze Teck, Senior Manager of Research and Consultancy at Dennis Wee Group. "Resale flats are for those who don't qualify, or who cannot wait."
Donald Han, Special Adviser at HSR Property Group, said the "assurance that there's enough supply for those who want to buy flats has hit home. The masses have gotten the message".
The price decline was particularly steep in areas like Pasir Ris and Woodlands. Cash premiums dropped to an average of S$20,000 for three- to five-room flats in Woodlands while Pasir Ris saw the biggest fall as COVs for executive flats hit S$35,000, from S$58,000 in the previous quarter.
COVs in more popular estates like Queenstown fell between S$4,500 and S$25,500 for three-room flats while cash premiums for four-roomers held steady at S$50,000.
"The central locations still collect a premium," noted Chris Koh, Director of Chris Koh International. "But for the rest of the towns in the outskirts, the COV is coming down quite quickly."
http://sg.finance.yahoo.com/news/cash-premiums-hdb-resale-flats-050404202.html
By Romesh Navaratnarajah: Cash-over-valuation (COV) for resale flats has dropped significantly in both mature and non-mature estates, making them more affordable to home buyers.
Data from property agencies shows that overall cash premiums fell 30 percent in the first quarter of 2012, compared with a 10 percent drop seen in Q4 2011. This comes as prices of resale flats edged up 0.6 percent in Q1, reflecting the slowest pace of growth since 2009.
Meanwhile, 5,892 resale flats were transacted in the first quarter of this year, down 0.5 percent from the 5,921 recorded in the same period last year.
The bumper crop of 8,000 new units announced for sale this year and the additional 5,000 units scheduled for release next month have impacted the market.
Observers said that last month's announcement to reserve a higher percentage of new executive condo (EC) units for second-timers also shifted buyers' sentiment.
"If people can buy Build-to-Order (BTO) flats, they will buy," said Lee Sze Teck, Senior Manager of Research and Consultancy at Dennis Wee Group. "Resale flats are for those who don't qualify, or who cannot wait."
Donald Han, Special Adviser at HSR Property Group, said the "assurance that there's enough supply for those who want to buy flats has hit home. The masses have gotten the message".
The price decline was particularly steep in areas like Pasir Ris and Woodlands. Cash premiums dropped to an average of S$20,000 for three- to five-room flats in Woodlands while Pasir Ris saw the biggest fall as COVs for executive flats hit S$35,000, from S$58,000 in the previous quarter.
COVs in more popular estates like Queenstown fell between S$4,500 and S$25,500 for three-room flats while cash premiums for four-roomers held steady at S$50,000.
"The central locations still collect a premium," noted Chris Koh, Director of Chris Koh International. "But for the rest of the towns in the outskirts, the COV is coming down quite quickly."
