Cash premiums for resale flats near record high

PHOTO: Cash premiums for resale flats near record high

SINGAPORE - CASH premiums for HDB resale flats have climbed to a median of $34,000 over the last two months, just $2,000 short of the record reached last year.

This has pushed the median resale flat price to $455,000 in the fourth quarter thus far, a 1.1 per cent rise from the quarter before, said the Singapore Real Estate Exchange (SRX) in its latest report.

Cash-over-valuation (COV) premiums are what buyers pay over and above the valuation of a flat. As they have to be paid in cash, COVs have an impact on the affordability of resale flats.

Since tracking began in 2007, the highest median that COVs have reached is $36,000, in the third quarter of last year.

Property agency bosses say they expect COVs to continue to rise as long as the supply of resale flats remains tight.

With prices of private property still rising, more potential buyers will also find themselves priced out and turn to the Housing Board resale market.

These buyers can put up considerable COVs, noted ECG Property managing director Shawn Tan.

"The private market must cool down before resale COVs can come down," he said.

According to SRX, which captures transactions from the HDB and major property agencies, the prices of private non-landed property grew 5.4 per cent in the last two months.

Property experts said policy measures to curb speculation have had the effect of diminishing the number of resale units put up for sale.

In 2010, for example, the minimum occupation period before a buyer could put his flat up for sale again was raised from three years to five.

This effectively shrank the resale market, and transaction volumes have dropped by about a quarter since.

In 2010, 32,000 resale flats changed hands. Last year, the figure fell to 25,000. The num-ber for this year is expected to come in about the same or lower.

C&H Properties key executive officer Albert Lu also pointed to the policy of allowing HDB upgraders to buy private property and still hold on to their flats. "This system is not healthy, in my view," he said. "If you can buy private property, you should let go of your HDB flat back into the resale market."

What also fanned the COV flames, said observers, were recent headline-making transactions where sellers pocketed cash premiums of about $200,000.

In September, a Queenstown flat went for the price of $1 million, which included $195,000 in COV. Around the same time, an executive flat in Bishan that went for $970,000 set a new COV record of $250,000.

"Sellers see these record prices being achieved, and they think they don't need to negotiate," summed up Mr Lee Sze Teck, DWG's senior manager of training, research and consultancy.

Flat buyers expressed resignation at the fact that high COVs are here to stay.

Mr Ong Jun Xing, 29, waited a year before buying a resale flat as he was hoping COVs would fall. But he finally bought a flat in Queenstown a few weeks ago, for which he paid $60,000 in COV.

"I couldn't wait any more and I wanted that location, so I had to pay the premium."

Mr Rudi Lim, 34, wants to move his growing family to an executive flat in Jurong to be near his parents.

He can get a good amount in COV from selling his four-room flat in Sengkang, but expects to have to pay an even higher COV - about $100,000 - for his new flat.

"If I were buying a house for the first time, I would be cursing," said the Web design company director. "I'm not happy about the COV I have to pay, but I'm better off than a first-timer."

Purchase this article for republication.

VIDEOS YOU SHOULD WATCH

  • #Joeyjios: We try bubble tea mala hotpot and bubble tea toast

    Full story: http://www.asiaone.com/food/we-try-bubble-tea-mala-hotpot-and-bubble-tea-toast-guess-which-ones-got-us-hooked Mala and bubble milk tea within the same hotpot? What about bubble tea on toast? Who even comes up with these ideas?! This week on #Joeyjios, we give these dubious food creations a taste-test to see if they're worth your time, money and calories. #bubbletea #bbt #boba --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Thirstdays: Where we talk weird dates and wild fantasies

    Full story: https://www.asiaone.com/entertainment/thirstdays-where-we-talk-weird-dates-and-wild-fantasies Ooo, it's been a hot week and the thirst is real at AsiaOne. Join Le En and Bryan as they chat about weird dates, constant 'cravings', and Beyonce's thigh gap! And they are quenching that thirst with a cup of root beer float to celebrate the return of a certain fast food restaurant. Thirstdays is a fortnightly AsiaOne #entertainment series where our hosts Le En and Bryan give you a peek into their personal lives while they satisfy their thirst over a drink, have a no-holds-barred chat, and do fun things. #gossip #confessions #realness --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Don't Say Cannot Ep4: He beats people up, but for the country

    Full story: http://www.asiaone.com/singapore/dont-say-cannot-delinquent-national-wrestler He used to beat people up, simply because he had "too much energy" to expend. Now, he still beats people up - but for the country. Meet 24-year-old #Singapore national wrestler Toh Xin Ran. Seeing the number of medals that he has been awarded and the respectful manner in which he now interacts with his wrestling coach, it is hard to imagine that Xin Ran used to be a troubled kid in his younger days. #wrestling #sportsman --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • #Joeyjios: Taste-testing The Alley Luxe and CHICHA San Chen

    Full story: https://www.asiaone.com/food/alley-luxe-and-chicha-san-chen-opens-week-heres-what-try A Michelin-standard bubble tea for $4.70? A drink that looks like the Northern Lights? This week, #Joeyjios her colleague Le En to check out two new bubble tea (BBT) stores that are opening along Orchard Road. Which will they prefer? Watch to find out. #Thedeerishere #TheAlley #Chichasanchen #Boba --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Office Tea Episode 5: Bosses and Things

    It’s been a few weeks - let’s find out if the higher-ups of AsiaOne have any regrets about hiring Le En. Efforts were made to make nice, charity is involved and work is never-ending still. Follow and subscribe so you won't miss a single episode of our new series, Office Tea! To catch more of her antics, follow her @goofy_feline! --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • #Joeyjios: DIY your way into mum's heart this Mother's Day

    Full story: https://www.asiaone.com/women/joeyjios-diy-your-way-mums-heart-mothers-day Mother’s Day is this Sunday! Have you gotten mum a gift yet? This week on #Joeyjios, Joey tries her hand at DIY projects that’s thoughtful, useful and inexpensive. #Mothersday #DIY --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Don't Say Cannot Ep3: He 'sees' the world with the help of tech

    Full story: https://www.asiaone.com/singapore/dont-say-cannot-he-may-be-blind-he-can-text-faster-you Edwin Khoo, 43, surprises friends with the speed at which he types on his phone. The reason? He's been blind since birth. But #technology has been the game-changer for Edwin in navigating the world around him despite his #disability, allowing him to #travel and even host his own online #podcast. --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Office Tea Episode 4: The Dress Code

    It’s in the employee handbook - but does ANYONE actually read and follow the dress code? Are calves too scandalous? Le En puts on Athleisure and tries to get away with it! Follow and subscribe so you won't miss a single episode of our new series, Office Tea! To catch more of her antics, follow her @goofy_feline! --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • Caryn Cheng finds the best deals at IMM's Greater Savings Home and Furnishing Sale

    Full story: https://www.asiaone.com/singapore/5-couples-share-most-expensive-items-they-have-ever-bought-their-home AsiaOne challenges Caryn Cheng to find the best deals at the upcoming #IMM Greater Savings Home and Furnishing #Sale. IMM's Greater Savings Home & Furnishing Sale will start May 13 to 19. With 20 per cent off storewide at Best Denki and discounts of up to 50 per cent at stores such as INKAGU Outlet by Picket & Rail, Linen Gallery Outlet and Red Apple from May 17 to 19, this epic sale is not to be missed. Address: 2 Jurong East Street 21, Singapore 609601 Opening hours: 10am to 10pm #brandedcontent --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com
  • #Joeyjios: I try a ballet-inspired workout despite my two left feet

    Full story: https://www.asiaone.com/singapore/joeyjios-i-try-ballet-inspired-workout-despite-my-two-left-feet Tendu, Arabesque and Grand Pliés? This week on #Joeyjios, I found out that these are in fact, not edible food dishes, but dance moves in ballet.  Watch as former professional ballerinas and co-founders of #BalletBody, Lisha Chin and Alison Carroll, take me through a snippet of their hour-long ballet-inspired workout while I try my best to keep up.  #Ballet #Barre #Fitness --- Read more: http://www.asiaone.com/ FOLLOW us on - Facebook: https://www.facebook.com/asiaonecom - Twitter: https://twitter.com/asiaonecom - Instagram: https://www.instagram.com/asiaonecom/ EMAIL: For story leads, business enquiries, contact asiaone@mm2entertainment.com

SERVICES