Don't Pay More Than $400k For A Hdb Flat

[cheesecake006 0]

Hi Every1,

Yes I also ask my agent to help me source for 3 room flat with LOW COV, but agent say is not possible.

Now the market rate is around $15 for COV.

Those greedy SELLER is demanding for cash as high as 30k for a 3 room flat. That's crazy, where got so much money to fork out?

If have wont buy HDB liao.

For me in the end i got no choice and end up with a 40 yrs old, ave move in condition 3 room flat.

COV - 11K, exercise OTB last wk.

Edited July 18, 2009 by cheesecake006

[stanley tom 0]

COV is paid when something is really worth that much.is a 20-30yr old small pigeon hole really worth that much???I hate it when i read flyers stating '''we r PR with cash up to 30k to buy your unit'' for me i will print the flyer that read''i m singapore citizen who is NOT WILLING TO PAY COV to buy your old unit!!''

[asoon88 0]

Let me just share with everyone what I did recently to avoid paying COV.

Many agents will tell you that 'it is impossible' to buy flats without COV. The reason is simple : The sellers usually use this money to cover the 2% commission to pay the agents. Any remaining money is just nice to pay the commission of 1% to the agent finding another flat for them.

I bought an EA flat recently. The owner's agent was asking Valuation + $15K cash. The flat was less than 12 yrs old, marble flooring, built-in wardrobes, fitted kitchen,etc,etc.....all were still in pretty good condition. I rejected their offer when first approached. After spending days checking out the surroundings, feng-shui and everything that I think will affect me, I decided to approach the sellers' agent again because the unit was ideal for me.

I offered to pay him a 1.5% commission and asked him to claim the remaining 0.5% from the owner in return for NO COV. IT WORKED !

I bought the flat at valuation.

Eventhough I paid the seller's agent commission using profits from my previously sold flat, I think it is money well spent because:-

i) I did not drive up the resale flat price which will be reflected in HDB's statistics

ii) Paying the agent 1.5% was much lower than forking out $15K COV

iii) The seller's agent was on my side the moment I offered to pay his commission. The resale process was seamless.

Therefore, what agents want are their commissions. Yes, a higher selling price with COV will increase their commissions. However, making a quick sell and collecting the commissions is the name of their game .

[merryman 0]

Let me just share with everyone what I did recently to avoid paying COV.

Many agents will tell you that 'it is impossible' to buy flats without COV. The reason is simple : The sellers usually use this money to cover the 2% commission to pay the agents. Any remaining money is just nice to pay the commission of 1% to the agent finding another flat for them.

I bought an EA flat recently. The owner's agent was asking Valuation + $15K cash. The flat was less than 12 yrs old, marble flooring, built-in wardrobes, fitted kitchen,etc,etc.....all were still in pretty good condition. I rejected their offer when first approached. After spending days checking out the surroundings, feng-shui and everything that I think will affect me, I decided to approach the sellers' agent again because the unit was ideal for me.

I offered to pay him a 1.5% commission and asked him to claim the remaining 0.5% from the owner in return for NO COV. IT WORKED !

I bought the flat at valuation.

Eventhough I paid the seller's agent commission using profits from my previously sold flat, I think it is money well spent because:-

i) I did not drive up the resale flat price which will be reflected in HDB's statistics

ii) Paying the agent 1.5% was much lower than forking out $15K COV

iii) The seller's agent was on my side the moment I offered to pay his commission. The resale process was seamless.

Therefore, what agents want are their commissions. Yes, a higher selling price with COV will increase their commissions. However, making a quick sell and collecting the commissions is the name of their game .

some sellers want higher cov not just to cover their agent's commission wor, some of them want some spare cash to renovate the next house, especially if they feel that their reno is still not that old/worn out...

[hightlighter 0]

I offered to pay him a 1.5% commission and asked him to claim the remaining 0.5% from the owner in return for NO COV. IT WORKED !

I bought the flat at valuation.

The agents seems to be biased once you offer to pay him another 1.5%.

I wouldn't think he will tell the seller that you are going to pay him 1.5%.

Instead he can just convince the seller to sell to you at valuation,

collect 1.5% from you, and then another 1-2% from seller.

Maybe you would want to state the block and road name,so we have a better guage whether COV is the norm for that block,

or you just buying a resale flat paying COV of around 5-8k. (as comm to the agent instead for your case)

Anyway an asking/opening price of COV 15k usually can be nego. down to 5-10k (if you are not aware).

Thus it comes back to the same thing, just that this time around the COV goes into the agent pocket instead of being declare as COV under HDB.

Edited July 20, 2009 by hightlighter

[asoon88 0]

The agents seems to be biased once you offer to pay him another 1.5%.

I wouldn't think he will tell the seller that you are going to pay him 1.5%.

Instead he can just convince the seller to sell to you at valuation,

collect 1.5% from you, and then another 1-2% from seller.

Maybe you would want to state the block and road name,so we have a better guage whether COV is the norm for that block,

or you just buying a resale flat paying COV of around 5-8k. (as comm to the agent instead for your case)

Anyway an asking/opening price of COV 15k usually can be nego. down to 5-10k (if you are not aware).

Thus it comes back to the same thing, just that this time around the COV goes into the agent pocket instead of being declare as COV under HDB.

When I make any offer, I make sure the owner is around. I want to see their body language.

Many agents don't like me talking to the owners and interject whenever possible, however, I usually brush them aside. Talking to the owners allow me to size up whether they are genuine sellers or just trying their luck to fetch a high price for their unit. Some of sellers are in financial difficulty ....but this is not revealed by the agents. I know after talking to the family.

Many areas in Singapore should not command any COV premium. That is why in my earlier thread, I asked buyers to confront the sellers and their agents to JUSTIFY COV. Many cannot and will not. They will just say " COV is the norm for that block".

[asoon88 0]

Anyway an asking/opening price of COV 15k usually can be nego. down to 5-10k (if you are not aware).

Thus it comes back to the same thing, just that this time around the COV goes into the agent pocket instead of being declare as COV under HDB.

BTW, you sound like an agent !

Try negotiating down to $5~10K and you will get an automatic and immediate response " OFFER REJECTED".

HDB doesn't compile agents' commissions in the statistics. They do so for selling prices of flats. However, they are also smart not to reveal the COV for each flat . They do a quarterly averaging so that the overall COV looks low because some flats sell below valuation....especially for repo or divorce cases.

Edited July 20, 2009 by asoon88

[MSlovers 0]

just need to note that each time there's a COV transaction we are contributing to the rise in valuation. agents are happy if the price is on the uptrend.

just like in private properties where short terms investors help jack up the pricing from the prelaunch sale

Edited July 20, 2009 by MSlovers

[asoon88 0]

Maybe you would want to state the block and road name,so we have a better guage whether COV is the norm for that block,

or you just buying a resale flat paying COV of around 5-8k. (as comm to the agent instead for your case)

Anyway an asking/opening price of COV 15k usually can be nego. down to 5-10k (if you are not aware).

Thus it comes back to the same thing, just that this time around the COV goes into the agent pocket instead of being declare as COV under HDB.

I will give you actual encounters and let the forumers draw their conclusions :-

i) BLK 547 JW St 42, 5A Masionette - Value $325K+ $30K COV

Offered COV $10K - rejected. Agent sms me two days later and say last offer was $22K. I said, "sell to that person then" ! Several days later, sms me again to say owner willing to let go at $25K COV. I said no thank you.

ii) Blk 556 JW ST 42, EM - Value $360K + $30K COV

Offered COV $10K - rejected. Agent sms me again to say seller willing to let go at $15K COV, I accepted. About to meet for OTP that day, agent sms to say seller now wants $25K. I said go "FO".

iii) Blk 558 JW St 42, EM - Value $372K + $10K COV

Matched COV $10K - No immediate acceptance. Agent sms me to say offer rejected and are asking for $30K. I said go to **** with that unit because the whole house was crumbling with spalling concrete.

iv) Blk 828 JW St 81 - EA - Value $388K + $10K COV

Did not offer anything because divorce case and sold by two agents. Luckily never offer anything because police came to break-up the commotion when buyers came to view !!

v) Blk 829 JW St 81 - EA - Value $385K + $30K COV

Offered $405K with re-valuation. Agent rejected offer immediately. Not satisfied, I contacted owner and found out that he wasn't a keen seller. Just testing the market and would only sell if someone offered him $450K ! I sms agent to tell him that I will only offer at VALUATION.

vi) Blk 828 JW St 81 - EA - Value $395K + $60K COV

No need to offer. Family also testing market. Willing to sell if someone offers at least $50K COV.

vii) Blk 761 JW St 74 - EA - Value $395 + $15K COV

Offered $5K. Agent rejected offer. Two days later, offered to up it to $10K. Agent say seller considering. Later found out that multiple agents trying to sell this unit and getting mixed signals. Next day, found out that owner sold it for $11K COV. One week later, found the unit being listed again. Last transaction cancelled and owner now asking $30K COV !

viii) Blk714 JW St 71 - EM - Value $400K + $40K COV

Offered $10K. Several families were there for viewing. Rejected immediately. Agent says one family offered $35K. I said," sell to her then ". Two days later, agent sms me asking whether can give $30K COV. I said, " Didn't you sell to the one who offer $35K?". Honest agents aplenty it seems !

There are many, many more stories but it is about the same outcome. Agents are giving sellers' wrong expectations and buyers' agents are doing lousy homework before bringing buyers to view flats. Wasting everyone's time.

Edited July 20, 2009 by asoon88

[hightlighter 0]

All those blocks/units u had seen, the last transacted price is even lower than the valuation you quoted,

no wonder you not keen on paying COV. Understand now.

[asoon88 0]

All those blocks/units u had seen, the last transacted price is even lower than the valuation you quoted,

no wonder you not keen on paying COV. Understand now.

Note that HDB statistics are not reflecting today's actual transactions. The statistics reflect valuations done earlier this year. Even then, many transactions had a mid-to-high COV already built-in because Valuations were lower than now.

[hightlighter 0]

Note that HDB statistics are not reflecting today's actual transactions. The statistics reflect valuations done earlier this year. Even then, many transactions had a mid-to-high COV already built-in because Valuations were lower than now.

Allow for 3-4months price time-gap if you are referring to HDB website for reference.

A unit can be sold today, scheduled for 1st appt at HDB 3 months later, resale approval given another few weeks later, and then the transaction is reflected on the HDB website.

Anyway, to the few hundred thousand HDB flat owners in spore, they are more than pleased with the expected/unexpected rise in the value of their flat.

Selling things is always based on supply and demand.

If there is no demand, there is no way resale flat prices can shoot up.

[Bighead 0]

Dear All

I m a newbie to this forum & happen to read abt your exchange of views.

As much as I would like to agree on asoon's comments, however, I do feel that it largely depends on the location. Our parents (hb & I) stay in Jurong & I've moved to Bt Panjang.

I heard frm my gf tat many flats in Jurong are asking for low or even no cov. Reason being, Jurong is close to industrial area, and is more polluted. Very often, ppl reject Jurong bcos of the aircraft landing area which caused noise pollution.

However this does not apply to Bt Panjang. Flats near the not-so-interesting BPP, as well as interchange & future mrt are asking for at least a 10k cov. On top of that, their valuation are also v high. Added to this, some blocks, though they are nt point-blocked designed, bt they only have 4 units per flr. This gives the privacy to home owners who stay there. Those sellers have been asking for at least a $25 - 30k cov & ppl are still willing to buy.

I've just bought my new EA luve nest w/ cov $17k (negotiated from 25k down). We hesitated quite awhile b4 deciding. Reason being,

1) nt many EAs are selling at the close-to-amentities area where the pty is newer also.

2) less cost on doing up the pipings & etc

3) most ppl hack away the study room to make the hall bigger. Bt we want 4 bedrms

4) existing wardrobes nt up to your taste

5) if you are looking at FS

With all these considerations & if we are to do all these, they def cost more if u build up & redo or watsoever.

Nwadays the price range for 4rms start from $300+k, 5rm flats close to 400+ or more, & EAs are valued from 500k onwards. How much the price will drop we are not sure also, but to what i have observed for BP estate, the price had only dropped a little. With future mrt coming up, we are pretty sure the price will rise.

Pty from Jurong East onwards are also asking for sky-high prices. A 4rm flat in Clementi can fetch close to 400k, Bt Timah hdb 4rms also abt that price, & their EAs can ask for 600+k 700+k, same as Queenstown/ Redhill hdbs.

I've once asked hb if he would like to move back to Jurong, so tat our parents can be closer to our child. bt he strongly disagree & said he's happy w/ BP, even if it meant to be abt 100k more exp. Besides, if we ever move back to Jurong, we would also choose to be where JP & the mrt is, & there isn't many EAs for sale.

However my advice to ppl who are thinking in the long run. If you can afford a 5rm flat right frm the beginning, go for it. At least the flat can last you quite awhile b4 u toggle the idea of upgrading. Hb & I were lazy to clean up the hse when we were much younger, hence we took a 4rm. Bt we felt the space was abit cramp (90sqm) & the living rm was pretty tight cos it's L-shaped, thats y we wanna change. bt it will look quite silly to change to a 5rm flat if it was only 3br; older 5rms were off amenities, tats y we chose to upgrade to an EA, simply nt bcos EA sounds better.

Many ppl said we were silly to pay so much & could hv paid for a pte. Bt since hdb gives us 2 chances to take up hdb loan, then y nt? + bank loans rates fluctuate, I dun wanna end up one day when I hv to pay a 5% interest rate & I hv to scratch big time where to find cash to top up. So, get a gd location for ur hdb now, whether u wanna upgrade or nt the nx time doesn't really matter already bcos u already hv wat u want as the basics.

Edited July 21, 2009 by Bighead

[asoon88 0]

Dear All

I m a newbie to this forum & happen to read abt your exchange of views.

As much as I would like to agree on asoon's comments, however, I do feel that it largely depends on the location. Our parents (hb & I) stay in Jurong & I've moved to Bt Panjang.

I heard frm my gf tat many flats in Jurong are asking for low or even no cov. Reason being, Jurong is close to industrial area, and is more polluted. Very often, ppl reject Jurong bcos of the aircraft landing area which caused noise pollution.

However this does not apply to Bt Panjang. Flats near the not-so-interesting BPP, as well as interchange & future mrt are asking for at least a 10k cov. On top of that, their valuation are also v high. Added to this, some blocks, though they are nt point-blocked designed, bt they only have 4 units per flr. This gives the privacy to home owners who stay there. Those sellers have been asking for at least a $25 - 30k cov & ppl are still willing to buy.

I've just bought my new EA luve nest w/ cov $17k (negotiated from 25k down). We hesitated quite awhile b4 deciding. Reason being,

1) nt many EAs are selling at the close-to-amentities area where the pty is newer also.

2) less cost on doing up the pipings & etc

3) most ppl hack away the study room to make the hall bigger. Bt we want 4 bedrms

4) existing wardrobes nt up to your taste

5) if you are looking at FS

With all these considerations & if we are to do all these, they def cost more if u build up & redo or watsoever.

Nwadays the price range for 4rms start from $300+k, 5rm flats close to 400+ or more, & EAs are valued from 500k onwards. How much the price will drop we are not sure also, but to what i have observed for BP estate, the price had only dropped a little. With future mrt coming up, we are pretty sure the price will rise.

Pty from Jurong East onwards are also asking for sky-high prices. A 4rm flat in Clementi can fetch close to 400k, Bt Timah hdb 4rms also abt that price, & their EAs can ask for 600+k 700+k, same as Queenstown/ Redhill hdbs.

I've once asked hb if he would like to move back to Jurong, so tat our parents can be closer to our child. bt he strongly disagree & said he's happy w/ BP, even if it meant to be abt 100k more exp. Besides, if we ever move back to Jurong, we would also choose to be where JP & the mrt is, & there isn't many EAs for sale.

However my advice to ppl who are thinking in the long run. If you can afford a 5rm flat right frm the beginning, go for it. At least the flat can last you quite awhile b4 u toggle the idea of upgrading. Hb & I were lazy to clean up the hse when we were much younger, hence we took a 4rm. Bt we felt the space was abit cramp (90sqm) & the living rm was pretty tight cos it's L-shaped, thats y we wanna change. bt it will look quite silly to change to a 5rm flat if it was only 3br; older 5rms were off amenities, tats y we chose to upgrade to an EA, simply nt bcos EA sounds better.

Many ppl said we were silly to pay so much & could hv paid for a pte. Bt since hdb gives us 2 chances to take up hdb loan, then y nt? + bank loans rates fluctuate, I dun wanna end up one day when I hv to pay a 5% interest rate & I hv to scratch big time where to find cash to top up. So, get a gd location for ur hdb now, whether u wanna upgrade or nt the nx time doesn't really matter already bcos u already hv wat u want as the basics.

Staying in a country like Singapore, pollution is everywhere. Horror stories about Jurong area being more polluted than other areas is a very subjective issue and seldom appreciated by people who don't stay in Jurong.

I have stayed in Henderson Crescent, Clementi, Bedok, Siglap, Marine Parade, Bukit Batok West Ave 6, Jurong West St 42 and currently in Jurong West St 81 and I can tell you pollution follows you whenever there is construction activity.

Yes, aircraft noise is prevalent in Jurong because of Tengah Airbase. This is something residents must discount if they intend to stay there. When I was staying in Siglap, the noise from Paya Lebar airbase isn't any better. In fact, it was much worse. When I moved to Bukit Batok, air pollution from the brick factories around the area was suffocating. Now when I travel back to Bedok & Marine Parade, I am glad I moved out from there many years ago. It has become a concrete jungle of condos and stuck-up people. No longer the laid-back, breezy and easy-going folks that I used to know.

My friends stay in Punggol and Sengkang and they tell me horror stories about their floor being dirty all the time because of pollution from JB and on-going construction activity. Similarly, my sis-in-law stays a few blocks away from Centris (Jurong Point) but complains to me about "smell" from the chocolate factory and dust from the near-by petro-chemical factories. However, the property prices there have hit sky-high instead.

The current property pricing game is manipulated by the govt. They want to give residents who stay in their respective estate a unique experience and premium over others. Bukit Pajang was a no-go area during the 80's. Ulu to be precise. However, due to its proximity to Bukit Timah and freehold condos around the area, prices have appreciated. No one in their respective estate wll say that their property is over-priced. Many will say wonderful things about their own estate but bad-mouth other estates even when they have never lived there before.

Edited July 21, 2009 by asoon88

[Bighead 0]

I guess each estate has it's gds & bads.... most impt is - so long as u are comfy staying there. Nothing is perfect in this world.

Just like I hv frens who lived in the East & North & they sang praises of their estate; and often ask me why didn't I consider shifting nearer to them.

Bt I stay in the West since young, & nv tot of leaving the West side... I m comfy w/ wat I hv & so I will stay put.