How Does Increasing In Valuation Affect Seller And Buyer?

[PointZero 0]

If the overall selling price of a flat has been fixed and agreed upon between the seller and buyer, and a second valuation is done which results in a higher valuation price, what will be the impact on the seller and buyer?

I am the buyer and currently the only thing that I can think of is that I need to pay a lower COV, but is there anything that will be negative, e.g. higher stamp fee?

Some background:

• Seller is currently servicing the flat through a bank loan.
• I will be getting a HDB loan.
• If the pros outweigh the cons, I am paying for the second valuation.
• The buyer needs around 6 months (from now) to move out. So I guess doing a second valuation will not really delay things any further. Am I right?

Thanks for any advice!

Edited September 21, 2009 by PointZero

[sugardaddy 0]

When was the last valuation done? If not too long ago, it may be show much difference so might as well save the money

For the loan, it would be basis the valuation and not your fixed price. Honestly I dont really think this would be too much of a concern since if the valuation is higher, you could use the money you saved from the COV and pay off more of the loan instead of taking so much loan. If the new valuation shows a lower value? Then you have to pay up for a higher COV. So nett nett not too much difference.

Of cos, stamp duties, GST, legal fees, etc, may be higher with a higher valuation lor .. so best do your sums properly first

Anyway, looking at the current sentiment, high chance of getting a higher valuation thou ..

[Supersimon27 2]

When was the last valuation done? If not too long ago, it may be show much difference so might as well save the money

For the loan, it would be basis the valuation and not your fixed price. Honestly I dont really think this would be too much of a concern since if the valuation is higher, you could use the money you saved from the COV and pay off more of the loan instead of taking so much loan. If the new valuation shows a lower value? Then you have to pay up for a higher COV. So nett nett not too much difference.

Of cos, stamp duties, GST, legal fees, etc, may be higher with a higher valuation lor .. so best do your sums properly first

Anyway, looking at the current sentiment, high chance of getting a higher valuation thou ..

if i'm not wrong . U can stick to the old valuation if the new val become lower.

However , high chance the val will be higher

[cacabi111 0]

hmm then perhaps wait abit more first, anyway ur 1st appt is prob in another 3months time prob....so just try to drag the re-valuation til its just in time for 1st appt. So can price in as much much of the rising prices as possible. Think there could be a 5-10k adjustment given the recent brisk sales?

Another thing is that for sellers, the second tiime valuation does not serve much purpose for them so they may not be that co-operative....no need to tidy place up etc since price already settled and flat sold....

Edited September 23, 2009 by cacabi111

[gohleong 0]

hmm then perhaps wait abit more first, anyway ur 1st appt is prob in another 3months time prob....so just try to drag the re-valuation til its just in time for 1st appt. So can price in as much much of the rising prices as possible. Think there could be a 5-10k adjustment given the recent brisk sales?

Another thing is that for sellers, the second tiime valuation does not serve much purpose for them so they may not be that co-operative....no need to tidy place up etc since price already settled and flat sold....

I like to point out that the valuation report is not used at the 1st appt. It has to be valid and this will be the report based on the loan amount when you did the submission for 1st appt.

Having a higher valuation report is of course lesser COV which will be good for buyer. Getting the valuation report will take another 10-14 days, so if you wanted the new valuation report before exercising your OTP may be a bit rushing.

Loan amt is based on the selling price or valuation price whichever is lower. Other expenses like the stamp duty fee is based on whichever is higher.

Just take note that all documents must be valid upon submission for 1st appt. HLE is subjective to HDB.