This is the news HDB Buyers want to hear – Cash Over Value Drops!
The largest drop came from areas such as Punggol, Tampines and Pasir Ris, where the premiums went down by 21 per cent, 13 per cent and 12 per cent respectively. Popular towns in the central regions still see high Cash Over Value figures of above $100K. One buyer for a Tiong Bahru 5-rm flat told me that the new rules of 30% of monthly income is not an issue for them (she is referring to the new rules in Jan 2013), her concern will be the COV, which is still high for units in Jalan Membina (mostly still asking about $100K COV).
SRX also recorded just 3,186 HDB resale transactions in the first quarter of this year, the lowest quarterly figure since 2009.
The cooled property market is a result of many rounds of cooling measures and the most recent one in January 2013, affecting the mortgage loans taken by buyers. Since January, mortgage payments to banks have been capped at 30 per cent of a borrower’s monthly household income. There were no restrictions for such loans before, allowing some home buyers to spend up to half their wages on their mortgages. This means that since January, those that are looking to buy larger units, but not truly being able to afford to pay for their HDB Flat because its monthly mortgage payment is 50% or more of their monthly household income. This forces such buyers to consider getting smaller unit like a 3 room or 4 room flat.
HDB Transacted Average COV
5 rm Redhill – $70K
5rm – Tiong Bahru – $100K
5rm – Ang Mo Kio – $80K
Interested to know what y our HDB could sell for based on latest transactions, contact us for a no-obligation consultation.
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