Most home buyers in Singapore are willing to offer up to S$25,000 in COV

Survey results by iProperty.com.sg highlights home buyers’ willingness to secure their dream homes 

Singapore’s number one property website, iProperty.com.sg, revealed in a recent Quick Poll in July, the market’s willingness to secure their dream property, even if it meant paying more than $45,000  in cash-over-valuation (COV) to seal the deal.

Key findings from the survey revealed that:

  1. Most survey respondents (63.3%) are willing to offer between S$10,000 to S$25,000 in COV to ensure they secure their dream HDB homes.
  2. The remaining respondents are willing to offer higher COV for their dream homes, with 16.8% willing to offer between S$25,001 to S$35,000, and 6.7% are willing to offer between S$35,001 to S$45,000.
  3. 13.2% of respondents are willing to offer S$45,001 and above.

If given the opportunity to own the HDB home of your dreams, with ideal location and facilities, how much COV (cash-over-valuation) are you willing to offer to ensure you secure that property?

A total of 327 respondents took part in this online survey from 28 June 2011 to 19 July 2011.

This comes on the heels of recent reports of a Tampines unit at Block 151 of Tampines Street 12 which sold at $150,000 COV, further reinforcing current market sentiments that saw the return of higher COV with the tightened supply in the housing market.

In response to Singapore’s all-time-high property prices, National Development Minister Khaw Boon Wan recently commented, during his first official visit to the HDB Hub, that prices of HDB’s new flats are typically pegged to prevailing resale prices, but are discounted.

Acting on the public’s call for more affordable housing, the HDB had seemingly lowered indicative starting prices for new flats recently launched in Sengkang, Tampines, Jurong West, Bukit Panjang and Yishun – as compared to the previous BTO launch in May 2011.

Commenting on Minister Khaw’s recent measures to alleviate the demand-supply conundrum, Shaun Di Gregorio, Chief Executive Officer of iProperty Group Limited “Home buyers are now getting closer to obtaining their dream homes – be it new or resale flats – as signs of the stabilising housing market are beginning to appear. Not only are we going to see more and more new HDB flats being offered in bumper BTO launches in months to come, our recent Quick Poll also suggests that most home buyers are willing to fork out top dollar to secure flats in ideal locations and with good facilities nearby.”

He added, “However, there is still some way to go in addressing affordability issues – home buyers are still anxious to see what comes with the review of the income ceiling for first- timers to buy BTO flats, as well as the review of the Design, Build and Sell Scheme (DBSS), and how this affects prices of the remaining 9,500 new flats by year end, and subsequently, the impact on resale prices.”

Trackbacks

  1. […] COV refers to the cash premium that an HDB resale flat buyer pays above a flat’s valuation. The number is closely watched because high COVs make resale flats more unaffordable for buyers. […]

  2. […] median cash premiums paid to sellers, called cash-over-valuation (COV), also reached eye-popping levels. In Marine Parade, for example, the median COV for five-room flats […]

  3. […] median cash premiums paid to sellers, called cash-over-valuation (COV), also reached eye-popping levels. In Marine Parade, for example, the median COV for five-room flats […]

  4. […] Most home buyers in Singapore are willing to offer up to S$25,000 in COV […]

  5. […] – I read from the newspapers that many people (were) calling (for MND) not to even bother to compute COV, or print it. And that’s a very strong view… by many people. I find a middle way […]

  6. […] What do you think these COV actually do for your decision-making process? From a recent iProperty survey, it showed that most Singaporeans are willing to pay COV prices of $10,000 – $25,000, some […]

  7. […] not be reported at allr. ‘Publishing such data may inadvertently endorse the practice of COV,’ he […]

  8. […] Most commonly used since the rapid increase of HDB prices since 2007, COV refers to the sum above and beyond what the flat is valued at. COVs have been known to reach highs of more than S$50,000 in recent years. Read the amount in COV that most Singaporeans are willing to pay up to here. […]

  9. […] Most commonly used since the rapid increase of HDB prices since 2007, COV refers to the sum above and beyond what the flat is valued at. COVs have been known to reach highs of more than S$50,000 in recent years. Read the amount in COV that most Singaporeans are willing to pay up to here. […]

  10. […] in cash, as home loans are pegged not to transaction price but valuation. Said Miss Chan: ‘Cash over value for flats around here is about $40,000 to $50,000. For a DBSS, we don’t have to fork out so much cash. […]

  11. […] the lack of overall figures, a closer look at COV figures shows them inching upwards. The lowest median COV for a three-room flat in any HDB town in the […]

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