Source : The Sunday Times, Feb 24, 2008
Choices are limited to three- and four-roomers in outlying areas like Yishun and Jurong West
DEMAND for new Housing Board (HDB) flats has been overwhelming even though their prices have been increasing in line with those of resale flats.
Those who want to move into a flat almost immediately but do not want to spend more than $200,000 will, understandably, find their choices fairly limited in today's market.
For one, five-room flats are out of the question. In addition, four-room flats for that price can be found only in certain outlying areas.
Choices for three-roomers are much more varied, but even then, flats in a few locations - such as the central area, Marine Parade and Bukit Timah - are mostly priced out of reach.
In order to facilitate a quick deal, homebuyers will also need to have at least $20,000 to $25,000 handy for the cash-over-valuation sum, which has to be paid in cold, hard cash, say property agents.
Look at outlying areas
THE median resale prices for a four-room flat in various HDB towns are all above $200,000.
And in the coveted district of Marine Parade, a four-room flat costs at least a whopping $310,000, based on caveats lodged with the HDB.
Mr Eugene Lim, the assistant vice-president of ERA Realty Network, said four-room resale flats which cost below $220,000 can be found in Bedok Reservoir, Bukit Batok, Bukit Panjang, Choa Chu Kang, Hougang, Jurong West, Woodlands and Yishun.
A search on the HDB website shows that four-room flats priced at $200,000 and below can be found only in far-flung towns such as Woodlands and Yishun.
A 94 sq m unit in Marsiling Drive was approved for sale this month at $178,000. The block is about 28 years old.
Newer flats in the same area are going for a bit more. A five-year-old Marsiling Drive flat on a high floor went for $198,000 recently.
But when it comes to rentals, a four-room flat in Woodlands can fetch a median rental rate of $1,440 a month, not far from the monthly median rent of $1,500 in Ang Mo Kio.
Generally, if buyers try harder, there are keen sellers out there who are not asking for the moon.
Mr Siaw Ah Seng, 39, told The Sunday Times that he bought a low-floor, four-room flat in Yishun late last year for $188,000.
The price included a cash-over-valuation amount of $7,000, which is reasonable, given that the median cash-over-valuation amount for four-room flats in Yishun is $18,000.
The printing firm supervisor said he found the seller through a friend after he had gone to check out several flats in Yishun.
'The rest were asking for $20,000 to $30,000. Where do I find that kind of money?' he said. His flat is about a 10-minute walk from the Yishun MRT Station.
In Sengkang, the sellers of a four-room flat are asking for just $5,000 cash above valuation.
'It's a divorce case, so they want to sell it off quickly,' said Mr Eric Cheng, the executive director of HSR property group. 'The flat is on the second floor, not near the MRT station and not well-renovated.'
If you do not mind a three-room flat, you will have more choices.
The fourth-quarter median resale prices for three-room flats range from $161,300 to $300,000.
In Ang Mo Kio, approved resales of three-room flats this month were priced as low as $162,000, while a 65 sq m three-room flat on a high floor in Marsiling Lane in Woodlands went for $163,000.
In Tampines Avenue 4, a 67 sq m three-room flat on a low floor was approved for sale this month at $185,000.
But certain locations such as the central area, Holland Close and Marine Parade will still be beyond the reach of those with a $200,000 to $220,000 budget.
If smaller flats are not an issue, there are two-room flats in areas such as Ang Mo Kio, Bedok, Clementi, Pasir Ris and Toa Payoh. These are priced below $200,000 but are limited in number.
What's ahead
ERA'S Mr Lim has this advice for buyers: 'If you are in urgent need and cannot wait, buy what you can afford. Do not overstretch.
'Waiting does not mean that prices will go down, as the demand for HDB flats is still very strong.'
Property consultants have said that the mass market segment of Singapore's property market will do well this year, notwithstanding the general weak market sentiment, as demand remains strong.
Last year, HDB resale prices climbed 17.5 per cent, the highest growth in a decade.
The good news for those who have yet to buy a flat is that sellers have become more realistic these days as there is less competition among buyers, said Mr Cheng.
'We see that the cash-over-valuation sums have come down slightly in the past two months,' he said.
National Development Minister Mah Bow Tan recently said HDB resale prices were stabilising.
The HDB Resale Price Index, he said, grew by only 1 per cent last month, and HDB prices are expected to grow at a more moderate pace this year.
Mr Mah also said the proportion of resale transactions with a positive cash over valuation, as well as the median cash over valuation, dipped marginally last month.
Generally, about 25 per cent of total deals in recent months were concluded with a cash-over-valuation sum of $10,000 and below.
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