Poodle say Boycott flat sellers demanding COV

[MarrickG]

I REFER to the letter, 'High COV for flat in non-prime area' (my paper, Oct 13).

As a grassroots leader and property agent, I have been observing this issue for some time.

There are many cases of flat owners asking for high cash-over-valuation (COV) when selling their flats.

This is especially so for sellers of three- and four-room Housing Board flats in popular mature estates such as Ang Mo Kio, Bishan and Bukit Merah. However, as the letter writer stated, sellers in other estates are also asking for high COV.

This trend of high COV could have started a few years ago, when buyers such as permanent residents and Singaporeans who had benefited from selling their property or other investments were willing to fork out large sums.

However, no one party is to blame for this.

It all boils down to supply and demand.

There are willing buyers and sellers in the resale market who agree on COV as part of their transactions.

It is not illegal as there are no clear guidelines on COV from the Government or regulatory bodies.

My advice to buyers of flats from the open market is: Do not make offers to sellers who demand COV.

If the majority of buyers adopt such a stand, then sellers would have no choice but to let their flats go with low or no COV.

Flat sellers should also understand that they would be in the same situation when it is their turn to purchase another flat.

Hence, they should make the transaction a win-win situation for both sides.

I also hope that my fellow property agents could advise sellers accordingly and analyse the situation carefully with their clients.

Mr Muhammad Dzul Azhan Haji Sahban

http://www.asiaone.com/Business/My+Money/Property/Story/A1Story20091014-173538.html

 

[oli9]

No wonder Mats have no business acumen.
Let's say if there's 3 interested buyers come to view a flat & liked it at ZERO COV, then the seller will be in a dilemma at whom he should sell. If buyer A, B & C offers seller incentives of $1K, $2K & $3K respectively, can the seller reject Buyer C & sell to buyer A?
COV is here to stay whether Encik Mohd Dzul liked it or not. I also suggest he cuts down his ciggie intakes Im sure he can have more disposable income to pay for COV & certainly will prolong his life.

 

[chewed]

No wonder Mats have no business acumen.
Let's say if there's 3 interested buyers come to view a flat & liked it at ZERO COV, then the seller will be in a dilemma at whom he should sell. If buyer A, B & C offers seller incentives of $1K, $2K & $3K respectively, can the seller reject Buyer C & sell to buyer A?
COV is here to stay whether Encik Mohd Dzul liked it or not. I also suggest he cuts down his ciggie intakes Im sure he can have more disposable income to pay for COV & certainly will prolong his life.

the days of COV will be over soon. U think IRAS will allow sellers to keep $$$ without taxing it?

 

[oli9]

the days of COV will be over soon. U think IRAS will allow sellers to keep $$$ without taxing it?

Capital gains are tax exempted. If I lose money on selling my properties, can i claim for my tax lossess then?

 

[shOUTloud]

I think it will take another 2-3 years for the COV thing to settle down. The issue is how did this shit happen in the first place? Where is Mah Bow Tan now? How come so quiet after scolding people for being "choosy"?

 

[chewed]

Capital gains are tax exempted. If I lose money on selling my properties, can i claim for my tax lossess then?

capital gains and COV are the different issues here. techinically, u can lose $$$ in your HDB when you sell it but still have 30K COV on hand.

 

[Zombie]

capital gains and COV are the different issues here. techinically, u can lose $$$ in your HDB when you sell it but still have 30K COV on hand.

capital gain/loss means netting off both lose $$$ in your HDB and 30K COV

 

[halsey02]

Is Cash Over Value another term for "Under the table money"..now it is above the table money????

 

[BusNo64]

There is another reason why many ppl ask for COV in resale mkt. It is the renovation cost. Many who bought from HDB direct will have to spend quite a sum renovating their flat, and these are paid by cash upfront or a renovation loan from bank. COV is to cover for that, and also to have spare cash for renovation in their new place. Buyers of resale flat shld pick a flat that is nicely renovated so they do not have to spend much redoing it, unlike a new flat. Furthermore, certain fixture and fittings cannot be removed like Air-con, water-heater etc, so they can save quite a bit.

 

[halsey02]

There is another reason why many ppl ask for COV in resale mkt. It is the renovation cost. Many who bought from HDB direct will have to spend quite a sum renovating their flat, and these are paid by cash upfront or a renovation loan from bank. COV is to cover for that, and also to have spare cash for renovation in their new place. Buyers of resale flat shld pick a flat that is nicely renovated so they do not have to spend much redoing it, unlike a new flat. Furthermore, certain fixture and fittings cannot be removed like Air-con, water-heater etc, so they can save quite a bit.

Like I have asked was it called "under the table money" in the past?, a certain race group use to ask for this when they were selling their 3 rooms flats..or flats..sell for $65,000 you pay them cash $15,000 under the table, and declare to HDB you paid $50,000?....other reaces does that too... It was known in the market quietly as "under table money"...but now this had become ABOVE THE TABLE? as COV?

Cash Over Valuation....what's the difference with the under table money?..one still uses that for whatever the reason...renovate, for children's wedding..find another wife..etc?...

 

[oli9]

If COV is abolished, what criteria is seller going to base in order to sell his flat? Have a free fuck with the buyer's chio wife ah?

 

[Semaj2357]

If COV is abolished, what criteria is seller going to base in order to sell his flat? Have a free fuck with the buyer's chio wife ah?

Haha Oli9, good analogy to put across your point, ouch!

 

[scroobal]

Why so blur? Valuation does not relate to original purchase price. COV is premium over valuation and the gap starts to widen when demand exceeds supply. A flat with absolutely no renovation can carry high COV in a rising market. In a depressed market, a flat with $200K renovation might be priced well bellow that.

The issue is whether the valuation is realistic and reflects the market price. On a national scale, supply has been clearly underestimated. HDB price valuation is politically driven to give the impression that housing is avoidable or that they screwed up on the supply front or a mixture of both.

Just sit back and watch others debate and learn.

There is another reason why many ppl ask for COV in resale mkt. .

 

[commoner]

according to valuation of HDB properties, they had included the renovation costs, and the immovable properties within the unit,,,

COV is what you are willingly to pay for the property above the valuation for maybe sentimental reasons, fengshui reasons or any other particular reasons,,,, COV is technically not the cost of renovation per se,,,,

say if the properties there are a few units valued 300k with COV 30k, and the transaction will be taken into consideration and next round of valuation, 330k,,,,

 

[Zombie]

In short
Actual Market Value Transacted and Declared = Valuation +/- COV

 

[soIsee]

No wonder Mats have no business acumen.
Let's say if there's 3 interested buyers come to view a flat & liked it at ZERO COV, then the seller will be in a dilemma at whom he should sell. If buyer A, B & C offers seller incentives of $1K, $2K & $3K respectively, can the seller reject Buyer C & sell to buyer A?
COV is here to stay whether Encik Mohd Dzul liked it or not. I also suggest he cuts down his ciggie intakes Im sure he can have more disposable income to pay for COV & certainly will prolong his life.

Let's be fair lah!

IT'S NOT ONLY THE MATS HAVE POOR BUSINESS ACUMEN although I must say a lot of them are very poor in maths!

A typical sinkie be it they are Mats or Chinks still argue with me whenever I tell them the open market for properties be it HDB or private, are totally subjected to market forces of supply and demand.

When I tell these ppl, of course the supply of flats in mature estates or those closer to it are always at a limited number and will always BE in demand, they chose NOT to see this point!

What to do? When these ppl are spoon fed all these years and can't 'wake-up' and open their minds and eyes to the fact that if they find the resale flats are too expensive , someone won't!:p

 

[scroobal]

Yes, you are right.

according to valuation of HDB properties, they had included the renovation costs, and the immovable properties within the unit,,,

COV is what you are willingly to pay for the property above the valuation for maybe sentimental reasons, fengshui reasons or any other particular reasons,,,, COV is technically not the cost of renovation per se,,,,

say if the properties there are a few units valued 300k with COV 30k, and the transaction will be taken into consideration and next round of valuation, 330k,,,,

 

[oli9]

Let's be fair lah!

IT'S NOT ONLY THE MATS HAVE POOR BUSINESS ACUMEN although I must say a lot of them are very poor in maths!

A typical sinkie be it they are Mats or Chinks still argue with me whenever I tell them the open market for properties be it HDB or private, are totally subjected to market forces of supply and demand.

When I tell these ppl, of course the supply of flats in mature estates or those closer to it are always at a limited number and will always BE in demand, they chose NOT to see this point!

What to do? When these ppl are spoon fed all these years and can't 'wake-up' and open their minds and eyes to the fact that if they find the resale flats are too expensive , someone won't!:p

Im just saying that the mats should smoke less & work harder so they can afford the COV.

 

[Zombie]

Cash Over Valuation....what's the difference with the under table money?

Financing.

 

[0939]

Let me gave you an insight. COV are here to stay as long as demand more than supply.
COV is also part of the cost of the renovations put up by the seller. I was in this senario.
In 1985, I got my 4-rm A at Jurong West for about $65,000. When I booked in 1982, It cost only about $36,500. When ready, the price ballooned up citing all kind of reasons.
Soon after, recession set in, for the next 5 to 6 years, price remained stagnant. In 1992, I decided that I can buy a private property, so I booked one, but my HDB worthed about $105,000 in the market. New flats cost about up to $75,000 then. Later the same year, influx of Hongkongers invaded Singapore, thats when HDB price gone
crazy, rising up. End of 1994, my condo ready for TOP, It was good investment, almost doubled up when I moved in. During that period, a lot of my neighbours are also selling their HDB flats, Valuations ranging between $160,000 to $180,000 of the same flat. It turned out that I got the highest valuation of $180,000. This was because of the renovations that I have done. So I left it to my agent to sell the highest price. At $200,000, it was snapped by the first customer. So $20,000 under table money, only later to be known as COV.
Before you pay high COV, you have to take into the renovations and also the location, location and location, Which floor and also what kind of neighbour you are with.
Take your time to choose.