ASEAN KEY DESTINATIONS
HDB COV dips to lowest level in 2.5 years
SINGAPORE: The overall cash premium, or Cash-Over-Valuation (COV), that buyers pay for HDB resale flats has dropped to its lowest level in about two and a half years, according to data from major property agencies compiled by the Singapore Real Estate Exchange (SRX)
Overall, HDB COV in July dropped S$4,000 from June to reach S$20,000 -- the lowest level since January 2011.
It is also down sharply from the peak of S$35,000 recorded in January this year.
SRX said overall COV has dropped by 43 per cent year-to-date.
This comes on the back of a 0.5-per-cent dip in overall HDB resale prices, the third consecutive monthly decline.
Christine Li, head of research & consultancy at property consultancy firm OrangeTee, said: "The drop in COV is expected.
"After the government imposed the mortgage servicing ratio on HDB loans, we do see some buyers staying away from the bigger HDB flats because their loan quantum is affected. As a result, that will affect their ability to pay high COVs."
SRX said HDB resale volume remained relatively flat in July compared to June, with about 1,270 resale transactions recorded.
Year-on-year, July's resale volume represented a 36-per-cent drop from the same period in 2012.
An estimated 1,760 HDB flats were rented in July, up by 13 per cent from June. The number also exceeded the 1,632 HDB rental transactions in July last year.
Meanwhile, resale prices of non-landed private homes rose marginally by 0.1 per cent in July, compared to the 0.8-per-cent increase in June.
This was led by the 1.2-per-cent price gain seen in the city fringes.
Resale prices of non-landed private homes in the city region fell 0.5 per cent, while those in the suburban areas slipped 0.4 per cent.
An estimated 670 non-landed private homes were transacted in July, compared to 640 units in June.
Overall, rental prices for non-landed private residential in July inched upwards by 0.2 per cent from June, reversing the decline seen in the past three months.
Rental prices in the city region gained 1.4 per cent, while rentals in the city fringes fell 0.9 per cent and suburban region declined 0.4 per cent.
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