35 Brand New Condominiums Nearing Their ABSD Deadline 2023
TLDR The blog post discusses the looming ABSD deadline for several new launch condos in 2023, highlighting the impact on...
Read More
Navigating the complexities of purchasing a resale HDB flat requires honing negotiation skills and market awareness. Understanding property valuations, seller motivations, and setting a realistic budget are key. Thorough research, strategic offers, and maintaining composure during negotiations are crucial. Remember, staying within your financial limits and being prepared to walk away if needed ensures a successful property purchase.
Are you considering buying a resale HDB flat?
Learn how to negotiate for the best price and get your dream home faster! Here are some pointers to help you sharpen your negotiation skills.
Are you tired of waiting for a BTO flat? If you want a roof over your head fast, buying a resale HDB flat is your best bet.
When you enter the resale HDB market with the intent to purchase, you’ll find yourself in the tricky situation of having to haggle with the seller or their agent to get to a mutually beneficial price.
It can take some hard work to get to a reasonable deal, and it’s not like you’re at the wet market!
If your negotiating skills are a bit rusty, no need to worry – we’ve got the perfect solution to help you reach an agreement without breaking your budget.
Leave your feelings aside and let’s explore the nuances of successfully negotiating an offer!
How To Offer The Right Price
- Thoroughly research the market, get a comprehensive understanding of the property, and set your budget with discipline!
How To Negotiate Property Price Like A Pro
- Be well-informed when entering the discussion, consider the seller’s reasons for wanting to sell, come to a reasonable agreement, and stay calm, but be ready to back out if necessary.
How To Offer The Right Price
#1 Do Your Market Research
As a keen buyer, it can be tricky to make the right move when purchasing a resale flat.
Setting the price too low could lead to a complete loss of the deal and too high could be costly.
To get the best possible outcome and not waste any money, it is vital to do the necessary research by comparing prices within the property’s estate.
This can take some time, but it is worth it for two main reasons: getting an insight on how competitive the area is and determining whether the asking price is in line with past transactions.
Gathering an understanding of the market price range can be the first step in your negotiations – knowing your lowest and highest offer will set you up for success.
To get a clearer idea, it’s a good idea to check the past resale prices of units within 200 metres of your desired block on the HDB website.
#2 Get To Know The Shortlisted Property
When considering a property, it’s important to take market trends and past transactions into account; however, the property you have your eye on may even be more expensive if it boasts exceptional features.
In fact, some properties are so desirable that they can even sell for a million dollars!
Features such as prime location, close proximity to an MRT station or the CBD, a spacious layout, major renovations, a long balance lease, a high floor, and corner units are all desirable attributes that may lead to a premium purchase.
As a potential buyer, it’s essential to determine if the property is in high demand as this could lead to a higher Cash Over Valuation (COV) – something you would prefer to be as low as possible.
#3 Set Your Budget
To ensure you don’t overextend your finances, make sure you know your budget and price limit.
When looking at a more expensive property, what is your highest comfort level when it comes to COV?
It’s no secret that HDB flats in mature estates have a high COV range from $10,000 to $40,000.
Don’t forget that you need to pay for COV completely in cash, and it is not covered by your mortgage or CPF. If the seller is pushing for a cost that exceeds your budget, it’s time to move on.
Living in your dream home might seem like the ultimate goal, but are you willing to sacrifice your lifestyle to make the mortgage payments?
Think twice before taking the plunge – it might not be worth it in the end.
How To Negotiate Property Price Like A Pro
#1 Go Into The Discussion Prepared
It’s just like going into a battlefield unarmed – you shouldn’t attend a negotiation without doing your market research beforehand!
To get started, have a look at the HDB Resale Flat Prices page to see the prices of similar properties in the area. Property sites also have indicative pricing tools to give you a rough estimate of the property’s worth.
With this data, you can use the insights to put together a strong offer.
What Happens If HDB’s Valuation Is Lower Than Your Purchase Price?
Once you and the flat owner agree on the price and you are granted the option to purchase.
For example, let’s say the agreed price is S$550,000, but HDB’s valuation turns out to be S$500,000.
In that case, you would have to pay the difference of S$50,000 (aka COV) in cash.
#2 Find Out The Owner’s Motivation To Sell
Having gained experience in the property market, you can tell a lot about a seller by the persona they present – it’s a great way to find out whether they’re serious about the sale and in a hurry to close it.
Empty nesters looking to downsize, for example, likely won’t be so rushed and may just be trying out the process.
However, there are also those with an urgent need to make a sale, or whose home may not be quite as attractive as others.
By asking the right questions, you can quickly uncover if you have the upper hand when negotiating.
One useful hint is to find out how long the listing has been active – if it’s been lingering for a while, it’s likely that the seller has difficulty closing the deal, giving you a chance to bargain.
#3 Arrive At A Fair Price
Be prepared for some negotiating with the seller as they may not be keen to agree to your first offer.
But, the big question remains – how much should you offer for the property? Is the unit you’re interested in a particularly sought-after one, with many potential buyers?
In this case, it is even more essential to be well-informed and to have done your research into the property market – this will help you to decide whether to start your offer below or above the asking price.
One can assume that the majority of owners hope to gain a good profit from the sale in order to afford their next property.
However, your investigations may lead you to find that the sale price they are asking for is greater than the estimated value of the flat. A smart way to deal with this is to take the estimated value and add the maximum COV that you are comfortable paying.
Remember, you are your own advocate in this process, so it would be extremely beneficial for you to establish a rapport with the seller’s agent.
This will allow you to gain insight into critical information such as the lowest price the owner is willing to accept, or if there are any other offers on the table – both of which will help you make the best bid.
Here’s a tip: Instead of immediately revealing your maximum offer, start low and incrementally increase your bid as the negotiation progresses. Always keep in mind not to go over your top dollar.
#4 Keep Your Cool But Back Out If Required
When buying a resale HDB flat, things can get complicated – negotiations can either go smoothly or you could find yourself facing an excessively high selling price.
In such cases, no matter how attractive the home may seem, it’s best to walk away.
Be aware that the housing market is vast and there will always be another property that meets your needs and, most importantly, your budget.
Remember, as a buyer you must remain clear-headed and level-headed during negotiations as to not be left disappointed in the event the deal falls through.
Above all, stay mindful of your loan repayments, for that should always be your primary focus.
Read these next:
- How To Buy A House In Singapore: A Complete Guide (2021)
- Buying A HDB Resale Flat: How To Minimise Cash Over Valuation (COV)
Should You Buy, Sell or Wait?
If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?
It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.
I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.
I can help you by:
- Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
- Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.
You May Also Like …
The Top 5 Renovation Tips For Increasing The Value Of Your Singapore Property Investment
When it comes to increasing the value of your Singapore property investment, strategic renovations can make a significant difference. Here...
Read More
Top 5 Tips : How Does One Choose Good Property In Singapore?
Singapore, a thriving city-state known for its impressive skyline and robust economy, has always been an attractive destination for property...
Read More
What Hidden Costs Are There When Selling Your House?
TLDR When selling your house, be prepared to cover expenses such as outstanding home loans, legal fees, property agent commissions,...
Read More
Don’t Get Scammed: The Top 5 Red Flags To Watch Out For In Singapore’s Property Market
Don't Get Scammed: The Top 5 Red Flags To Watch Out For In Singapore's Property Market When it comes to...
Read More
Building A World-Class Nation: Top 5 Facts About Singapore’s Developed Infrastructure
Building A World-Class Nation: Top 5 Facts About Singapore's Developed Infrastructure Singapore is known for its high standard of living,...
Read More
Top 5 : Best Quirky Museums in Singapore
Singapore, a vibrant and diverse city-state, is known for its rich history, cultural heritage, and modern attractions. While the city...
Read More
Top 5 Dessert Places in Singapore
Singapore, a melting pot of cultures and culinary delights, is known for its mouth-watering food scene. From hawker centers to...
Read More
The 5 Most Common Mistakes First-Time Buyers Make (And How to Avoid Them)
The 5 Most Common Mistakes First-Time Buyers Make (And How to Avoid Them) Here are the 5 most common mistakes...
Read More
Discovering the Response of Private Property Owners towards the 15-Month Wait-Out Phase
TLDR The blog post discusses the impact of the 15-month wait-out period cooling measure on private property owners in Singapore....
Read More
5 Impacts Of The Singapore Government’s Cooling Measures On Property Investing
The Singapore government has implemented several cooling measures over the years to regulate the property market and prevent it from...
Read More
Top 5 Factors That Real Estate Investors Should Consider When Selecting A Luxury Condo In Singapore
Investing in a luxury condominium in Singapore is an attractive option for real estate investors seeking high-quality properties with potential...
Read More
Top 5 Places to Learn About Singapore’s History
Singapore, a thriving metropolis with a rich history and diverse cultural heritage, offers numerous opportunities for visitors and locals alike...
Read More
Singapore Property Bubble Ahead? My Friends Share My Market Predictions
TLDR The author delves into various opinions on the Singapore property market for the year 2023. Experts have differing views...
Read More
Is Singapore’s Property Market on the Verge of a Crash? Understanding the 5 Factors at Play
The Singapore property market has long been an attractive option for both local and international investors. However, as with any...
Read More
Singapore’s Property Insights : Where to Find 5 Hidden Gems?
Singapore's Property Insights : Where to Find 5 Hidden Gems? With its booming economy, vibrant culture and attractive regulations, Singapore...
Read More
Top 5 Must-Try Foods in Singapore
Top 5 Must-Try Foods in Singapore Singapore, a melting pot of cultures and cuisines, offers a diverse and tantalizing array...
Read More
Top 5 Factors : Why Not All Properties Appreciate Steadily
Real estate has long been considered a lucrative investment option, with the potential for significant returns. However, not all properties...
Read More
Identifying a Good Investment Property: A Guide
TLDR When it comes to navigating the real estate market in Singapore, understanding key factors can make a significant difference...
Read More
5 Secrets To Successful Property Investing In Singapore
Investing in property is a popular option in Singapore, with many investors seeing it as a lucrative way to build...
Read More
