TLDR
Understanding property valuations and their impact on mortgage loans is crucial in the Singapore real estate market. By considering factors such as current asking prices, recently transacted prices, recent highest transacted price, peak price of the development, and valuation price, you can ensure you’re making an informed decision when buying or selling a property. Online tools and professional help can aid in determining the right price to pay or sell for, maximizing your chances of success in property investments. Remember to stay objective, seek professional advice when needed, and be prepared to walk away from a deal if the price doesn’t align with the property’s value.
Amidst the highly competitive property market where prices seem to rise every other day, how can you be certain you’re securing a fair deal on your desired property?
Owning a property in Singapore can be expensive, and the last thing you’d want is to pay an excessive price – leaving you with no choice but to make tough sacrifices, such as forking out an outrageous Cash over Valuation (COV) or facing the prospect of having to offload the property for a less-than-desirable price in the future. Sure, you could get your dream property, but is it worth all the trade-offs?
Ready to start searching for the perfect property?
Learn the 5 essential factors you can use to make sure you get the best price for your purchase.
Getting an understanding of the typical asking prices of similar units in a development can give you a good idea of the expected price range. This will help you determine if someone is trying to sell their property at an unusually high price compared to what is typical.
Take note though – it’s not unheard of for certain units in the same building to be priced differently or at a premium compared to the rest. This doesn’t necessarily mean the property is incorrectly priced; instead, it could be attributed to specific features that make those units worth more. Such features might include an exquisite interior, a higher floor level, or stunning views and orientations.
To ensure that the price of the property is justifiable, why not take a look at photos and videos to get a better understanding of its features?
Alternatively, it would be even better to take a physical viewing to truly appreciate its attributes. Additionally, you can use online property research tools to gather data on asking prices and narrow down the results with additional search filters such as number of bedrooms, floor size, and floor level.
Despite asking prices which generally reflect a seller’s desires, transacted prices provide a more realistic indication of what the wider market deems a property is worth. Being aware of the recently transacted prices in a development can help you establish a reasonable sum to pay for a property.
To keep up with market trends and developments, especially in a rapidly evolving market such as the one we’re in right now, it’s advisable to examine transactions up to the past 6-12 months – any older than that could potentially be obsolete and not reflect the current market trends.
Check out these helpful online tools for your research:
When considering a property’s value, it’s important to keep in mind that recently transacted prices may have a bearing on your loan financing journey down the road.
Many banks will look into property valuation to decide how much to loan, and often times the unit’s purchase price will need to be in line with the recent transactions in order to be approved.
If the price deviates too much, the bank may not be willing to match it with the valuation, which can lead to a decrease in the amount of loan available.
If you have been keeping track of transacted prices, it’s definitely worth taking a look at the highest transacted price for the development. After all, if you’re planning to buy the property with the goal of selling it in 3 to 5 years and making a profit, this is definitely something to pay attention to.
When it comes to investing in property, it is important to take into consideration the highest transacted price, which could act as a ceiling for pricing you can expect to get in the future. With your investment goals and projected returns in mind, and keeping this upper limit in mind, you can then decide if the asking price is suitable for you.
Gaining valuable insights into the pricing trends of a development has never been easier – thanks to online property portals! Not only can you have a quick look at the highest transacted price, but you can also filter based on unit size (e.g. number of bedrooms) for a deeper understanding.
Despite being similar to the earlier point, we consider the difference between the two concepts considerable enough to warrant this to be a separate point on its own.
The peak price is not quite the same as the recently-set highest transacted price, as this is based more on the all-time peak price during the property’s lifespan, rather than the freshness of the transaction.
If you buy a property near the highest price the development has ever achieved, making a profit off of it will be challenging. Setting a new record price will be hard to do since potential buyers are likely to be anchored to the peak price, meaning they won’t be willing to pay more.
Gain insight into a property’s value and you can be sure you’re paying the right price – and who knows, you might just get lucky and stumble upon a great bargain on an undervalued asset!
D.I.Y with Online Evaluation Tools
Technology has made it incredibly easy to access free online evaluation tools for assessing the value of a property – unless you’re an agent, of course.
With just a few details keyed in, these tools can provide an estimated value. But to make sure you’re getting the best price possible, consider pairing the online tools with websites that showcase past property transactions.
This way, you’ll be able to calculate a more accurate valuation of the property and compare it to the asking price.
Professional Help
Rather than conducting an in-depth valuation and analysis yourself, why not let the professionals take care of it? Here are three fantastic options to consider :
As an investor, it is absolutely essential to understand the valuation of a property and the right cost to pay in order to maximize your chances of success on your property investment mission.
Leave emotions out of it and, if the price doesn’t add up, don’t be afraid to turn away from the deal. The real estate market is never-ending and there will always be another property that fits both your budget and expectations.
Gaining clarity on the right buying price for your property doesn’t have to be complicated – I’m here to help! I’m always available to provide further guidance and professional advice.
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:
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