Seller optimism is on the rise, as indicated by the cash-over-valuation (COV) prices, which finally picked up in the third quarter, after a 9-month decline.
According to the latest figures from the Singapore Real Estate Report (SRX), the overall median COV in the third quarter is $30,000, up $4000 from the $26,000 recorded in the second quarter.
When the Housing Development Board (HDB) released its flash estimates earlier this month, it showed resale flat prices to have risen by 2% in the third quarter to hit a record high.
This could in part, be due to rising COV prices. The median resale price for flats is now at $450,000, up 2.3% from the previous quarter. The highest median price is for executive flats in Serangoon at $690,000.
Seller optimism is fuelled by an increase in demand, which is happening despite the economic slowdown. Overall, Singapore has not been badly affected by the downturn. Unemployment is low and the country is not yet in recession. Purchasing power remains high.
Signs are pointing to a better Asian economy next year, so buyers are ditching the “wait-and-see” approach and heading to the estate agents’ before the quarter ends.
The HDB market isn’t the only one on a rebound. Resale prices for private apartments are also on an upward trend, reaching a record high of $1156 psf. Median rents for HDB flats have seen a slight increase from $2300, where it has stayed for the past 9 months, to $2400 in the third quarter.