One way cash-over-valuation (COVs) can be lowered is if the government limits private homeowners and second-time buyers from acquiring resale HDB flats, according to Tejaswi Chunduri, PropertyGuru’s real estate analyst.
Her comments come after Minister for National Development, Khaw Boon Wan, highlighted in his blog yesterday that private property owners topped the list of median COV paid in Q4 2011 at S$45,000.
As for second-timers, first-timers, permanent residents (PRs) and singles, they paid S$34,000, S$33,000, S$32,000 and S$31,000 respectively.
"Private homeowners and second-timers have more money to spend and can afford the higher COVs asked by sellers," said Chunduri. "If they are willing to pay a higher price for a better location, the seller would certainly be happy."
According to some property agents, private homeowners who are eyeing for HDB flats include those aged 40 to 50, and who have up to S$200,000 worth of savings.
They added that there is a growing interest among this group of buyers for HDB flats. However, Mr Khaw said it is unfair to blame the higher prices on a particular group.
The Housing Board has always maintained that "prices are influenced by a myriad of factors such as pace of economic growth and market sentiments."
Affirming that home prices have shot up within the last two to three years, Mr Khaw asked for the public’s patience, as he has been working for the market to "stabilise in due course".
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