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DEAL NO DEAL DEAL NO DEAL

Property sellers keep changing minds as they hold out for more cash
He was all set to rent a unit in a condominium in the east.

And had already agreed on the rental amount set by the owner.

Then the owner changed his mind and wanted to sell it instead.

IT consultant Ryan Lim consulted his wife and they agreed on the asking price of $430,000.

But the owner changed his mind again. He decided not to sell after all.

Mr Lim, 32, said: ‘We were upset because I thought we had an agreement. He put us through so much trouble and wasted all our time and effort.’

The owner wanted to rent the unit out for $1,800, but Mr Lim decided not to take up the offer.

He said: ‘It’s a matter of principle. I refuse to deal with anyone who can’t keep their word.’

Mr Lim then found a 1,500 sq ft unit in that same development, and was willing to match the asking price of $550,000. But he said the seller upped the price to $570,000.

EXASPERATED

A similar-sized unit was sold for $485,000 last month.

He has given up on the second property and is now in discussion over a third one in the same estate.

Said an exasperated Mr Lim: ‘It’s really frustrating looking for a place now. It seems like the sellers are either not sincere about letting go of their place or they’re just plain greedy.’

In Mr Lim’s case, there was only a verbal agreement. So, legally, there’s nothing a buyer can do, property agents said.

However, industry watchers said that this take-it-or-leave-it attitude by the sellers has been frustrating buyers and property agents in the last couple of weeks.

Property agents whom The New Paper spoke to claim deals are now more difficult to close because sellers keep changing their prices and minds.

It’s reminiscent of the run-up to the property peak in 1996, although this time, the phenomenon seems more rampant, they said.

This is happening not just in private properties in prime districts 9, 10 and 11, but those in the suburban areas as well.

So are sellers getting more greedy and unrealistic went it comes to pricing their units?

Property agent Sally Kong said she encountered three such sellers in a week earlier this month.

She said: ‘Even though I had willing buyers, the owners suddenly increased their asking prices. It frustrates the buyers and also agents who can’t close the deals.

‘In one case, I had already received the buyer’s cheque and was doing the paper work when the seller called and said, ‘My heart was beating very fast this morning. I think God is telling me that I should wait for a month later and then sell’. Can you imagine that?’

ERA assistant vice-president, Eugene Lim, described it as the ’shifting goal-post’ syndrome.

He explained: ‘We had one seller who increased his asking price without any rational reason. The agent asked the seller how he arrived at the new price and he said ‘because my brother said we can sell for this amount’.

‘It’s just ridiculous when people increase their prices based simply on emotions.’

Dennis Wee Properties director Chris Koh said: ‘The market is moving and these sellers know that. It could be greed stepping in. That’s why they keep increasing their prices. But there are also some who are just testing the market.’

Mr Eugene Lim warned that sellers should be realistic about their properties.

‘Every property has its own attributes such as location and ambience. You can’t read about the premium properties and just assume it applies to your place. Yes, the market may be doing well but you also have to be reasonable about your asking price.

‘The euphoria has created an unrealistic state of mind for some people.’

RECORD HIGH

En-bloc deals hit a record high of $6.38 billion up to 15 May this year, just 18 per cent shy of the $7.75 billion record achieved for the whole of last year, according to figures from Jones Lang LaSalle.

Housing loans by Singapore banks also reached $64.3 billion in March, the highest on record so far, according to a Business Times report earlier this week.

Meanwhile, in the HDB market, expatriates are also having problems getting a flat to rent due to a supply crunch and picky landlords, according to the Sunday Times.

One expatriate said that whenever he viewed flats, there would be at least 10 other expats viewing the same unit at the same time.

And these sellers also forget that they could sabotage their own deals with their unreasonable prices because it may not match the bank’s valuation.

For example, if the seller wants

$1.2 million for his place, but if the bank’s valuation is only $1 million and they’re willing to lend only that amount, the buyer will have to cough up the remaining $200,000 in cash.

Mr Eugene Lim said: ‘For those buying properties in the $1 to $2 million bracket, the bank’s valuation is very important. The buyers won’t pay too much above valuation unless the place has very good attributes. And most people still need bank loans to buy property.’

For one seller though, it’s just a waiting game for him.

Business development manager Roy Wee, 39, is now considering offers for his 1,130 sq ft condo unit in Serangoon.

The last transacted price was about $470,000 for a similar same unit last month and he is asking for about $500,000 now.

He said: ‘I’ve turned down a few offers because I believe prices will go up even more. I don’t mind waiting because it’s no loss to me.’
 
Source : The New Paper - 29 May 2007