I had read that story too, even a 30 years old 5RM flat in Ghim
Moh is selling at 840K! I hope they won't faint when they seek
mortages to those HDB houses, bank is able value those 30YEARS
(WITH 69 YEARS LEASE) 5RM flats above 800K?
Bank valuation only half of market rate
I AM currently selling my freehold semi-detached property, which is
in brand new and move-in condition. Based on the transacted rate of
$720 per square foot (psf) in October last year for another house
in the vicinity, and the conservative indicative price from DBS at
$2.3 million (which works out to slightly above $580 psf), I asked
for $2.4m for my property.
One buyer was keen to buy the house after viewing it, and checked
with his bank, Citibank, for valuation. After getting Citibank's
valuation at $1.4 million, a staggering difference from my asking
price, the buyer backed out.
When I called Citibank in disbelief, the female officer gave me an
indicative price at $1.6 million after checking with the bank's
'only approved valuation agency, Knight Frank'.
I called back shortly after and asked to talk to someone at a
higher level. An AVP named Adeline Wee called me back.
First, she asked me if I was a Citibank customer. Once she found
out I was not, she told me in an unfriendly manner that her officer
had given the correct indicative price based on 'a few valuation
agencies'. This differed from what the earlier officer had told me
- that Knight Frank is Citibank's only approved valuation agency. I
pressed Ms Wee for the names of the other agencies, and she named
DTZ. She then reminded me that since I am not a Citibank customer,
I have no right to question the accuracy of its indicative price.
Does she not realise my buyer and I are potential customers? Also,
whether I am a customer or not should not change the fact that
Citibank should be diligent and professional enough to seek
valuations from more than one agency, a practice I believe other
banks follow. Such an inaccurate property valuation directly
impacts property sellers like me.
I then called Knight Frank to check further. A director of
valuation, Ms Lydia Sng, called me back after checking for a few
hours. She insisted that its valuation was correct and based on the
'latest and only caveat' for a property near mine. I then told her
that based on the Urban Redevelopment Authority's (URA) publicly
available caveat records, there are three comparable houses nearby
which were sold recently at $720 psf (October last year), $620 psf
and $605 psf (July last year). She was surprised and did not seem
aware that such records are available, which is astonishing
considering she is in the property industry and I am not.
When I searched URA's caveat records for details of the caveat she
had based the valuation on, I was shocked to find it had been
lodged way back in June last year, before prices of suburban
housing started moving up. This is serious as the resulting
difference in price valuation is a million dollars, or roughly half
the current market rate. Does Knight Frank base all its valuations
on outdated transacted prices? If so, aren't the resulting property
valuations a poor reflection of true market trends?
Does any authority or professional organisation evaluate valuation
practices in the market?
