Property valuation in Singapore is a not-so-secret tool used by astute asset buyers and home flippers to minimise their losses and maximise profit when purchasing or selling a property.
With prices for HDB resale flats and private property remain at record-highs in Singapore, you may be tempted to sell your home for a tidy profit. According to HDB Resale Statistics for Q2 2024, the Resale Price Index sits at an all-time high of 187.0 points, increasing 2.3% from Q1 2024. Similarly, URA real estate statistics for Q2 2024 reveal the Price Index increasing 0.9% quarter-on-quarter and sitting at 206.1 points.
Equipped with a property valuation report, sellers can steer clear of bad acquisitions and make sure that they can get the best price available. Learn more about how to get a property valuation report and how PropertyGuru valuation tools can help you.
What Is Property Valuation in Singapore?
In essence, this is an estimate of the fair market value of a property, whether it’s an HDB flat, private condo, landed housing, retail space or a factory unit.
This is extremely important especially if you are considering selling your property, as this serves as an indispensable benchmark, through which buyers and sellers haggle over the price of a property.
What Determines Your Property Valuation in Singapore?
1. Indicative Valuation
Indicative house valuation in Singapore is a simple and rough calculation of your property’s worth. Typically, this can be obtained by averaging the selling prices of all similar properties transacted recently within the vicinity of your area.
This kind of property valuation in Singapore is mostly done by unit owners by asking around and researching records. However, this method can be time-consuming and inaccurate. A more convenient and easier way is to go to a reputable real estate portal or listings website. For example, the PropertyGuru valuation tool takes from a database of the latest transactions.
You may also consult a licensed property agent, who is familiar with your area’s market. They usually provide estimates for free to attract a client. Alternatively, get a free PropertyGuru valuation estimate in just two minutes.
2. Factors Affecting Actual Property Valuation in Singapore
| Property’s address | Is it situated in a secluded place or in a prime area? Is the property strategically located close to amenities, transport nodes and major roads? |
| Zoning | What is the intended use of the property according to the Urban Redevelopment Authority? Is it zoned for residential or commercial? Some properties have mixed usage like F&B on the first level and residential on the second floor. |
| Property’s land area, built-up space and number of rooms | Generally, larger properties command higher prices on absolute terms. Smaller properties usually fetch higher PSF prices. |
| Building age and state | Typically, new properties with modern specifications are more expensive than ageing properties. The former are also more in demand due to easier upkeep. |
In comparison, actual valuation is more meticulous as it is carried out by real estate professionals like valuers, who are paid a fee to assess a property’s estimated market price. Usually, actual valuations are based on the above factors.
After a valuer or surveyor finishes their job, you will get a comprehensive property valuation report that describes your property’s land area, structure and status along with the market price.
If you can afford it, experts recommend that you engage three different valuers. Then, use the median of their calculation to obtain a more accurate property valuation report.
How Do You Receive Your HDB or Private Condo Property Valuation Report?
HDB homeowners need not worry about house valuation in Singapore as they can get a property valuation report on their unit from the office of the Housing & Development Board. Accuracy is also not an issue as the house valuation in Singapore will be carried out by qualified staff licensed by the Inland Revenue Authority of Singapore (IRAS).
For owners of private properties, they can engage licensed appraisers who are members of the Singapore Institute of Surveyors and Valuers. Another option is to hire property consultancies, including DTZ, JLL, CBRE, Propnex, ERA Realty, Huttons Asia, Knight Frank, OrangeTee & Tie and Colliers International.
Perks of Obtaining Property Valuation in Singapore
A good property valuation report, coupled with an in-depth grasp of the market value of similar properties transacted within your vicinity, provides you with a crucial tool that will assist you in negotiating the property’s price with potential buyers.
Below are the other advantages of a performing a house valuation in Singapore and obtaining a property valuation report.
1. Helps in Getting Funds
As standard industry practice, financial institutions require a house valuation in Singapore before a property buyer can obtain a mortgage or housing loan. This is because this document will be used as a reference by banks on how much it can lend.
If the property you want to purchase has different house valuation in Singapore, the bank will utilise the average of two or more valuations.
2. Smoother Negotiations
Performing a house valuation in Singapore allows you to bring a property valuation report to the negotiating table. This way, major disagreements over the property price are less likely to occur.
It’s also then easier to create rapport between the seller and buyer, enabling both of them to close the transaction as quickly as possible.
3. Protects the Interest of Buyer and Seller
Thanks to this document, sellers are less likely to agree to an unfavourably low price, while buyers are guided from spending too much.
According to experts, it’s not advisable to purchase a property if the price is 3% higher than the average value of similar properties nearby. Likewise, sellers should not accept if the offered price is lower than the market value by 3% or more.
If you need help, you can always get in touch with us and use our free PropertyGuru valuation tool. Aside from being able to monitor your property value in real-time, you can also gain more insight into how much homes in your neighbourhood have sold for.
Other Things that Impact Property Price
Aside from the aforementioned material factors that professional valuers take into account to determine a property’s value, there are also intangible things that affect the price.
1. Property’s Sentimental Value
There are some homeowners who significantly increase the asking price of their property due to their emotional attachment to it. This happens when some sellers list their homes for sale at an exorbitant price due to its sentimental value. But due to the high price, the property is often left unsold for months or years.
2. Blood Ties
Inter-family transactions typically don’t reflect the actual value of a property. For instance, parents selling their home to their children, or the transfer of ownership among relatives is usually undervalued.
3. Urgency
There’s a market saying that a fair market price is not possible if the seller is desperate to sell or when the buyer is desperate to buy. For instance, a man who needs to sell his home to fund the medical expense of his terminally ill wife is more willing to accept a lower price to get money quickly.
4. Superstition
In Singapore, home sellers and real estate agents are not required by law to reveal if a property was the scene of a gruesome murder. They also don’t need to disclose if the house is haunted or inhabited by something paranormal. Usually, these stigmatised properties are offered at lower prices and are hard to sell.
Similarly, superstitious buyers may shun inauspicious homes, like those near a cemetery or with bad feng shui.
Amid the transparent nature of Singapore’s property market, one of the riskiest things a seller or buyer can do is to determine the value of a home just by relying on gossip, rumours or hearsay without validating the price or performing due diligence.
For more property news, content and resources, check out PropertyGuru’s guides section.
Looking for a new home? Head to PropertyGuru to browse the top properties for sale in Singapore.
Need help to finance your latest property purchase? Let the mortgage experts at PropertyGuru Finance help you find the best deals.
