By Person of Interest (guest contributor)
A decline in property transactions came after the 7th round of property cooling measures that saw a jump in the Additional Buyer’s Stamp Duty (ABSD), and a further reduction in Loan-to-Value ratios for property investors in January 2013. This was followed just five months later by the Total Debt Servicing Ratio (TDSR) loan framework that reduced transactions across all sectors.
Buyers are taking the opportunity of a slowing market to secure bargain deals. Some call it a ‘Buyers’ Market’ now.
But is it really a buyers’ market?
A property agent friend (let’s call him Agent A) who focuses in the Core Central Region shared this interesting story with me when he treated me at my favourite salad store. The sharing started after we overheard a couple sitting next to us debating on the fair price to pay to a car seller they would be meeting later that evening.
Agent A shared that his buyer(let’s call him Buyer A) put up a bid of $300,000 lesser than the asking price, when the recent transaction data showed $50,000to $80,000 less would be more acceptable.
Buyer A went to great lengths to provide all the supporting news articles and his chart depicting how dire the economy would be, and why the seller should accept his bid of $300,000lower than the asking price. This was despite Agent A highlighting numerous times that the seller (through his agent) had turned down a bid that was $200,000lower than his asking price.
Buyer A did not give up – he instructed Agent A to bypass the seller’s agent to bring his message to the seller. Agent A politely educated Buyer A that this was not the correct protocol.
Buyer A started to discredit Agent A for not acting in his interest and that he was not helping at all.
So whose market is it really?
It is true that the real estate market in Singapore is not as buoyant as during the period from 2007 to 2010.
It is also true that property buyers currently are able to pick the best property of their liking.
However, Buyer A adamantly stuck to his strong belief that as it was a ‘Buyers’ Market’, buyers have all the leverage, and he did not absorb any of the information provided to him.
The questions remain:
Was the buyer serious enough or in a hurry to make any purchase?
Was the seller serious enough or in a rush to make a sale or did he really think his asking price was fair?
So in a slow market, whose market is it?
In the end, it is a ‘Willing Buyer, Willing Seller’ market. Otherwise, there would be no market at all.
By guest contributor Person of Interest, a Service Excellence Advocate and an avid Forum writer.