Before March 2014, when you were selling your HDB flat you would have to first apply for a HDB valuation.
Once you have received your valuation for your property that you are planning to sell only then will you decide on the price.
After March 2014, HDB abolished this practice of HDB owners applying for a valuation and then deciding on their property price.
This was to curb the rising HDB prices as sellers were asking for Cash, above the valuations of the property.
COVs are now NOT part of the negotiation process.
Both buyers and sellers must now agree on a price before the buyer can apply for an official valuation.
Will I Know my HDB Valuation?
As the buyer will be the one paying and applying for the valuation you will not know your valuation unless the buyer decides to disclose the amount.
In fact most of the time buyers will not reveal the valuation but simply will decide to proceed with the purchase or otherwise.
What if My HDB Valuation is Higher than the Selling Price?
As a seller, the final price negotiated before the official valuation is applied is your final price. It will not change.
For the buyer if the valuation is lower than the final selling price they would have to pay a cash premium above the official valuation of your property. In this case, most buyers will likely not proceed with the purchase of your HDB flat.
Scenario: Valuation is Lower than Agreed Price.
After a few weeks of marketing you finally found a buyer to agree on a price of $500,000 for your HDB flat. The buyer puts down a deposit of $500 and applies for an official HDB valuation.
After a few days, HDB updates the buyer that the official valuation of your HDB flat is $490,000. That means the buyer needs to top-up the difference of $10,000 in cash.
They will not be giving you the $10,000 in cash but to HDB. HDB will then issue your cash proceeds normally. For you it feels like nothing happened as the buyer proceeded to fork out the $10,000.
In many cases, buyers will not proceed with the purchase as most of them don’t have cash to spare as they’ll need cash for renovation or furnishings. In this case you will keep the $500 deposit given to you.
Scenario 2: Valuation is The Same with Agreed Price.
After a few weeks of marketing you finally found a buyer to agree on a price of $480,000 for your HDB flat. The buyer puts down a deposit of $500 and applies for an official HDB valuation.
After a few days, HDB updates the buyer that the official valuation of your HDB flat is $490,000. That means the buyer does not need to top-up cash for the property as it is within the official HDB valuation.
Similar to Scenario 1, if the buyer proceeds, will be based on the agreed price before the official valuation was done.
As a HDB home seller the only way for you to sell for the highest price is through research and understanding how to get a higher price for your HDB when selling.
Compare your price with your surrounding neighbourhood that have sold (not the ones that are currently selling as their prices are usually too high).