ST Forum : Valuation report is not a marketing tool

Apr 9, 2010

Valuation report is not a marketing tool

I REFER to Ms Phyllis Law's Forum Online letter yesterday, 'Buyers shouldn't
pay for valuation reports', in which she suggested that the valuation report
in an HDB resale transaction is a 'marketing tool and part of the agent's
service'.

The valuation report is not a marketing tool. In this context, the valuation
report provides the market value of the HDB resale flat on the date of
valuation and is used to apply for HDB's mortgage loan or withdraw CPF
savings by the buyer of the HDB resale flat. The seller does not require a
valuation report to sell his flat. Nor does the estate agent require one to
market the flat on behalf of the seller.

In the terms and conditions of sale/purchase of an HDB resale flat available
on HDB Infoweb, paragraph 4.5 reads: 'A valid valuation report done by an
HDB-assigned valuer must be produced latest at the First Appointment if the
buyer is taking a loan and using CPF money to pay for the flat. A valuation
report is valid for three months from the date of report.'

Therefore a valuation report is required of the buyer (not the seller) if he
is taking a mortgage loan and using CPF money to pay for the resale flat.
This is regardless of whether the buyer is taking a mortgage loan from HDB
or a bank. This further indicates that the valuation report is for the
benefit of the buyer.

Nonetheless, buyers of HDB resale flats can ask their appointed agent or
seller to consider bearing the cost of the valuation report as part of
purchase negotiations.

Dr Tan Tee Khoon

Chief Executive Officer

Singapore Accredited Estate Agencies