In my earlier post, I’ve concluded that I will have to sell my Resale HDB Flat after MOP. If you have been following my property journey so far, you would have known that I will be looking at a loss of at least $90,000 from this sale. Although it is a tough call to make, Kay and I believe it is the right thing to do moving forward. And so we did. We sold our first home – a 4 room resale HDB flat.
In this post, I will be sharing the process of us selling it and some of the challenges we face (our sale was delayed for 3 months) and what’s next after the sale. So stay tune and enjoy this MELEPAK session.
Engaging An Agent
When our flat MOP, we toyed with the idea of selling and upgrading (just like the many FB ads that pops up) but we weren’t sure if we could and what are our numbers. Honestly, at that point of time, I was not knowledgeable when it comes to property. (Hindsight: I should have seek more knowledge about property before the flat MOPed) But I knew I wanted to upgrade and having a dual key house would be a cherry on a cake as we can earn passive income while staying.
Therefore, when I saw a dual key condo up for sale on Property Guru, I was intrigued and shared with Kay. At that point, we still do not know our numbers and if we can afford it (or even how much is needed to buy such house). So we contacted, Era, the agent listing the place.
Free Consultation by Property Agent
After agreeing to meet and discuss, Era do up our numbers and shared with us. That’s when we realized the big loss that we are facing with our current flat (you can read that up here). After the consultation, Era (the property agent) gave us time to think and decides if we want to go ahead with selling the house.
When we decided that we should cut our loss and sell it, we agreed to engage Era to help us with the selling. We were really new and didn’t know the procedure. We do not know what can or can’t we do when engaging agents. So we just gave Era 6 months exclusive to list our place. (after we signed, then we get to know that we do not need to sign an exclusive and we can just sign for 3 months)
Stage Our Home And Prep For Selling
Once agent was selected, Era started to assess the house and shared tips on how to stage our home. She also took some pictures and pointed some things that needs fixing before she can list the house. Everything seems doable but then, she noticed something about our place that will be a deal breaker to potential buyer – water damage.
Fixing Our Water Damage
We noticed throughout our 5 years stay that there was a stain on our ceiling but didn’t make a big deal out of it. But when Era assess our place, she identified it as water damage and we need to get it check and even fix it. Era direct us to HDB to get them to check the severity of the damage if any. And only then can they list our place.
Damage Assess By HDB
So when the HDB came and assess it, she confirms that it was an old water damage and will no longer cause any further damage in the future. We were relieved. But to sell the place, we need to fix the water damage even to the cornies (yes, our flat is that old that we still have the old style cornies).
Hiring A Contractor
She gave us contact of contractor who is able to help fix the damage. We called him and he quoted us $500 to fix everything and gave a fresh coat of paint. At that point, we just wanted to get it done so we agreed. After agreeing on a date, the damage was fixed within a day and when it was done, there was not a single evidence to suggest there was a damage in the first place. Awesome.
From the back and fro of emails with HDB, to multiple assessment by HDB and contractor, all of it took us 1.5 months to settle the issue. Now, we are ready to get it listed and market it.
Contacted CPF To Asked About Accrue Interest
As we are looking at a loss when we sell the house, Era told us to contact CPF and get them to confirm that we will not have to top up cash to pay for the loss and the accrue interest.
It took them a couple of weeks to reply and get back to us. And it was confirmed that we do not have to top up cash into our CPF when we sell our place since we are making a loss. That was a relieved.
Setting The Selling Price
When Era wanted to start marketing the place, she asked what is our selling price. Ideally, we wanted to list it for $400,000 (The price we bought it) but of course that would be unrealistic on our part. We didn’t know what price to set and told Era to help us decide on the price.
Based On Past Transacted Price
To set a realistic price, Era shared that we could look at past transacted price in our block or surrounding blocks. We uses tools such as SRX, 99.co and Square Foot to check the transacted price. Here is the past transacted price for our block:
As you can see, there wasn’t a lot of transaction for my block. There are only 5 transaction over the past 6 years including the one that we bought in 2014. The latest transaction is just a few months ago (at the time that we are selling) and it sold for $340,000.
And from the screenshot above, you could also see the downward trend in price over the years. (Boohoo!) This is definitely something for us to take note of even when buying a house which is to look out for price trend of the units that you are planning to buy.
Check past transaction and price trend before buying or selling your house. It will give you an idea of what to expect.
Pak Melepak (2020)
Now that we know the latest price is $340,000, it would be impossible to set our asking price at $400,000. In the end, we set our selling price at $360,000. Fully aware that we might have to accept a lower price if we want to sell it fast.
Once selling price is set, Era starts to post listing on Property Guru and all other property platform.
Viewing By Potential Buyers
In the next couple of weeks after that, Era arranged a number of viewing for us. There are many things to take note and prepare when conducting viewing. I’ve highlighted some of these tips in this post.
One of the trick that Era did was to arrange a few viewing in the same day. These help Kay and I to schedule our time accordingly. It also gave an impression to all the potential buyers that there was higher demand for the house.
Honestly, we could have staged better but Kay and I just ensure our place is clean and tidy. Apparently, that is enough. =)
Offers Coming In
After some viewing, Era shared that we have 2 interested buyers BUT both offered $340,000. This was expected as they probably based their offers on the recent transaction. When we received both offers, Kay and I sat and discussed if we can stomach selling it at $340,000 knowing that we will face a loss of $100,000.
We agreed and we decided to just cut our loss and move on. But because there are 2 interested buyers, we told Era to inform the 2 potential buyers and do a bidding style. Whoever offered the most will get the unit. In the end, we got a final offer of $348,000 and the whole selling process took us 4 months.
After the sale of our house, we felt sad but at the same time, motivated to move on and do better for our next few houses (God’s willing).
Lesson Learnt From The Sale Of Our Resale HDB Flat
Being a first time seller, there are a lot of mistakes that we did and would probably have not done the same next time. So let me share some tips and what we learnt. This way you would not make the same mistake with your selling process.
1. Be Picky When Choosing Your Agent
I must say that we just hantam only any agent without doing much research. Era, the agent that we engaged, is just a random agent that we contacted from a listing. We didn’t know about her before this. If I were to give her a rating out of 10, she would be a 6. She barely passed as there are no additional service on her part. Her advised on what we should do is minimal. In fact, we did not engage her when we bought our next house as she does not share our vision.
So if I were to reset the time, I would take the effort and time to meet more agents. I would listen to what they have to say before committing to them.
2. Exclusive Or Non-Exclusive Agent
The next tip that I wanted to share is you should know that you have the right not to grant any agent exclusivity. It is not a must thing. We didn’t know at that point of time so we just signed the contract without realizing what we are doing.
Basically, it is ok to not grant exclusivity and engage a few agents to sell your place. This creates competition and MAYBE gives you more chance to get better price.
Having said that, Kay and I did discussed and came to a conclusion that we would still grant exclusivity even if we knew it. The reason being, we felt that it is not right to get a few agent to ‘work’ for us and in the end only one of them gets the commission.
But just know that it is ok to do that. =)
3. You Can Negotiate The Agent Commission
Although standard commission is 2% of selling price, you are allowed to negotiate on the commission and it is not a fix thing. So if you think you do not want to pay 2% commission, you can try to negotiate with potential agent. The important thing is that you need to know that you can negotiate and it is not a fix thing.
4. Importance Of Staging Your Place
I also learnt the importance of staging your place for potential buyers. It really helps them to imagine the place when they bought it. This will make selling easier.
BUT it is hard for us as we have TOOO MANY things at our place. Plus, we are just too busy to bother. Also, knowing that no matter how much we stage it, we will still make a loss really dampens our mood to stage it.
For your case, if you are selling your place, please stage it nicely and keep unsightly things somewhere!
5. Know The Past Transacted Price
The last thing that I learnt which is the most important is finding out the past transacted price. This is a good skill to have as it not only helps with the selling process BUT also when we want to buy next time.
So if you do not know how to check yet, please go and learn and find out. You can also contact me and I can share how exactly I did this. And that sums up the top 5 things that I learnt from selling my resale HDB flat.
Sold My House And It’s Time To Move On
With that, I hope my sharing this time is useful especially for those who are in the process of selling. We made a lot of mistake but it was an experience. We know we loss a lot of money from this resale HDB flat but we have plans to move on. Hopefully, we will be better off in the long run as compared to if we are to keep the place.
That’s all for this MELEPAK session. If you have read all the way till the end, I appreciates it. Please leave a comment below with your thoughts and questions. Thank you!
