Developers to cut prices next year for 31K unsold private condos, 1/2 subject to ABSD

[Sammyboy RSS Feed]

An honorable member of the Coffee Shop Has Just Posted the Following:

Battered residential developers forced to slash prices to evade hefty fines

Over 14,600 flats will be subject to ABSD soon.

Too many flats, too little time. The race to move unsold inventory is going to heat up in 2015, as the clock is ticking for policy-battered residential developers whose projects are subject to the Additional Buyer’s Stamp Duty (ABSD).

Under the ABSD, projects built on sites purchased under the Government Land Sales programme since 7 December 2011 have to be fully sold within five years. Otherwise, developers will be fined 10% of the purchase price for sites bought before 11 January 2013, and 15% of the purchase price for sites acquired after this date.

According to Nomura, there are currently about 31,000 units of unsold private housing inventory across the island. Of this, 47% or 14,600 flats are subject to the ABSD rule.

“While the overall representation is less than half, the situation appears more pressing for unsold inventory in the OCR (a proxy for mass market private housing). Our estimates suggest about 80% of the circa 12,100 units in uncompleted inventory in the OCR are subject to the ABSD rule. We therefore think there could be more urgency for developers with such inventory to cut prices in 2015F to stimulate sales,” noted Nomura.
- See more at: http://sbr.com.sg/residential-proper....QMf8NbRA.dpuf


Click here to view the whole thread at www.sammyboy.com.