Development charge for private condos hiked by up to 33%
The development charge (DC) rate for landed housing in Singapore remains the same from 1 Sep 2018 to 28 Feb 2019, while that for non-landed residential was increased by 9.8 percent on average, said the Ministry of National Development (MND) on Friday (31 Aug).
In particular, the DC rate for non-landed homes was hiked by 3.0 percent to 33 percent across 75 out of 118 geographical sectors, while that for the remaining 43 sectors was unchanged.
The biggest increase took effect in Sector 43 and Sector 67. The former comprises Tanglin Road, Cuscaden Road, Orchard Blvd and Grange Road, while the latter covers Dalvey Road, Stevens Road, Anderson Road, Orange Grove Road, Tanglin Road, Napier Road and Cluny Road.
More: Developers expect condo prices to fall.
ZACD Group executive director Nicholas Mak told the Business Times that the new DC rate hike was more focused than the prior one for non-landed residential. In 1 March 2018, the levy for this usage group was raised by 12 percent to 38 percent across 116 out of 118 areas, with sectors 19, 23 and 34 seeing the largest gain.
“The general upward revision of DC rates is in line with the other pre-emptive measures put in place to cool the property market and tame bullish bids by developers,” noted OrangeTee & Tie’s research head Christine Sun.
More: Savills still upbeat over condo prices.
“Moving forward, such steep increases in DC rates are less likely to be seen as the en bloc market is already cooling off and developers’ thirst for land is moderating after the property measures,” she added.
Huttons Asia’s research head Lee Sze Teck concurs, forecasting that the future DC rate hike for non-landed residential will likely range from zero to 2.0 percent.
In consultation with the Chief Valuer, MND revises DC rates biannually on March 1 and Sept 1 for different land uses across 118 geographical sectors in the city-state. Such levy is payable when the site owner intensifies or enhance the use of the property.
Looking to purchase a new home? Read our in-depth reviews of all new launches or check out our buy/rent guides.
