Crowds at the Bellewaters showflat for the re-balloting exercise. (Photo: Qingjian Realty)
Chinese developer Qingjian Realty conducted a re-balloting exercise for 10 units at its fully-sold Bellewaters executive condominium (EC) in Sengkang last Saturday (8 April).
The 651-unit project comprises three- to five-bedroom units with sizes ranging from 926 sq ft to 1,528 sq ft. It is expected to be completed by this quarter.
PropertyGuru understands that a mix of unit types were resold and demand was particularly strong. “The ballot units were more than four times oversubscribed with a total of 43 applications,” said Yen Chong, Deputy General Manager at Qingjian Realty.
“These units became available when the original buyers did not meet the eligibility requirements (of the Housing and Development Board) for an EC purchase,” she noted, without going into specific details.
One industry expert who chose to remain anonymous, said that in such cases, a change in family nucleus is the main contributing factor. This could be due to the breakup of an engagement, divorce, or death of a family member, with the first two scenarios being the most common reasons. Thus, they must pay a five percent cancellation fee, down from 20 percent in 2013.
Calling it a common issue faced by EC developers, the source added: “The developer will have to actively re-market such units to avoid incurring the Additional Buyer’s Stamp Duty (ABSD).”
Under the ABSD rules introduced in December 2011, developers must build and sell all units at their projects within five years of acquiring the sites. Failure to do so will incur a 10 percent levy on the land price, plus a five percent interest. Subsequently, the levy was increased to 15 percent for sites purchased from January 2013 onwards.
Alvin Tan, Executive Director of Local Projects at PropNex International, said that in some instances, the affected units could be resold at higher prices, but this depends on which stage the units were released for sale.
“If it is just after launch, it could be sold at launch price. If sales are good, the price would possibly be higher. Only when the project is nearing completion are developers maybe under pressure to offload the units, which could possibly see some discounts coming in,” he said.
Qingjian would not disclose pricing details for the re-balloting exercise, but URA Realis data shows that the total median transacted price of units at the 99-year leasehold project is $795 psf.