Developers have started to offload their stocks through various attractive schemes when their prime developments obtained Temporary Occupation Permit (TOP) phase or Certificate of Statutory Completion (CSC).
Most Schemes are targeted at cash rich buyers and who feel that there might be a relieve of the Additional Buyer’s Stamp Duty (ABSD) within next 2-3years.
This year 2016 we noticed 4 schemes which created buzz in the real estate industry.
- Experiential Leasing Scheme
- Enhanced Purchase Plan
- Deferred OTP
- Stay then Pay
Which scheme is more attractive? Less risk? More suitable for you?
Let’s go through them in a systematic way.
Table 1. Shows Various Payment Schemes
Table 2. Shows Comparison Table of the Features
* As of 1st September 2016, the project compared is The Peak II / Lloyd 65 by TG Development, Hilltops by SC Global, OUE Twin Peaks and D’Leedon / Interlace by CapitaLand.
Table 3. Shows Total Amount Paid by Year 2018
As of 1st September 2016, the project compared is The Peak II / Lloyd 65 by TG Development, Hilltops by SC Global, OUE Twin Peaks and D’Leedon / Interlace by CapitaLand.
+ Deferred payment additional 5% of Purchase Price
^ 2BR Maintenance fee SGD 318 per month, ^^2BR Maintenance fee SGD 246 per month (Based on 2BR at D’Leedon)
Table 4. Shows Impact if Property Price drop by 20%
SSD- 2nd Year 12% of Selling price – ^ Assume that the property has been rented out since key collection – * Based on Estimate Rental price of SGD 3,800 per month – ** CapitaLand project can only be rented out after 1 year – # 10% forfeited for non complete – ## 20% forfeited, rental amount to be kept
Above Comparison Tables are intensively researched by our Guest Analyst, Kevin Nur Amin Widjaja , who is an avid property broker and investor. He can be contacted via email at kevin.nur.amin@gmail.com .
Our Editor’s views
After going through the various schemes, we can see that the Developers are taking serious consideration into the buyer’s concerns in current subdue market. With the various schemes, Buyers impacted by Total Debt Servicing Ratio (TDSR) and/or Additional Buyer’s Stamp Duty are now back to the market to check out these prime properties, which are in long term definitely a good buy in current down market.
Also looking at the recent En Bloc sales in prime CCR sector, we foresee that future new developments will command a much higher selling price which will surpass the current.
Therefore we are seeing strong buying interest when the various payment schemes are out.
Do your sums and happy investing !
