Singapore Property Market-
Development charges (DC) for large chunks of the real estate market were cut, in line with softening market conditions. These charges are levied by the Government on owners of the land, or the person who applied for planning permission, for enhancing the use of some sites, or building bigger projects on them. They are revised by the National Development Ministry every half year; the revised slate apply for the period March 1 to Aug 31 this year.
DC rates for four groups – commercial, non-landed residential, hotel or hospital and industry- fell, while DC rates were unchanged for five others, including landed residential and place of worship or civic and community institution.
DC ratees for commercial fell by 2% on an average, with the largest decrease of 5% of sectors including Raffles Place, Marina Bay Financial Centre and Dhoby Ghaut.
Condo DC rates fell by 1% on average, with the largest decrease of 4% for sectors including Stevens Road and Bukit Timah, River Valley Road, Clementi Road, Jurong West Avenue 2 and Choa Chu Kang Way, and Sentosa.
DC rates for hotel and hospital use fell by 2% on average, while those industry use fell by 3% on average.
The largest decrease of 16% for industrial DC rates applies to Sector 114, which includes Boon Lay Jurong West, Tuas and Sungei Kadut.
Analysts welcomed the reduction but the move did not come as a surprise on the back of a softening real estate market, in particular with the supply overhang in the commercial office sector and cooling measures impacting the residential market.
“Both the commercial office and retail markets are under pressure from demand and supply imbalances with occupier statistics showing softening rental values for both markets,” according to Desmond Sim, CBRE head of research.