Hi Mr Vipul,
The recent spate of enbloc sales happen for various reasons, mainly because of the short supply in GLS. With the Master Plan, Developers are bullish on Singapore property market in the long term. Hence, Developers are exploring the en bloc sales and redeveloping older properties.
As for their funding, it is not surprising that these Developers have deep pockets, because apart from paying out the existing owners, they will also have to top up development charge to the Government, and top up the lease to 99-years. This is apart from the demolition and construction cost that they would have factored in before proceeding ahead with the en bloc. A part of it could be under bank financing, but these borrowings will be backed by their assets as well.
May I know what is your objective in knowing these? Are you looking to buy something? And how will these factors affect your decision making?
In my opinion, these are not the key considerations you should think about if you're planning for a purchase. Rather, I
I'd recommend you focus on which are the value buy in today's market, because this "Buyers' Market" could turn into a "Sellers' Market" in due time. I'm sure you would prefer to get in during a "Buyers' Market", right?
Should you need any further assistance in matters relating to property, please contact me at my mobile
9748 6305
. I will be happy to assess and share with you the possibilities for you in the current market.
Thank you.
Best regards,
Robbie Chen
9748 6305
PropNex Realty
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Thanks for your reply.
Yes, you are right - I am looking to buy. However, I am not so sure if this is the right time to buy.
If developers are funding these projects themselves, then maybe they are driving up the market without there being any real demand. Agreed that the Government has not released any new land for development, but then I feel that there is not much demand too.
For an investor looking for returns, he must see healthy rental demand, which does not seem to be there as of now. With the government restrictions on the issuance of new EP and PR (which seem justified - but that is another matter), I don't see the rental market going up.
Real demand comes from an economy up-swing and that does not seem to be happening in the near future. Granted that the buyers will only have to face the situation years from now, but it is a bit of a gamble and could as well turn out to be a bad buy.
Regards,
Vipul