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Thread: Offset on stamp duty 'not wrong'

  1. #1
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    Default Offset on stamp duty 'not wrong'

    http://www.straitstimes.com/Singapor...ry_761555.html

    Offset on stamp duty 'not wrong'

    Analysts say Far East's offer to 'reimburse' property buyers is a common tactic, not illegal

    Published on Feb 1, 2012

    By Cheryl Lim


    PROPERTY consultants say there is nothing wrong with a promotion by developer Far East Organization in which it offers buyers a 'reimbursement' of stamp duty.

    The developer has mounted several marketing promotions since the latest batch of property measures came into effect early last December, which included a hefty 10 per cent extra stamp duty on foreign buyers.

    The promotions included furniture vouchers and the offer to reimburse stamp duty.

    However, some buyers such as Straits Times reader Samuel Tan questioned whether such tactics were legal. In a letter to the Forum page, he said it was 'a blatant attempt by the property developer to dilute the effect of the cooling measure'.

    The Straits Times understands that the Far East promotion is intended as a price discount rather than a total reimbursement of stamp duty. It is not meant to offset the additional stamp duty that applies to some buyers.

    It is also understood that the subsidy rate differs among the various Far East projects, but that at each project, it applies at the same rate to all buyers across the board. It can take the form of furniture vouchers or cash, both of which are typically given to buyers when a project attains its Temporary Occupancy Permit.

    But the amount of discount a buyer may get also depends on how negotiations with the project's selling agent pan out, said Mr Colin Tan, head of research and consultancy at Suntec Chesterton International.

    Property experts also say that while this tactic is essentially a price cut, some developers may be reluctant to cut prices directly or use such a label, as it may seem unfair to those who bought units during earlier phases of a project's launch.

    Market watchers say the use of such promotions is an industry-wide practice, highlighting similar cases in 1998 and in the early 2000s.

    Such tactics are not illegal, say property consultants, adding that the private residential property segment is a free market. The use of such tactics is probably one way the market is dealing with the recently announced measures, they say.

    Mr Png Poh Soon, head of research at Knight Frank, said adopting these kinds of tactics gives developers more flexibility in their price strategies.

    'If developers give an outright discount of 5 per cent, people will think the government measures are working. But at the back of their minds, buyers will also be thinking of the additional stamp duties they will have to pay.

    'So in a way, it also helps developers show that they are addressing the needs of their buyers,' said Mr Png.

    But industry experts add that it is ultimately up to individual developers to decide if, and how, they want to cushion the effects of any new government policies and measures.

    Other developers have also been rushing to push out their residential projects in order to avoid any further uncertainty.

    [email protected]

  2. #2
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    Got some ppl who have been prayimg for crash muzt hv

    complained abt this scheme.

  3. #3
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    com'on.. do u seriously think the govt scholars are so dumb,not able to forseen under methods from developers.

    it's a matter of,to slowly close the gate or immediately shut the gate effects.

    *slowly close the gate, alrdy offend so many kpkb owners,

    if immediately shut the gate off the foreigners. maybe see street strike and riot.

  4. #4
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    Far east used to give early bird discounts way before cm5 was announced. How is that not legal? Ultimately, the onus is on buyers to make sure they are confortable with the price they pay. If they accepts mark ups followed by discount. Then so be it.

  5. #5
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    If developer wants to give 10% discount, its their choice. Which buyer in their right mind will complain about discounts? The more the better. It is often the bitter non-buyers who complain. One man's potion is another's poison...

  6. #6
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    maybe FEO should say "Price cut" then these ppl will be happy. But of course owners will be questioning, what the heck

    in the end , it's the same thing. why those ppl also kpkb

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