DC rate hike Mar-Sep 2013

[mcmlxxvi]

Revision of Development Charge Rates
28 Feb 2013 05:00 PM

1 The Ministry of National Development has revised the development charge (DC) rates for the period from 1 March 2013 to 31 August 2013. The review is carried out on a half-yearly basis, in consultation with the Chief Valuer.

2 The DC rates for Group A (Commercial) have increased by an average of 24%, with the largest increase of 39% in Sectors 114 & 115 (Yishun / Sembawang / Woodlands / Choa Chu Kang / Jurong West area).

3 The DC rates for Group B1 {Residential (landed)} have increased by an average of 4%, with increases ranging from 7% to 15% in 41 sectors and no change in DC rates for the remaining 77 sectors. The largest increase in Group B1 rate is 15% in Sectors 92 & 93 (Guillemard Road / Tanjong Katong Road / Haig Road / Changi Road / Joo Chiat / Telok Kurau area), and Sectors 95 to 97 (Siglap / Upper East Coast / Bedok South / Bedok Road / Marine Parade area).

4 There is no change in the DC rates of Use Group B2 {Residential (non-landed)} for all sectors.

5 For Group C (Hotel/Hospital), the DC rates have an average increase of 26% with the largest increase of 46% in Sector 112 (Jurong Lake District / Jurong East / Bukit Batok / Clementi / West Coast area).

6 The DC rates for Group D (Industrial / Warehousing Use) have increased in 4 sectors, with increases ranging from 14% to 26% while there is no change in the remaining 114 sectors. The largest increase is 26% in Sector 115 (Woodlands / Senoko / Sembawang / Yishun area).

7 There are no changes in the DC rates of the remaining four use groups, Groups E – H (See Appendix 1 for Table of DC Rates).

8 The Use Groups Table and the number or boundaries of the 118 geographical sectors remain unchanged (See Appendix 2 for Table of Use Groups).

9 The revised DC rates, to be read in conjunction with the Use Group Table and the set of Geographical Sector maps (Map A and Map B), will be effective from 1 March 2013. The new rates will apply to cases which are granted Provisional Permission (PP) or 2nd and subsequent extension to the PP on or after the effective date.

10 If there is any disagreement over the DC payable for any development proposal, calculated based on the rates under the respective Use Groups, developers and owners can opt for a case-by-case valuation by the Chief Valuer, as provided for in the Planning Act.

11 For any enquiries on DC sectors and use groups, please contact Mr. Loh Teck Hee from URA at Tel. No. 6321 8286. For enquiries on valuation matters, please contact Ms Elaine Leong from IRAS at Tel. No. 63512469.


Issued by: Ministry of National Development
Date: 28 February 2013

[DC33_2008]

How can price drop with the increase in land price, DC, foreign worker tax levy, etc?

[mcmlxxvi]

DC commenting on DC....haha....nice.

well govt want stability and not bubble burst.

so stabilise at 10% price growth annual. Cheers. Lol

so according to what some say wage incr 40% with govt help, affordability is definitely increased significantly! Muahahahaha

[Shanhz]

does it mean that the GLS land price will go up in these areas?

or only relevant to enbloc / redevp cases?

[Leeds]

does it mean that the GLS land price will go up in these areas?

or only relevant to enbloc / redevp cases?

DC is payable only when developer wants to maximise the land to its full plot ratio be it residential or commercial. As such, developer will need to take into consideration the additional DC cost when they bid for the land usually in private sale such as en bloc sales. It does not necessariy means higher land price depending on the state of the market. With higher DC, the asking price for en bloc sale may has to be lower if the market is soft.

It does not affect GLS.

[Shanhz]

DC is payable only when developer wants to maximise the land to its full plot ratio be it residential or commercial. As such, developer will need to take into consideration the additional DC cost when they bid for the land usually in private sale such as en bloc sales. It does not necessariy means higher land price depending on the state of the market. With higher DC, the asking price for en bloc sale may has to be lower if the market is soft.

It does not affect GLS.

thanks leeds.
so i guess it only affects a certain group of pple. esp those who waiting to huat on en bloc.

[mcmlxxvi]

The main takeaway from the PR is that govt is starting to 'take care' of previously ignored sectors like landed and industrial.

MM crazed locales get further power 'topup'.

Was wondering the rationale of the hike on landed. Guess too many rebuilt their landed into (ugly) 4storey monsters.

From URA(nus):

Homeowners of landed property must apply for planning permission to reconstruct their existing property or redevelop the property back to a single house.

Reconstruction refers to projects where the:

proposed increase in the Gross Floor Area (GFA) of the property exceeds 50% of the approved GFA (e.g. by adding a second storey to a single storey house)

external building walls to be removed and replaced with new walls exceed 50% of the approved external walls

columns/beams/floor slabs to be removed and replaced exceed 50% of the approved columns/beams/floor slabs
Redevelopment refers to projects where an entire building is demolished and a new one erected. You can increase its GFA as long as you comply with prevailing Development Control parameters for landed housing (PDF).


What must I comply with when redeveloping my property?

Your proposed reconstruction or redevelopment must comply with prevailing Development Control parameters for landed housing (PDF).

You also have to comply with technical requirements by other government agencies. Your QP (Qualified Person) will be able to advise you on the requirements.


What else should I take note of when redeveloping my property?

You may have to pay development charge if the Development Ceiling (proposed GFA) is higher than the Development Baseline (approved GFA). However, most projects that reconstruct/redevelop from one existing landed property back to one landed property do not incur development charge.


How do I apply for planning permission?

Please refer to the step-by-step guide – How to Apply: Development Application via CORENET eSS.

The application fee for additions and alterations varies. Please refer to the Fees Schedule for Development Applications (PDF).


I need help. Who can I contact?

Contact the Development Control Group at:
Tel: (65) 6223 4811 (Monday to Friday, 8:30am to 5:30pm)
Email: [email protected]

[DC33_2008]

I cannot remember if I have paid DC for the reconstruction of my landed property. Do we need to? I thought is it applies only to developer. To develop one lot is not a developer.

The main takeaway from the PR is that govt is starting to 'take care' of previously ignored sectors like landed and industrial.

MM crazed locales get further power 'topup'.

Was wondering the rationale of the hike on landed. Guess too many rebuilt their landed into (ugly) 4storey monsters.

From URA(nus):

Homeowners of landed property must apply for planning permission to reconstruct their existing property or redevelop the property back to a single house.

Reconstruction refers to projects where the:

proposed increase in the Gross Floor Area (GFA) of the property exceeds 50% of the approved GFA (e.g. by adding a second storey to a single storey house)

external building walls to be removed and replaced with new walls exceed 50% of the approved external walls

columns/beams/floor slabs to be removed and replaced exceed 50% of the approved columns/beams/floor slabs
Redevelopment refers to projects where an entire building is demolished and a new one erected. You can increase its GFA as long as you comply with prevailing Development Control parameters for landed housing (PDF).


What must I comply with when redeveloping my property?

Your proposed reconstruction or redevelopment must comply with prevailing Development Control parameters for landed housing (PDF).

You also have to comply with technical requirements by other government agencies. Your QP (Qualified Person) will be able to advise you on the requirements.


What else should I take note of when redeveloping my property?

You may have to pay development charge if the Development Ceiling (proposed GFA) is higher than the Development Baseline (approved GFA). However, most projects that reconstruct/redevelop from one existing landed property back to one landed property do not incur development charge.


How do I apply for planning permission?

Please refer to the step-by-step guide – How to Apply: Development Application via CORENET eSS.

The application fee for additions and alterations varies. Please refer to the Fees Schedule for Development Applications (PDF).


I need help. Who can I contact?

Contact the Development Control Group at:
Tel: (65) 6223 4811 (Monday to Friday, 8:30am to 5:30pm)
Email: [email protected]

[mcmlxxvi]

I cannot remember if I have paid DC for the reconstruction of my landed property. Do we need to? I thought is it applies only to developer. To develop one lot is not a developer.

Perhaps u didn't exceed the GFA max? Dunno

[DC33_2008]

I have max it out in the reconstruction of my place 12 years ago. But URA rules have changed and allowable GFA has gone up for my place. Cost of construction was about half of today's price for similar size.

Perhaps u didn't exceed the GFA max? Dunno

[reporter2]

http://www.businesstimes.com.sg/arch...-rise-20130225

Published February 25, 2013

Development charges projected to rise

Consultants cite appreciation in land values over past half-year

By Kalpana Rashiwala


[SINGAPORE] Property consultants expect development charge (DC) rates - payable for enhancing the use of some sites or building bigger projects on them - to head upwards come March 1 for all major use groups. They cite an appreciation in land values over the past six months.

In some cases, the hikes could be in double digits.

DC rates, revised on March 1 and Sept 1 each year, are stated according to use groups - such as landed residential, commercial and hotel - across 118 geographical sectors. The Ministry of National Development, in consultation with the Chief Valuer, revises DC rates based on current market values. In addition to being tracked in property circles as they can impact redevelopment sites with a sizeable DC component, DC rates are seen as the government's reading of land and property values.

The average DC rate for industrial use, which saw the biggest hike (among major use groups) of 14.3 per cent in the last revision six months ago, could potentially rise 8-12 per cent this round, according to Jones Lang LaSalle. Colliers International projects an increase of 5-10 per cent, while Knight Frank is predicting the appreciation will be 3-5 per cent.

Arguing the case for a further hike in industrial use DC rates this round, JLL's South-east Asia research head Chua Yang Liang said: "Prices fetched for industrial Government Land Sale (GLS) sites in the past half-year reflect an average premium of about 59 per cent compared with land values implied by the prevailing Sept 1, 2012 industrial use DC rates for the respective locations. This is a shade higher than the March-August 2012 period, when the prices fetched by industrial GLS sites reflected an average premium of 55 per cent to then-prevailing DC rates."

Advancing another reason industrial DC rates are likely to rise, Colliers director Chia Siew Chuin highlighted the strong demand and escalating prices of strata industrial units which prompted the authorities to introduce a seller's stamp duty for this segment in January. She also notes that JTC Corporation raised industrial land rents by 5-10 per cent from Jan 1, 2013, after leaving them unchanged in second-half 2012.

Analysts predict Sector 114 - which includes Tuas, which has been a hotbed of transactions of short-tenure sites sold at state tenders in the past half-year - will see a substantial DC rate hike. Colliers estimates that prices at which industrial Government Land Sale (GLS) sites were sold in this sector over the past half year on average reflected a premium of about 39 per cent to the DC rate-implied land value.

Another sector that Colliers's Ms Chia tips for a significant DC rate hike is sector 115, where GLS sites in Yishun and Woodlands were sold at substantial premiums (80-108 per cent) to the DC rate-implied land value.

Last round, the market was surprised by a 9 per cent escalation in the average DC rate for commercial use. CBRE predicts commercial use DC rates will lead gains among the major use groups, possibly ascending 12-15 per cent on average in the upcoming revision, citing investment sales deals in the past half year such as 79 Anson, Mapletree Anson, Katong Junction and NOL Building at prices substantially above land values implied by DC rates in the respective locations.

JLL expects the average commercial use DC rate to climb about 2-5 per cent, while Colliers predicts the rise will be in the order of 5-8 per cent, citing robust demand for strata office and shop units as seen at Alexandra Central.

The average DC rate for the use group that includes hotels increased 10.8 per cent last round. This time it could climb a further 5-10 per cent, both JLL and Colliers predict. Petra Blazkova, research head (Singapore and SE Asia) at CBRE, says the geographical sectors that will see the biggest rate hikes will include Sector 112, which covers Jurong East, where a hotel site was sold at a state tender in November at about 200 per cent above the DC rate implied land value. Analysts also predict the Victoria Street/Jalan Sultan, and MacPherson locations may see a big jump in hotel use DC rates, citing transactions in these areas.

With landed residential DC rates left untouched in the previous two rounds of revisions, a moderate rise averaging 1-3 per cent can be expected this time, argues Colliers's Ms Chia. She highlights that Urban Redevelopment Authority's landed residential property price index rose 1.1 per cent and 1.8 per cent quarter-on-quarter in Q3 and Q4 2012, a stronger pace than the 0.1 per cent and 0.4 per cent increases in Q1 and Q2 last year.

"In addition, the Good Class Bungalow (GCB) market has been active and there should be some increases in the sectors where GCBs are located," she added. JLL's Dr Chua sees potential upside in the landed DC rate in GCB areas of 2-5 per cent on average, with stronger potential for upward revision of 5-7 per cent in non-GCB areas.

During the previous revision, the average DC rate for non-landed residential use inched up 1.2 per cent. Come March 1, it could go up 5-10 per cent, predict both Colliers and JLL. Knight Frank reckons the rate will inch up 0.5-1 per cent.

Colliers reckons DC rates are likely to rise significantly for Sectors 72 (which includes Alexandra area) and 82 (Tiong Bahru Road/Bukit Merah View), 97 (New Upper Changi Road/Tanah Merah/Bedok South), 107 (Ang Mo Kio/Thomson) and 112 (West Coast, Clementi), citing GLS and private-sector land deals at prices above DC rate-implied land values.

Analysts also note that in the prime Dracyott Park area (in Sector 39), Hampton Court was sold at a record $2,526 per square foot per plot ratio - 51 per cent above the land value implied by the current DC rate for the location, possibly setting the stage for a DC rate hike in the sector.