Changes meant to make sale process more regulated and transparent
NEW collective sale regulations will kick in today - a few weeks earlier than many in the industry had expected.
The rules, which were passed in Parliament two weeks ago, were expected to take effect this month, but a date had not been specified.
The much-anticipated announcement, which came yesterday, took some en bloc players by surprise.
'We thought it was going to be later, and expected the Government to give more lead notice as well,' said Mr Jeremy Lake, executive director of investment properties at property firm CB Richard Ellis (CBRE).
He added that 'initial indications were that they were likely to kick in only at the end of the month'.
The changes are aimed at making the sale process more regulated and transparent.
They require more conditions to be fulfilled, such as adhering to stricter requirements on setting up a sales committee and providing a five-day cooling-off period for owners to change their minds after signing the collective sale agreement.
The changes will apply to all developments that, as of today, have not obtained consent from enough owners to go en bloc - 80 per cent of owners by share value, or 90 per cent for estates less than 10 years old.
It will be back to the drawing board for the owners of these developments, who will have to start the collective sale process all over again and do so by the new rules.
Most property firms said they each had 'two or three' en-bloc estates that will be affected by today's changes.
But CBRE's Mr Lake expressed relief that there was clarity on when the rules would finally kick in.
Indeed, for the last few weeks, a few projects had been suspended because no one knew when the changes would take effect, said Mr Tan Hong Boon, executive director of Credo Real Estate.
'Most lawyers were also not prepared to quote their fees for new en-bloc projects because they didn't know how much more work they would have to do under the new rules,' added Mr Tan.
Some consultants scrambled last night to get the last one or two signatures.
Mr Steven Ming, director of investment sales at Savills Singapore, said he had expected to have 'one or two more weeks to get the last few signatures'.
'I guess I will have to work overnight,' he joked.
Other consultants, such as Jones Lang LaSalle's head of investments, Mr Lui Seng Fatt, said they have been advising would-be en-bloc sellers to follow the new rules since last month.
'Fortunately, none will have to start all over again,' he said.
CAUGHT BY SURPRISE
'We thought it was going to be later and expected the Government to give more lead notice as well.'
MR JEREMY LAKE, executive director of investment properties at property firm CB Richard Ellis, on the announcement that new collective sale regulations will take effect from today
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