Sunday, September 2, 2007

Free Legal Clinics In The Heartland

Source : The Sunday Times, Sep 2, 2007

Legal help at 2 centres is part of Law Society's move to make the law accessible to everyone

THE Law Society will offer free legal advice in two heartland locations, in a bid to make such help readily available to the public.

Starting from Sept 10, at least two volunteer lawyers will be at either the North West or South East Community Development Council - on alternate days from Monday to Thursday - to help those who need legal assistance.

Each session will run from 7pm to 9.30pm, and each person will be given up to 20 minutes to consult a lawyer.

This is part of the Law Society's move to make the law equally accessible to everyone - a point raised by Chief Justice Chan Sek Keong yesterday at the launch of the Law Awareness Weekend at VivoCity.

CJ Chan said the poor and less educated were often 'taken advantage' of by those who know the law. 'There are laws and a legal system in Singapore that protect citizens' rights, and citizens or residents in Singapore are entitled to equal protection of the law.'

The opening of the Community Legal Clinics was also meant to promote pro bono work among lawyers.

Law Society president Philip Jeyaretnam calls pro bono work a 'special responsibility': 'We all benefit from being lawyers and from having the advantages of our education and we, as a profession, see the need to give back in return for the position we hold.'

Before the Law Society's Pro Bono Services Office was set up last month, there was no central body coordinating lawyers doing independent pro bono work. Free legal clinics in the past were held on an ad hoc basis at family service centres or community centres.

The Law Society currently recommends, but does not make it compulsory, that each lawyer puts in 25 hours of pro bono work a year.

Lawyer Harold Seet, who has been practising for 26 years, said: 'People tend to look at lawyers as people who are difficult to approach and who hoard a lot of money.

'So we are trying to dispel all that. We are ordinary, approachable people just doing our jobs.'

At VivoCity yesterday afternoon, 14 lawyers provided free legal counselling for passers-by with legal queries.

Mr Gopinath Pillai, a litigation lawyer who heads the society's Criminal Legal Aid Scheme, spoke to about 10 people during a two-hour stint yesterday afternoon.

Many of them, he said, just wanted to know if they needed a lawyer for their simple cases.

Besides the legal consultation booths, there are also talk-show style discussions on topics such as gambling, consumer credit, family laws and employment laws.

The event continues today with the free legal advice available from 2pm to 4pm.

He Gave Up Annuity But She Didin't

Source : The Sunday Times, Sep 2, 2007

Finance Correspondent Lorna Tan talks to two retirees who bought annuities but have different tale to tell

Mr Rajamanickam & his wife Madam Sarojini -PHOTO: CAROLINE CHIA, GRAPHICS: MIKE M DIZON

ALL the current talk about annuities is rather painful for retiree S. Rajamanickam, 75.

He was one of a fairly small group of Singaporeans who bought this type of insurance voluntarily. Soon, annuities are expected to be compulsory for Central Provident Fund (CPF) members who are currently under 50.

Mr Rajamanickam bought his annuity in 1992 but changed his mind and cashed it in soon after and has lived to regret deeply the 'foolish' move.

The decision is costing him nearly $5,000 a year in lost income payments - which would have been guaranteed as long as he lived.

Mr Rajamanickam and his wife, Madam Sarojini, 75, have just celebrated their 50th wedding anniversary - a joyous occasion but one that underlines the fact that Singaporeans are living longer.

An annuity provides monthly or yearly income payments for as long as you live. It involves paying an insurer a one-off lump sum that is invested to provide this regular income.

Annuities have long proven to be unpopular among Singaporeans, as they have been little understood and tended to seem unnecessary to some.

Mr Rajamanickam was typical of the sceptics. Back in October 1992, the former primary school teacher reluctantly bought two annuities - one for himself and one for his wife. He was acting on the advice of a friend, a former colleague who became an NTUC Income insurance agent.

In an interview with The Sunday Times, Mr Rajamanickam recalled that his friend visited him at his Upper Bukit Timah home and recommended the Income Guaranteed Annuity Policy. This plan offered monthly or annual annuity payouts for the life of the policyholder. If the policyholder died within the first 15 years, a beneficiary would get the payouts for the rest of that 15-year period.

But if he died after the first 15 years, no payments go to the beneficiary.

Mr Rajamanickam had just retired from teaching at Marsiling Primary School and was sitting on a handsome pile of money. He had just received his teaching gratuity of $130,000, as well as his CPF savings of $115,000. He had to leave $35,000 as his CPF Minimum Sum, which provided monthly payouts of up to $292 for 15 years.

'I had just retired at 60, and my friend knew I had funds lying around,' he said.

Although he had already bought two small endowment life insurance policies, he had never heard of annuities. And even after his friend explained how an annuity worked, Mr Rajamanickam was not impressed.

'It didn't appear attractive. The returns of the annuity was about 5 per cent, similar to what the banks were offering then for fixed deposits. Secondly, I didn't expect to live past 70.

'So, I was reluctant to purchase the annuity, but I was persuaded to buy just to please him as he was a very good friend, and I figured I wouldn't make a loss,' he said. His friend suggested a single premium of $100,000 for each annuity, but Mr Rajamanickam decided he would invest only half the amount on each annuity.

The 15-year guarantee feature meant he - or his wife, if he died - was assured of getting more than the $50,000 premium he paid for each.

The couple opted for annual payouts that commenced in November 1993. The annual payouts were $4,800 for Mr Rajamanickam and $4,315 for his wife. The accumulated payouts worked out to $72,000 and $64,725 for Mr and Mrs Rajamanickam, respectively, after 15 years.

Mrs Rajamanickam, a housewife, usually leaves financial decisions to her husband. In this case, however, she talked him into selling his annuity after just three years.

'I didn't think then that he needed the annuity payouts, as he would be receiving a monthly teaching pension of about $2,339 till he dies.

'I thought the lump sum in cash he could obtain by terminating the annuity could be put to better use,' explained Mrs Rajamanickam.

He went ahead and terminated the annuity in 1996 after three annual payouts. For Mrs Rajamanickam, there was no question about maintaining her annuity as it would be her lifeline if her husband died before her.

So far, her payouts have amounted to $60,410.

Looking back, Mr Rajamanickam realises that his friend would have persuaded him to keep the annuity - but he had died by then.

The cash value of Mr Rajamanickam's annuity amounted to $36,000, which he placed in a fixed deposit.

He soon began to realise that it was an 'unwise' decision, as banks' interest rates started to drop. He said: 'I still regret my foolish action. Sometimes, God gives you a fishing rod and you throw it back because you didn't want to catch fish, and so it's gone. I tried to buy another annuity, but I can't get the payouts I was receiving.'

With declining interest rates, annuities in the current market give lower payouts than those sold in the 1990s.

Still, Mr Rajamanickam is grateful that he is in a more fortunate position than most people, despite the opportunity cost of terminating his annuity.

'I just do whatever comes naturally. I had no ambitions, no aspirations. I just do what I have to do. I'm surprised at what I am today. I didn't expect a life this comfortable, this good,' he said.

A Malaysian and now a Singapore permanent resident, he came to Singapore as a teacher when he was 19 in 1951. A fondness for landed houses led him to buy his present 6,750 sq ft, three-bedroom home, through a colleague, for a mere $18,000 in 1955. For 11 years, he rented it to soldiers of the Royal Air Force stationed at Tengah Airbase before moving his family in. The house was fully paid up in 1968.

Things also went well on the homefront. Last Wednesday was the couple's 50th wedding anniversary. They have two children - Mr Ramachandran, 48, a vice-president at Abbot Laboratories, and Ms Shakunthala, 43, a paediatrician living in the United States - and five grandchildren.

An avid nature lover, Mr Rajamanickam is a member of the Nature Society in Singapore and Malaysia and still leads groups for long treks in places such as the Taman Negara Nature Reserve in Pahang.

He keeps his mind active by teaching English, Mathematics and Science three times a week to students at the Chinese Development Assistance Council.

He and his wife could get by with about $1,000 a month for day-to-day expenses and twice-a-year travels. The couple does their marketing and refuels their car in Johor Bahru.

Analysts call for more US measures to ease credit crunch

Source : The Sunday Times, Sep 2, 2007

Many want the Fed - which has pledged to act to limit impact on economy - to cut interest rate

Nearly two million US homeowners are at risk of losing their homes.

NEW YORK - THE White House and the US Federal Reserve remain under pressure to aggressively address the sub-prime crisis, despite their attempts on Friday to reassure investors.
Although analysts welcomed the moves, several of them want the Fed to lower interest rates on Sept 18 to ease the credit crunch, while Democrats called for more relief from the government.

Fed chairman Ben Bernanke on Friday pledged to act to limit the spillover of a credit crunch on the economy, as President George W. Bush unveiled aid to homeowners facing foreclosure.

The two separate announcements were aimed at curbing contagion from a housing crisis that some fear could derail the US economic expansion by causing credit markets to freeze up further.

Wall Street closed out another erratic week with a big gain on Friday after investors took the speeches as signs that they will not be left to deal with problems in the mortgage and credit markets on its own.

The Dow Jones Industrial Average rose 119.01, or 0.90 per cent, to 13,357.74 on Friday. The broader Standard & Poor's 500 Index rose 16.35, or 1.12 per cent, to 1,473.99.

Markets viewed the Fed remarks as opening the door to a potential interest rate cut on Sept 18 that could lower borrowing costs and stimulate credit markets.

Citigroup economist Robert DiClemente said he believes that 'the speed and magnitude by which the overall financial setting has deteriorated are consistent with downside risks...that justify policy (rate) action'.

The Fed's existing measures - offering discount rates to banks - have not been enough to keep the affected debt markets liquid, said Deutsche Bank economists Joseph LaVorgna and Carl Riccadonna in a note to clients.

'The current medicine (of easier discount window lending) has not worked,' they said.

'The asset-backed commercial paper market has remained completely frozen. If this situation continues, a much broader credit crunch could develop, which would have serious negative consequences for the economy. The Fed will not take this chance.'

Professor Alan Binder at Princeton University, and vicechairman of the Fed from 1994 to 1996, said: 'There was a tone of guarded pessimism as opposed to guarded optimism. I think they should and they will' cut the benchmark interest rate.

There is also a 'significant' chance that the US economy will sink into recession if the Fed stays on the sidelines, said Mr Martin Feldstein, president of the National Bureau of Economic Research.

'My judgment is there is enough of a risk that the Federal Reserve should be responding,' Mr Feldstein said.

Meanwhile, Democrats wanted the government to do more and said the issue is likely to become a topic in the 2008 presidential elections. Senator Christopher Dodd, chairman of the Senate Banking Committee, said Mr Bush still needed to 'get serious about this problem' and go further.

AFP, AP, Bloomberg, New York Times

$29m For A Piece Of Singapore History

Source : The Sunday Times, Sep 2, 2007

Glencaird, the last of four bungalows built a century ago in White House Park, goes to mystery buyer

THE mystery buyer who snapped up a White House Park bungalow has secured a special piece of Singapore history for his record $29 million purchase price.
The 105-year-old Victorian home, Glencaird, was designed in the late 1870s by Regent Alfred John Bidwell, a famous British architect who has been called the originator of the country's black and white colonial bungalows.

Mr Bidwell's houses are marked by timber elements painted black and the rendered surfaces white, according to Julian Davison's book, Black And White: The Singapore House 1898-1941.

The book also says that many of these Victorian bungalows were built for the Public Works Department for civil servants and officers during World War I.

The Singapore House 1819-1942 by Lee Kip Lin, states that White House Park, a 22ha estate, was granted to Gilbert Angus in 1852.

By 1862, it was sold to Reme Leveson & Company. It was later sold to John Fraser, from Fraser & Neave, who built Glencaird and possibly also Cree Hall, which was also designed by Mr Bidwell.

From 1947, Glencaird became the official residence of the Australian High Commissioner before its 1996 sale to Wheelock Properties, which declined to name the new buyer.

The bungalow is the last left out of the four built in White House Park estate more than a century ago.

It was gazetted as a heritage building in 1991 which means no structural modifications can be carried out.

'Glencaird is a very important building which has yet to be thoroughly documented,' said Dr Kevin Tan, president of the Singapore Heritage Society.

The 22,000 sq ft bungalow has two living and dining rooms and five bedrooms.

In 1997, Argentinian architect Ernesto Bedmar, who headed the conservation efforts at the Goodwood Park Hotel, began restoring Glencaird.

Mr Bedmar described it as a 'challenge' as he had to 'modernise and update the look while respecting the original concept'.

The restoration included laying parquet flooring, new carpentry, additional beams and columns and building a basement.

The huge and imposing staircase was 'kept intact' as well, said Mr Bedmar, although modern features such as air-conditioning, a swimming pool and a basement entertainment room were added.

Work on the entire Glencaird Residences - which included building 11 other bungalows - was finished in 1999. But Glencaird itself stayed empty until a good enough offer came along, said Wheelock's chief executive officer, Mr David Lawrence.


GLENCAIRD'S ORIGINAL OWNER was John Fraser, from Fraser & Neave. The 22,000 sq ft bungalow (above) has two living and dining rooms and five bedrooms. The entrance to the house (below), which was designed in the late 1870s by famous British architect Regent Alfred John Bidwell, was placed at a corner instead of the centre front, breaking long-held traditional planning, to take advantage of the pleasant views. The house was built in such a way as to ensure good ventilation and sunlight.



THE BUNGALOW WAS THE OFFICIAL RESIDENCE of the Australian High Commissioner from 1947 until its sale to Wheelock Properties in 1996. In this picture (above), the tower appears to have been torn down.


RESTORATION WORK by Argentinian architect Ernesto Bedmar, who headed conservation efforts at the Goodwood Park Hotel, began in 1997. He described the works as a 'challenge' as he had to 'modernise and update the look while respecting the original concept'. The restoration included laying parquet flooring, new carpentry, additional beams and columns (above) and building a basement. Modern features such as air-conditioning, a swimming pool (below) and a basement entertainment room were added. Work on the entire Glencaird Residences was completed in 1999 but Glencaird stayed empty until a good enough offer came along.


Storeys Of Dust And Noise

Source : The Sunday Times, 2 Sept 2007

Homes and businesses surrounded by en bloc constructions bemoan the physical discomfort and additional costs they bring

BESIEGED BY EN BLOC REDEVELOPMENTS, Ban Nee Chen Florist is surrounded by (left to right) The Sea View condominium, which is already near completion; Amber Lodge, which has already been sold en bloc and is awaiting demolition; and The Esta condominium, which is under construction. Florist Steven Ng (above) said the dust has affected his plants so much, he has to hire two workers to clean them. -- PHOTO: MUGILAN RAJASEGERAN

THE welter of collective sales around town might be making a lot of Singaporeans richer but they have made life a blooming misery for florist Steven Ng.

His Amber Road business has been besieged by en bloc building works that have not only cost him a packet in clean-ups, but have also prevented him from even getting into his own shop at times.

Once one condo construction site winds down, another building goes under the demolition hammer and the nerve-wracking cycle of dust, noise, cement-mixers and trucks revs up again.

It has been going on for four years, and ‘at the moment, it looks like it’s never going to end’, said Mr Ng, 41.

It is a similar story islandwide with about 170 buildings - or 10,000 flats - sold in collective deals since the start of 2006, according to CB Richard Ellis.

But Mr Ng is unlucky in that some areas such as Amber Road, St Thomas Walk and Telok Kurau Lorong N have a concentration of en bloc redevelopments.

His troubles began in 2003, when Mer Vue Developments bought the Sea View Hotel next door to Mr Ng’s 7,000 sq m Ban Nee Chen Florist and started building The Sea View, a 546-unit condo.

A year later, MCL Land bought Maryland Point condo across the road from Mr Ng, and construction on the 400-unit The Esta began.

Far East Organization has acquired Rose Garden, a condo sharing an L-shaped border with Mr Ng’s nursery.

Mr Ng said he has spent $200,000 above his operational budget dealing with construction-related problems over the four years.

Cracks appear on his premises, building work deters customers while the dust affected his plants so much he had to hire two workers to clean them.

THE CHANGING LANDSCAPE near St Thomas Walk has fuelled complains about its noise levels.

Mr Ng is now spending $40,000 to build an enclosure to house his plants. He hopes it will be up before work starts on the Rose Garden site.

Other residents in Amber Road, St Thomas Walk and Telok Kurau Lorong N are also grumbling.

Two properties - Nclave and Emprado Suites - are under construction along a 400m stretch of Telok Kurau Lorong N while three others have been sold en bloc. Between the condos sit fed-up landed property owners.

Nearly half the condos at St Thomas Walk in River Valley have gone through an en bloc sale. Three new ones are under construction - St Thomas Suites, The Ritz and SkyPark - while four - St Thomas Court, Eng Tai Mansion, Airview Towers and Phoenix Court - have been sold.

Neighbours in both areas are up in arms about the dirt and noise, rumbling engines, crashing concrete, pile driving and the beeping from reversing vehicles.

Writer Michelle Kong, 47, who lives in a house across from Nclave in Telok Kurau, said she has been falling ill because of the lack of sleep and bad air. ‘I’m so tensed up and bad tempered and falling sick a lot. I feel like I’m going crazy,’ she said.

Complaints about noise have risen so much - from 4,953 in 2005 to 6,160 in 2006 - that the National Environment Agency is toughening up noise limits on sites starting work on and after Oct 1.

Most families fight the noise and dust by shutting windows and cranking up the air-conditioner but that is not a cheap fix.

Retiree Ang Sin Yam, 75, who lives in a house in Telok Kurau Lorong N, said his utilities bill is up 20 per cent from two years ago, while neighbour Mrs Kong has had a 50 per cent rise to $600.

Residents also lament the changing landscape.

WITH THE NOISE AND DUST, banker Thomas Chan and his son Marshall miss the rural feel of the St Thomas Walk neighbourhood before en bloc fever gripped the area. Mr Chan was nostalgic about how 'it used to be like a forest, quiet and pleasant'. Now, they can't even go for walks because of the heavy machines. -- PHOTOS: CAROLINE CHIA

Banker Thomas Chan, 36, who has been renting at Sam Kiang Mansion beside St Thomas Suites for four years, said: ‘It used to be like a forest, quiet and pleasant. We were close to the city yet there was a rural feel. Now, we can’t even go for walks because of all the heavy vehicles.’

Mrs Judy Goh, owner of Amber Hotel in Amber Road, said that when business started 20 years ago, their four-storey building was of ‘average height’.

But they will soon be dwarfed by towering condominiums. ‘What to do? That’s the way things change,’ said Mrs Goh.

Despite all the trouble that Mr Ng has to put up with, he seems set on staying put. He has declined previous offers by persistent property developers to buy over his plot of land.

More new residents in the area will mean more business for Mr Ng: ‘I must think long term so I’ve got no choice but to endure in the meantime.’

Help! My Ex-Wife Refuses To Sell The Flat

Source : The Sunday Times, 2 Sept 2007

Q. I WAS divorced about two years ago and have no children.

My matrimonial flat has become an issue as my former wife (the petitioner) who is living in it, has refused to sell.

A. proposed matrimonial property plan was filed with the petition for divorce in April 2005.

This stated that an application will be made to the HDB to sell the flat on the open market within 13 months of the grant of the Decree Nisi Absolute.

Q. An Order of Court was made in July 2005 for the sale of the flat and the Decree Nisi was made absolute in August 2005. The 13-month period as stated in the proposed matrimonial property plan has clearly expired.

1) Why hasn’t the HDB enforced a sale of the flat since the owners no longer form a family nucleus?

2) I am planning to buy a HDB flat and need my CPF money. Can I apply for a court order to enforce the flat’s sale?

3) How is an order made and how much will it cost?

4) I don’t earn much. What is the criteria to meet before I can seek court assistance?

A. THE scenario you describe happens to many divorced couples. There is an existing court order for the sale of the matrimonial home so it seems your former wife is stalling over the sale.

Usually, the HDB does not check if divorced flat owners have complied with court orders relating to sales and they do not apply to the court to have orders enforced.
You are right in saying that you will have to apply to the Family Court to obtain an order to force your former wife to sell the flat.

The application has to be filed together with your affidavit or sworn statement setting out the background facts.

The Court will set a hearing date and you will have to ensure that your former wife receives your court application. She will be given an opportunity to file an affidavit in reply.

On the appointed date, the court will hear from both of you and make a decision. It is likely the Family Court district judge may order your former wife to take steps to sell the flat by a certain date.

You can also ask the court to order that the Registrar of the Subordinate Courts be authorised to sign the sale documents on your former wife’s behalf, if she persists in not complying with the court order.

As this process involves legal procedures you may find it difficult to handle it yourself.

A lawyer can help you and advise on legal fees, or you can apply to the Legal Aid Bureau or the Tanjong Pagar Family Service Centre’s Pro-Bono Legal Assistance Scheme for legal aid.

Rajan Chettiar Lawyer Rajan Chettiar & Co

Advice provided in this column is not meant as a substitute for comprehensive professional advice.

Selling En Bloc: New Rules Will Help Improve Process

Source : The Sunday Times, 2 Sept 2007

Proposed changes aimed at addressing concerns of transparency and clarity in conduct of sale

While the collective sale boom that has been on the boil here for two years has enriched many Singaporeans, others have been left angry and frustrated by the process.

Many claim that the collective sale process could be made clearer and more transparent with the major players more accountable.

Last week, the Government proposed a raft of changes aimed at addressing many of these concerns.

Additional consent requirement

Now: An estate may be sold only if there is consent from owners representing a minimum set percentage of the overall value of shares in the development.

This stands at 80 per cent if the condominium is older than 10 years; 90 per cent if less than 10 years.

Change: A new level of consent requires approval from owners representing at least 80 per cent of the building’s area if the development is more than 10 years old, or 90 per cent if it is less than 10 years old.

This differs from a proposal mete in March, in which majority consent would have been required based on the number of units.

Why: This is aimed at addressing the imbalance in voting rights in some mixed developments.

The share value in a mixed development is generally 1:4:5 for residential, office and shop units respectively, which means that office and shop owners tend to get a greater weightage of voting rights.

Collective sale committee

Now: Owners can start a collective sale attempt any time by forming an ad hoc sale committee and there are no rules on the procedures.

Change: A collective sale committee, with not less than three members or more than 14, can be formed only if more than half of the owners present at a general meeting of the Management Corp agree.

The period of notice for a general meeting to decide on and appoint a sale committee will be specified.

Anyone standing for election to the sale committee must declare his interest or relationship, if any, with a developer, property consultant or law firm.

Why: Many owners have complained that they were not consulted on whether to start a collective sale in their estate or on the formation of a committee.

The change means a collective sale attempt can start only if the owners have discussed the matter at a general meeting and agreed to proceed to explore possibilities of a sale. The notice period ensures that all owners will get sufficient warning of the meeting.

Now: No rules on who can be in the sale committee.

Change: A person standing for election must be an owner or a nominee of an owner. However, co-owners cannot be elected at the same time.

The person must also be subject to the same criteria as for those standing for election to the Management Corp Council. For example, he must be at least 21 years old.

Why: This ensures that the sale attempt is driven by responsible persons who are owners. It also ensures that a single owner - who may own more than one unit - cannot dominate a sale committee.

Now: No rules on the number of sale committees that can exist concurrently.

Change: Only one sale committee can exist for a development at any one time.

Why: Some developments have more than one committee pursuing a sale, which creates confusion for owners.

Now: No restrictions on a sale committee’s lifespan.

Change: The committee’s role will cease when the collective sale agreement lapses.

Why: This means a committee cannot persist in making sale attempts when the majority of owners are no longer interested in selling en bloc.

Now: Uncertainty over whether the sale committee can use Management Corp funds.

Change: A sale committee can not use Management Corp funds for its activities except to convene general meetings.

Why: This means majority owners have to come up with the money for any pre-sale preparations such as the valuation report.

Now: Uncertainty over whether the sale committee has the mandate to appoint the property consultant and the lawyer.

It typically chooses the consultant and the lawyer without consulting or informing owners, and owners are deemed to have signified their agreement to the sale committee’s choices when they sign the agreement to sell.

Change: Unless otherwise decided at a general meeting, a sale committee can select a property consultant and a lawyer. However, before deciding, the appointments must be considered at a general meeting.

Why: Clarifies the step of selecting the consultant and lawyer thus keeping owners in the loop.

Now: No requirement for minutes of sale committee meetings to be displayed or sent to owners.

Change: A sale committee must either (a) display minutes of its meetings on a notice board within seven days and for at least 14 days; or (b) pass the minutes to all owners within seven days of each meeting.

Why: Some owners have complained about being kept in the dark on the sale process. This would fix it.

This can be tedious, though owners can choose to get a third party for the job, which would add to pre-sale costs.

Now: Sale committees are not required to meet owners to discuss the apportionment formula, appointment and fees of lawyers and property consultants, and terms and conditions of the collective sale agreement and sale and purchase agreement.

Change: A sale committee must discuss the apportionment formula, the appointment and fees of lawyers and property consultants, and terms and conditions of the collective sale agreement and the sales and purchase agreement at a general meeting.

Why: This is to ensure that owners get the opportunity to discuss key issues and take them into consideration before consenting to a sale.

Collective sale agreement

Now: Lawyers are not required to witness the signing of the collective sale agreement. The property consultant usually witnesses this.

Change: A lawyer should be present to witness the signing of the collective sale agreement, if signed in Singapore, and to explain the legal terms and liabilities and address any doubts that the owners may have.

Why: Some owners have complained of being forced to sign the sale agreement under duress and that they have no clear idea about the terms.

This will ensure that owners are fully aware of the implications of the agreement they have entered into. The Horizon Towers saga has highlighted the potential liabilities sellers can face.

But this creates more work for lawyers and they will have to charge higher fees, lawyers say.

Now: No regulations on the collective sale agreement’s format.

Change: Sale committees are to provide a preface to the agreement, listing where to find key information such as the reserve price, apportionment method, lawyer fees and so on.

Why: This will ensure that owners know the agreement’s important points before signing.

Now: Owner’s consent to the sale takes effect right after he signs the collective sale agreement.

Change: An owner can change his mind within a five-day cooling- off period after signing the agreement. However, he can do so only once for the same agreement.

Why: This lets owners get out of a contract if they feel that they had been forced to do so under duress or misrepresentation. However, this step may affect consent level updates.

Now: Sale committees are to give updates of the consent level every eight weeks. Lawyers are not required to certify the updates on consent level, which is typically reported by just the property consultant.

Change: Sale committees are to give monthly updates of consent levels with a lawyer to certify these.

Why: This is aimed at helping owners make informed decisions on whether to sign the agreement and address concerns over the accuracy of consent level updates.

Sale of development

Now: Mode of sale is not regulated.

Change: Every launch for sale must be by public tender or auction. If it fails, the sale committee can negotiate with any bidder to get the best deal.

But a sale by private treaty must be concluded within 10 weeks of the close of the tender or auction.

Why: This addresses concerns over whether the sale committee has done its utmost to get the best price.

Now: A sale application must include a valuation report not more than three months old.

Change: A valuation report from an independent valuer should be submitted on the date the tender closes.

Why: In a fast-moving market, prices may change significantly within three months. A report as at the tender date will help the sale committee evaluate bids and assures owners that they will not sell at a price below market value.

This also means that majority owners have to fork out several thousand dollars or more for the report, whether or not the sale succeeds.

Now: An advertisement of a collective sale application must include details such as the owners’ names and unit numbers and names of the mortgagees and chargees.

Change: The advertisement can dispense with much of this information, such as the names.

Why: This is to reduce costs, and accord a certain degree of privacy to the owners.

Strata Titles Board

Now: The Strata Titles Board can have up to 30 members.

Change: Increase the number of deputy presidents and members in the board.

Why: The aim is to shorten time needed by the board to consider sale applications.

Now: A financial loss is deemed if an owner’s sale proceeds after any deduction allowed by the Strata Titles Board is less than the price he paid for his unit. But there is no clear definition of the allowable deductions.

Change: The deductions the board will allow when evaluating financial loss claims suffered by those opposed to selling en bloc are set out clearly. These include stamp duty and legal fees.

Why: The board can throw out a sale application on the grounds of financial loss. While owners can rely on precedents set by the board’s decisions as a guide, which show that renovation costs, for example, cannot be deducted, the rule will provide certainty to owners who intend to make financial loss claims.

Now: There is no explicit provision to prohibit a person from claiming financial loss if the unit was sold after a collective sale has been awarded to a buyer.

Change: The purchase price of a unit will not be considered for financial loss claims if it was sold after a sale has been awarded to a buyer.

Why: This confirms that such transactions will not qualify for financial loss claims.

Now: The Strata Titles Board will allow an application if no objecting owners suffer financial loss and if it does not find any bad faith in the process.

Change: The board can raise the sale proceeds for minority owners who have filed valid objections. It will authorise the sale only if the majority agrees. Each owner will have to contribute 0.25 per cent of his proceeds, or $2,000, whichever is higher.

Why: This addresses complaints of minority owners who feel that they have not been treated fairly in the distribution of the sale proceeds.

Now: The Strata Titles Board must dismiss any applications that fail to comply with the procedural requirements, even if they are just cases of technical non-compliance.

Change: The board will be empowered to disregard any technical or procedural irregularity if it is satisfied that the irregularity will not prejudice any owner’s interest.

Why: Majority owners need not redo the application process just because of a technical error that does not prejudice any owners. If this rule had been in place, there is a chance that the Horizon Towers sale application may not have been thrown out at the board’s level, said a lawyer.

Return of funds

Now: Under the law, the buyer-developer is entitled to the funds in both the sinking fund and the Management Corp fund after a successful collective sale.

In practice, the owners-sellers will negotiate with the buyer on the return of the money.

Change: Once a collective sale has been legally completed, money in the sinking fund and the management fund will be returned to the owners promptly.

Why: Clears up a grey area to ensure that owners get the money in the funds.

Changing Face Of Foreign Owners

By Sonia Kolesnikov-Jessop

Malaysians and Indonesians have traditionally been the dominant foreign buyers of property in Singapore and they still remain at the top of the list. However, over the last year, their shares of the property market bought by foreigners have been diminishing in favour of other nationalities.

According to Donald Han, Managing Director (Singapore) of Cushman and Wakefield, requests for information are coming fast and furious from Middle Eastern, Indian and Korean investors, although investors from different counties are looking at different sectors of the market.

While the deeper-pocketed Middle Eastern buyers are more interested in District 9 and the Orchard Road areas, the Koreans, who typically have a US$1-$3 million budget, are looking at the fringes of the central core area. Indians generally target the mid-market to upper-tier market and are willing to go further into the suburbs like Clementi, Yishun and Bukit Batok, while Europeans tend to go for projects that are under construction.

“Europeans are playing the rising market. They’re not looking into yield but strictly looking into being an absentee investor. When the property is ready, they might offload it instead of having the headache of finding a tenant,” Han explains.

Data from the URA shows that the number of Korean purchasers increased 132% in 2006, while the number of French increased by 138%. Indian buyers were up 72%, while American buyers were up 67% and Australian buyers were up 45%. However, it should be remembered that some of these figures may be skewed by low base figures, professionals said.

“Singapore has long been a favoured country for foreign investors,” notes Chia Ngiang Hong, Group General Manager of City Developments Limited. “However, we’re also experiencing increased interest from many first-time foreign buyers as well as many from non-traditional markets. This is a positive sign that Singapore is developing into a global city for investors. It marks its success of transforming into one of the most attractive and exciting cities to live and work in.”

Global appeal
The latest URA data shows that foreign buying interest has remained strong so far this year. Purchases by foreigners made up 29% of total purchases in the first half of 2007, said Tay Huey Ying, Director of Research and Consultancy at Colliers International.

Between January 2006 and June 2007, 33.6% of foreign purchases were for properties in districts 9 and 10, while 12.1% of foreign purchases were for properties in District 15. In terms of pricing, 6% of all foreign purchases were for properties priced at S$5 million and above, and 39% were for properties priced between S$1.5 million and S$5 million, Tay revealed.

Given the ongoing restrictions on landed properties, the majority of the properties purchased were condominium units. Even so, there has also been a growth in the number of buyers for landed properties.

Based on DTZ Debenham Tie Leung’s analysis of caveats captured by the URA’s Realis database, foreigners bought 2,008 non-landed private homes in the first quarter of this year, accounting for 30.3% of the total condos/apartments bought in the period, while foreigners (mainly Permanent Residents) bought 93 landed homes, only 8.4% of the total of 1,108 landed homes purchased.

While buyers from Indonesia and Malaysia remain the dominant players in the current market, the share of the top-five nationalities (68%) continued to slide, a trend that started in 2005. “This shows that private residential properties are attracting interest from other nationalities and that Singapore is becoming more international,” points out Ong Choon Fah, Executive Director at DTZ Debenham Tie Leung.

Developers are also reporting anecdotal evidence of the increase in these new buyers. At the launch of luxury boutique development Parkview Éclat, foreigners represented 83% of buyers, with some South Asian owners, the second-largest group of buyers, taking on more than one unit, said Eddie Chow, a Senior Executive at the Hong Kong Parkview Group.

Spreading the message
To cater for this wider international demand, developers are now going further afield in their road shows and spending top dollar on their show flats. Kan Kum Wah, Head of Residential Marketing for Marina Bay Financial Centre, revealed that this year’s current marketing plans include exhibitions and talks at luxury property conferences in Hong Kong (twice), Shanghai and Dubai, to build interest and awareness ahead of their second residential tower planned for later this year or early next year. When the Marina Bay Residences’ first tower was launched last December, around 40% of the buyers were from overseas.

Kan said the presence of this new type of buyers was to be expected given the rapid expansion of the banking and financial sector due to Singapore’s growing reputation as a financial hub. He also pointed to a new trend, also evidenced in Parkview Éclat: the rise of the multiple home owner.

“These buyers typically own multiple homes in multiple destinations,” Kan said. “I envisage the buyers of high-end developments in Singapore owning homes in other vibrant cities like Hong Kong, Shanghai, Tokyo and Dubai. These buyers are attracted by location, being near leisure and business districts, as well as quality and exclusiveness. Price is not the major concern with this type of buyer, and many are prepared to write blank cheques up to a pre-arranged price.”

Foreign investors are not only buying for investment but also to live in, property experts point out. Ong noted that foreigners have become more active in the resale market where they now account for 32% of resale apartment transactions. Unlike new projects, these homes are usually ready for lease immediately. Tay anticipates buying interest from foreigners will grow from strength to strength in the coming years.

“Singapore’s journey as a global property market has just only begun,” she said. “As such, we believe that to date, only a small fraction of the world’s high net worth individuals have invested in Singapore’s residential property market. We’re of the opinion that as Singapore’s reputation as an attractive country for investment, particularly due to our economic makeover, reaches out to an even wider global market, more foreigners can be expected to purchase residential properties in Singapore.”