Rationale for Newer Property Developments in Collective Sales
Ministry of National DevelopmentSpeakers
Summary
This question concerns Er Dr Lee Bee Wah’s inquiry regarding a minimum age for collective sales and whether recent sales of newer developments constitute a waste of resources. Minister for National Development Lawrence Wong explained that the framework facilitates rejuvenation and land optimization, requiring a higher 90% consent threshold for buildings less than 10 years old. He shared that 13 of the 40 developments sold en bloc in the last three years were under 30 years old, representing only 6% of total housing units. Minister for National Development Lawrence Wong stated that while decisions are market-led, the government imposes safeguards including Urban Redevelopment Authority planning approvals and traffic impact analyses. These measures ensure redevelopments comply with regulations on unit sizes and parking while allowing the market to determine the economic viability of collective sales.
Transcript
14 Er Dr Lee Bee Wah asked the Minister for National Development (a) whether the Ministry will consider putting a minimum number of years before a development project can qualify for an En bloc collective sale; (b) how many developments that are less than 30 years old have undergone En bloc sales in the past three years; and (c) whether the Ministry considers this to be a waste of resources.
The Minister for National Development (Mr Lawrence Wong): Mr Speaker, the main objective of the collective sales framework is to give owners the choice on whether to go for redevelopment. Such redevelopment allows rejuvenation and land use optimisation in residential developments. The collective sales framework imposes higher consent thresholds for newer developments. The Land Titles (Strata) Act requires buildings less than 10 years old to obtain 90% consent from owners before allowing the collective sale to go through, compared to 80% for older developments.
Of the 40 developments sold En bloc in the past three years, 13 were less than 30 years old at the point of sale. That said, most of them were more than 20 years old at the point of sale and were small developments of less than 20 units each. In terms of the number of housing units, around 240 units, or 6% of the approximately 4,000 units sold En bloc in the last three years, were less than 30 years old.
Mr Speaker: Er Dr Lee Bee Wah.
Er Dr Lee Bee Wah (Nee Soon): I would like to ask the Minister whether is there any concern on the continuous En bloc sales recently?
Mr Lawrence Wong: Mr Speaker, I believe we have a framework where the En bloc decisions are in a way left to the market to decide. That is the framework that I have put in place in the Land Titles (Strata) Act. The consent thresholds are clearly specified but there are also safeguards in place. Even if the consent thresholds are reached, the developer will have to submit their development plans to the Urban Redevelopment Authority (URA) for approval. URA will go through the plans, look at planning considerations, make sure that heights and unit sizes are kept to regulations; that adequate provisions, for example, are made for parking, and we have now put in place a new provision, which is, to do a traffic impact analysis before the developer gets planning approval.
So, with all these frameworks in place and safeguards, we would allow En bloc developments to go through if, indeed, the consent thresholds are reached, if the market feels that an En bloc is economically viable. But there are safeguards and controls in place which I have just described.