Help genuine HDB upgraders with ABSD remission, UOL chief urges

An artist’s impression of the twin 37-storey towers sited on tiered landscape gardens. PHOTO: UOL GROUP


An artist’s impression of the integrated gym and co-working space for a residential development. PHOTO: UOL GROUP


SINGAPORE (THE BUSINESS TIMES) – There has been another plea to allow genuine first-time HDB upgraders to a private condo defer payment of the additional buyer’s stamp duty (ABSD), this time from UOL group chief executive Liam Wee Sin.

“It is our hope that the government will grant ABSD remission – similar to EC (executive condominium) buyers – giving them time to sell their HDB home six months after collecting their keys,” said Mr Liam on Wednesday (Nov 25) during a media briefing at the launch of the company’s latest residential project.

Demand for the private residential market is genuine, and substantially from HDB upgraders who have higher aspirations of living in a condo, said Mr Liam.

“It makes logical sense to promoting the aspirations of Singaporeans,” he said.

“A tweak to this ABSD policy to align with what is already in place for EC buyers can help genuine HDB upgraders to transition to a private property,” he said.

If the remission is given, HDB upgraders buying a private home would not face the pressure of having to pay up the ABSD within 14 days of signing the sale and purchase agreement.

Based on the current ABSD regime, a HDB owner would need to pay a 12 per cent ABSD within 14 days from signing the sale and purchase agreement when they commit to a private property if they have not sold their existing home.

“The 12 per cent is a substantial amount to pay,” said Mr Liam.

As such, the Government should consider allowing HDB upgraders buying a private property to get ABSD remission similar to what is currently applicable for HDB upgraders buying an EC, he said. ECs are a public-private housing hybrid. This group is given six months to dispose of their HDB flats after having collected the key to their new EC home.

What this translates to is that the HDB upgraders would now be given six months to sell their HDB flat after collecting their keys to their new condominium, as against the current requirement of having them to sell their HDB flat six months after buying the private property, he said.

“This is logical in many aspects. Besides easing their cash flow, this also addresses other considerations that buyers have to contend with, such as the logistics of finding interim accommodation while still waiting for the new private property to be completed,” said Mr Liam.

In September, the head of the Real Estate Developers’ Association of Singapore also urged the Government to urgently consider allowing first-time upgraders from an HDB flat to a private property to defer payment of the ABSD till six months after the completion of the private property.

UOL is quite optimistic about selling its latest project as prices are “realistic and affordable”, said Mr Liam.

Called Clavon, it is in Clementi Avenue 1 and integrates work and living trends, and features flexible spaces, smart home amenities and technology solutions for a safe living environment.

Pricing of the 640-unit condominium comprising two 37-storey towers on a per sq ft basis (psf) starts from $1,475 psf.

Comparable projects Parc Clematis has a median unit price of $1,634 psf, while Kent Ridge Hill Residences’ median unit price was $1,770 psf for the January to October 2020 period, according to Ms Christine Sun, OrangeTee & Tie head of research and consultancy.

An 80:20 joint venture between UOL and subsidiary United Industrial Corporation Limited, Clavon comprises a mix of one- to five-bedroom units ranging from 527 sq ft to 1,690 sq ft. About 56 per cent or 356 units at the development are one- and two-bedroom units sized between 527 sq ft and 764 sq ft.

More than half of the development’s units are priced below $1.5 million. A one-bedroom unit starts from $800,000, a two-bedroom unit from $1 million, a three-bedroom unit from $1.45 million, a four-bedroom unit from $1.9 million and a five-bedroom unit from $2.5 million.

Asked about the overall new private new home sales market for 2020, Mr Liam said the market is stable and he hopes it will continue to move in a “sustainable manner”. Year to October, new home sales were 8,021 units.

Mr Liam estimates total new home sales of 9,000 to 10,000 units for the year. In 2019, total new home sales were 9,912 units.

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