Staring from 1 September 2016, the development charges for non-landed residential sites will go up by an average of 2.7 percent. The next revision of development charges for properties will be due on 1 March 2017. A development charge is a tax which developers have to pay when development projects are approved legally to increase the value of the land through rezoning, higher plot ratio etc. At this round, the development charges increase varies from as low as five to as high as twelve percent.
Government land sales from March to August 2016 have seen keen and bullish bids for several parties as land banks have been dropping for such developers. How will the increase in development charges affect the upcoming launches such as Forest Woods and Clement Canopy?
Both government land sales for Forest Woods and Clement Canopy took place in 2015 where development charges had followed two straight years of contraction. Forest Woods price and Clement Canopy Price will benefit from this round of upward revision as any other new developments in close proximity to them will have to pay higher development charges in the future. Assuming that the price of land sales are similar, future development will cost more due to the upward of development charges which buyers will have to pay more for new developments after 1 September. Indirectly, this also creates a safety price margin buffer for the current balance units of new launches such as Stars of Kovan, Sturdee Residences etc as they fall under the older version of lower development charges. However, let hope that developers with balance units of new launch condo will not increase their price to match the upward revision of revision charges.
Forest Woods showflat will be ready for viewing in September 16 and tentatively Clement Canopy showflat will be completed end of 2016. Due to the credibility and track records of developers, both new launch condo will expect to draw interest from home seekers and investors.