The "Today" newspaper, Weekend Edition of 14 April 2007, splashed a front-page article on en bloc sales. In this "Today" news article, a pre-eminent lawyer, Dr SK Phang, who specialises in en bloc / collective sales (in fact, Dr Phang is the pioneer in this arena), was quoted as saying that "a bona fide home owner should be offered an exchange ...".
Yeh!!! I'm so, so heartened ... perhaps, civil society in Singapore is not quite dead after all. you think?
This blog-site sets out my entire wish-list. I know Santa won't come to town until December (even then, this is far from the Land of Oz)! So if I could gleefully rub Aladdin's lamp ... perhaps the 108 Heroes from The Water Margin would wrangle from the Ministry of Law just Three Die-Die-Must-Get Wishes:
1. An additional option (the other option is still cash) for one-for-one "exchange" unit of same-level and same-size for Owner-Occupiers with ONLY one residential property in Singapore at the point of completion of the collective sale - For details, pls click on the relevant page in this blog-site.
2. Mathematical factual basis for distribution of collective sales proceeds using (i) ratios as a 1st cut and (ii) precise strata-title-area and precise share-values as a 2nd cut - For details, pls click on the relevant page in this blog-site.
3. Scaled time-bar to next collective sale attempt pegged to estate age - For details, pls click on the relevant page in this blog-site.
Are you, the readers of this blog-site, one of the 108 Heroes? Nothing ventured, nothing gained, eh?
19 comments:
Before I can make intelligent suggestion, I think I need to learn the basic terms first (share value, ratio, strata etc). Do you know where I can learn the 101 stuff? My condo is going for enbloc and I'm against it as all nearby place is more expensive than the Reserve Price :-( I call this go-broke, not en-bloc.
My empathy goes out to you, dear Anonymous, as en bloc attempts are distressing to say the least. When successful, it is devastating, especially for Owner-Occupiers with one 1 residential property.
Basically, you need to read the Land Titles (Strata) Act as a starting point but to understand the implications and then apply to ground realities, it is quite another thing.
I've attempted to put it in layman's terms on this blog-site - scroll down to past the picture of The Wailing House and then click on the various topics on the left hand - eg, Share values; Sales proceeds formula, etc.
Dr Minority runs an informative blog-site:
www.enblocsingapore.blogspot.com
[as you may notice, my blog-site address is a Reversal of his].
If after reading both our blog-sites, you have specific questions, post them here and I'll see how I can help.
Just dropping in to say keep up the good work. Damn work is piling me up with reports so here's a quick reply.
The MAIN document is the Land Titles (Strata) Act Part VA available here:
http://statutes.agc.gov.sg/
(Click on 'L' and select "Land Titles (Strata) Act")
Note thought it's legal speak so you may find it quite heady reading. You may find occassional references to the Building Maintenance and Strata Management Act particularly for 'share values' and strata definitions.
The Strata Titles Board has a shorter more readable version:
http://www.mnd.gov.sg/stb/typesofapplicationannex1.html
Good luck. :)
ps. sorry for intruding into Pariah space :) :)
In view of the various COMMENTS posted by different readers on various pages of this blog-site, I have today (21 Apr 2007) expanded my blog page on "SHARE VALUES; SALES COMMITTEE" to draw out an EXAMPLE of how the 80% (90%) majority consensus is computed and the position of the Dissenters who refuse to sign the Collective Sale Agreement. Hope this will help somewhat. If you have specific questions, do post them here and I'll see what I can do.
Hi, great job. I've been searching for what psf ppr mean. I know it's price per sq feet and price per plot ratio. I know what both means, but I don't know when both are combine. If the psf is $1000 and plot ratio is 2.5, does it mean it is $2500 psf ppr? thanks again in advance for doing the STB job.
Thank you, dear Anonymous, for your kind compliments. As the Chinese have a saying that roughly translates into: "The observer has a more insightful perspective". Personally, I've always found it useful to step OUT of the box to look INSIDE the box to understand the drivers and constraints faced by those inside - so I'm hopping in-and-out like a Latino folk dancer most times!
PSF PPR (Per Sq Foot Per Plot Ratio) is derived as flws:
(a) Say, the estate land size is 50,000 sq ft.
(b) The Developer-buyer pays $50mn for this en bloc estate.
(c) PSF = $1,000 ($50mn divided by 50,000 sq ft).
(d) Say, the Plot Ratio set by the Gahmen for that estate is 2.5.
(e) Price PSF PPR = $400 ($1,000 PSF divided by 2.5 Plot Ratio).
Hope the above helps.
Got it. It's clear now. Thank you The Pariah.
Dear Pariah, Do you know of any support group for dissenters(minority) of enbloc sales.I have ageing parents who are so distressed about having to move out of a property that they are so attached to plus the whole legalese of the CSA is beyond me on how to explain it to them..Please help!!
Dear Anonymous:
I'm sorry to hear of your parents' plight. Has 80% or more of the owners in your parents' estate "SIGNED THE CSA" (this is a legally binding document and is DIFFERENT from signing an "Expression of Interest" document or some other survey form)? If not, there's still a chance of scuttling the deal.
The lawyer appointed by the Sales Committee is actually paid by your parents. So your parents are entitled to ask the lawyer to explain the CSA point-by-point in layman's terms.
If your parents really do NOT wish to sell, whatever the price, then DON'T sign (anyway, they will still be entitled to share in the collective sales proceeds). Then keep a keen look-out for the Strata Title Board (STB) review process because you must submit your objections before the deadline. During the STB review, your parents could raise their objections. I'd suggest that you help your parents to formulate MORE OBJECTIVE BASIS for objecting the CSA (ie, keep a low-key on sentimentality issues).
For the more objective basis of objection, you may wish to click on my blog-pages on the flwg topics:
- Constitution;
- Share values;
- One-for-one exchange;
- Sales proceeds formula.
Another blog-site you may wish to refer to is:
www.enblocsingapore.blogspot.com
It's very sad that this en bloc law is turning Singaporeans into Squatters, Refugees, Downgraders or Downsizers.
If you have further questions, pls post them here.
Thanks Pariah and Dr. Minority (for website tips) for an excellent explanation of PSFPPR price. But my condo Ocean Park enbloc has used share value as apportionment of sale proceeds and computation to determine individual unit price.
Method of calculation of unit % :
1) EAch Strate Unit's share Value
____________________________
Total Share VAlues of all strata
multiply 50% = A
Each Strata Unit's Strata Area
_______________________________
Total Strat Areas of all strata Units
multiply 50% =B
(A+B) x 100% = Unit % Apportionment
Such a formula does not take into account the facing, the floor and the block location of your unit albeit in airspace. But when the condo was first offered off the plan , the units all varied in prices , so my contention is why can't that variation in value of the units based on a present day condo-market price or even projected market price be used as a true indices of the price of each unit?
Furthermore, when developers acquire our units it is based on an existing Plot Ratio. What we want to know too is what is the potential development ratio that the developer is anticipating or entitled to when new plans are submitted to STB or URA for planning permission for potential gains.
Should'nt the SC be made responsible to find out what that potential Plot ratio would be? Should'nt the Management consultants being property experts be made to research and give us that sort of info. to make our educated decision? It is the potential price differential which is the true value of our units that we want to know, given of course the unforeseen property market and other extraneous factors which no one could put a projected indices on.
IF the SC and Management consultants they employ explore those figures, it would give all residents a new perspective and even allow the residents to consider taking on the development themselves jointly with developers who are interested!
After all if they could do it what is there to stop the residents themselves?
Amongst the residents in some condo are professionals who would be able to form a developers company , run it professionally. Such a project is not just entrepreneurial , it could evolve in time to new types of residential / citizenry management of our own property.
Some new ideas which might evolve is perhaps a co-operative development/management concept where the residents/owners will work with developers on a percentage sharing and have a say as to how the design /plan is to look like, determine the quality and quantity/density of the plot. We could own our unit and for those who wish to purchase and invest in more units within the new project, they may do so , and expand their portfolio for posterity sake!
What better way to involve a neighbourhood and bring back the kampong spirit and protect the integrity and unity of our own community. Along the way we could well reap intangible rewards beyond just a quick profit and run scheme.
Just daydreaming here and furthering our wishful plan ..a vision that is not unachievable if all pro and anti-bloccers calm down and put on their thinking caps and make some real long term plan about their most precious asset. The future of Singapore's skyline and who they want to see own that.
Dear Rebel Rouser:
1. Intrinsic value versus Consumption value. Firstly, the en bloc law does not (and cannot) seek to compensate you based on what you paid for your unit. It's simply not viable because of a zillion variable factors in that equation (eg, interest rate, timing of purchase cycle, loan structure, etc). This therefore accounts for the law's "kindergarten" computation in determining "financial loss".
Secondly (this is where I deviate from Dr Minority's views)... By my analysis - the purchase price you paid for your unit comprises of:
(a) Intrinsic value - pegged to location, land tenure. This establishes the value of the entire estate over which your unit hovers and is represented by your strata-title area and/or share values.
(b) Consumption value - pegged to facing, level, view, design, etc. This - to me - is irrelevant in an en bloc sale because of wholesale demolition. You'd have "consumed" the premium by buying a choice unit during your residence or by collecting a higher rental during your lease.
That's why you don't see me harping on value to be accorded for unit facing, level, etc.
2. Apportionment method, development base line, comparative sales prices of redeveloped projects in the vicinity. You are absolutely spot-on that for the first two issues because the marketing agent and the Sales Com have ABSOLUTELY NO CREDENTIALS to make any recommendations on (much less decide on) such matters. There are qualified valuers and surveyors to do this job properly UPFRONT BEFORE SETTING THE RESERVE PRICE and you must ensure transparency in such appointment. The owners who are potentially most affected by apportionment issues should have a first right of selection on reasonable basis.
3. Cooperative, joint development. Nada - the law in fact prohibits owners from being obliged to co-develop the estate arising from an en bloc sale. There are massive risks - seriously, do NOT under-estimate these.
Even 1-4-1 exchange for which I have been pitching so zealously to MinLaw carries significant risks which requires careful legal and commercial structuring in the current absence of statutory protection. Depending on your position, 1-4-1 exchange may nonetheless be the lesser of two evils under certain parameters ... based on the present unsatisfactory state of affairs. What to do, lah?
Well Pariah, Looks like you and Dr. Minority are way ahead exhausting all the views there are to alleviate this en bloc issue that seems to be on an epidemic scale in Singapore.
I am just waiting at the sidelines for some sort of fallout..whether caused externally like subprime mortgage disaster to hit enbloc everyone in every nook and corner..so the status quo in property prices might be stabilise. Or those zealous developers and their zealot agents find some other hair raising , profit making scheme to absorb their obsession.
Even the 1-4-1 exchange is not necessarily the best scheme in that I will hate having to compromise the density of the plot and have to cope with more nosey neighbours!
Should we not get all the anti-bloccers to sign a petition and parade down to parliament or Minlaw with banners and stage a protest?
Ahhh ... dear Rebel Rouser ... for starters, anyone who wants to stay (I no longer use the word "live" for this land) in Singapore must accept that this will be one helluva congested and noisy place - en bloc or no en bloc!
So, IF, IF, IF we continue to stay in Singapore - whether by choice or by default - that's what we'd be lumped with. Casting a backward look at history, we are probably at the equivalent stage of redevelopment where our grandparents/parents were shell-shocked into losing their terrace houses, attap huts, shophouses, colonial bungalows in exchange for monstrous faceless HDB flats!
Singapore is in the midst of Yet Another Remaking ... Time will tell if we can make it this round. If Singapore does make it, all those who cashed-out (or were forced to cash-out) from en bloc sales will live to sorely regret it in the next decade or so!
Unless one is already 70-80 years old today, those who sold out in 2006 are already regretting it in 2007 and I reckon they will regret it far, far more in time to come ... likewise for those who will be cashing-out within the next couple of years (or are being forced by the tyranny of the majority to cash-out)!!!
Pariah,
YOu are sure right about history repeating itself in this generation game of development in the name of progress.
All of us are genetically constructed to adapt to change and Singaporeans I think besides the HOng Kong Chinese must reign top of the league table as the most adaptable race and country.
Next generation of Singaporeans will probably just live in even tinier cubicles , spend their waking hours at office cubicles or even worst in the same pigeon hole working from their laptop. Eat of microwaveable meals or food court takeaways. Entertainment will still be mall shopping and eating, put in some gambling at the spanking new resorts by night , hop on the plane to other holiday resorts and then back to the same old grind..
For those who are brave like their immigrant forefathers willing to cash out and move to new frontiers , they will see from a different perspective that the world is your oyster , all it takes is a little grit, and u will be the pearl in it..
Laws are just a system of man made rules that are changeable.
Pariah,
YOu are sure right about history repeating itself in this generation game of development in the name of progress.
All of us are genetically constructed to adapt to change and Singaporeans I think besides the HOng Kong Chinese must reign top of the league table as the most adaptable race and country.
Next generation of Singaporeans will probably just live in even tinier cubicles , spend their waking hours at office cubicles or even worst in the same pigeon hole working from their laptop. Eat of microwaveable meals or food court takeaways. Entertainment will still be mall shopping and eating, put in some gambling at the spanking new resorts by night , hop on the plane to other holiday resorts and then back to the same old grind..
For those who are brave like their immigrant forefathers willing to cash out and move to new frontiers , they will see from a different perspective that the world is your oyster , all it takes is a little grit, and u will be the pearl in it..
Laws are just a system of man made rules that are changeable.
Dear Rebel Rouser:
Errr ... does our "system" even allow for grit? I have no doubt that Singapore (sans our taxi drivers) will top the Global Sycophancy Index!
A chain is only as strong as its weakest link. By my reckoning, our links have an amazingly common tensile strength with precious few pearls in between.
Laws are made by Gahmen. Gahmen is elected by the majority amongst us. At this juncture, allow me to do my classic French shrug ...
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