Desperate developers slash prices by 15% to dodge hefty government fines

ABSD could erode profits by up to 50%.

Local developers desperate to move inventory have slashed prices by 15% to avoid paying hefty government fines.

According to CLSA, the pace of price cuts could accelerate as developers struggle to avoid paying applicable extension fees and stamp duties for unsold inventory beyond a stipulated timeframe.

Under the Residential Property Act, developers will have to pay an Additional Buyer Stamp Duty of 10% for land acquired after December 2011 and 15% for land bought after January 2013.

The fee could be cancelled if the developer signs an agreement to construct and sell all units with the stipulated project-completion period of five years, or four years for ECs.

Developers that fail to meet the stimulated project-completion period will have to pay the full ABSD with interest, which CLSA says could erode profits by up to 50% for some luxury-focused developers.

“Given the buildup of inventory among developers and the requirement to pay an extension premium for QCs, developers may adjust pricing for existing launches in order to move inventory,” said CLSA.

Also Read

One Sophia sells 30% of units at weekend launch

Turf City sites could deliver up to 800 public housing units: Huttons

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit