ERA Daily Research - 6 September

Singapore property agents' transaction data now available for all residential properties

The Straits Times, 3 Sep 2021, Fri 11:50 am  

By Fiona Lam

The Council for Estate Agencies (CEA) has published a complete record of all residential property transactions facilitated in the past 24 months by property agents in Singapore.

Prospective buyers and sellers can now view the publicly accessible information on Housing Board flat resale and rental deals, as well as new sales, resales and rentals of private homes.

With this, consumers may have "better visibility" of the track records of Singapore's real estate salesmen, said CEA. The move to increase informational transparency comes under its Property Agents' Transaction Records Initiative (TRI).

Published on the CEA Public Register, details include when a deal was completed, the property's general location and whether the agent represented the buyer, seller, tenant or landlord.

For private housing, the records will also show the type of property - condominium, executive condominium, landed or strata-landed - and whether it was a new sale or resale deal. Rental transaction data will indicate whether the whole unit or a room was leased out.

Read more at: https://www.straitstimes.com/business/property/singapore-property-agents-transaction-data-now-available-for-all-residential

Singapore real estate agents' transaction data now available for all residential properties

The Business Times, 3 Sep 2021, Fri 11:58 am 

By Fiona Lam

THE Council for Estate Agencies (CEA) has published a complete record of all residential property transactions facilitated in the last 24 months by property agents in Singapore.

Prospective buyers and sellers can now view the publicly accessible information on both resale and rental deals of Housing and Development Board (HDB) flats, as well as new sales, resales and rentals of private homes.

With this, consumers may have "better visibility" on Singapore real estate salespersons' track records, said CEA. The move to increase informational transparency comes under its Property Agents' Transaction Records Initiative (TRI).

Published on the CEA Public Register, details include when a deal was completed, the property's general location, and whether the agent represented the buyer, seller, tenant or landlord.

For private housing, the records will also show the type of property - condominium, executive condominium, landed or strata-landed - and whether it was a new sale or resale deal. Rental transaction data will indicate whether the whole unit or a room was leased out.

The transaction information for each month will be updated on the 15th of the following month. Records older than 24 months from the date of access are available at data.gov.sg.

Previously, CEA's website provided only data on HDB resale deals brokered by salespersons and completed within the last 24 months.

Soh Cheng Hwee, CEA director (licensing), said the council has "struck a careful balance between transparency and privacy" in the amount of details provided.

The records do not identify specific properties and their transacted prices. They also do not include details on the type of condominium unit or HDB flat, such as the number of rooms, as they are a proxy for the transacted price.

The initiative aims to empower consumers to make an informed decision when selecting an agent, Mr Soh noted. Potential clients can find out the transaction types and locations that an agent has experience in, and the recency of such experience.

"Property agents can also use these verified records to show their professional experience and specialisation in the kinds of residential transactions they have facilitated, as a way of gaining consumer confidence," he added.

CEA refined the TRI after receiving and incorporating feedback from industry stakeholders such as the real estate agency industry associations, the agencies' key executive officers, property salespersons, as well as consumers.

Lee Nai Jia, deputy director at the Institute of Real Estate and Urban Studies at the National University of Singapore, expects the enhanced initiative to benefit consumers in the long run, as the overall standard of property agencies and industry professionalism improve.

With the data, consumers are more likely to approach agents who have brokered more deals in their area, Dr Lee said.

"Hence, agencies will have to get their senior agents to mentor the junior ones if they want to expand their teams. Personal branding and quality of service will become more important for agents to have a successful career," he added.

Property agencies are required to submit salespersons' residential property transaction records to CEA, under the amended Estate Agents Act, and ensure that the information is true and not misleading.

As for HDB resale flat transaction records, the public housing authority provides the information directly to CEA for publication.

Besides the TRI and the CEA Public Register, another initiative under the Real Estate Industry Transformation Map is the Guide on Best Practices for Consumer Ratings of Property Agents.

Published in October 2020, the guide aims to introduce consistent standards for the rating of property agents based on the key categories of service, professionalism and skills.

Source: https://www.businesstimes.com.sg/real-estate/singapore-real-estate-agents-transaction-data-now-available-for-all-residential

Property agent, buyers admit to backdating an option to purchase to evade higher stamp duty

The Straits Times, 4 Sep 2021, Sat 7:05 pm

By Wong Shiying

A property agent and two buyers of a condominium unit have admitted to backdating an option to purchase (OTP) to avoid paying higher additional buyer's stamp duty (ABSD).

Property agent Loy Thye Wei pleaded guilty to one charge under the Stamp Duties Act on Friday (Sept 3). Buyers Daniel Halim and Lee Liu Ying each pleaded guilty to a similar charge on Thursday.

All three are Singaporeans aged 44.

The property involved is a fourth-storey unit at 163 Jalan Loyang Besar. The address corresponds with that of Sandy Palm, a 99-year leasehold condominium in Pasir Ris.

The court heard that the offences took place in July 2018, after the Government announced a round of cooling measures for the property market.

For Singaporeans buying their third and subsequent residential property, the ABSD rate was 10 per cent until July 5, 2018, but this rose to 15 per cent from July 6, 2018.

The ABSD is a tax paid on top of the existing buyer's stamp duty (BSD). ABSD and BSD are computed on the purchase price or the market value of the property, whichever is higher.

As Daniel and Lee already owned two properties, and their OTP had not been granted on or before July 5 they had to pay 15 per cent in ABSD.

The couple first viewed the property on July 7 and proposed to Loy, through their agent Mu Shen, the scheme of backdating the OTP to July 4.

A search on the Council for Estate Agencies’ public register shows that Loy has been with ERA Realty Network since 2017, while Mu was previously with PropNex Realty.

During their second viewing on July 8, they agreed on a purchase price of $1.38 million and told Mu that they would only proceed with the transaction if the OTP was backdated.

Mu instigated Loy, who then went ahead with the plan despite concerns raised by the property's seller.

The couple executed the OTP on July 24 and evaded $69,000 in ABSD by paying 10 per cent of duty instead of 15 per cent.

The cheque issued by Daniel for the option fee - a 1 per cent deposit of $13,800 - was also illegally backdated to July 4 to lend credibility to the scheme.

For successfully closing the deal, Loy had her commission raised from 1 per cent to 1.5 per cent. Her ill-gotten gains were shared with Mu.

Court documents did not state how the offences came to light, only that the Inland Revenue Authority of Singapore received information on the case.

Mu pleaded guilty in July to one charge of abetting by instigating Loy into falsely stating the OTP date.

Loy, Mu, Daniel and Lee will return to court for sentencing on Sept 10.

The maximum penalty for each offence of omitting information in the OTP with intent to evade duty is a $10,000 fine and a jail term of three years.

Source: https://www.straitstimes.com/singapore/courts-crime/property-agent-buyers-admit-to-backdating-an-option-to-purchase-to-evade

Troubled contractor Greatearth files to wind up company, a week after shock BTO site closures

The Straits Times, 3 Sep 2021, Fri 8:14 pm 

By Michelle Ng

Troubled construction company Greatearth is being wound up - a week after its shock closure of five Build-To-Order (BTO) project sites that left around 2,900 buyers facing long delays for their homes.

The move is also likely to leave many sub-contractors in the lurch, with few avenues open to recoup what are substantial losses for some.

The winding-up process was triggered when Mr Goh Eng Hwee, the director of Greatearth Corporation and Greatearth Construction, filed a statutory declaration of the company's inability to continue business.

Three related companies - Greatearth, Greatearth Holding and Universal EC Investments - are also being wound up.

Professional services firm PwC was appointed provisional liquidator on Friday (Sept 3). A creditors meeting will be held on Sept 27.

Greatearth Corporation and Greatearth Construction were the main contractors for the five affected BTO projects, which comprise a total of 2,982 units. The projects are Sky Vista @ Bukit Batok, Senja Heights and Senja Ridges in Bukit Panjang, Marsiling Grove in Woodlands and West Coast Parkview in Clementi.

Work at the sites stopped on Aug 20.

Several sub-contractors are facing heavy losses on the contracting fees owed to them by Greatearth.

Some told The Straits Times that they have been locked out of the sites, and so cannot retrieve valuable building materials such as steel components that have not been paid for.

Insolvency lawyer Lam Zhen Yu from Withers KhattarWong said the liquidators will assess Greatearth's financial status and whether it has assets that can be sold to raise cash for creditors.

"At the end of the liquidation process, which may take up to a few years, the liquidators will distribute any balance funds, after paying the costs of liquidation, to the creditors in order of their priorities," he said.

Read more at: https://www.straitstimes.com/business/property/troubled-contractor-greatearth-files-to-wind-up-company-a-week-after-shock-bto

Construction raw material prices to stay high amid supply chain, shipping disruptions

The Business Times, 6 Sep 2021, Mon 5:50 am

By Yong Jun Yuan

CONSTRUCTION raw material prices look set to remain elevated as countries around the world struggle to contain the Delta coronavirus variant.

In particular, companies have been grappling with lockdown-induced supply chain and shipping disruptions since the start of this year. And as demand rose on the back of global economic recovery, supply has struggled to keep pace.

A Singapore Contractors Association (SCAL) spokesperson said steel rebar prices have risen 54 per cent, aluminium prices 59 per cent, copper prices 81 per cent and concrete prices more than 20 per cent.

"While Singapore has a regionally diversified source of material supply, sporadic lockdowns as well as border restrictions imposed by countries greatly disrupted the continuity of supply. Therefore, the delivery of required materials has seen significant delays for most projects," the spokesperson said.

SCAL said the sporadic lockdowns also resulted in production shutdowns, rendering factories and plants unable to operate at optimal capacity.

Soaring shipping costs have also been a cause of concern for companies importing construction materials from overseas. The Freightos Baltic Index, a global benchmark for major shipping routes, has risen from S$1,946 a year ago to S$10,323 for the week of Aug 27.

"The implementation of Covid-19 safety measures has resulted in port congestion and shipping port inefficiencies," said Compact Metal Industries general manager Charles Lee.

He does not expect shipping rates to ease in the next two to three years either, as demand for shipping continues to increase.

China shut operations at two ports this year after the emergence of Covid-19 cases there. The Meishan terminal at Ningbo port, the world's third-busiest container port, was closed for two weeks in August. Yantian port was closed for a month in late May.

There have also been bottlenecks unique to specific construction materials. For instance, steel prices have been heavily impacted by demand and supply imbalances in China.

Seah Kiin Peng, chief executive of steel reinforcement solutions provider BRC Asia, said China has managed to control its Covid-19 pandemic more effectively and its construction industry has therefore recovered strongly.

This increased Chinese demand for raw materials could not be met by the country's domestic supply. China, the world's largest producer of steel, recently became a net importer of steel, he said.

Since May 1, the Chinese government has removed export tax rebates for certain steel products such as hot-rolled coils and plates. From Aug 1, it removed rebates on items such as cold-rolled coils and hot-dipped galvanised coils as well.

Furthermore, Mr Seah said, the Chinese government's push to limit greenhouse gas emissions has capped the country's crude steel output at 2020 levels.

"A lot of steel mills have been producing as much as they can because prices are going up. For the first half of 2021, they have already surpassed the amount that they made in the first half of last year so they will have even less (output) in the second half," he said.

Mr Lee of Compact Metal Industries also noted the Chinese government's shutting of smaller steel mills that failed to adhere to environmental standards. This has impacted supply.

Lockdown-related disruptions have also caused the price of cement to increase by up to 40 per cent, said Pan-United Cement CEO May Ng.

She said production facilities have been adversely affected at different times due to the pandemic, with the most recent disruption being the lockdown imposed in Malaysia. This caused the cost of cement and aggregates to rise.

Ms Ng said it is difficult to predict when prices would be expected to ease as uncertainties remain and Singapore remains dependent on imports.

"The costs of such raw materials and the disruptions to the supply chains depend on when the source country significantly normalises its economic activities," she said.

For tile specialist Soon Bee Huat, its costs are up about 5 to 7 per cent compared to pre-pandemic prices due to a rise in gas prices for tile-firing in kilns.

Because of the many factors causing prices to rise, it may be difficult to predict when prices will normalise or even fall.

Shahzad Nasim, executive chairman at planning, engineering and project management company Meinhardt Group, said: "Businesses have suffered huge losses during this period and the suppliers and manufacturers must be factoring in these in their calculations and concerns about the continuity of supply chains."

Similarly, SCAL said it does not foresee prices falling to pre-pandemic levels in the near term as countries such as India, China and the United States have been stimulating their domestic economies with infrastructure projects.

"With the US$1 trillion infrastructure package being rolled out at the same period by the US government, global demand for raw materials, especially for metal commodities, may surge, and this will push the prices higher. Construction costs will therefore be on the rise."

Source: https://www.businesstimes.com.sg/companies-markets/construction-raw-material-prices-to-stay-high-amid-supply-chain-shipping

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