On 6 May 2020, the Ministry of National Development announced temporary relief measures for property developers and individuals affected by the disruption of construction schedules and sales of housing units as a result of the circuit breaker from 7 April to 1 June. The government said that it will ensure that private residential prices are aligned with economic fundamentals. Meanwhile, the other existing residential property market cooling measures remain in place. The measures will take effect immediately.
The application for the extension of Project Completion Period (PCP) and/or sales period for projects under the Qualifying Certificate (QC) regime was the second round of relaxation introduced in these three months. On 6 Feb 2020, the Ministry of Law and Singapore Land Authority announced that some listed property developers can apply to be exempted from the QC scheme. The qualifying criteria stipulated by the Land Dealings Approval Unit include:
– incorporation in Singapore and listing on the Singapore Exchange;
– principal place of business is in Singapore;
– chairperson and the majority of the board members are Singapore citizens; and
– shareholders to be substantially Singaporean; and
– a track record of housing development in Singapore.
The QC exemption might bring some relief to listed property groups which purchased large, privatised HUDC estates and prime freehold sites during the en bloc fever from 2017 to first half of 2018. Qualified developers who fail to sell their projects within two years of completion will be exempted from the penalty payments of the QC regime.
It is encouraging that the government has taken a pro-active approach by extending timelines now instead of waiting till the deadline-crunch reaches a peak. These measures will give some buffer time to developers to sell their residential units as it is foreseeable that even when the circuit breaker is lifted in due course, social distancing measures remain and the economic malaise will weaken buyer sentiment. As Real Estate Developers’ Association of Singapore (Redas) aptly responded to the government’s initiative: “Given that the COVID battle is still very volatile and likely to be long-drawn and coupled with major disruptions and economic fallout both in Singapore and globally, we hope the government will continue to monitor the situation closely and provide flexibility to assist the built environment sector return to normalcy.”