Complete Property Market Updates of Singapore

July 10, 2008

Don’t penalise desperate ones who sublet illegally

Filed under: General,Rental News — Propertymarketupdates @ 3:58 am

WITH a growing number of Singaporeans waiting to be allotted a rental flat from the Housing Board, it is good to know the HDB is taking steps to ensure those who abuse the system are caught and punished.

However, the article, ‘Tenants cashing in on rental flats’ (May 29), did not reflect other groups of tenants and unauthorised occupiers who run the risk of being caught for illegally subletting or occupying rental flats. In my work as a social worker, I have come across these groups and wish to bring to light their predicament.

Examples of tenants who sublet their units are:

Single elderly people who find public assistance money insufficient;

Elderly people who are unable to find employment; and

Elderly people who cannot depend on their children for monthly maintenance money.

It can be argued that there are assistance schemes in place to help these groups. However, the fact that some still resort to illegally subletting their homes indicates that the schemes do not address their actual needs and more needs to be done to reach out to them.

A number of unauthorised occupants also includes Singaporean families. These are predominantly families who:

Already face a debarment period, having sold their purchased flat, either because they were unable to settle their mortgage with the HDB or settle housing or renovation loans from the banks; or

Are on the wait list and have exhausted all other accommodation options.

What can be done to address the concerns of these groups without penalising them and pushing them down further when they are trying to stay afloat? What preventive measures need to be taken and how can government bodies work together to address these issues – which may indicate greater problems?

If the HDB acts alone, downstream the community- based agencies will have to pick up the pieces with those affected. Without policies in place, our remedial efforts may not be sufficient to assist these client groups.

Source : Straits Times – 7 Jun 2008

July 8, 2008

Rental flats: HDB to weed out errant tenants

Filed under: General,HBD Reviews,Rental News — Propertymarketupdates @ 4:20 am

THE Housing and Development Board (HDB) is clamping down harder on the abuse of its heavily subsidised rental flats.

Enforcement blitzes to identify illegally rented flats will be stepped up and they will be extended across a wider area of the country, said the HDB yesterday.

Its response comes amid growing disquiet on several fronts about the abuse of subsidised rental housing.

MPs, residents of rental blocks and eligible Singaporeans who feel they have been left in the queue while foreign workers snap up cheap flats have all called for action.

The Straits Times reported last week that an increasing number of tenants have been illegally subletting HDB flats to cash in on the demand for low-priced accommodation. The flats are often leased to workers from Malaysia, China and India who are either in the dark about rules or just want the cheapest rental option.

Some MPs told The Straits Times that residents had alerted them to the illegal rentals and demanded more enforcement.

‘There should be more thorough checks,’ said Aljunied GRC MP Cynthia Phua. ‘Subsidised housing should be given to deserving families. People who do not need it should let it go.’

HDB rental flats have soared in demand over the past year, with the waiting list up by at least 30 per cent in recent months. There are about 4,000 applicants in the queue with a waiting time of 15 months – double the wait in 2006.

Ms Lee Bee Wah, an Ang Mo Kio GRC MP, frequently gets appeals from Singaporeans who are eligible for rental flats but have been stuck in the queue for several months.

The issues concerning rental flats have been raised in Parliament before. National Development Minister Mah Bow Tan said in a February session that HDB will increase its supply of 42,000 flats by 20 per cent. It is also reviewing its eligibility scheme.

He also said then that enforcement will be carried out to ‘weed out those who do not need or have abused the privilege of a rental flat’.

HDB has stepped up enforcement efforts and extended blitzes to areas such as Jalan Minyak, Telok Blangah, Jalan Bukit Merah, Kallang- Whampoa, Mei Ling Street and Clementi this year. These are on top of annual inspections ‘to ensure the tenancy of the flat is in order’.

Tenants illegally renting out their home can lose the flat and face a five-year ban from renting or buying HDB property.

As of April, HDB had recovered 131 flats since 2005.

An MP for Pasir Ris-Punggol GRC, Mr Teo Ser Luck, said the community could also be roped in to help. ‘There is a greater demand for rental flats and we need everyone’s help to highlight errant cases,’ he said.

HDB said that about 30 per cent of the cases of illegal renting uncovered stemmed from residents’ feedback.

North West District Mayor Teo Ho Pin, who is also MP for Bukit Panjang, said the problem goes beyond housing demand and touches on the lack of cheap, adequate housing for foreign workers.

‘We need to quickly provide solutions to house the foreign workers,’ said Dr Teo, so as not to crowd out needy Singaporeans.

Retiree Amy Tan Ai Bee, 75, is one such Singaporean. She has spent 14 months in the queue: ‘I think it’s really unfair that I waited for such a long time, yet there are people who are renting their flats out for a profit. I hope this can be addressed soon.’

Source : Sraits Times – 5 Jun 2008

July 3, 2008

Reality check for 99-year lease top-up assumption

Filed under: General,Rental News — Propertymarketupdates @ 3:15 am

The market used to assume that the government would top up leases for sites to 99 years as they came up for redevelopment. A series of recent decisions – in which the authorities either declined lease top-ups or allowed them, but for shorter tenures – have put a big question mark over that assumption.

Property players say these decisions could have an impact on investment sales of 99-year leasehold properties or at least the way such deals are structured.

In January, when the proposal for Market Street Car Park’s redevelopment into an office tower was made public, owner CapitaCommercial Trust revealed that the authorities declined to top up the lease for the site, which has another 65 years to run.

More recently, the market learnt that the former Crosby House site at 71 Robinson Road – which is being built into a new office block – had its lease topped up in April last year, not to the usual 99 years but 85 years and 10 months instead. This was apparently to match the remaining lease term of SIA Building next door.

BT understands that no lease top-up was granted for Marina House last year, which is proposed to be redeveloped, although HMC Building nearby (being developed into Lumiere condo) got a lease top-up to 99 years earlier. Sources say another building at Cecil Street has also had its lease top-up application rejected. Again, the Urban Redevelopment Authority (URA) may have plans for the streetblock where it is located.

In recent years, the government has topped up leases of nearby sites to the original 99-year term, including 1 Shenton Way (being redeveloped into One Shenton), NatWest Centre (being redeveloped into The Clift) and HMC Building.

The recent decisions appear to run contrary to the perception that the government would generally agree to top up leases of such sites to the original 99 years, so long as the planned redevelopment scheme is in sync with URA’s long-term vision for the area.

Instead, Singapore Land Authority (SLA) said: ‘The government will generally allow leases to expire, without extension.’ It noted that ‘the state generally sells land on leasehold to allow it the flexibility to reallocate land to meet socio-economic needs.’

‘However, the government has considered and allowed lease extensions based on whether the proposed redevelopment is in line with the government’s planning intention and long-term development plans, and factors such as whether there would be significant intensification, or greater optimisation in land use. That remains the government’s policy,’ SLA said.

SLA evaluates each application on its merits and in consultation with the relevant agencies. The specific circumstances of each development dictate whether it should be given a lease extension – and for how long.

Market Street Car Park’s lease was not topped up ‘as there is a need to retain planning flexibility over the future development of the site’, SLA said.

URA said it evaluates requests for topping up leases based on ‘a range of planning considerations in relation to the specific location and context of the area’. This approach gives ‘the state flexibility to review the longer-term plan for the area, as and when the existing leases expire or come in for extension in future, and to reconfigure the parcels, if required, to provide for better land utilisation’, it added.

In the Central Business District, for instance, the considerations may vary from streetblock to streetblock, URA said, when queried about the unusual lease top-up to 85 years and 10 months for 71 Robinson Road. ‘This lease period is sufficient to allow for the owner to redevelop the site to a new modern office building,’ URA added.

DTZ executive director Ong Choon Fah said: ‘In the past, the government may have been pretty liberal in topping up leases. Now, they’ve to think of Concept Plan 2011 and how to accommodate a long-term population of 6.5 million people.

‘So they have to be more creative and safeguard land for the future, by having a common lease expiry period.’

The head of a property consulting group said: ‘URA’s probably doing a housekeeping exercise of trying to coordinate lease expiries of buildings in the same streetblock, to give themselves some flexibility. So they may ask: ‘What’s the longest remaining lease in this block? Let’s now try, going forward, to have leases in this streetblock expire at the same time, so that in future, if we want to do anything, we’ll be able to do that.’

DTZ’s Mrs Ong observes: ‘There are many pencil buildings on tiny plots in the CBD. It would be more efficient if the government has common lease expiry periods for adjacent plots so that they may amalgamate them into bigger land parcels and resell them in future.

‘It’s more efficient to intensify land use for bigger land parcels. Globally too there’s a trend of mixed developments, with a live, work, play environment. It’s more environmentally friendly and reduces commuting time. For that too you need bigger sites.’

Source : Business Times – 4 Jun 2008

Uncertainty over lease top-ups may affect sentiment

Filed under: General,Rental News — Propertymarketupdates @ 3:13 am

The government’s recent decisions to either not top up leases of some leasehold sites to the original 99-year term or to approve shorter lease extensions could affect sentiment towards investment sales of such properties.

The decisions may have implications for the likes of other leasehold properties such as DBS Building, UIC Building and Shenton House, market watchers say. ‘We can’t take it for granted that the Government will agree to extend leases for sites it had sold in the past to 99 years,’ an investment sales veteran said.

While some may be tempted to hold back investment sales deals, a property consultant points out that in reality, the economic life of an office building is probably about just 40 years. ‘It’s just the emotional thought of being stuck with say just 60 years lease, that may make some potential investors reluctant to redevelop a property,’ he added.

Knight Frank executive director Foo Suan Peng added: ‘If an investor is planning to develop a new office block and hold it for rental income, he may not necessarily be deterred if he receives a shorter lease top-up or even no lease top-up on the site, since the rental income from the new office block would not vary according to the site’s leasehold tenure.

‘However, for residential collective sale sites, a potential developer may find it tough selling a new condo built on a plot with a remaining lease of say, 70 years or 80 years, in the Singapore context. If he develops the plot into serviced apartments or apartments for lease, though, it may still be a viable proposition.’

DTZ executive director Ong Choon Fah did not think the government’s decisions would scare away investors. ‘The shorter lease-term will be priced into the property. The return has to be recouped within the allowed lease period. What would be good is if investors had clarity on lease top-ups; if you know the risk, you can manage the risk.’

There were calls to take some precautionary steps before inking deals, especially for collective sales of residential sites.

‘Buyers and sellers should check with the authorities about lease extensions before they agree to anything. The authorities for their part should also come up with clearer guidelines on lease top-ups,’ says Credo Real Estate managing director Karamjit Singh.

Agreeing, Knight Frank’s Mr Foo said: ‘If there’s an element of risk that the lease may not be topped up, the buyer will factor this into his pricing. One way to eliminate this risk, would be for the buyer to make the deal subject to the lease being topped up to 99 years.’While that would be one option, Credo’s Mr Singh argues: ‘It does not cover a situation where the authorities may agree to extend the lease, but not to 99 years. ‘Practically, it would be difficult to impute a formula to recalibrate the sale price depending on the number of years that SLA approves for lease extension.’

Instead, Mr Singh suggests ‘that where the redevelopment proposal is in line with the Master Plan, Singapore Land Authority consider processing an in-principle application for a lease upgrade without a need for the applicants to first obtain an outline planning permission (OPP) from Urban Redevelopment Authority’. An OPP may cost anywhere from $5,000 to $100,000, or even more, depending on the size of the proposed redevelopment project – and owners, especially in a residential collective sale, may find this a costly upfront payment.

In early 2005, history was made when Eng Cheong Tower in the Beach Road area became the first collective sale of a 99-year leasehold property. Paving the way for the deal was an unprecedented decision by SLA to grant in-principle approval to top up the site’s lease to 99 years before the site’s sale.

Source : Business Times – 4 Jun 2008

June 24, 2008

Tenants cashing in on rental flats

Filed under: General,HBD Reviews,Legal Ground,Regulators,Rental News — Propertymarketupdates @ 3:50 am

Heavily subsidised HDB units, which are much in demand, are often sub-let to foreigners

SOME tenants in heavily subsidised HDB rental flats have been illegally sub-letting their homes to cash in on surging demand for cheap accommodation.

There are no official figures but tenants in some estates say that as many as one in five rental flats is rented out to foreign workers – a clear breach of HDB rules.

The flats are often leased to workers from Malaysia, China and India – who are either unaware that they are renting illegally or do so because the units are the cheapest option.

Property agents and tenants told The Straits Times that there is an increasing number of such flats put up for rent by people keen to cash in on foreign workers’ demand for cheap housing.

A Malaysian, who declined to be named, told The Straits Times that she leases a two-room HDB rental flat in Toa Payoh with a friend for $700 a month.

That could be as much as $650 more than the subsidised rent – a tidy profit for the original tenant.

Their ‘landlord’ told them to keep windows shut and not to answer the door. The 35-year-old said she knew the deal was illegal but she was ‘desperate for cheap housing’, adding in Mandarin that ‘If I didn’t rent this flat, I can’t afford anything else’.

The abuse of HDB rental flats comes amid soaring demand for such homes, which are meant for needy Singaporean families.

The waiting list has shot up by at least 30 per cent over the past few months, with about 4,000 applicants in the queue. This translates to a 15-month wait, which is double the time in 2006.

Eligible Singaporeans can apply for HDB rental flats and pay $26 to $205 for a one-roomer and $44 to $275 for a two-roomer, depending on household income and other factors. The HDB manages about 43,000 such flats and plans to add 20 per cent more.

A Member of Parliament for Ang Mo Kio GRC, Ms Lee Bee Wah, told The Straits Times that residents had complained about the problem when she visited Teck Ghee last month.

‘People tell me their neighbours are renting their flats out. They should not be hogging the flats if they have an alternative place to stay,’ said Ms Lee.

When The Straits Times called five property agents last week, four said they had one- and two-room flats available for rent. Most of these flats would be rental units, said HDB.

And it is not just low-paid foreign workers renting such flats.

A Singapore permanent resident from Malaysia said he used to rent such flats as they were the cheapest on the market.

The 28-year-old finance executive rented a two-room subsidised flat in Owen Road for $550 in 2006. A similar unit on the open market would cost at least $1,000. Now, government-subsidised flats can fetch $1,000 in good locations, he added.

When The Straits Times visited Toa Payoh rental blocks last week, some tenants said they noticed an increasing number of workers from China and Bangladesh living in their blocks.

Coffeeshop worker Poh Lee Tee, 45, said her neighbour frequently rented out his flat to Indian workers, who kept her up when they came home from work.

‘But I don’t want to report my neighbours, in case I get into trouble,’ said Madam Poh.

Mr Wu Mu Song, 74, who has lived in one of the rental blocks for the past 30 years, estimated that two out of 10 flats are rented out illegally. ‘This is unfair; there are others who need these flats more,’ he said in Mandarin.

Although abuse of rental units is on the rise, Mr Wu said it was hard to catch illegal tenants as they often ignore visitors – including HDB officers.

Tenants illegally renting out their home can lose the flat and face a five-year ban from renting or buying HDB property.

The HDB recovered 17 flats in 2005 and 27 last year. The increase was due ‘to better public awareness and feedback’, it said.

It also conducts inspections at least once a year and carries out regular ‘enforcement blitzes’.

One blitz recovered 57 rental flats in three months in 2003 and 35 in a crackdown that began last year in areas like Tampines, Ang Mo Kio, Toa Payoh and Bukit Merah.

Anyone aware of illegal renting can contact the HDB at flw1@hdb.gov.sg. or call 6490 2410.

Source : Straits Times – 29 May 2008

Cases of illegal sub-letting

Filed under: General,HBD Reviews,Legal Ground,Rental News — Propertymarketupdates @ 3:46 am

Blk 63 TOA PAYOH LORONG 5

When The Straits Times visited this HDB rental block last week, we identified one unit where voices in a heavy Chinese accent could be heard. The windows were shut, save for a panel at the top where we could see a light and a suitcase. When we knocked on the door, the voices fell silent and, even after repeated knocks, nobody answered the door.

HDB also cited two recent case studies of tenants illegally sub-letting their rental flats.

Blk 3 JALAN BUKIT MERAH

A one-room flat at Block 3, Jalan Bukit Merah, was leased by the HDB to the tenant and her two children. An inspection in January revealed that the flat was sub-let to five Chinese nationals at a monthly rental of $900. The tenant was working in Malaysia while her two children were living with relatives.

Blk 805 KING GEORGE’S AVE

A two-room rental flat was leased to the tenant and his two children. An inspection by HDB revealed that the flat was sub-let to Chinese nationals for $800 per month. The tenant and his family were living with his mother at Chai Chee.

In the latter two cases, the units were recovered in January and February, and the tenants banned from renting HDB flats for five years.
 
What’s the penalty?

Tenants who illegally sub-let their flats will have their units recovered by HDB, and banned from buying or renting a flat from HDB for five years, while any unauthorised occupier (above 18 years old) will be barred for 2-1/2 years.

Source : Straits Times – 29 May 2008

Stansfield wins tenancy auction of its premises

Filed under: General,Regulators,Rental News — Propertymarketupdates @ 3:30 am

STANSFIELD Group yesterday won a Singapore Land Authority (SLA) tenancy auction, allowing it to continue leasing its existing eight-storey premises at 11 Penang Lane from SLA for a further period of up to nine years.

Stansfield’s winning bid was for $270,000 monthly rental for a three-year lease term, with options to renew for another two terms of three years each.

However, lease renewals for the second and third terms will be at market rentals at the time.

The $270,000 monthly works out to $7.96 per square foot (psf) based on the building’s gross floor area of 33,905 square feet.

Stansfield leased the building from SLA in May 2003 after the group won a public tender for a 3+2 year tenancy.

Before that, the building had been used by National Council of Social Service.

Knight Frank conducted the auction for the tenancy on behalf of SLA.

The $270,000 monthly rental that Stansfield will pay SLA for the next three years is over six times the $40,000-plus it was paying SLA under the lease that has just expired.

The group was prepared to bid high to ’spare our students the inconvenience and disruption that would have resulted had we moved to new premises’, Stansfield CEO Ramel Ang said when contacted by BT yesterday.

‘We are committed to the students and want to ensure continuity for them,’ he added.

Stansfield is suing the Consumers Association of Singapore over an alleged breach of an agreement governing insurance payments that hampered its ability to bring in foreign students.

Since Stansfield’s existing 3+2 year lease for 11 Penang Lane expired on May 19 this year, the group has been occupying the building under a Temporary Occupation Licence issued by SLA.

Bidding for the building’s tenancy at yesterday’s auction began at a monthly rental of $76,000.

A total of 10 parties took part in the bidding, including other private schools and investors, some of whom were keen to convert the building into a hotel, BT understands.

Separately, Knight Frank also sold two properties at its auction yesterday at Amara Singapore.

One was a four-storey building at 466 Serangoon Road, which was sold on behalf of its liquidator, for $3.2 million.

The 999-year leasehold property, which is currently tenanted, has a shop on the ground level and apartments on the upper floors. The total net lettable area is 7,061 sq ft.

The other property sold was a 1,399-sq-ft ground-floor shop unit at the freehold Tembeling Centre in the East Coast area, that fetched $1.31 million.

Source : Business Times – 29 May 2008

June 16, 2008

Middleman to blame for rent owed, says firm

Filed under: General,Legal Ground,Rental News — Propertymarketupdates @ 3:28 am

THE company whose 167 workers were locked out of their Joo Chiat quarters last Wednesday says it does not owe the landlord any money.

The Sunday Times had quoted landlord Mohamed Ali as saying that Deluge Fire Protection, based in Joo Koon Crescent, owed him $23,500 in rent.

But Deluge project director Tan Ann Kiong said it has an agreement with a firm called Broadlee Construction to house its workers who are from India, Bangladesh, China and Myanmar.

Showing documents and copies of cheques paid to Broadlee and the agreement it has had with the firm since January this year, he said: ‘We paid promptly at the start of each month and we’ve never been late in payments. We have no way of knowing whether Broadlee passed on the money to this Mr Mohamed Ali and we have no dealings with him.’

The evidence from Mr Tan revealed that $99,360 had been paid to Broadlee between January and April.

According to the agreement, the monthly fee of $160 per worker also covered the cost of utilities and laundry.

They were housed in two double-storey shophouses in Joo Chiat.

Deluge is an established industry player in the construction, installation and maintenance of fire-protection systems.

When asked to comment on its workers’ complaints of poor living conditions in Joo Chiat, Mr Tan said: ‘Broadlee promised to replace some faulty equipment, such as shower heads, as well as provide extra beds for newly arrived workers. These promises were never carried out.’

Mr Tan said Deluge also paid Singapore Power Services $5,900 this month when Mr Mohamed Ali fell behind on payments ‘because we didn’t want to see our workers inconvenienced’.

The affected workers have since moved to temporary quarters in Sungei Kadut after Deluge received a notice from the Urban Redevelopment Authority that the quarters were not sanctioned for housing foreign workers.

Mr Tan said: ‘We trusted Broadlee to have obtained all the necessary approvals.’

When The Straits Times called Broadlee, a person, who did not want to be named and claimed he was the former owner, said it had stopped acting as a middleman between companies and landlords.

Mr Mohamed Ali could not be reached to explain why he insisted that Deluge owed him money even though it had no formal agreement with him.

Deluge is now building its own workers’ dormitory at a site off Chin Bee Drive. The facility, which can house up to 500 workers, will be completed in six months and managed by Deluge itself.

Said Mr Tan: ‘Our previous arrangement with Broadlee seemed to cater to our needs at first, but look what happened in the end.

‘It’s better to have our own place to house our workers.’

Source : Straits Times – 23 May 2008

June 11, 2008

MI-Reit’s distributable income rises

Filed under: General,REIT,Rental News — Propertymarketupdates @ 5:32 am

Q4’s $5.8m boosted by rentals from new properties

STRONG rental contributions from its new properties lifted Macarthurcook Industrial Reit’s (MI-Reit) distributable income in the fourth quarter to $5.8 million, with distribution per unit (DPU) coming in at 2.22 cents.
 
Q4 distributable income was 19.9 per cent higher than its initial forecast, while DPU was 19.4 per cent ahead of estimates.

‘The 19.4 per cent higher than forecast DPU for 4Q FY08 was largely due to rental contributions from our acquisitions of nine yield accretive properties during the year. Of these nine properties, five were acquired during the fourth quarter,’ said Craig Dunstan, chief executive officer of the manager for MI-Reit.

These acquisitions increased the total value of MI-Reit’s investment properties by 75.5 per cent to $555.4 million, compared with its initial portfolio value of $316.5 million, he added.

MI-Reit’s net property income for the fourth quarter ended March 31 stood at $8.21 million, 38.1 per cent higher than forecast. Taking an earlier revaluation gain from its 12 properties into account, its net asset value per unit (NAV) was $1.29 at the end of March, 7.5 per cent higher than the NAV of $1.20 at its initial public offer in April 2007, it said in a statement yesterday.

Annualised DPU came in at 7.91 cents for the full financial year, beating forecasts by 6.7 per cent. The annualised yield worked out to be 8.03 per cent, based on the closing price of $0.985 per unit at the end of March. Full-year distributable income also beat estimates at $19.61 million.

Properties acquired in the last six months include new warehouse and logistics facilities in Yishun Industrial Park A and Defu Lane 10, as well as a manufacturing complex in Kallang Way which was acquired through a sale and leaseback agreement with Xpress Holdings.

Besides lifting rentals, these acquisitions also helped to reduce the reliance on a single property or tenant, said MI-Reit. As testament to the results, it said no single tenant contributed more than 20.3 per cent to total rental income in March this year.

Looking ahead, Mr Dunstan expects economic growth in the region to be moderated as a result of the US mortgage crisis and this may put a temporary halt to MI-Reit’s acquisition plans. However, he expects demand for industrial properties to remain strong across Asia.

MI-Reit shares closed at 96 cents yesterday, down 1.5 cents.

Source : Business Times – 22 May 2008

Seletar’s colonial houses in demand as bulldozers roll in

Filed under: General,Rental News — Propertymarketupdates @ 4:50 am

Rentals have soared for the 131 units that will remain even after area’s development as aerospace hub

WHEN it was a verdant oasis of calm and tranquillity, not many people wanted to live in the former Seletar airbase.

But now that the bulldozers have rolled in to turn the area into Singapore’s key aerospace hub, monthly rentals for the colonial houses sitting on streets with quaintly English names have shot through the roof.


TRANQUIL ABODE: Residents have so far been paying under $3,000 for such homes. — ST PHOTO: FRANCIS ONG

In some cases, they have just about doubled.

Never mind that the din and dust will be a fixture until 2018, when the 300ha Seletar Aerospace Park – including the existing airport and runway – is ready.

The higher rents reflect the current market conditions, said a spokesman for the Singapore Land Authority (SLA), in response to queries from The Straits Times.


 
Of the 378 Seletar houses, 204 will be retained, and 174 demolished. Of those to be left standing, 131 will be retained as homes, and the remaining 73 redeveloped for non-residential use – for example, to house aerospace training schools and food and beverage outlets.

Two-year leases for the properties have all either expired or will expire soon.

Those living in the units to be demolished or redeveloped must move out by year-end.

If their leases expire before then, these residents have the option to extend them for these last few months – but they will have to pay between 16 and 33 per cent more in rent.

The SLA spokesman said: ‘For each of such renewals, the rental rates will have to be revised to reflect market rates, as advised by professional valuers.’

Islandwide, rental rates jumped 69 per cent between the first quarter of 2006 and the first quarter of this year, she noted.

Rental hikes for the units unaffected by the development are a lot steeper – more than 100 per cent in some cases, residents said.

The SLA did not provide data on this, but said the increases were ’still lower than the bids which we have received for the units’.

As and when leases have expired for units whose residents have opted against renewing them, the properties have been put up for public bidding.

In one such case, a two-storey terrace house recently attracted a bid of $5,000 – more than three times the recommended rent of $1,500 set by the SLA, its spokesman said.

Seletar residents, some of whom have lived there for more than 20 years, paying under $3,000 for a house with a garden, have been taking the impending changes in their stride.

But they are sorry to leave behind what they admit is a great deal.

Ms Edith Kraayeveld, 39, an airline marketing and sales manager and mother of two preschool children, pays $2,650 a month for her three-bedroom house with a garden.

She said: ‘Yes, we realise we have been incredibly lucky all these years. But it is not quite our fault that nobody wanted to live here. We just managed to find the deal and saw the opportunity.’

She and her husband, the managing director of a sports company, have to move by year-end, after 14 years there.

She said: ‘It is a great community of people who live here and everyone is so upset about leaving. I have two golden retrievers and two young children who have grown up amid the lush greenery and fruit trees.

‘If need be, we will move across the Causeway after moving out of Seletar.’

Source : Straits Times – 21 May 2008

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