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strata landed singapore restrictions

Increased in Communal Open Space

URA made a revised guidelines for the determination of the maximum number of houses in a cluster housing development. Developers will have to set aside at least 45 per cent of the land area for communal open space, up from the current 30 per cent.

Of this, at least 25 per cent will have to be set aside for on-ground greenery, while up to 20 per cent may be used for communal facilities, such as swimming pools and playgrounds.

This was done after feedback from residents in landed housing estates that such developments could inject a disproportionately large number of units, causing additional traffic and parking problems as well as creating a more congested living environment.

As a result, developers of future cluster housing developments will need to reserve nearly half of their projects for communal open space, in a move that will result in more greenery and communal facilities, but also see fewer sellable units.

These revised guidelines apply for plans submitted from 23 Aug 2014.

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Estimated Impact on Prices

Take an instance of an actual cluster housing development at Paya Lebar / Hougang. The gross area is 44,010 sqft and it is hosting 27 units. Assuming the current communal open space is 30 per cent. Then 14,670 sqft area must be catered for such use, leaving 30,807 sqft for the 27 units.

To implement the new guidelines of 45 per cent, then the communal area must be increased to 19,804 sqft and the number of units that could be built would need to be reduced to 21 units.

Assuming each unit is $2.7m. The developer would have to spread $2.7m x 6 units = $16.2m additionally to the 21 units.

Each unit would cost $600,000 more.

Impact on Developers

Also as a result of such new rules, with development having fewer sellable units, developers would likely wane in their interest for strata landed homes. That would also means strata landed housing developments will be rare and may push prices higher.

Limited Units NOT Impact by Restrictions

Also as a result of such new rules, there are some limited cluster house developments that residents can enjoy without having to pay up more (as compared if the new restrictions are implemented).

Do find out whether the cluster homes you are considering are affected by this restrictions.

In time to come, Cluster Homes will be more expensive to own.

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