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Two parties I knew bought into a Katong condominium for different reasons. One, a bachelor who never lived there, collected a windfall he had anticipated on an en bloc sale. The other, a couple, had spent heavily on doing up a dream home that they had not sufficiently enjoyed. Had they objected to the en bloc sale, they would likely be in a minority derided for a foolish sentimentality. Before 1999, an en bloc proposal required 100-per-cent agreement among the owners. Technically, the old lady who preferred the familiarity of her environment or wanted to live near her relatives could prevent her neighbours from becoming millionaires. The law was amended to allow an 80-per-cent majority to decide the fate of the minority.

What rights, then, do the minority have but the opportunity to cast a dissenting vote?

Is majority rule a fair yardstick when it can literally push someone out of their home, albeit under what most people would deem propitious circumstances?

Many societies thrive on the making of decisions that benefit the majority, from electing a government to small group commitments as personal as deciding on a venue for dinner. Without this mechanism, life may come to a standstill or there may be chaos. The question is whether this seemingly “as fair as it can get” principle should be applied to every situation.

All arguments distilled, it comes down to deciding whether the minority in a situation like this deserves protection.

In the wider context of a multi-racial, multi-cultural and multi-religious society like Singapore’s, it is easy to understand the importance of upholding minority rights.

Prime Minister Lee Hsien Loong recently assured minority communities that they will have the space to keep their heritage alive and not feel pressured by the dominating community.

In fact, a hallmark of Singaporean success lies in the acceptance, tolerance and promotion of diversity.

However, less visible is the recognition — or non-recognition — of the minority rights of communities defined by different factors, whether social, physical or sexual. Examples are the physically disadvantaged and working mothers.

Dissenting property owners to an en bloc proposal form an even more ambiguous segment.

For many people, buying a home is a once-in-a-lifetime experience. It would, therefore, be callous to consider an en bloc proposal solely as a matter of the mind and nothing of the heart, toting up the numbers on the profit to be gained.

The couple I mentioned were far from thrilled with the little profit they may make. Unlike the bachelor, they did not have the luxury of time to wait for the next trough before buying a replacement home.

Hence, this minority deserves some measure of consideration, if not protection. For example, ensure a minimum age of the property before it can be eligible for en bloc sale, so that prospective buyers, whether speculators or residential owners, are not blind to its possibilities. Another option is to allow a minimum dwelling period for any owner.

Fundamental to the issue of minority rights must be the respect of individual freedom that does not become criminal or result in others being disadvantaged as a consequence.

In an en bloc proposal, it is a moot point whether pecuniary benefits outweigh emotional considerations. If it is as clear-cut as deemed by many people, why peg approval to a 80-per-cent majority? Would not a simple majority, even if it is by one, have been sufficient?

Buyers of a strata development would have been spared all that angst if, on day one, they are made aware of an en bloc contingency by majority rule.

It is another matter, then, if you ask what price a place you call home, if you have to live with that uncertainty?

Source : Today - 8 Jun 2007

Being an Australian expatriate living and working in Singapore for the past 10 years, I have found myself in a position where the rental on my current condo unit will be increased from $1,900 a month to $3,500.

Most of us know that paying this much in rental is nothing short of pointless and a complete waste of hard-earned money. So, like almost all of my expatriate friends, I have decided to buy rather than rent. I decided to make appointments with all of the major banks in Singapore and get an idea of what kind of loans are available and see who offers the best rates and loan package in town.

Having purchased property in Australia, I was keen to find out how competitive banks were in Singapore and to arrange a similar loan to what I have there.

About 10 years ago, a housewife in Queensland, Australia, discovered that if you were to pay your home loan repayment fortnightly and not monthly, you could reduce the life of your loan from 20 years to 12 years (based on an average loan amount). The banks in Australia had been hiding this fact from the consumer for decades. Not a single one had any provision for fortnightly payments.

For example, you owe the bank a monthly repayment of $2,000. Instead of paying $2,000 at the end of the month, you pay $1,000 each fortnight, and so reduce the amount of interest calculated on at the end of each month. Over time, this adds up to a huge saving in interest payments over the life of the loan and will bring about the end of the loan years sooner.

So, why do banks in Singapore not offer this? Simple. They would lose hundreds of millions of our hard-earned dollars in interest payments. Hence, their profits will drop.

In Australia, when the news of the benefits to consumers of this repayment method hit the media, major banks scrambled to cut off the defection of hundreds of customers to smaller banks offering this service.

Today, every major bank in Australia offers the service and even sets up simulators to show how you can cut your loan in half with fortnightly repayments.

When I asked each of the loans officers in Singapore why they did not offer this service, I received a sheepish grin and a shrug. I am sure many home owners here will be very keen to know why fortnightly repayments — offered by most banks in the world today — are not available?

When can we expect this service to become available so that we can look forward to saving possibly hundreds of thousands of dollars in interest payments to banks that post huge annual profits partially due to our home loan repayments?

Letter from Bruce Harvey

Source : Today - 7 Jun 2007

I REFER to the article, ‘Small band of dissenters fights en bloc sale frenzy’ (ST, May 30).

I am proud of retiree Mary Chan, who, in spite of being in her 70s and computer-illiterate, put up a valiant fight for her home. Sadly, she failed and will end up losing her flat in an en bloc sale.

As a senior citizen myself, I appreciate the steps taken by the Government to safeguard my health and welfare, e.g., by revamping ElderShield, passing the Maintenance of Parents Act, and extending the employment age.

I appeal to the Government to also safeguard my home and those of others like Mary Chan from being sold off by strangers.

According to press reports, there were 72 en bloc sales last year and this number is likely to be exceeded this year, seeing the frenzy that has taken hold.

There are many more Mary Chans caught in this situation who are unable to fight back. Many have sleepless nights and feel helpless to prevent the loss of their homes. Some descend into depression.

One in five Singaporeans will be 65 or older by 2030.

Minister for National Development Mah Bow Tan said at a BCA-SIA seminar last September: ‘With such a high proportion of elderly people, it is important for us to create an environment where our elderly can ‘age in place’. What this means is that they can also continue to enjoy living in familiar surroundings and among friends and neighbours.’

One way of ensuring this is for the Government to step in and either stop this en bloc frenzy altogether or make it mandatory for the interests of the elderly to be fully safeguarded before an en bloc sale commences.

The recent en bloc sales of huge properties have ‘released’ many hundreds of new home buyers into the property market.

In the short term, the supply of homes will not be able to satisfy the demand.

This will create a ’shortage’ of homes and drive prices of property up.

Visit any showflat and you will find developers selling more small units and fewer medium/large ones.

This is logical because the smaller units are affordable and sellable.

Therefore, those who sell their medium-sized/large apartments in en bloc sales will now have to settle for small units unless they pay extra and buy penthouses or landed property.

For en bloc sales, only prime district and freehold land will continue to attract large premiums.

Developers are willing to offer multi-million-dollar price tags because such land commands a high selling price per unit.

If you gain less than a million dollars from the en bloc sale of your 99-year leasehold estate, it may be financially wise to consider buying a HDB flat. This way, you get to keep some cash in the bank.

Source :  Straits Times - 1 Jun 2007

For the past few months, the media has been reporting record breaking en bloc transactions and high property prices.

It seems that everyone is trying to outdo each other in prices.

A discerning buyer will ask: Are the high-priced properties bought up by wealthy foreigners or investors wanting to chase up the market so that they can sell it later at even higher prices?

Are these transaction prices indicative of the overall market?

A discerning buyer should also ask why there is a sudden rush of people changing property, private as well as HDB, at this time.

I’ve personally encountered people paying $100,000 cash above valuation for a five-room HDB apartment which is 20 years old. Word gets around. Now almost every seller in the same district is asking for absurd cash amounts, regardless of the condition of their flat, just because someone sold it at a premium. This is pure greed.

For the buyer looking for a HDB apartment now, I have these to say:

Don’t let kiasuism rule your head and make impulse purchases that are way above market value.

Property valuators have a bird’s-eye view on the valuation of an apartment. Trust their assessments, they are the experts. Don’t pay more than 5 per cent above valuation.

Don’t pay more than you can afford to, or you’ll pay for it for a long time. Interest rates are not as good as before. You can end up paying twice your buying price.

Learn from history - don’t fall into the same trap many did six years ago, when they paid more than half a million dollars for a five-room HDB apartment.

Don’t buy when everybody is buying. If you can wait, hold out.

Know the HDB rules. You have to pay the cash above value, plus 5 per cent cash of the selling price, plus stamp duty and lawyers’ fees.

Finally, no matter how ‘good to move in’ a condition the flats are, there will always be some level of renovation that needs to be done. Toilet bowl replacement is mandatory for me.

Source :  Straits Times - 1 Jun 2007

I REFER to the reply by HDB’s Dr Chong Fook Loong, ‘HDB remains committed to the Punggol 21 vision’ (ST, May 22). One reason cited for the lack of facilities in Punggol is the ‘lack of a critical mass’ of flats.

However, as can be seen from the overwhelming oversubscription for the recent eco-precinct project (Treetops, where 3,356 applicants vied for 712 flats), there is actually a very large demand for good-quality flats in the Punggol area.

Dr Chong mentioned that HDB would ‘announce other new projects in Punggol later this year’, presumably under the Build-to-Order (BTO) system.

I would like to suggest that instead of inviting applications for these new projects, the HDB could replicate the Treetops project in other precincts nearby and offer them to the 2,644 unsuccessful applicants of the Treetops.

The HDB, as well as these flat applicants, would then not have to go through another round of BTO applications, thereby saving time and cost for everybody.

Unsuccessful Treetops applicants would also not have to submit a fresh application and incur the non-refundable $10 application fee again.

The added advantage is that HDB would be able to fill up three to four precincts almost immediately, and achieve its desired ‘critical mass’ in Punggol more rapidly.

Source :  Straits Times - 1 Jun 2007