Following yesterday’s amendments to the Housing Developers Rules (HDR) which take effect on 18 May for all new projects, some market watchers have raised concerns that they may not be practical.
According to Lee Sze Teck, Senior Manager of Research and Consultancy at DWG, it is unlikely that developers will build showflats representing all the different unit types in a development. So much of it will be left to the buyers’ imagination.
Under the revised rules, developers will now be obliged to present showflats as faithful representations of the project’s actual units. This will help to give buyers a glimpse of the actual usable space in a unit.
Amid a low interest rate environment, many consultants expect shoebox units, which are usually misrepresented in showflats, to perform well as smaller units remain attractive for being affordably priced.
“This issue of transparency in the real estate market has been around for quite some time, often through feedback from consumers, investors and consultants. The triggering point was the recent advent of shoebox units, where the issue of misperception of space and size is more critical and obvious,” said Chua Yang Liang, Head of Research at Jones Lang LaSalle South East Asia.
“Buying is also sentiment-driven and purchasers may decide on the spot to purchase before fully digesting the facts,” added Chua Chor Hoon, Head of Asia Pacific Research at DTZ.
At the same time, Nicholas Mak, Head of Research at SLP International Property Consultants, said big property players will not likely feel the effects of this measure but newcomers to the local market could face issues.
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