Legal framework for collective sale of real estate in Singapore. Pot of gold for investors?
| DOI | https://doi.org/10.1108/14635781011024854 |
| Date | 09 March 2010 |
| Published date | 09 March 2010 |
| Pages | 109-122 |
| Author | Alice Christudason |
| Subject Matter | Property management & built environment |
Legal framework for collective
sale of real estate in Singapore
Pot of gold for investors?
Alice Christudason
National University of Singapore, School of Design and Environment,
Singapore
Abstract
Purpose – The purpose of this paper is to provide an analysis of the profile and differing
perspectives of strata owners (subsidiary proprietors) involved in collective sales in Singapore. It aims
to examine their position within Singapore’s legal framework, and consider the repercussions of the
power-play between them.
Design/methodology/approach – The paper utilises legislation and case-law to reveal the
problematic aspects of the collective sale process through majority rule. Similar legislation exists in
Hong Kong, South Korea and Taipei. Data on collective sales from real estate information systems and
property analysts are also utilised.
Findings – The findings reveal the dichotomy of concerns between different groups of subsidiary
proprietors,namely the owner-occupiers andproperty investors. This causesdelay and acrimony which
characterisemany collective sale exercises.This is fuelled by a lack of differentiationin the voting rights
of the different groups of subsidiary proprietors. However, Parliament and the Courts have been
dynamic and sensitive inseeking to strike a balance between the legitimateconcerns of both groups.
Originality/value – The findings assist both groups of subsidiary proprietors to be morealert about
the pitfallsand profits in a collective sale. Policy makersin other jurisdictions can learnfrom Singapore’s
experienceof the collectives sale phenomenonas an avenue for urban renewal.It provides insights to the
multiple issues which arisewhen majority rule can dictate the trajectory of collective sales.
Keywords Real estate, Selling,Legal systems, Singapore
Paper type Research paper
1. Introduction
The year 2007 was described by a leading property analyst as “the most spectacular in
the 13-year history of Singapore’s collective sale market” (Singh, 2008). In the first-half
of 2007 alone, 82 collective sale (CS) worth $10.49 billion were transacted. In total, the
year 2007 saw 109 deals done. They developments sold comprised 6,566 units
(REALIS, 2009) and the value of the transactions was $13.3 billion. This was said to be
“a whopping jump” from the 79 CS deals amounting to $8.2 billion transacted for the
whole of 2006 (Rashiwala, 2007).
The projection for the next few years is for even more CS as a result of improved
sentiment and rising demand for land. Five to ten deals are expected in the second half
of 2009, 30 to 40 transactions in 2010 and about 18 for 2011 (Teo, 2009a).
1.1 What is a collective (or enbloc) sale?
CS is a form of collective action whereby all owners of separate units within a
development sell their properties collectively and at the same time to a single party or a
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1463-578X.htm
Pot of gold for
investors?
109
Received September 2009
Accepted November 2009
Journal of Property Investment &
Finance
Vol. 28 No. 2, 2010
pp. 109-122
qEmerald Group Publishing Limited
1463-578X
DOI 10.1108/14635781011024854
To continue reading
Request your trial