District 10 Freehold Condo Offers Discounts to Offload Stock Before the ABSD Deadline
A District 10 freehold condo with a rooftop tennis court is a tempting buy for buyers looking to own a home in the city. It also has a good location, being near SUTD and Upper Changi MRT stations.
Usually, developers will try to sell off the last units before the ABSD deadline. They may offer discounts or flash sales to clear stock.
Discounts for individual buyers
With the additional buyers’ stamp duty (ABSD) clawback deadline set for next year, developers are ramping up efforts to offload their unsold stock before it hits. Discounts and deferred payment schemes are among the strategies being used to boost sales.
A freehold condo in Bukit Timah, for example, is touting buyer’s stamp duty (BSD) discounts of up to $110,000 off selected units, in a bid to offload its remaining units before the ABSD deadline. One promotional advertisement for Royalgreen screamed “Full absorption (100%) of BSD”, while another ad said:
But analysts warn that heavy discounts will leave a bitter taste for earlier batches of buyers who missed out on cheaper deals. And they may have an impact on pricing of developments nearby.
Discounts for bulk buyers
A freehold condo near Bukit Timah is offering discounts to offload stock before the ABSD deadline, which means you can get a good deal without paying heavy stamp duties. The developer has also negotiated to pick up transfer taxes and applicable luxury or mansion taxes on the unit, effectively cutting your costs by a significant amount.
During times of slow sales, developers have a natural tendency to look for ways to offload their units. In turn, bulk buyers are also looking for opportunities to purchase condo units at discount prices in order to resell them later on.
For example, UOB’s chairman emeritus Wee Cho Yaw bought 45 unsold units at The Nassim back in 2017 from developer Kheng Leong. The deal helped the developer avoid a Qualifying Certificate (QC) penalty, which it would have to pay if it failed to finish the project within five years and sell all units within two years of the top-of-market date (TOM).
Discounts for upgraders
In a bid to offload stock before the ABSD deadline, some District 10 freehold condos are offering discounts to upgraders. This is a strategy to attract more buyers to their projects and push sales.
Analysts say developers can also offer other sweeteners such as deferred payment schemes or discounts for renovation works. These strategies aim to help developers overcome the hurdle of a hefty ABSD liability and get their units sold before the deadline.
But this approach could leave a bitter taste for earlier batches of buyers who bought these properties at higher prices. Moreover, bulk deals tend to have a negative impact on the prices of other developments nearby, analysts say.
One freehold condominium in Bukit Timah – Royalgreen – is promoting “buyer’s stamp duty (BSD) discounts” of up to $110,000 for selected units, according to its promotional advertisement.
Discounts for investors
As some new condos near the 5-year ABSD deadline are still unsold, developers are keen to offload stock. To do this, they may offer discounts to investors based on the take-up rate or number of units left unoccupied.
One popular freehold condominium in Bukit Timah, Royalgreen, is now running what it calls buyer’s stamp duty (BSD) discounts of up to $110,000 off selected units. These promotional advertisements were spotted on WhatsApp last month, days after the marginal BSD for pricier residential and non-residential property was raised in Budget 2023.
In the face of these discounts, analysts have cautioned that they could leave a bitter taste for past buyers, especially if they bought their units at higher prices earlier. Nevertheless, some analysts say that a discount does help clear the stock and boost developer profit.
For instance, Malaysian plantation and property group IOI Corp, the developer of The Trilinq at Clementi, is facing S$52.1 million in ABSD fees if it fails to offload 267 unsold units by February. Singapore Land, the developer of Mon Jervois (42 unsold units) and Pollen & Bleu (93 unsold units), is also expected to incur heavy clawback fees this year.