Developers rush to meet marketing rules deadline

Developers rush to meet marketing rules deadline

Developers are warning of administrative headaches in the changeover to new rules this Friday requiring them to be more transparent in the marketing of their projects.
A check with developers by The Straits Times found that most are ready to meet the deadline on Friday.

Developers say that while they do not anticipate major challenges in complying with the new rules, the sales process will become much more complicated.

There will be an increase in paperwork, especially for projects with units left unsold at the time of the change.

They will need two versions of sales and purchase agreements and options to purchase - one for sales before May18 and another set after. Each will have different contractual obligations.

This means that even if a few units in a launched project are unsold, the developer must use the new versions of the purchase documents mandated by the Urban Redevelopment Authority (URA) for all sales from Friday on wards.

The URA made changes to its Housing Developers Rules last month, requiring developers to give more information in writing on the project and unit to buyers before the option to purchase is issued.

This first phase of changes to ensure that 'what you see is what you get' requires developers to provide a drawn-to-scale project location plan and site plans. They must also give a unit floor plan and a breakdown of a unit's floor area by spaces such as bedrooms, balconies and bay windows.

Other new requirements include getting the consent of home buyers before making changes such as adjustments to a unit's layout.

Mr Lee Liat Yeang, a partner at Rodyk & Davidson's Real Estate Practice Group, noted that industry players feel the preparation time given for the new rules to be implemented is too short, especially since they are also applicable to projects which have been partly sold before this Friday.

Source: The Straits Times – 15 May 2012