Flat sale may not help speed up bankruptcy discharge

Flat sale may not help speed up bankruptcy discharge


Q My brother, 58, was declared a bankrupt three years ago because of a credit card debt of about $90,000.

He and his wife own a five-room Housing Board flat and they have to pay $800 every month to service the HDB loan. But he is unable to do so owing to various financial reasons.


He plans to downgrade to a four-room flat and use a portion of the sale proceeds to reduce his debt and get a discharge from bankruptcy from the Official Assignee (OA).


He has worked out that after the sale of the flat, he can pay the OA about $20,000. However, the OA said he cannot be granted a discharge based on this figure.


My brother cannot decide if he should sell the flat. There appears to be no point in doing so because even if he pays $20,000 to the OA, he will still remain a bankrupt.


I understand that if a bankrupt owes less than $500,000, he can write to the OA after three years to request a discharge. Is this true?


As the amount he owes is not huge and there is no way for him to raise the cash other than to sell his flat and downgrade to a smaller unit, is this method the only way to get him out of bankruptcy?


How can the OA help him? Are there any Central Provident Fund or HDB restrictions if he disposes of his flat and buys another?



A A discharge from bankruptcy may be done in two ways, either by an application to a court or by a certificate of the OA.


Your brother, the OA or any person with an interest may make an application to a court, which may grant an absolute or a conditional discharge.


If your brother is granted an absolute discharge, he will be free from any further obligations.


For a conditional discharge, the court may attach conditions such as requiring him to make contributions from his post-discharge income.


The court will take into account factors such as your brother’s age, the cause of bankruptcy, why he incurred the debts, the number of creditors involved and the value of his assets compared against that of his liabilities.


For a discharge through a certificate of the OA, the latter generally reviews all cases in which there is a bankruptcy of at least three years and the debts are less than $500,000.


The OA also takes into account similar factors as reviewed by a court and also looks at the bankrupt’s conduct and level of cooperation. The discharge is not automatic.


In both situations, the creditors have to be notified and they are entitled to object. If the OA rejects the objections, the creditors can go to a court for an order prohibiting the OA from granting the certificate.


As both situations involve the exercise of discretion, the interests of the bankrupt are balanced against those of the creditors, the public and commercial morality or common honesty.


An HDB flat is protected as it is not available for distribution to a bankrupt’s creditors, and it has been argued the same protection should apply to sales proceeds.


However, in practice, the OA has always intervened and taken the bankrupt’s share of the proceeds for distribution.


For the purchase of an HDB flat, following an arrangement between the OA and the HDB, there may be no need to apply for the OA’s consent to buy a four-room or smaller flat.


Your brother should work and cooperate with the OA if he wishes to be discharged. This is because the OA keeps a fair balance between the interests of the creditors, which is to be repaid a reasonable sum on the one hand, and the eagerness of a bankrupt to be discharged on the other.


Amolat Singh


Amolat & Partners


Advice provided in this column is not meant as a substitute for comprehensive professional advice.


Source: Straits Times

Huh? What are plot ratios?

Huh? What are plot ratios? 

Where do you see this?


In articles about property. The term is often used by those engaged in collective sales.



What does it mean?


The plot ratio of a site is the gross floor area of the building divided by the site area.


The higher the plot ratio, the more gross floor area can be allocated to the site.



Why is it important?


It tells you the site’s development intensity, or how much can be built on the site. This is of particular interest to those who are keen to sell their ageing homes en bloc.


If a site’s allocated plot ratio is higher than that utilised by the existing building or if it is revised upwards, then more gross floor area can be allocated to the site.


This would raise the site’s value because a developer could build and sell more homes on the site.


If the Government feels there is a need, it can revise plot ratios in its Master Plans – which are reviewed every five years – to cope with a growing population, for instance.



So you want to use the term. Just say …


‘Many developers were disappointed with the 2008 Master Plan as there were no major changes to the plot ratios.’


Source: Straits Times

‘Mickey Mouse homes’ snapped up near Little India

‘Mickey Mouse homes’ snapped up near Little India 


Buyers like these small apartments as they are close to the city and they seem more affordable

By Joyce Teo, Property Correspondent 

The area near Farrer Park MRT station in Little India – once largely shunned by developers – has become the playground of smaller property players.


These little-known companies have bought land there and launched projects that range in size from as few as 13 units to around 50.


Recently, Suites 123 in Rangoon Road – which has 37 apartments – was largely sold out, despite weak market sentiment.


Before that, other small projects such as Citigate Residence, Suites@Owen and Soho@Farrer were also sold out. Some of these projects were sold at around $1,000 to $1,100 per sq ft (psf), which is not cheap, market watchers noted.


However, as the apartments are usually quite small, these ‘Mickey Mouse units’ appear to be priced at relatively low levels. Most of these projects have shop units as well.


Mr David Neubronner, the executive director of Savills Residential, noted that many of the one-bedroom units are just 400 sq ft and the two-bedroom units 700 sq ft.


He added: ‘A two-roomer may cost $700,000.’


That, he said, is a ‘very attractive entry point’ for buyers looking to stay near the city.


At Suites@Owen, the 20 apartments range in size from just 366 sq ft for a one-bedroom unit to 1,044 sq ft for a two-bedroom penthouse.


The sizes shrink even further at the 13-unit Kent Residences on Kent Road. The smallest apartment is just 312 sq ft – roughly half the size of an average three-room HDB flat, or about the size of two Old Chang Kee kiosks.


The developer of Kent Residences, which is also behind Tyrwhitt 139 on Tyrwhitt Road, said the area is attractive because it is near an MRT station.


These projects target singles and small families. The buyers are mainly Singaporeans in their 30s but there are also some foreigners.


Mr Neubronner said the projects attract many end-users as the area is at the city fringe, which is getting more exciting.


Market watchers said Farrer Park’s proximity to Little India might deter single females or families with kids, but not necessarily single men.


Still, there are many projects located north of Farrer Park MRT station, across the road from the buzz and chaos of Little India – and less savoury activities at Desker Road.


While many people also do not want to live near the Little India conservation area, some love living there, including artists and film-makers.


The area is full of history and character. Race Course Road, for instance, took its name from Singapore’s first race course, built in Farrer Park in 1842. One of the country’s oldest Buddhist temples, Leong San Buddhist Temple, is also in the vicinity.


And when some of the newer developments are completed, the residents might include a famous face or two. At least one local celebrity is believed to have bought a unit in a small development north of Farrer Park MRT station.


For buyers, the good thing about these small projects is that they are mostly either freehold or 999-year leasehold. With the MRT station only a short walk away, residents are basically two MRT stops away from town.


However, market watchers warn that buyers – those who bought off developer’s plans – might not realise how small the units are until they see the completed apartments.


Nowadays, the space allocated for bay windows, planter boxes, air-con ledges and balconies can eat significantly into your living area.


‘In some instances, they can make up as much as 20 per cent or more of the total. If you want more ‘liveable’ space, you should do a like-for-like comparision before you make your decision,’ said Chesterton International’s head of research and consultancy, Mr Colin Tan.


For instance, at the 56-unit Citigate Residence on Rangoon Road, the 441 sq ft and 517 sq ft advertised for its smaller units include the bay window, air-con ledge, planter and balcony.


Nevertheless, many buyers could still bite simply because of the seemingly low absolute prices and projected high rental yields, market watchers say.


‘Consumers must be more prudent. The absolute value of such developments might be low, but investors have to consider whether they can find a buyer or tenant later,’ said HSR Property Group’s executive director, Mr Eric Cheng. ‘They are suitable only for those who are comfortable with small units.’


He said that many buyers might not realise the units are too small to live in until the projects are completed.


‘One of my friends who bought a 580 sq ft unit on Mackenzie Road told me it’s like a bird’s nest,’ he added.

Hidden risks



Many are drawn in by the seemingly low absolute prices and projected high rental yields. However, the units aren’t that cheap on a per sq ft basis. Also, some buyers might find the units too small to live in comfortably when they see the completed apartments. It might not be easy to find a buyer or tenant later.


Source: Straits Times

On the market : New launches

On the market 

In this weekly column, we bring you a sampling of homes for sale. In the spotlight this week: New launches.


Clover by the Park,

99-year leasehold

Bishan Street 22/Street 25

Units: 616


Price: $750 per sq ft (psf) on average


Launch date: Last Friday


This mass-market project has two 39-storey blocks. Sim Lian is releasing one tower, comprising 308 units, for the launch.


Facilities include a 50m lap pool, a jacuzzi pool and fitness stations. The units range in size from 1,216 sq ft for a three-bedder to 3,498 sq ft for a split-level penthouse with five bedrooms.







OLA Residences@Mountbatten, freehold

839 Mountbatten Road


Units: 50


Price: $1,250 psf on average


Launch date: July 5


The units vary in size from 732 sq ft for a one-bedder plus study to 2,164 sq ft for a four-bedder. There are nine penthouses that range from 1,258 sq ft to 3,208 sq ft. Most units have private lifts.


This Lian Beng Group project is located near Katong Shopping Centre.







The Amery, freehold

Telok Kurau Lorong K


Units: 74


Price: $860 psf on average


Launch date: Last weekend


This project, being developed by Sim Lian Group, has only large units. They range from 1,313 sq ft for a three-bedder to 2,379 sq ft for a penthouse.



Source: Straits Times

Is this S’pore’s most expensive house?

Is this S’pore’s most expensive house? 


Worth at least $120 million


The size of 92 five-room HDB flats


Owned by a prince


The mansion mired in a legal battle between the Brunei Sultan’s brother and the country’s national investment agency could well be Singapore’s most expensive residence.

Owned by Prince Jefri Bolkiah, the younger brother of Sultan Hassanal Bolkiah, Arwaa Mansion at 46B and 48 Nassim Road is said to be worth at least a jaw-dropping $120 million.


That figure for a home, even in land-scarce Singapore, is not something you hear about every day. Even property pundits that The Sunday Times spoke to were hard-pressed to think of a residential address that could fetch that kind of value.


There are only between 2,500 and 3,000 good-class bungalows with at least 15,070 sq ft of land area here.


Based on the Urban Redevelopment Authority’s numbers, the average cost of a good-class bungalow was $13.8 million last year.


What could possibly make the Brunei royal’s Nassim address worth that princely sum? Size, location, possibly even its pedigree ownership.


Industry observers believe that the palatial property, which stands on top of a hill, has such a staggering value because of its sheer size.


The mansion sits on a land area of about 110,000 sq ft. The area was the result of merging two pieces of property with different addresses. Imagine 92 five-room HDB flats combined.


‘It is part of Singapore’s most desirable and prestigious residential area,’ said Savills Singapore’s director of prestige homes Steven Ming.


‘But each property value is unique,’ he said.


And this none-too-humble villa is special because, well, it belongs to a prince.


‘You would assume that only good-quality stuff went in there, so there is a premium attached to it,’ said one industry pundit.


The mansion made news last Friday after it was reported that the Brunei Investment Agency, which manages the Brunei government’s General Reserve Fund and external assets, wants Singapore’s courts to get the 53-year-old prince to hand over the property.


Homes in the $100 million club are few and far between.


Said Credo Real Estate managing director Karamjit Singh: ‘Over the years, governments and corporations that have owned large properties have been selling them and they get re-developed and sub-divided. So such big properties are very rare.’


Property pundits say that large parcels still exist, owned mostly by the old rich or foreign governments to house their embassies.


‘Some are sitting on land that has been passed down for generations and it goes into the $100 million category because you can build 20 storeys on it,’ said Mr Ku Swee Yong, the director of business development and marketing for Savills.


He singled one out: Mitre Hotel in Killiney Road, which some have estimated could fetch $200 million for its nearly 40,000 sq ft of land. Its prime location and plot ratio mean it has good redevelopment potential.


Size isn’t the only thing that matters when it comes to how many zeroes go into a property’s value. In areas like Katong, property can fetch a premium since plot ratios there are higher than those in town, like in Nassim. That means more units can be built.


Dr Della Suantio Lee, the wife of Mr Lee Seng Gee, the eldest son of late philanthropist Lee Kong Chian, was said to have sold a 115,300 sq ft piece of property in Meyer Road to the Hong Leong Group for about $200 million last year.


Even fengshui plays a part, albeit a much smaller one.


‘Some wealthy Chinese businessmen will consider how wide the gate at a bungalow is, whether it’s sloping up or down or whether it faces a good house,’ said Mr Ku.


The palatial residence of Arwaa Mansion is certainly fit for a prince and comes with a suitably intimidating value. It was built by merging two pieces of property with different addresses. This photo shows the part of the mansion at 46B Nassim Road.


Source: Straits Times