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What To Do And Consider If My Condominium Is Undergoing An En-Bloc (Collective Sale)?

An en-bloc sale isn’t always a bed of roses. Here’s what homeowners need to know before agreeing to a collective sale.


En-bloc sales are generally regarded as having positive effects on the property market.

When existing residential sites are taken over and redeveloped, fresh value is created. Units will feature more contemporary design features and more “optimised” housing layouts, while the higher prices that developers (and new owners) pay is actually a closer, more accurate reflection of the current value of the site, taking into account infrastructure (like MRT stations, shopping centres, and public spaces) that has since been built and the overall growth of the economy.

Residents who sold their properties en-bloc will likely need to look for an alternative property to live in or plough their dollars into for investment. This means that there will be a large influx of cash-rich property hunters, which is good news for everyone in Singapore who has a property for sale.

However, the entire process of putting up a development for en-bloc sale, gaining consensus, closing the sale and then having to deal with the aftermath of vacating one’s home can be stressful for everyone concerned, even if there is an attractive payout at the end.

Here’s what prospective property owners need to know if their property is being put up for an en-bloc sale.

Read Also: En-Bloc Fever: How Much Longer Will It Go On?

What’s Required For A Successful En-Bloc?

For an en-bloc sale attempt to be made, a group of owners would first form a pro-temp committee and then begin lobbying and convincing other owners in the development to agree to the collective sale.

This committee will also need to hire professionals to assist in various aspects of the en-bloc, including a property consultant, who, among other things, assesses the value of the property and proposes a reserve price. The committee would also seek out developers or other companies who might be interested in making bids.

The quorum required for an en-bloc depends on the age of the property. For properties that are less than 10 years old, 90% of the ownership of the development has to agree. For properties that are more 10 years old, the percentage required is 80%. Note that this percentage is determined by the share of the ownership stake in the property, and not the number of units/households.

Once this quorum is met, the proposal for the sale must then get the approval of the development’s Strata Title Board, unless there is a unanimous decision to sell. The Strata Title Board protects the interests of residents by making sure no one makes a loss from the sale, after factoring in relevant taxes and duties.

Read Also: 5 Ways To Calculate The Returns On Your Investment Property

How Long Will It Take Before You Get The Money?

You can receive the proceeds of the sale as soon as four months after the deal closes, or need to wait for up to a year in the worst cases.

Read Also: What Singaporeans Need To Know About Home Equity Loans Before Taking One

More Implications Of An En-Bloc Sale

While you’re waiting for the proceeds of the sale to come in, you’re given around three to six months to vacate the property.

This means that if your en-bloc property is your only home, you may need to fork out cash or take a bridging loan to make the downpayment for a new home, or rent a place until the proceeds of your en-bloc comes in.Read

Once the en-bloc sale closes, residents who bought their units less than three years ago will be liable to pay the Seller’s Stamp Duty (SSD) of between 4% to 12% of their property valuation. This is a pretty significant sum that could have been used for a downpayment for their new home.

When the money does come in, any CPF monies that have been used for downpayment or monthly repayments need to be returned, with accrued interest. If the property value has not appreciated significantly enough, then the need to return your CPF monies with accrued interest may mean that you may see a much smaller large cash influx than what you might imagine.

Read Also: Accrued Interest VS Property Charge VS Property Pledge: What Are The Differences?

En-Bloc Sales Are Not Always Rosy

Even when things go smoothly – and they don’t always go smoothly – the can take an entire year. It is a long process with twists and turns.

So long as homeowners do not get swept up by the fervour of en bloc sales and ensure they plan ahead to ensure they have sufficient cash for the costs of relocating and paying the necessary duties, then they can enjoy the financial rewards of giving up their property in the en-bloc sale.

Read Also: Complete Guide To Choosing The Most Suitable Home Loan

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