Land betterment charges to rise by 3.4% on average for non-landed residential, 3.5% for landed residential uses

[SINGAPORE] In line with firm property prices, the government has raised average land betterment charge (LBC) rates in most property sectors in its latest half-yearly review.

Only rates for the use group that covers hotels and hospitals were left untouched.

Announced on Monday (Aug 31), the latest rates are for the six months starting on Sep 1. LBC rates were raised for residential, industrial, commercial and place of worship/civic and community institution uses.

Developers pay LBC for the right to enhance the use of some sites, or to build bigger projects on them.

LBC rates are announced twice a year, on Mar 1 and Sep 1, following a review by the Singapore Land Authority (SLA), in consultation with the taxman’s chief valuer (CV).

The rates are based on the CV’s assessment of land values, and take into consideration recent land sales.

LBC rates are stated according to use groups for 118 geographical sectors in Singapore.

For landed residential use, rates have gone up by 3.5 per cent on average.

The rates in 108 sectors are being raised by about 2 to 8 per cent. There are no changes in the other 10 sectors.

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LBC rates for non-landed residential use are being raised by 3.4 per cent on average. Rates have been upped in 70 sectors by about 1 to 29 per cent, with no change in the remaining 48 sectors.

In the industrial use group, LBC rates have risen by 3.9 per cent on average. The rates in all 118 sectors were raised by about 2 to 10 per cent.

For the place of worship/civic and community institution use group, LBC rates were increased by 2.9 per cent on average in all sectors to “keep pace with the overall growth in land values”, said SLA in its news release.

LBC rates for commercial use have risen by 1.7 per cent on average. The rates in 46 of the 118 sectors were raised by about 3 to 19 per cent; the rates in the remaining 72 sectors were left unchanged.

Chua Yang Liang, head of research and advisory for South-east Asia at JLL, noted that the level of investment activity in the Singapore commercial segment has been high since the start of this year. “The full-year value of office transactions is poised to breach the historical peak of S$13.3 billion recorded in 2007.”

He added: “There has also been keen investment interest in retail assets across the board – prime, city-fringe and suburban.”

The biggest increase in commercial use LBC rates, at 19 per cent, was in geographical sector 96 (which includes the Bayshore Drive area). Market watchers linked this to the S$1,323 per square foot per plot ratio (psf ppr) fetched in July 2026 for the commercial and residential government land sale (GLS) site in Bayshore Drive.

“The top bid came in above expectations, indicating a high degree of conviction in the long-term prospects and the strategic importance of the site as the focal point from which the Bayshore growth area will start,” said Knight Frank Singapore research head Leonard Tay.

For landed residential use, sectors 67, 68 and 69 had increases of 8.1 per cent in LBC rates from Sep 1. The trio are in highly demanded Good Class Bungalow locations in Nassim/Fernhill; Botanic Gardens/Gallop Road/Tyersall; and Ridout/Peirce Hill/Swettenham Road respectively, shows JLL’s analysis.

For non-landed residential use, the biggest LBC rate increase of 29.1 per cent was in geographical sector 54 (which includes the Kallang Bahru and Boon Keng areas). Newmark’s analysis showed that the S$1,415 psf ppr winning bid for the Kallang Close GLS site in April was 44 per cent above the land value implied by the Mar 1, 2026 LBC rate for non-landed residential use in the sector.

River Valley Green (Parcel C), in sector 48, fetched a winning bid of S$1,730 psf ppr in June; this is 13 per cent above the land value implied by the Mar 1, 2026 LBC rate for non-landed residential use for the sector.

The Sep 1 LBC rate for the sector has gone up by 8.7 per cent.

Overall, Huttons Asia chief executive officer Mark Yip described the 3.4 per cent average appreciation in LBC rates for non-landed residential use as “a mild increase that is unlikely to discourage developers from acquiring a collective sale site”.

He noted: “A realistic selling price and location attributes of the development are still key determining factors for a successful collective sale.”