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New URA rules for bigger unit sizes may reduce affordability for retirees and millennials: Redas
THE new guidelines on average unit sizes and the maximum number of units allowed in new private flat and condo developments could affect affordability for those looking to downsize and retire, and millennials seeking smaller dwelling units and flexible living, the Real Estate Developers' Association of Singapore (Redas) said in a statement Thursday afternoon.
The industry association also said that developers currently build based on market demand to cater to the diverse needs of all segments of the market, and are building fewer shoebox units in new private housing projects as demand for such dwellings has fallen over the years.
Redas' statement comes after the Government on Wednesday announced that from Jan 17 next year, the average size of new private flats outside the central area will have to be at least 85 square metres, up from 70 sq m.
Also, nine areas in Singapore - up from four presently - will be subject to an even more stringent minimum sizes of 100 sq m. The areas are Marine Parade, Joo Chiat-Mountbatten, Balestier, Telok Kurau-Jalan Eunos, Stevens-Chancery, Pasir Panjang, Kovan-How Sun, Shelford and Loyang.
The Urban Development Authority (URA) said on Wednesday that these changes are aimed at managing potential strains on local infrastructure and safeguarding the liveability of residential estates.
Redas also commented on other policy changes made on Wednesday, which included a lowering of the 10 per cent bonus gross floor area (GFA) cap for outdoor spaces in private non-landed housing - namely, balconies, private enclosed spaces and private roof terraces - to 7 per cent.
"The new guideline of 7 per cent Bonus GFA cap aim to provide homebuyers more choices of units with and without private outdoor spaces and allow developers the flexibility to choose from a menu of available Bonus GFA incentives that best fit their own business needs," said Redas, which noted that the adjustment came from URA’s observation that the full 10 per cent bonus GFA is not usually taken up.
Redas welcomed the new bonus gross floor area scheme also announced on Wednesday, which provides bonus GFA capped at 1 per cent of total area (or the GFA of the residential component for mixed-use developments) for providing more indoor recreation spaces such as gyms, libraries, function rooms and reading rooms to residents.
"It allows developers to provide additional facilities and covered communal spaces for residents," Redas said.