Get out of the market.... correction maybe here liao!!!

DJ MARKET TALK:Property Stocks Down On Higher Development Charges


0751 GMT [Dow Jones] Property stocks down on concerns profit margins will be hurt by Singapore government's move to up development charge rates to 70% of the rise in piece of land's valuation, from 50%; new rate effective now, applies to new applications for land development. Donald Han of Cushman & Wakefield says developers caught between rock, hard place; "just passing on (the extra costs) to buyers is not the perfect answer" as they'll be at disadvantage against those who already have secured planning approval, paid their development charges, launching projects in same area at same time; "if they don't increase their price, margins certainly will be squeezed." But adds developers can still achieve "comfortable double-digit" profit margins vs average of 15-20% margins now. (FKH)


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July 18, 2007 03:51 ET (07:51 GMT)

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DJ MARKET TALK: S'pore Developers May Pass Ppty Tax To Consumers


0805 GMT [Dow Jones] Higher charges on Singapore private property upgrades may not hit profits of developers if firms can pass burden to consumers, says local analyst. "It depends on the outlook for the market, and if developers see prices still heading up, they'll pass the charge on," analyst adds. However, increase "does warrant some concern" as developers will factor cost into bids for existing property, so owners of original sites bought for redevelopment "may need to be more realistic" about prices their apartment units may fetch. (JRJ)


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