Showing posts with label Urban Mutation. Show all posts
Showing posts with label Urban Mutation. Show all posts

Sunday, 22 June 2008

Being a Responsible Home Owner

Yesterday's Straits Times (Saturday 21 June 2008) has a follow up to my previous blog post's ST article ("Landmarks at risk"). Written by the same reporter - Tan Hui Yee - the Saturday review gives a cogent argument about the differences between private and public ownership, and in particular the responsibilities that a private home owner should have, NOT ONLY to her private home, but to the common property as well.

Ms Tan Hui Yee asks an important question - at what point do we 'give up' on an old property and consign it to the demolition beasts? She points to an irate owner who told her that her condo (slated for conservation) does not deserve to be protected, as it was leaking and too old to be saved; better to enbloc it and reap the rewards. But the point of private ownership isn't just that you can do what you will to your own home, including selling it when you want, in whatever condition it is in. The point of private ownership is that you are responsible for your home and its surroundings. There's no fall back to some town council to help you out with major repairs. Instead, you and your neighbours are ultimately responsible to ensure your estate is in good, liveable condition.

And that, as Ms Tan Hui Yee points out, is something private condo owners have yet to learn to do.

Straits Times Saturday Review
Packing up your troubles is a mere cop-out
Tan Hui Yee
21 June 2008

A RECENT Saturday Special Report I wrote on Singapore landmarks drew an indignant call from a homeowner whose graceful 30-year-old development had been declared worthy of conservation.

She said there was no point in conserving the condominium because it was leaking. She and her neighbours hoped to sell the development in a collective sale, or more popularly known as an en bloc sale.

Did you try to fix the leaks, I asked.

Whatever for, she retorted. The estate was too old and the pipes were embedded in the floor.

Buildings are meant to outlast human beings - unless you live in disposable Singapore. Here, cars can be scrapped after five years and people suffer a pay-cut - while still doing the same job - after hitting 50. In all likelihood, there are many homeowners like Ms Too-Old-To-Be-Fixed out there.

Heritage lovers will have you believe that property owners gunning for en bloc sales are philistines all too willing to trade their spacious (but leaky) homes for gleaming new boxes in the sky.

These are the same people, they charge, who see no point in fixing leaks if they can still get good money for renting out their deteriorating properties.

These cardboard villains are products of a deeper problem. About 15 per cent of Singaporeans live in private homes today. Although that figure has been rising in recent years, it has not been matched by a growing awareness of how private estates should be run.

The colourful advertisements selling the pleasures of condominium living make it easy to forget the responsibility that comes with owning a private home.

The key difference between public and private housing lies in the parties which own and maintain common spaces. If a leak occurs in the common area of a public housing block, the town council fixes it. If that same leak occurs in a private estate, all its owners are responsible.

Laws governing strata-titled properties soften the weight of this responsibility by requiring owners to appoint a council among themselves, which then usually outsources the care of their estates to managing agents.

The resulting structure somewhat resembles that for public housing, except for the fact that the homeowners themselves hold the purse strings for expenditure on the estate.

Assuming that the estate's council works in the best interest of the estate, it still would have to contend with its ignorance of building maintenance. This is a specialised and grossly underrated field of practice, especially where residential buildings are concerned. It is a major component of study in the Project and Facilities Management degree programme offered by the National University of Singapore.

Estate management is a thankless job, made worse by the tendency of homeowners to stint on maintenance fees because they have splurged on their homes. Homeowners who suggest raising maintenance fees are quickly shot down by sceptical neighbours. Too many people, it seems, think they know what it takes to maintain a building and not enough are willing to spend money on the professionals.

The result is a race to the bottom: homeowners pick the cheapest managing agent, who picks the cheapest contractors, who hire the cheapest staff.

Adding to this recipe for neglect is the unregulated nature of the facilities management industry. There are currently about 30 managing agents accredited either by the Association of Property and Facility Managers or the Association of Management Corporations in Singapore.

Anyone, regardless of credentials, can set up a company to 'manage' properties. If his rates are low enough, he will have no shortage of business. From then on, it is simply a matter of keeping up appearances.

As long as the appointed contractors keep the lobbies spanking clean and security guards patrol the boundaries zealously, cracks and leaks in hidden areas go unchecked. In the long run, it is the cracks and leaks that will prove to be expensive - and perhaps even dangerous.

Barring cases of truly shoddy construction, the truth is that leaky pipes embedded in floors can be fixed. All it needs is an owner to raise the red flag and a managing agent to investigate and rectify the problem.

But it is so much easier for a lone homeowner to shrug off the problems and proclaim one's property 'too old'. Doing otherwise might be to set oneself up for a huge expense, a whole lot of heartache and nasty comments from penny-pinching neighbours.

For a nation obsessed with property, we haven't quite got the hang of caring for it so as to make it last. Such wasteful behaviour does not make good sense at a time when climate change and unchecked development are driving up construction costs worldwide.

The buck needs to stop somewhere, before our residential districts become a perpetual construction site as homeowners pack up and go at the first sign of physical deterioration.

It is time we learnt that stumping up the cash for a condo is not the end of private homeownership. It merely marks the beginning of a long journey.

Saturday, 15 September 2007

Architects - The Invisible Victims of En-bloc Sales

Friday's Straits Times carried a lengthy article on Singapore's veteran architects whose babies were subjected to the wrecking ball recently, courtesy of enbloc sales. Architects like Victor Chew, Timothy Seow, and William Lim, designed some of the earliest post-independence buildings and condominiums. These landmarks - Beverly Mai, Futura etc - are the true icons of Singapore's modern architecture. Yet in gaining huge windfalls, they are losing, as William Lim said "collective memories". Willaim Lim - "The Red House Bakery in Katong, the National Theatre - these may not be fantastic examples of architecture but they said something to the people"; "But there is no respect for the memories of the invisible public."

Victor Chew's question is poignant - what does a building mean to people? Is it just an investment waiting for the enbloc profit? Is it memories and histories for people who lived there? Is it just a place to stay, in true pragmatic Singaporean style?

Dr Timothy Seow's suggestion is likewise significant - he pointed out that many of the condos he designed were "well-designed buildings which if given a chance to be upgraded, would still be able to take on a new look that is relevant to the times".

Will the government continue to let the market-driven model of urban redevelopment systematically demolish the collective memories and architectural heritage of Singapore's modern era? Or will the government step in and put into place, like what Dr Seow suggested, upgrade schemes for condos which are worth conserving?

It's not impossible, it's a question of will. And if the government's actions in the past were any indication, when there's a will there's a way, as they say.

This article couldn't be more timely. I grew up on the west side of Singapore, and used to imagine Westpeak Condo (currently being torn down) as a giant Transformer (with its noticeable 'head'). Now I will never be able to drive past it and remember my childhood memories.

You can read the article reproduced in condosingapore here.

Wednesday, 15 August 2007

Is Singapore Your Oyster - Proximity and Amenities

Most agents, pro-sale owners and even Mr Mah Bow Tan, would point out that should the sale proceeds be insufficient to afford you a similar location home, you can always move further afield where properties might be cheaper.

A Voices letter in Today Online raises an important issue - what intangibles do you lose when you move "further afield"? The letter by Mr Francis Hong (reprinted in CondoSingapore here) is about 500 patients who petitioned to HDB to retain their family GP when they are forced to relocated for a SERS (Selective En Bloc Redevelopment Scheme) on their estate. Mr Fong points out that the need to be close to certain amenities is not one of luxury but "one of necessity".

What amenities do you lose when you are forced to move away from a community that you are familiar with? How do you calculate the loss of such intangibles, when factoring in what you'll get from the proceeds, and what you'll lose from your home?

Some examples:

For children: Parents often relocate to within a certain boundary around a school of their choice, so that there's a higher chance of their kids going to that school. They have to, without any choice, continue to stay in the same area for their childrens' future.
For parents: Any parent with more than 1 child knows that if they have to send their kids to school, they want (a) their kids to be in the same school/kindergarten ideally (b) a school/route that is convenient for them, enroute to work ideally. Moving home will disrupt this, often requiring that they wake up earlier just to get the kids to school on time.
For elderly: Psychologists have pointed out that as you get older, you want to have familiarity around you. Grandparents hate it when kids come into their homes and really mess things up. Likewise, when old people venture out, they need familiar routes, places, landmarks. Moving home is disruptive, and often traumatic.
For families: Loss of clinics that they have been with for decades, loss of friends and neighbours, people who'd keep an eye out for their homes when they're away on holiday.
For working adults: Unless you move to a home nearer to your place of work, chances are you'll have to device new routes to work. Further afield may well mean longer travelling time, more traffic to encounter, and waking up earlier/coming home later.

These are very real factors that will affect you if you move home, whether by choice or not. These are very real reasons to think about before you decide to enbloc your home or not. I know of people who have spent the past 6 months trying to find a new home for themselves, visiting flat after flat to no avail. Perhaps in 3-4 years' time, one might find a glut of new units flooding the market, but there's no guarantee that prices will not escalate beyond your reach (a very real possibility).

Do you cherish the conveniences and necessities that you have taken for granted, things people and places that will disappear at the stroke of an STB approval?

Saturday, 30 June 2007

Money or Memories?

In a strike of the hammer (metaphorically), over 600 residents from Farrer Court, some of whom I know and some who have lamented the loss of their flats, are now going into a mad frenzy to find replacement homes. With each getting over $2m for their ex-HUDC flat, it's no wonder other ex-HUDC estates are now getting very active in forming sales committees, pushing for signature collection, attempting to privatise etc all to cash in the enbloc fever before the temperature abates due to possible worries of bubble bursting and/or government intervention. Some have already said that the recent news that plot ratios will remain largely the same (curbing rampant speculation that the government will increase plot ratios to house the additional 2m influx of migrants, and subsequently boost redevelopment agendas) is an early sign that the governmental panadol is going to cool the enbloc fever.

Add to this, more legalistic confusion arises. One estate that has been collecting signatures and received tenders, found out that they had exceeded their 1 year limit. No names mentioned, but the fact is ALL estates hoping to go down the enbloc road have precisely 1 year from the date of 1st signature on the CSA to acquire the 80% or 90% consensus, and then up to 1 year to submit the application to STB. Given that this estate has received bids, but not reached the 80% required to execute the CSA, and has exceeded the time limit, what happens now? Will the developers' bids be nullified and another round of CSA (which surely must happen) occur, but maybe this time with the RP raised, given that it was a value from a year or even 2 ago? Is this a form of cold feet or active 'resistance' to an unfavourable CSA?

And of course, Horizon Towers (you can read about this in the condosingapore forum) is undergoing a yoyo battle over when the mediation for STB is; current date set would exceed legal deadlines which may cause the enbloc deal to fall through. Heavyweight lawyers are hired and guns are on the ready to go off.

Pearlbank Apartment is under threat again, and with the neighbouring MRT land being redeveloped, there's even more pressure to tear down a modern icon of Singapore's past. You can read the International Herald Tribune piece on Pearlbank here.

Finally, a fantastic piece from Prof Linda Lim of U of Michigan which can be read here. Reflecting on the state of collective sales in Singapore, and the tension between place-based sentimentality and economic and urban renewal justification, she has these to say when her mother's flat was en bloc'd :-

Witnessing my mother's experience made me realise that 'retirement at home' is no longer an option for me.

As an economist and business professor whose thinking is rooted in market logic and financial rationality, I do not always agree with policies and financial actions which may be rational only in a particular institutional and collective cultural context. Singapore's current en bloc fever is a prime example of economic irrationality on all sides.

But regardless of the economic considerations and outcomes, one thing is for sure - the destruction of so many homes not only pollutes the environment and tightens short-term housing supply, but also could cause excess supply and loss of property values in the longer term.

It also destroys the sense of home itself, which is much more than an economic phenomenon. As a friend contemplating an en bloc sale says: 'I am torn. It will make me rich and give me financial freedom...But it will also take away my children's memories.'

Money or memories? Perhaps only a romantic expatriate like myself - with values rooted in the Singapore of the 1960s when we were a new nation, and who has eschewed an economically rational decision when it has meant surrendering the ephemeral identification with home that citizenship brings - will choose memories.


I have met Linda when she was in Singapore June 2006 for an Institute of South East Asian Studies talk titled "Singapore: Place or Nation - The Implications for Economy, State and Identity". If the resistance to enblocs (however small, but still about 10-20% of all who are subjected) is anything to go by, there are some owners (Singaporeans and otherwise) who have a strong affiliation to place and treasure the fact that homes are places of security and places of attachment. Geographyer Tuan Yi Fu said it eloquently, when he points to the difference place has for the young and old:-

Place can acquire deep meaning for the adult through the steady accretion of sentiment over the years. Every piece of heirloom furniture, or even a stain on the wall, tells a story. The child not only has a short past, but his eyes more than the adult's are on the present and the immediate future. His vitality for doing things and exploring space is not suited to the reflective pause and backward glance that make places seem saturated with significance. ... Yet adults, particularly educated adults, have no difficulty associating inanimate objects with moods. Young children, so imaginative in their own spheres of action, may look matter-of-factly on places that to adults are haunted by memories (Tuan 1977: 33)*

Are we a generation of adults or youths, able or unable to understand the significance of place over the 'present and the immediate future'? What is the government saying of citizens when they allow the systematic destruction of places that for many are viewed as homes, and not sound investments? Can any blame be cast on Singaporeans, with little sense of place, if they become 'quitters' and pragmatically choose to emigrate? Memories. I choose that anytime. But in current enbloc atmosphere, I go against the majority and am deemed anti-democratic and anti-Singaporean.

How ironic.

ps. Transcript taking longer than usual. Need to get excerpts transcribed! In the meantime, Enbloc List has been updated. Apologies for the delay.
* Tuan, Y.F. (1977). Space and Place: The Perspective of Experience. Minneapolis: University of Minnesota Press.

[Error on permitted time corrected, with thanks to Pariah's comments]

Saturday, 10 February 2007

Other Minority Voices - Better Arguments Against Enblocs

I'm greatly heartened to see more forum letters that point to a need to reevaluate the legal practice of enbloc sales. Reprinting them here for all to read - all from Straits Times, two printed and two online. All very well argued. Bravo!

En bloc rules have unintended effect of distorting the market
Straits Times Forum Online
by Waleed Hanafi
7th Feb 2007

In the article excerpting a speech by Mr Ngiam Tong Dow, 'Maximising the lie of the land' (ST Review, Feb5), there is the claim that Singapore's rules governing en bloc sales of private property are innovative and that the 'happy outcome is that both the individual and public interest are served'.

Singapore's en bloc rules have led to people being forced from their homes and neighbourhoods, and to rampant speculation in the property market.

Rather than maintain their buildings, owners are incentivised to suspend maintenance in order to maximise profit at the expense of those who truly want a home instead of just an investment.

Why use the sinking fund to repair the building when you can just wait until things deteriorate and you can persuade your neighbour to give up and sell out?

Mr Ngiam says he is 'glad to see that the invisible hand of pricing has often worked its wonders'.

In fact, it is the distorting hand of government that has permitted the abrogation of property rights and the distortion of pricing.

If the market was truly efficient, the price of flats would fully reflect the value of the building and the land they stand on.

With construction costs running at about $200 per square foot, how does one explain the sudden jump in value of a property from $1,000psf to $2,400psf simply by destroying the existing building?

It is because the prospect of an en bloc sale encourages short-term thinking and treats buildings as tradable assets, instead of homes.

If one takes the example of Ardmore Park, it is hard to understand any reason for the destruction of pretty much every building on the street and the surrounding neighbourhood. These were sound, desirable residences. What exists now looks like a war zone.

In most other economies, these buildings would increase in value, given their location and quality. If an owner wanted to profit from the increase in valuation, he would sell to a new buyer, not vote for the destruction of the property.

When a building does go en bloc, it is not a triumph of the majority over the individual, as Mr Ngiam asserts, but rather the triumph of the developer, the estate agent, and a few speculators.

The environmental cost of destroying perfectly sound buildings because of this price distortion is inexcusable.

The real cost is borne by those forced to live through the destruction of the existing building and eventual construction of a replacement.

The reality on the ground is quite different than the idyllic picture painted by Mr Ngiam.

Rather than an efficient market in which willing buyer and willing seller set prices, the en bloc rules have had the unintended consequence of distorting the market, disincentivising building maintenance and upkeep, raising housing costs and destroying the quality of life for tens of thousands of residents of Singapore.

Why demolish perfectly livable old apartments? New isn't necessarily better
Straits Times Forum Online
by Susan Amis (Mrs)
9th Feb 2007

In the craze to sell older condos en bloc, has anyone stopped to consider the consequences of demolishing perfectly livable old apartments and replacing them with new developments? Many expatriates who come to Singapore want to spend their housing budgets on large, older style condominiums because they offer large amounts of space for children to run around in, established gardens, three or four bedrooms and big balconies or courtyards. There is low demand for brand new small apartments for a typical expat family of four.

As these new developments are completed over the next few years, who will be buying the thousands of expensive new apartments on the market? Surely there will be a glut of these types of properties once the developments are completed? Potential buyers who intend to rent out these apartments to high-income earners will need to investigate the pitfalls of investing in these new developments.

Noise pollution from construction sites is also a huge problem and will become worse over the next few years. It is becoming increasingly difficult to find a quiet place to live in. Many expats are insisting upon a 'construction clause' in their rental contracts that allows them to break the lease should construction noise from surrounding properties impede their quality of life.

New isn't necessarily better, and a lot of expats are lamenting the current lack of desirable older housing in Singapore.

Ensure no one suffers financial hardship
Straits Times Forum (Printed)
by William Foo Kuo Meng
9th Feb 2007

I AM shocked by the landmark ruling of the Strata Titles Board that losses incurred in one's CPF account are not considered a financial loss in the case of an en bloc sale ('Couple lose fight on collective sale'; ST, Feb 6).

CPF funds are for our retirement, housing and medical needs and are our hard-earned savings.

With the current buoyant property market and frequent en bloc sales, it is time that the rules governing such collective sales be reviewed to ensure that no one else will suffer similar financial hardship as a result of actions beyond their control.

En bloc sales: Have laws to protect minority
Straits Times Forum (Printed)
by Valerie Ong Guek Kim (Mdm)
9th Feb 2007

I REFER to the article, 'Couple lose fight on collective sale' (ST, Feb 6).

I sympathise with the couple who lost the fight when the Strata Titles Board ruled that their CPF principal amount and accrued interest owed to their CPF accounts are not considered a financial loss.

My condominium is also going through an en bloc sale. That very term now sends shivers down my spine. With large estates like Waterfront View and Gillman Heights being demolished, where are the owners to find another abode? Demand is outstripping supply and home prices have escalated. The amount reaped from an en bloc sale would rarely get an owner an equivalent property. New developments that spring up on properties that have gone en bloc are almost double the price per sq foot of the original.

Also, friendship and neighbourliness are thrown aside in the name of progress. En bloc sales are blind to whatever reasons a family may have for not wanting to move, be it proximity to the children's schools, elderly dependants and amenities or plain attachment to one's home or neighbourhood.

So what benefit is there for the majority? It is the developer, the marketing agent and speculators who benefit.

Will the Government consider the environmental cost of destroying perfectly sound buildings in the light of the scarcity of sand that Singapore is facing?

With all the negative consequences of en bloc sales, I request lawmakers to put themselves in the shoes of the minority and protect their quality of life.

Friday, 12 January 2007

Myth #5 - Urban Renewal

NUS Geography professors Lily Kong and Brenda Yeoh have provided an apt definition of urban renewal or redevelopment:-

Urban redevelopment primarily has meant demolition of the old and construction of the new on the basis that such a program provides better employment and investment opportunities, improves living conditions, and leads to physical, social, and economic regeneration. Such an interpretation of urban redevelopment places values on 'efficient', 'rational' and 'pragmatic' use of limited land resources. .. Indeed, such an approach suggests that, in some places, urban planning becomes no more than a 'technical problem of clearance and construction' (Kong and Yeoh 2003: 46)*

They pointed out that "urban renewal generally has emphasised demolition and reconstruction rather than conservation and preservation" (2003: 78). This certainly applies to en-bloc sales, where developments are demolished and new buildings constructed, often offering either smaller units but larger quantities, or larger (and hence more expensive) units and smaller quantities (the boutique condominiums). The trend, particularly in the prime districts, is veering towards the latter. Look at Holland Hill Mansion which is going to be redeveloped into 2000 sqf units, larger than the average existing units in the area. With an estimated cost of $1500-$1800 psf, we're talking about $2.5 mill upwards per condo in the new Holland Hill development. Now how many people can afford that (or more specifically how many local citizens can do so)? The target group is obviously foreign investors who have the capital to purchase such luxury apartments.

But more worrying is the fact that a LOT of the en-bloc'ed developments are less than 20 years old. In fact, based on the en-bloc sales of 2005-2006**, the average age of the en-bloc developments, upon the first attempt at en-bloc, is about 12-15 years old.

This is not urban renewal. This is urban mutation.

This is possible courtesy of the rather arbitrary development age set by the government, of 10 years. Any development that wishes to en-bloc itself and is <> 10 yrs old, you need only achieve 80% consensus, which is what most en-blocs are aiming for nowadays. Note this is different from Selective En-bloc Restructuring Scheme which targets older HDB estates, approximately 30 odd years.

What are the consequences of this?

  • If you wish to continue staying in condos but can't afford landed properties, it would mean that you will be required to move from condo to condo, at least 3-4 times in your adult working life. Every condo is now waiting for that golden age of 10 yrs to begin the en-bloc process.
  • It means you'll have to undergo the hassle of house hunting, looking for suitable schools for your children, reestablishing social ties with the community, securing bank loans etc.
  • Given that if property market continues to be bullish, your windfall from the en-bloc sale will be able to secure you another unit NOT in the same district but further from the central parts of Singapore. This has implications for travel time and travel inconveniences.
  • You will need to encounter en-bloc madness and greedy neighbours 3-4 times.
  • It completely ridicules the notion of 'freehold' which is meant to be a property you hold for life. It makes no ownership difference if your property is 99 yrs or freehold, aside from some differences in land value.
  • Environmentally, there are huge wastage in the demolishing of all these buildings and developing new ones. Not all building materials can be recycled.
  • It means you will not recognise the place where you and your children grew up in.
Some argue that Singapore is so small, that moving around is not a problem especially considering how much profit one gains from multiple en-blocs. Yet it can cost you anything from 4-10 folds if you stay in the central districts as opposed to the outlying ones. There are issues of convenience, and yes, even prestige in staying in a small clearly demarcated part of Singapore.

Some say it's better to demolish before escalating maintenance costs make living in the development untenable. Yet, does this not speak of the poor construction quality and building materials if they can't last 10-20 years? Most apartments in central districts in Western countries are easily 50 years or more, and are surprisingly well-maintained. A well-managed management committee would have been able to take into account potential upgrades to the development in addition to maintenance, but this is obviously not happening; why upgrade when you can demolish at a profit?

Urban mutation, because mutative processes occur at a highly accelerated rate, is what is happening here in Singapore, not urban renewal.

* Kong, L. and Yeoh, B.S.A. (2003). The politics of landscape in Singapore: Constructions of 'Nation'. New York: Syracuse University Press.
** Calculated based on en-blocs from 2005-2006, age of development drawn from various websites when possible, and average age at point of initial en-bloc is approximately 70% accurate.