Lloyd Sixtyfive introduces a leasing scheme.
In a bid to increase market demand, developers have introduced to the buyers the option of renting property before making a decision to buy.
Such a program that allows buyers to stay at a property after payment of small down payment is seen on competed projects. However, TG Development has introduced experiential leasing scheme on its uncompleted project, Lloyd Sixtyfive. URA had disallowed the earlier version.
With the scheme, the customer signs a 2-year lease, pays a rental advance of 10% of purchase price, a refundable deposit of 2.5% and then moves in upon the completion of the project next year. If the tenant chooses to buy the unit, the developer refunds the deposit and full rental based on whether the units are available. If there are no available units, only the deposit is refunded. The units under the scheme are twenty 1-bedroom and 1-bedroom plus study. Lloyd Sixtyfive is near Somerset Road and it has 76 units.
The one bedroom has an average price of $2,670 psf or $ 1.62m and therefore the rent is about $6,750 per month.
This scheme differs from the earlier one on the basis that the unit is not reserved for the tenant but is under lease.
URA had disallowed the earlier version on the basis that it seemed to be giving tenants up to 20 months option from when the lease commences to decide if they would like to buy the unit. This is in contradiction to the standard buying option that is valid for 3 to 5 weeks.
According to the spokesman of TG Development, with the scheme, clients have enough time for planning their finances. They can enjoy their stay without worrying about loan interests.
The company is Singaporean and it bought the site before introduction of ABSD-Additional Buyers Stamp Duty, and therefore does not risk incurring extension charges or ABSD.
The move came after the success of other developers’ flexible payment schemes.
CapitaLand sold at The Interlace 30 units and at D’Leedon 50 units based on its stay-then-pay scheme where buyers can defer paying fully for the units.
OUE has sold 160 units at OUE Twin Peaks due to the deferred payment program and longer-option exercise date.