FAQ
 

CHARLES YUE (R001164B)
RETAIL SHOP DIVISION
TEL: 6235 3066
FAX: 6834 2133
GINZA REAL ESTATE PTE LTD (L3007546B)

Email Me

  1. FAQ FOR TENANT
  2. FAQ FOR BUYER
  3. FAQ FOR LANDLORD
  4. FAQ FOR SELLER

AS BUYER-FREQUENTLY ASKED QUESTIONS (F.A.Q.)

RELEVANT AUTHORITIES CONTACT NO:

  1. CPF Board.................................................. 62202422
  2. Singapore Immigration & Registration ............63916100
  3. Goods & Services Tax (GST) ........................635368633
  4. Income Tax (IRAS) ......................................63568300
  5. Property Tax ...............................................63568600
  1. How much should I set aside as downpayment?
    Unlike buying a residential, Buyer ideally, should set aside 30% to 40% as cash down payment. As valuation for shop is more difficult and varies widely, buyer should shop for Bank with higher/ highest valuation.

    Generally, the better the location, the lower or wider the gap between valuation and the purchase price. This gap is called the premium and often need to be paid in cash.
  2. What is the cost of buying?
    The cost include legal fee, stamp duties, loan mortgage fee. Generally, the cost is about 4%of purchase price.
  3. Can you explain about using CPF + the Loan Quantum?
    Most Bank would loan you 70% of valuation or purchase price, whichever is lower. As from 1/7/2006, you cannot use CPF to buy non residential properties.
  4. Can you explain the transaction process?
    Step 1 - Offer a price and put a 1% Option Deposit.
    Step 2 - Obtain the Option to Purchase upon seller agreement & check Lease Agreement if shop is tenanted.
    Step 3 - Pay 9% within 14 days.
    Step 4 - Standby the balanced cash downpayment and loan payment within 12 weeks. .
  5. Should I offer a purchase price based on rental return?
    Generally, a gross return ( before Property Tax & maintenance charges) of 4% is reasonable + realistic in Far East Plaza. But it is not the best way as current rental may be too high, or based on extra benefits given by landlord, or tenant may only last for a few months as rental was negotiated during intense competition or promise of good retail traffic / predicted sales activity or promotion.

    Factors Influencing Shop Purchase Price Include:
    i) Location, Actual Site & Orientation.
    ii) Rental return.
    iii) Policies by the Management Corporation, like food-shop & water supply restriction.
    iv) Investment climate & state of the economy.
    v) Government policies for e.g. No Capital Gain Tax.
    vi) Demand of shopkeepers, investors & speculators in a given area/building.

    All shops in Far East Plaza have been informally valued by us and given a price range recommendation for Sale/Rent.
    Please come to #05-134B Far East Plaza or call us at  67326266 / 62353066
    Email: enquiry@fareast-plaza.com.
  6. What is Phase I & Phase II?
    Far East Plaza was developed into 2 stages. Thus the earlier Phase I is at the smaller concourse nearer to Hyatt Hotel and the overhead bridge spanning Scotts Road. Phase II is the bigger concourse surrounding the water fountain / Performing Stage.
  7. What is the maintenance charges?
    It is about S$1.35 psf + 7% GST as on July 2011. It may be increased or decreased by the MCST during the yearly AGM.
  8. Do I need to pay (Goods and Services Tax) GST for buying a shop?
    No, unless the seller is a GST registered member or corporate. Please check that some private limited company-owner may need to collect 7% GST on purchase price from 01/07/2007.
  9. What happen if I sell the shop within 3 years?
    There is no more Capital Gain Tax since 13 Oct 2001 and the 14/1/2011 restrictions does not apply to non-residential properties. As such, you can keep the profit without Tax. Opportunity arises now to "buy today, sell tomorrow".
  10. What is Joint-Tenancy and Tenancy-in-Common?
    Joint-Tenancy gives ownership to the surviving partner and is most commonly used for husband and wife relationship. Tenancy-in-Common give only the portion of share to the estate of the partners.
  11. Why do people invest in Far East Plaza?
    Reasons:
    i) Freehold Title.
    ii) Orchard Road vicinity (Tourist Belt).
    iii) Individual can still own (most good shopping centres are not for sale as they are owned by 1 single corporate owner)
    iv) High yield of 4% to 6% gross return.
    v) High demand from Tenant as there is generally no trade restriction on Tenant mix.
    vi) Little or low downside in value.
    vii) Long term cashflow/ retirement income.
    viii) Many end-users, investors / speculators. Over 500 shops transacted since 1988.
    ix) Developed market in price transparency & communication channel pioneered by Ginza Real Estate Pte Ltd.
    x) Only selected retail properties ( including Far East Plaza) are still doing well. Residential, Industrial & Commercial (Office) sectors may remain stagnant and low in rental yield.
  12. Where can I find shops for sale?
    Kindly come down to the Far East Plaza Tenants/Owners Service Centre situated at
    #05-134B.
  13. Who can help me after I became  the Owner or the LandLord?
    Below are the services and facilities offered by us;

    A) FREQUENTLY ASKED QUESTIONS (F.A.Q.) GUIDE

          These series of questions are designed to answer the most common questions that
          prospective Landlords and Sellers would often request.

          Like in :

          1)  What should I do if my tenant owed me rental?
          2)  How do I know about the market rental?
          3)  Why is it I always have tenant problems?
          4)  What are some reasons for selling a shop in Far East Plaza?

          B) CARETAKER ROLE

          Having been stationed here for the last 22 years, we have been appointed by many owners
          as a caretaker agent.

          Our role include :

          1)  Collecting rental
          2)  Third party negotiation with existing or new tenants
          3)  Providing free replacement if your tenant quits pre-maturely to prevent you from
               suffering loss of income and disruption to your cashflow
           4)  Reporting & enforcement of illegal sub-letting, unauthorized trades, assisting in
                Landlord/Tenant disputes and help in recovery and re-entry into the locked premises.
           5)  Forecasting rental and sale value.
 

           C)  ANNUAL VALUATION OPINION ON MARKET VALUE FOR SALE /
                 RENT

               Every year since 2003, we will carry out a massive project, courtesy of our Research &
               Development (R&D) department, to express an opinion as to the current market price for
               sale and for rent on shops in Far East Plaza. (We have also collected 600 sales
               transaction records since 1988).

               Such opinions and forecasts will help the owners and landlords to evaluate their
               decisions to sell/rent/hold/buy.  These individual records will be compiled into a
               "one-look-see-all-value" data into the site plan of all the levels from #02 to #05.
               Prospective owners-turned-buyers can review these data as a guideline to the offer
               price of available shops as well as future potential value of shops for sale and rent.
               Owner are encouraged to meet us in person to discuss about their plans to sell/lease
               and buy.

            D) TENANTS/OWNERS SERVICE CENTRE @ WE HEAR YOU sm

               Envisioned like a Business Centre in a Hotel,   the Tenants/Owners Service Centre is
               to provide and evolve into a one-stop service centre for existing Tenants and Landlords
               as well as prospective Buyers/Sellers/Tenants.

               Landlords who appoint us can tap into our Service Centre as a third party venue to
               resolve disputes with the Tenants regarding rental arrears,  subletting lease assignment
               and pre-mature termination of lease.

            E) PAST NEWSLETTERS AVAILABLE IN ENGLISH AND CHINESE

               Since July 2002, we have published a bi-monthly newsletter on Far East Plaza.  Past
               topics raised include :
               -    retrofitting work in Far East Plaza
               -    Turnover problems of Tenant
               -    Illegal partitions infringing the bye-laws

               By accessing to these past newsletters,  the new owners would be able to review the
               past years history and crisis so as to be well informed in their investment decisions.

            F) WEBSITE : www.fareast-plaza.com

              Through our website,  locals and foreigners alike can access into information on the
              shops for Sale/Rent and search for occupants by trade unit no.,  shop names and can
              hyper-link to their own websites.

              Our website is among the top site from the various search engines like Yahoo,  MSN,
              Google, etc.

              Thus, prospective landlords and sellers can have an international audience of
              prospective Tenants and Buyers.

            G) MANAGEMENT CORPORATION (MC) COMMUNICATION AND
                  ANNUAL GENERAL MEETING (AGM) REPRESENTATION

              We represent many Owners to request an appeal to the many bye-laws administered
              by the Management Corporation (MC).  Oftentimes, both tenants and landlords may
              be faced with frustrating renovation application procedures that may bound back and
              forth in dealing with the Management Corporation.

              We also represent a huge group of Strata-Titled Owners in voicing issues and
              grievances affecting them during the Annual General Meeting traditionally held in the
              last Saturday of September each year.

 

AS FOREIGN BUYER-FREQUENTLY ASKED QUESTIONS

  1. How is foreign buyer taxed?
    You can own the shop under your personal name or through incorporating a Pte Ltd company. If you stay in Singapore for less than 183 days in a year, your rental income will be taxed at maximum of 20% personal income tax as in 2011. Expenses like interest servicing & maintenance charges can offset income tax.
  2. How can I get a loan?
    Yes, you can secure a Singapore Dollars loan and the rate hovers around 2% to 4% as at July 2011. Foreigners usually get 10% less loan quantum than locals. Generally, locals get 70% financing based on valuation or purchase price, whichever is lower.
  3. Who can assist me before I decide to buy?
    You can do the following steps:
    i) Go to www.fareast-plaza.com
    ii) View listing on shops for Sale/Rent.
    iii) View the occupants/Tenants Trade classification, telephone number, related hyper-linked websites.
    iv) View shopfront photographs of shops
    v) Call or email your enquiry.
    vi) Put up your offer with a goodfaith deposit or option money. Obtain written confirmation before proceeding with other payment / handing over to your lawyer.

          LAST UPDATED ON JULY 2011

   

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