**URA cuts number of units allowed to be built in condos, private flats.**

From early next year, the maximum number of units allowed in new private flat and condominium developments outside the central area will be reduced, as the Urban Redevelopment Authority (URA) has revised its guidelines in a bid to manage potential strains and stresses on infrastructure.

The new guidelines will further curb the proliferation of shoebox units. They will apply to new development applications for projects submitted on or after

Under new rules, the maximum number of housing units allowed in a development outside the central area will be arrived at by dividing the proposed building gross floor area (GFA) by 85 sq m. The current formula divides GFA by 70 sq m.

This means around 18 per cent fewer units will be allowed if developers maximise their quota.

Meanwhile, nine areas will face even more stringent requirements, where the GFA will be divided by 100 sq m to work out the maximum number of units that can be built. This is to avert a severe strain on infrastructure.

These areas are Marine Parade, Joo Chiat-Mountbatten, Telok Kurau-Jalan Eunos, Balestier, Stevens-Chancery, Pasir Panjang, Kovan-How Sun, Shelford and Loyang.

The new guidelines will further curb the proliferation of shoebox units. They will apply to new development applications for projects submitted on or after

__Jan 17 2019__.Under new rules, the maximum number of housing units allowed in a development outside the central area will be arrived at by dividing the proposed building gross floor area (GFA) by 85 sq m. The current formula divides GFA by 70 sq m.

This means around 18 per cent fewer units will be allowed if developers maximise their quota.

Meanwhile, nine areas will face even more stringent requirements, where the GFA will be divided by 100 sq m to work out the maximum number of units that can be built. This is to avert a severe strain on infrastructure.

These areas are Marine Parade, Joo Chiat-Mountbatten, Telok Kurau-Jalan Eunos, Balestier, Stevens-Chancery, Pasir Panjang, Kovan-How Sun, Shelford and Loyang.

Above is the summary of the new URA guidelines to cut down on the number of smaller units in the future.

Land Plot A has a landsize of

The GFA (Gross Floor Area) will be 300,000 x 2.8 = 840,000

70 sq m = 753 sq ft

85 sq m = 915 sq ft

Under the current/old guideline:

840,000 / 753 = 1115 units (Max)

Under the New guideline:

840,000 / 915 = 918 units (Max)

This means that the Developer will have to built

Another impact due to the reduced number of units, either the developer has to built lesser smaller units, or they will have to built larger units. Confused? below are the explanation:

**Let me give you an example to further understand the impact of this new guideline:**Land Plot A has a landsize of

__300,000sqft__with a plot ratio of__2.8__(plot ratio means the number of levels a Developer can built on the land)The GFA (Gross Floor Area) will be 300,000 x 2.8 = 840,000

70 sq m = 753 sq ft

85 sq m = 915 sq ft

Under the current/old guideline:

840,000 / 753 = 1115 units (Max)

Under the New guideline:

840,000 / 915 = 918 units (Max)

This means that the Developer will have to built

**units under the new guideline.**__197 lesser__Another impact due to the reduced number of units, either the developer has to built lesser smaller units, or they will have to built larger units. Confused? below are the explanation:

If this plot of land has a

**GFA of 9150sqft**. With the new guideline, it can built only**. If using old guideline, the Developer can built**__10 units__**. Below are 3 different example on how the Developer can built based on the different bedroom type ratio.**__12 units__

**Example 1 Above:**As the new guideline is based on 915sqft, to built a 1 Bedroom of size 500sqft, the balance 415sqft will need to be added to the bigger unit sizes.

Equally, if a 2 Bedroom is of 850sqft, the balance 65sqft will also be added to the bigger unit.

This will result in a much bigger size for 3 and 4 Bedrooms.

If the selling PSF remains the same, or even increases next year (1Q2019), the total quantum for bigger units will be much higher.

Let's tabulate:

If 1 Bedroom used to be a size of 450sqft with selling PSF of $1600, quantum will be = 450 x 1600 = $720,000

Now if 1 Bedroom is 500sqft with same PSF of $1600, quantum will be = 500 x 1600 =

**$800,000**

If 2 Bedroom used to be a size of 750sqft with selling PSF of $1550, quantum will be = 750 x 1550 = $1,162,500

Now if 2 Bedroom is 850sqft with same PSF of $1550, quantum will be = 850 x 1550 = $800,000 =

**$1,317,500**

If 3 Bedroom used to be a size of 950sqft with selling PSF of $1500, quantum will be = 950 x 1500 = $1,425,000

Now if 1 Bedroom is 1100sqft with same PSF of $1500, quantum will be = 900 x 1500 =

**$1,650,000**

If 4 Bedroom used to be a size of 1168sqft with selling PSF of $1450, quantum will be = 1168 x 1450 = $1,693,600

Now if 4 Bedroom is 1575sqft with same PSF of $1450, quantum will be = 1575 x 1450 =

**$2,283,750**

**Example 2 Above**Let's tabulate:

If 1 Bedroom used to be a size of 450sqft with selling PSF of $1600, quantum will be = 450 x 1600 = $720,000

Now if 1 Bedroom is 500sqft with same PSF of $1600, quantum will be = 500 x 1600 =

**$800,000**

If 2 Bedroom used to be a size of 750sqft with selling PSF of $1550, quantum will be = 750 x 1550 = $1,162,500

Now if 2 Bedroom is 850sqft with same PSF of $1550, quantum will be = 850 x 1550 = $800,000 =

**$1,317,500**

If 3 Bedroom used to be a size of 950sqft with selling PSF of $1500, quantum will be = 950 x 1500 = $1,425,000

Now if 1 Bedroom is 1100sqft with same PSF of $1500, quantum will be = 1100 x 1500 =

**$1,650,000**

If 4 Bedroom used to be a size of 1168sqft with selling PSF of $1450, quantum will be = 1168 x 1450 = $1,693,600

Now if 4 Bedroom is 1575sqft with same PSF of $1450, quantum will be = 1275 x 1450 =

**$1,848,750**

__Example 3 Above__Let's tabulate:

If 1 Bedroom used to be a size of 450sqft with selling PSF of $1600, quantum will be = 450 x 1600 = $720,000

Now if 1 Bedroom is 500sqft with same PSF of $1600, quantum will be = 500 x 1600 =

**$800,000**

If 2 Bedroom used to be a size of 750sqft with selling PSF of $1550, quantum will be = 750 x 1550 = $1,162,500

Now if 2 Bedroom is 850sqft with same PSF of $1550, quantum will be = 850 x 1550 = $800,000 =

**$1,317,500**

If 3 Bedroom used to be a size of 950sqft with selling PSF of $1500, quantum will be = 950 x 1500 = $1,425,000

Now if 1 Bedroom is 1000sqft with same PSF of $1500, quantum will be = 1000 x 1500 =

**$1,500,000**

If 4 Bedroom used to be a size of 1168sqft with selling PSF of $1450, quantum will be = 1168 x 1450 = $1,693,600

Now if 4 Bedroom is 1575sqft with same PSF of $1450, quantum will be = 1225 x 1450 =

**$1,776,250**

- Shoe box units will be trimmed down (eg: 450sqft may change to 500sqft and up)
- 2 Bedrooms size may change to > 850 sqft, 3 Bedroom size may change to > 1100 sqft (I think most buyers will be happy, but read the next concern)
- Quantum per unit will increase in price because of larger floor area (eg: $720K per unit, may eventually be $800K to start with)
- Market prices goes up, per unit cost will go up
- Affordability will be an issue (TDSR)