Collective sales stem from pragmatism

The reasons why Mr Tan Yew Hock feels collective sales should not be encouraged are understandable (Collective sales destroying communities; June 9).

However, there are many other considerations.

One must note that many of the estates that have been sold en-bloc sit on 99-year leasehold land.

Generally, the capital value of these assets starts declining over the years, especially when the property hits the 50- or 60-year mark. So, some owners feel pressure to sellto take advantage of the current market value.

Some older folk want to keep their homes for their children, and collective sales actually force them to sell against their will.

At the same time, these owners are aware of depreciating prices for old property and do not want to leave their children with a depreciating asset.

The Government's policy of enhancing plot ratios to encourage redevelopment also plays a part in this.

If the Government grants longer leases, instead of 99-year ones, it could take care of this aspect of the problem.With longer leases, owners can continue to stay without the worry of having to move out.

So, there are more considerations than just community spirit and bonding.

M V Andeny

A version of this article appeared in the print edition of The Straits Times on June 10, 2017, with the headline 'Collective sales stem from pragmatism'. Print Edition | Subscribe