Maintenance and Management Fees
From the date of vacant possession of a new apartment or condo, the buyer is normally responsible for paying for services such as:
Refuse removal, Upkeep of drains etc.
The buyer is responsible for such payment until such responsibility is taken over by the proper local authority. The buyer must pay a six months’ deposit upon being handed vacant possession for the services to be rendered. After six months, if the services are still not taken over by the relevant authority, any subsequent payment shall be payable on a monthly basis.
For subdivided buildings, payment is for the cost of maintaining and managing the common areas and payment starts when vacant possession is handed over.
The buyer pays one (1) month’s deposit and three (3) months’ advance payment in respect of the maintenance service charges and any payment thereafter is payable monthly in advance. Maintenance fee must be paid to the developer from the date of vacant possession up until the formation of a management corporation under the Strata Title Act 1985. Once the management corporation is formed under the Strata Title Act 1985, maintenance services will be handled by the management corporation and the buyer must pay the maintenance fee to the management corporation and not to the developer.
Sinking Fund (For apartments and condominiums only)
The buyer contributes to the sinking fund in an amount equivalent to 10 per cent of the service charges from the date he takes vacant possession. In addition, the buyer pays one (1) month’s deposit and three (3) months in advance in respect of the service charges to the sinking fund; any payment thereafter is payable monthly in advance.
Payment of Quit Rent, Rate Assessment, etc
From the date of vacant possession or date of assignment, whichever is earlier, the buyer is responsible for the quit rent, assessment, rate payment and other charges relating to the property bought.
Vacant Possession
Vacant possession on the building complete with water and electricity connection must be handed over within 24 calendar months from the date of signing of the SPA for landed property and 36 calendar months for a subdivided building.
Buyers should ensure the property is free from any encumbrances before accepting notice of vacant possession. If the developer leases the land or the property, the developer must settle the balance payment before handing over vacant possession.
Property developers must provide the following certification that:
The buyer is entitled to enter into occupation of the property only upon issue of the CFO by the relevant authority and renovation may be carried out only upon issue of the CFO and approval of the plan by the relevant authority.
While inspecting the building, any defect is recorded and handed over to the developer to be rectified. Make sure you obtain a copy of the report.
The buyer is entitled to claim damages for late delivery from the developer.
Damages
If the developer fails to deliver vacant possession of the building as stipulated by the SPA, it must pay damages calculated on a daily basis at a rate of 10 per cent per annum of the purchase price.
Defect Liability Period
The defect liability period is normally 18 months from the date of vacant possession.
Creation of Management Corporation (Apartments and Condos)
A management corporation will be created once the strata title of each individual parcel is issued to the owners. Functions of the management corporation include insuring and maintaining the building.
