SINGAPORE (Sept 1): Developers of residential and commercial real estate from today will have to pay higher development charges -- the fifth straight increase since Sept 2016.

This follows the revised development charge (DC) rates for the period from Sept 1 2018 to Feb 28 2019 by the Ministry of National Development which was announced on Friday night.

The DC is a tax levied on developers to carry out development projects that increase the value of land, including rezoning to a higher value use and increasing the plot ratio of the property.

The review is carried out every six months on March 1 and Sept 1 each year in consultation with the chief valuer.

Analysts note that latest increases should temporarily cool the collective sale fever, given that the biggest increase of 33% is seen in residential non-landed property.

Last month saw the largest collective sale in a decade when Tampines Court was sold for $970 million.

In the latest review, the DC rates for four Use Groups, namely Groups A (Commercial), B2 {Residential, (non-landed)}, C (Hotel/Hospital) and D (Industry) have increased.

The DC rates for Use Group B2 {Residential, (non-landed)} have increased by 9.8% on average.

Seventy-five out of 118 sectors have increases in DC rates ranging from 3% to 33%. There is no change to the DC rates for the remaining 43 sectors.

The largest increase of 33% is in Sector 43 where the DC rates rose to $18,200 psm of GFA (gross floor area) from $13,650 psm and Sector 67 where DC rates rose to $16,800 psm of GFA from $12,600 psm.

Sector 43 encompasses the Tanglin Road, Cuscaden Road, Orchard Blvd and Grange Road areas while Sector 67 consists of the Dalvey Road, Stevens Road, Anderson Road, Orange Grove Road, Tanglin Road, Napier Road and Cluny Road areas.

For Use Group A (Commercial), the DC rates have increased by 8.3% on average.

A hundred and sixteen out of the 118 sectors have increases in DC rates ranging from 3% to 17%. There is no change to the DC rates for the remaining two sectors.

The largest increase of 17% applies to Sector 110 surrounding the Commonwealth Avenue West, North Buona Vista Road, Holland Road, Ulu Pandan Road and Clementi Road areas.

The DC rates for Use Group C (Hotel/Hospital) increased by 11.8% on average. A hundred and sixteen out of the 118 sectors have increases in DC rates ranging from 8% to 23%.

The DC rates for Use Group D (Industry) increased by 2.1% on average. Twenty-six out of the 118 sectors have increases in DC rates ranging from 6% to 11%.

The DC rates remain unchanged for Groups B1 {Residential, (landed)}, E (Place of Worship / Civic and Community Institution), and three other Use Groups F, G and H.