What is "GFA Harmonisation"?
(everyone seems to be talking about it.)
It helps to understand before this ruling was introduced, various government agencies had adopted different definitions of floor areas for their respective purposes, leading to confusion among property owners. Especially when owners had undertook additions and alterations in their respective strata units.
Beginning on 1 June 2023, these government agencies will adhere to the standardized new definition for floor areas set by URA. This measure aims to standardize measurements and expedite application processes with the agencies.
The new definition will apply to all development applications from 1 June 2023, and to all Government Land Sales (GLS) launched for sale from 1 September 2022 onwards. The affected new launches will include upcoming Lentor Mansion, Marina Garden Lane site, Jalan Tembusu site and subsequent new launches.
Starting from 1st June 2023, the following changes will be made:
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Floor areas are measured to the middle of the wall, for all agencies
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All strata areas will be included under the total GFA count
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Void spaces will no longer count toward the GFA
In the future, we might be seeing brand new "showflat unit types" that may look/sound like they are much smaller, but using this illustration to provide you better understanding:
3 BR Type A1 - 88sqm | 947sqft
3 BR Type A1 - 83sqm | 893sqft
How this impacts buyers?
Aircon ledges typically would occupy 4-5% of total saleable area in private condo developments. The curtain wall system typically would also represent an additional ‘free’ saleable area for developers, typically comprising 1-2% of total saleable area.
1. No more with the "massive" air con ledges.
2. No more "strata void spaces"
3. This new shared definition will help with buyers planning for extensive renovations.
We might start to see lesser of 'full height' curtain walls in future developments, where developers would opt for more 'conventional' window walls. This means the loss of overall aesthetically luxurious condo appearance for the facade of projects.
In conclusion:
GFA will now be based on the midpoint of the walls, excluding wall finishes. Excluding aircon-ledges, as well as high ceiling "void spaces".
The new GFA definition will apply to all developments, including landed and strata-landed housing.
In essence, aircon ledges, which typically occupy 4-5% of the total saleable area in private condo developments, will be omitted.
How this impacts developers?
With the implementation of the standardized definition for strata areas as Gross Floor Area (GFA), developers are inevitably facing an estimated reduction of around 5% in total saleable area.
Amidst the ongoing rise in construction costs and interest rates, these uncertainties may further reduce developers’ efficiency ratios. This will also eat into the total saleable area that developers can charge buyers for.
To enhance efficiency ratios, developers might consider lowering their land bid prices.
