SALE OF OVERSEAS PROPERTIES TO SINGAPOREANS (Control measures)

[Mr Speaker in the Chair]

Mrs Yu-Foo Yee Shoon asked the Minister for National Development whether he will implement any controls on the sale of overseas properties to Singaporeans as sales by overseas property developers are on the increase.

Mr Chay Wai Chuen asked the Minister for National Development if he will implement measures to ensure that advertisements and exhibitions for sale of overseas properties in Singapore, whether by overseas developers or local agents, do satisfy rules and conditions of sales comparable to those of local development sales in Singapore.

The Minister for National Development (Dr Richard Hu Tsu Tau): Mr Speaker, Sir, with your permission, I would like to take Questions Nos. 1 and 2 together as they are related.

Mr Speaker: All right.

Dr Richard Hu Tsu Tau: In recent months, there has been a sharp increase in the promotion and sale in Singapore of overseas properties. This is to be expected as, with our growing affluence, many Singaporeans will consider investment opportunities, both local and foreign. Developers of properties overseas and their agents will naturally target Singaporeans as potential buyers.

Those who purchase overseas properties do so for investment purposes. As with other investments, potential investors should do their homework carefully, weighing the risks involved against the possible returns.

It must be stressed that Singaporeans buying properties overseas do not enjoy the protection of the Housing Developers (Control and Licensing) Act and its subsidiary legislation. The laws in place to protect the interest of home-buyers in Singapore do not cover Singaporeans investing in overseas properties. Different countries have different rules and regulations to control their property developments. It is not feasible for Singapore to extend the Act to regulate purchase of foreign properties.

At the present time, there is no existing legislation dealing with the advertising, promotion and sale of foreign properties in Singapore. This has not been necessary in the past because there have been few such offers and, when made, they have been generally directed at companies or sophisticated buyers. However, the recent spate of advertisements and promotional road shows are directed at the public at large, including a large number of first-time buyers of foreign properties. As this trend is likely to persist, Government is considering the introduction of specific legislation to regulate the marketing of foreign properties in Singapore.

As this may take some time, Government has recently introduced several interim measures to weed out bogus sale of foreign properties - local estate agents are now 2required to check the credentials of the foreign developers and their projects before acting as their marketing agents - advertisements on new foreign properties must list the necessary permit numbers from the relevant planning and building authorities. Prospectuses for the properties on offer should also be published or made available to potential buyers - permits for property exhibitions will only be granted if the developers can furnish documentary proof of their planning and building authorities' approvals for their projects.

These measures will help to establish that foreign properties marketed in Singapore are from bona fide developers who have obtained the necessary approvals from their relevant authorities.

However, I must stress that we do not have any control over the development of foreign properties outside Singapore. Nor is it possible for the Government to check on the authenticity and accuracy of the descriptions of foreign properties offered for sale in Singapore. Like other forms of foreign investment, Singaporeans purchasing foreign properties should carefully weigh the risks involved.