Chief Valuer may factor in potential impact of the Total Debt Servicing Ratio framework, suggest some analysts..

Development charges are generally expected to go up from Sept 1 on the back of higher land prices over the past six months. However, the pace of hikes may be conservative in line with the objective of promoting a stable property market, said some property consultants polled by BT.
Development charge (DC) is paid to the state in exchange for the right to enhance the use of certain sites or to build bigger projects on them. In addition to being tracked in property circles as they can affect redevelopment sites with a sizeable DC component, DC rates are seen as the government's reading of land and property values.
The rates are revised every six months taking into account current market values and stated according to use groups across 118 geographical sectors.
For the upcoming revision, property consultants expect the average DC rate for commercial use to rise between 3 and 10 per cent. For landed residential use, a smaller rise is predicted, between 0 and 5 per cent.
Increases forecast for the average DC rate for non-landed residential use vary widely: 0-3 per cent for Colliers, 3-5 per cent for Jones Lang LaSalle and 10-20 per cent for CBRE.
For the average industrial use DC rate too, CBRE has the most bullish forecast: 10-15 per cent growth. JLL expects the increase to be sub-one per cent and Colliers, 0-3 per cent.
JLL says the average DC rate hike for hotel use will be under 5 per cent and Colliers, 3-8 per cent.
DC rates are revised by the Ministry of National Development in consultation with the Chief Valuer (CV).
In the March 1, 2013 revision, the average DC rates for commercial and hotel use were jacked up significantly by 23.7 per cent and 26.1 per cent respectively. These were the market segments spared the January 2013 cooling measures, notes Colliers International consultant (research and advisory) Tay Huey Ying.
On the other hand, the residential and industrial property sectors, which were the subject of the cooling package, saw just a marginal increase or were left untouched - despite transaction evidence pointing to DC rates trailing land prices, she added.
For the March 1 revision, the average DC rate for industrial use inched up 0.6 per cent and that for landed residential use, 3.9 per cent. Non-landed residential DC rates were left completely untouched. "This was possibly the result of CV giving due consideration to the potential impact of the January 2013 cooling measures," says Ms Tay.
"For the upcoming review, CV is likely to give similar due consideration to the potential effects of the Total Debt Servicing Ratio framework introduced in late-June and affecting the purchases of all types of properties. Consequently, CV is likely to adopt a conservative stance when deciding on the extent of hikes in DC rates applicable for the coming six months," she added.
JLL's SE Asia research head Chua Yang Liang too expects the "outcome of the DC revision exercise to align with the government's overall intention of having a stable and sustainable property market as well as a healthy collective sales market (to promote overall urban regeneration and asset renewal), where DC rates can have a bigger impact".
Alan Cheong, research head of Savills Singapore, said: "Among the various use groups, DC rates for commercial use are likely to rise the most island-wide due to exponential price gains for strata shop and office units. Increases of up to 20-25 per cent in certain locations will not be surprising. An example would be Sector 109, where retail units at King Albert Park project have achieved high prices."
CBRE Research associate director Desmond Sim does not expect any major changes in commercial use DC rates in the CBD given their already high base, but predicts hikes of up to 10 per cent in suburban hubs with growth potential such as Jurong East, Woodlands and Paya Lebar.
Dr Chua expects Sector 27, which includes the Middle Road location, to post the biggest hike of 8-12 per cent, supported by the price for Bright Chambers' collective sale, which was 70 per cent above the land value implied by the sector's current DC rate for commercial use.
Ms Tay says that the commercial DC rate for Sector 112 (which includes Jurong East), which was raised by 15.4 per cent in the last revision, could see a further 8-12 per cent appreciation. A plot in Venture Avenue was sold at a state tender for $1,009 psf ppr in March, 25.7 per cent above the DC rate-implied land value. Morever, market watchers expect continuing buzz in the location to allow land values to keep trending upwards.
For non-landed residential use, Knight Frank research head Alice Tan predicts the biggest DC rate jump of around 15 per cent will be in Sector 112 (which also includes the Pandan/West Coast areas). She cites the sale of a Faber Walk plot in June at $687 psf ppr - a 35 per cent premium over the DC rate-implied land value. Dr Chua says Sector 100 has potential for an over-5 per cent rate hike this round, citing the en bloc sale of Yi Mei Garden in Tampines Road at 130 per cent above the DC rate-implied land value. Colliers says DC rates could rise 10-15 per cent in Sector 74 (which includes Tiong Bahru Road) and the adjacent Sector 80 (Kim Tian Road, Jalan Membina).
Tuas, Woodlands, Mandai and Ubi are among candidates for above-average increases in industrial use DC rates going by prices achieved at state tenders.