What is GFA Harmonisation and How Does It Affect You as a Buyer?
In June 2023, Singapore implemented the Gross Floor Area (GFA) harmonisation initiative to standardise floor area calculations across various government agencies, including the Urban Redevelopment Authority (URA), Building and Construction Authority (BCA), and Singapore Land Authority (SLA). This move aimed to eliminate inconsistencies in GFA measurements, promoting transparency and efficiency in the property market.
Key Changes Under GFA Harmonisation
Unified Measurement Standard: Floor areas are now consistently measured to the middle of external walls, ensuring uniformity across all regulatory bodies.
Inclusion of Strata Areas: Previously, certain spaces like private balconies, roof terraces, and air-conditioner ledges could be excluded or partially excluded from GFA calculations. Under the new rules, these areas are fully counted towards GFA, leading to a more accurate representation of usable space.
Exclusion of Void Spaces: Void spaces, such as double-volume ceilings, are now excluded from GFA calculations. This change discourages the inclusion of non-functional vertical spaces in new designs.
Impact on Property Buyers
As a property buyer, GFA harmonisation affects both the pricing and design of available properties:
Higher Price per Square Foot (PSF): With the inclusion of previously excluded areas like air-conditioner ledges and private terraces, the overall GFA for new developments has increased. This leads to a higher PSF, as developers now account for every square foot. Previously, developers could exclude air-con ledges from GFA, allowing them to advertise larger units at a lower PSF. Now, with those areas included, the advertised size remains the same, but the PSF has increased.
Smaller, More Efficient Designs: Developers are focusing on designing more efficient units. With void spaces excluded and air-con ledges now included in GFA, developers are likely to design smaller, more compact apartments to maintain affordability for buyers while keeping construction costs in check.
Reduced Availability of Premium Features: Features like large balconies, private roof terraces, and high-ceilinged units are becoming more expensive for developers to include because they are now fully counted toward GFA. As a result, these features may be offered in fewer units or at a higher price premium.
Case Studies: Pre- and Post-Harmonisation Developments
To illustrate the impact of GFA harmonisation, let's examine two condominium projects: Condo A (pre-harmonisation) and Condo B (post-harmonisation).
Condo A (Pre-Harmonisation)
Unit Size: 1,356 sq ft (including 8 sqm/86 sq ft AC ledge)
PSF Price: S$2,087
Total Price: S$2,830,000
In this pre-harmonisation scenario, the air-conditioner ledge and balcony were not fully counted in the GFA, allowing the developer to advertise a larger unit size at a lower PSF.
Condo B (Post-Harmonisation)
Unit Size: 1,270 sq ft (AC ledge is there but not calculated into the area)
PSF Price: S$2,228
Total Price: S$2,830,000
Post-harmonisation, the same functional space is now represented with a smaller unit size due to the inclusion of all areas in the GFA. While the total price remains the same, the PSF appears higher, reflecting a more accurate valuation of usable space.
Considerations for Buyers
Focus on Usable Space: With the new regulations, it's essential to assess the functionality of the space you're purchasing. While the PSF may appear higher, it reflects the true value of the functional space.
Evaluate Floor Plans Carefully: Pay close attention to floor plans to understand how space is utilised. Efficient layouts that maximise usable space can offer better value.
Consider Resale Properties: If premium features like large balconies and high ceilings are important to you, exploring resale properties built before the GFA harmonisation may provide more options.
Conclusion
GFA harmonisation aims to create a fairer and more transparent property market by standardising floor area calculations. As a buyer, understanding these changes can help you make more informed decisions when evaluating property options.
