High Time URA Curb the Use of SOHO

Finally the Urban Redevelopment Authority (URA) has decided to curb the use of SOHO by developers. This has to come sooner or later after the URA clamped down on developers and real estate salespersons selling loft space in industrial strata units.

Why is this important?

First of all, in Singapore, SOHO is never classified as a type of land use by URA. Our broad categories of land use are residential, commercial, industrial, hotel and institutional use. It is a pure marketing term.

Second, the term has been abused by developers and real estate salespersons that a lot of buyers think that the residential home can be used as an office. But that is not true. You have to apply to the authorities to use your home as an office. And you might not get approval.

Third, such units are always marketed at a higher price than residential units. Why is that so? The rationale used is that SOHO is a mix of residential and commercial so it can be priced higher than residential. But if it cannot be used as an office, the price paid is not justified.


But why now, you may ask.

My guess is that the URA is trying to "clean up" its residential price index. It has been "polluted" by some developers marketing their residential homes as "SOHO-styled" units and at higher prices than normal.


Overall this is a good step forward for the real estate industry. With the Council of Estate Agents (CEA) set up to regulate the "cowboy" industry, URA has also to get its act right. In fact, when I was training the real estate salespersons, many of them do not understand what is SOHO. With this, I hope the market will be less confused over such marketing terms.

But then again, developers are creative. Soon new marketing terms will appear. Like for example, the developer who introduced dual key concept now calls it TRIO to differentiate its products from the competitors.