You are right that HDB is a pretty safe bet. It will also be interesting to note that even if the private property market takes a nosedive, HDB prices may not react in tandem, if anything it could even go up due to people downgrading from private to HDB.
HDB property prices...increase maintain or reduce?
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You are right that HDB is a pretty safe bet. It will also be interesting to note that even if the private property market takes a nosedive, HDB prices may not react in tandem, if anything it could even go up due to people downgrading from private to HDB.
just a thought. HDB bound to self correct eventually if private falls. but i always think e correction will be sthg acceptable. because anything too drastic will cause ppl to point finger at gahment for not monitoring and to even sell at high prices on its own. this is the thought that i carry and believe which cause me to feel it is alright to pay for what i buy. but anything in the range of 600-700k is a no go for HDB to me.i think it is madness..
Zero O u are a very safe and careful man....
Zero O u are a very safe and careful man....
hahaha .. please dont say that .. it just that i learn through my fair share of ups and downs..
600k for a HDB is not madness ....... Everything is relative ... 20 years ago, u tell pple u buyin a place for 200k, guy says madness ..on hindsight, 200k is cheap cheap now ... 1000 psf used to be able to get u top of the line apartment in the expensive end of bukit timah, balmoral and orchard shangri-la .. now 1000 can only get u balestier...
so 600k for HDB .. dont discount as madness .... 600k divided by 1500 sq ft = 400 psf (very cheap compared to 99 year leasehold development sold by private developer )
i don't know man...i just feel 600k hard to sell.profit impossible to me. break even maybe. me also have my fair share to learn my mistake....there were times i had zero O is my bank...haha
end of the day we all just want to make a living
end of the day we all just want to make a living
from today voices forum
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Why we peg to market rates: HDB
Letter from Ignatius Lourdesamy Deputy Director (Marketing & Projects) for Director (Estate Administration & Property), Housing & Development Board 05:55 AM Sep 25, 2009
I REFER to the letter "It's not all about the numbers", (Sept 16) by Mr See Leong Kit.
It is misleading for Mr See to use the example of flats at Pinnacle@Duxton to conclude that HDB is profiteering from the sale of public housing flats. HDB is able to recover the cost for some projects, while incurring significant losses for others. Overall, in the last three years, HDB incurred an average deficit of $1,045 million a year in its home ownership programme. This cost subsidy, which has to be financed by the Government, is reported in HDB's audited financial statements.
Why does HDB benchmark its flat prices to market in spite of these huge deficits? Because this is the fairest way of pricing new HDB flats while ensuring equitable distribution of subsidies.
How is this done? HDB first determines a flat's equivalent market price by taking into account various factors such as location, finishes for the flat and other attributes. This price reflects the flat's value at the point of sale. It is what people are willing to pay in the open market. HDB then sells the flat at a significant discount, which is the subsidy given by the Government.
Market-based pricing is fairer to all buyers because it allows buyers to receive similar levels of subsidy regardless of market movements and fluctuations in development costs. Mr See states that the Pinnacle@Duxton flats were re-launched at an average selling price "which is $180,000 higher than initial launch prices (in 2004)". If HDB were to sell those flats at 2004 prices as Mr See suggests, it would be giving Pinnacle buyers today an additional subsidy of $180,000. This is not fair to those buying other HDB flats today, or indeed to all taxpayers.
A market-based pricing approach ensures that all groups of buyers at any point in time enjoy similar subsidies, and balances the demand for new and resale flats.
It is illogical for Mr See to attribute the increase in property prices to HDB, because the recent appreciation in asset and equity values is not unique to Singapore. Nonetheless, flats remain affordable - first-time flat buyers use 17 to 29 per cent of household income for their loans, below the international benchmark of 30 per cent.
HDB is ramping up new flat supply, up to 8,000 Build-To-Order (BTO) flats this year. HDB's latest BTO project, Punggol Spectra, offers smaller two- and three-room flats with affordable prices that start from $89,000 and $151,000, respectively. HDB will continue to ensure that flats remain affordable.
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Why we peg to market rates: HDB
Letter from Ignatius Lourdesamy Deputy Director (Marketing & Projects) for Director (Estate Administration & Property), Housing & Development Board 05:55 AM Sep 25, 2009
I REFER to the letter "It's not all about the numbers", (Sept 16) by Mr See Leong Kit.
It is misleading for Mr See to use the example of flats at Pinnacle@Duxton to conclude that HDB is profiteering from the sale of public housing flats. HDB is able to recover the cost for some projects, while incurring significant losses for others. Overall, in the last three years, HDB incurred an average deficit of $1,045 million a year in its home ownership programme. This cost subsidy, which has to be financed by the Government, is reported in HDB's audited financial statements.
Why does HDB benchmark its flat prices to market in spite of these huge deficits? Because this is the fairest way of pricing new HDB flats while ensuring equitable distribution of subsidies.
How is this done? HDB first determines a flat's equivalent market price by taking into account various factors such as location, finishes for the flat and other attributes. This price reflects the flat's value at the point of sale. It is what people are willing to pay in the open market. HDB then sells the flat at a significant discount, which is the subsidy given by the Government.
Market-based pricing is fairer to all buyers because it allows buyers to receive similar levels of subsidy regardless of market movements and fluctuations in development costs. Mr See states that the Pinnacle@Duxton flats were re-launched at an average selling price "which is $180,000 higher than initial launch prices (in 2004)". If HDB were to sell those flats at 2004 prices as Mr See suggests, it would be giving Pinnacle buyers today an additional subsidy of $180,000. This is not fair to those buying other HDB flats today, or indeed to all taxpayers.
A market-based pricing approach ensures that all groups of buyers at any point in time enjoy similar subsidies, and balances the demand for new and resale flats.
It is illogical for Mr See to attribute the increase in property prices to HDB, because the recent appreciation in asset and equity values is not unique to Singapore. Nonetheless, flats remain affordable - first-time flat buyers use 17 to 29 per cent of household income for their loans, below the international benchmark of 30 per cent.
HDB is ramping up new flat supply, up to 8,000 Build-To-Order (BTO) flats this year. HDB's latest BTO project, Punggol Spectra, offers smaller two- and three-room flats with affordable prices that start from $89,000 and $151,000, respectively. HDB will continue to ensure that flats remain affordable.
actually the thing I never understood when I read the audited reports from hdb website last time was
HOW IN THE WORLD did they incurred an average deficit of $1,045 million a year when for the past few years they were building like only thousands of flats.
how did the accouting work? where did the money go to? Is the deficit due to unsold flats from the earlier years?
How come earlier years they were building like 10x the flats with less deficit????
HOW IN THE WORLD did they incurred an average deficit of $1,045 million a year when for the past few years they were building like only thousands of flats.
how did the accouting work? where did the money go to? Is the deficit due to unsold flats from the earlier years?
How come earlier years they were building like 10x the flats with less deficit????
Read in the papers that some blocks of flats in S'pore is empty because S'porean don't like the locations. :sweat:
There're many factors that enters into the cost of building flats.
1 example is internal taxation factors. If land authority sells HDB a plot of land for 60 million that cost will be amortised into the cost of building.
Another example is the artificial control of supply. I remember there were 16 blocks of flats built and completed in 2001 in Jurong West near the camp but were fenced up and released to public only only in 2006. So the cost of maintaining these vacant flats as well as it's monthly conservancy charges were also amortised into the cost.
There're many more factors but I guess I'll stop here.
Cheers.
1 example is internal taxation factors. If land authority sells HDB a plot of land for 60 million that cost will be amortised into the cost of building.
Another example is the artificial control of supply. I remember there were 16 blocks of flats built and completed in 2001 in Jurong West near the camp but were fenced up and released to public only only in 2006. So the cost of maintaining these vacant flats as well as it's monthly conservancy charges were also amortised into the cost.
There're many more factors but I guess I'll stop here.
Cheers.
There're many factors that enters into the cost of building flats.
1 example is internal taxation factors. If land authority sells HDB a plot of land for 60 million that cost will be amortised into the cost of building.
Cheers.
An Gong's child sell the land to another An Gong's child where this money goes back to Ah Gong's pocket. :bsmilie:
Anyway, the key issue is HDB till this date, refuse to announce to public on the cost of building HDB flat per unit and its add on cost.
How will the public understand if they are not transparent enough on this. I can only perceived the reply by HDB as playing with figures.
*Does HDB has dilemma in releasing these figures? :think::dunno:
is not just HDB...a lot of things are never transparent. i never trust our papers.....deficit my foot. they have some unit they can't sell due to racial ratio. who to blame?got cash cannot buy cause skin colour wrong. and as for location poor...this is a true problem that the ppl pick and choose. but have you seen their selling price for these location. i think it is unreasonable. of course one can say it is relative ....but come one...i thought this is public housing...and now we are talking business...
recent new flat construction also not good. my friend staying in the new bedok HDB near MRT. less than 1 year wall cracks....in jurong my friend tell me the tiles HDB placed not only pop out but crack too....how do u think they will release the figure....
is like telling the home buyer they pay the price of a japanese car but the construction is nothing like it but more of a QQ cherry
V
vince123123
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A lot of people compare HDB to private prices but do not realise a lot of deficiencies with HDB to make such comparisons meaningless. Apart from the numerous rules and restrictions regarding HDB flats, the construction quality is much poorer as well.
Those of you who are staying in mid-older flats will have faced the spalling concrete problem (concrete ceiling falling off, exposing bars underneath). I have heard from a very reliable source in HDB that the reason for this is because HDB used insufficient concrete (cost issue perhaps?) when making the ceilings and hence there is insufficient thickness in encasing the reinforcement bars. WIth insufficient thickness, water goes in and therefore the bars get rusty; leading to spalling concrete.
Hence, those who wish to compare prices will therefore need to factor in a big discount on these factors before comparison.
Those of you who are staying in mid-older flats will have faced the spalling concrete problem (concrete ceiling falling off, exposing bars underneath). I have heard from a very reliable source in HDB that the reason for this is because HDB used insufficient concrete (cost issue perhaps?) when making the ceilings and hence there is insufficient thickness in encasing the reinforcement bars. WIth insufficient thickness, water goes in and therefore the bars get rusty; leading to spalling concrete.
Hence, those who wish to compare prices will therefore need to factor in a big discount on these factors before comparison.
I think it's better not to release the construction costs. The public will be so shocked causing many to dump their flats. Not very good if public housing market suddenly crashes...
Seems like a moat point. Those looking to sell in the near future--appreciate more than 20%. Those looking to buy--deppreciate more than 20%. I just want affordable housing, wish they'll bring that back--rant over.
Well, I don't have intention to buy or sell now and I opt for HDB prices to decrease by more than 20%. Because the price is really crazy.:thumbsd:
I think most agree that HDB price should increase over time, but it just the huge increase in price lately is hard to swallow, especially for first time buyer.
Any huge increase or decrease in selling price are also not good, if HDB can plan supply properly, this should help to stabilise the market price.
Any huge increase or decrease in selling price are also not good, if HDB can plan supply properly, this should help to stabilise the market price.
http://finance.yahoo.com/real-estat...ldly-different-prices.html?mod=realestate-buy
This is a report in Yahoo finance dated 24 Sept 2009. The original source is CNN Money
It reports the disparity between the cheapest and the most expensive 4 bedroom house across America, trying to compare apples to apples.
I know this may not be relevant here, but it goes to show that buyers will have to pay premium for 'hot' locations. Just wanted to post it here so that we can broaden our perspective.
This is a report in Yahoo finance dated 24 Sept 2009. The original source is CNN Money
It reports the disparity between the cheapest and the most expensive 4 bedroom house across America, trying to compare apples to apples.
I know this may not be relevant here, but it goes to show that buyers will have to pay premium for 'hot' locations. Just wanted to post it here so that we can broaden our perspective.
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FYI
There is a on-line petition for "LOWER HDB VALUATIONS OR BUILD MORE AFFORDABLE HDB". It is for "All Singaporeans who feel resale HDB price & COV is too high".
It started in 03/09/09 and has now get 1065 signatures.
There is a on-line petition for "LOWER HDB VALUATIONS OR BUILD MORE AFFORDABLE HDB". It is for "All Singaporeans who feel resale HDB price & COV is too high".
It started in 03/09/09 and has now get 1065 signatures.
don't mean to be rude...but this kind of things don't make me laugh....
if your neighbour are pricing cov 50k and manage to sell off,are u gonna price it at cov10k or no cov?
and there are many ppl who bought during the high time....if valuation self correct by more than 20% etc because of these petitions,did u think it will work and the impact on HDB's valuators?
this petition is no diff from those who were against the IR...at the end you only achieve getting your voice/opinion heard but it will have little or no effect. your best bet is a correction on the property markets...
Well.... S'porean could petition as much as they want... but don't hold your breath while you wait.
Still waiting for someone here willing to put Words into Action and sell their Flats at below Market Price or without COV.... but to be honest, if someone is really desperate to sell off their property ASAP (even under Cost).... you should look around the floors for telltales sign of LoanShark activity.... :sweat:
agree. i hold my breath for a year and ended up paying 50k more....good luck to you while you wait for the petition..
is was real pain for me to wait so long for a year thinking sthg might just happen and it din...and i needed a house badly
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