Condo-style (HDB flat) losing allure

[Ahyoo2002]

The Straits Times

Dec 12, 2008

Condo-style losing allure

Falling prices in private home market chipping away at demand for DBSS flats

By Joyce Teo, Property Correspondent

 

PRICEY condo-style HDB flats have not been spared in the property downturn, going by what has been left for sale at Park Central @ AMK.

 

While over 70 per cent of the project's 578 units have been sold, the larger five-room units costing $600,000 to $670,000 each are still available.

 

These levels put the flats in the same price bracket as older condominiums, which might prompt some potential HDB buyers to turn to the private home market, where prices are falling.

 

Developer United Engineers announced the figures yesterday, and also said foundation works had begun at the Ang Mo Kio estate, which is being developed under the HDB's design, build and sell scheme (DBSS). Under the scheme, public flats are designed, built and sold by private developers.

 

Sales at Park Central have been favourable in view of the challenging economic climate, said Mr David Liew, the managing director of the group's integrated facility management and property development business.

 

Buyers include young couples, retirees and those with proceeds from collective sales, the group said.

 

The DBSS concept has been quite popular, but some experts fear the fall in private condo prices could leave buyers spoilt for choice.

 

Price is the key factor in DBSS projects as they are targeted at HDB buyers whose household income must not exceed $8,000 a month.

 

'It's a price-sensitive sector. These buyers can choose between HDB flats and lower-end condos,' said Associate Professor Sing Tien Foo, the deputy head of the National University of Singapore's real estate department.

 

'During a downturn, the price gap between these segments will narrow, so demand (at DBSS projects) may be affected,' he noted.

 

Most DBSS flats are priced at $500,000 to $700,000 each, roughly the level for executive condos, said ERA Asia Pacific associate director Eugene Lim. 'There is already an overlap.'

 

For a $600,000 unit, the monthly instalment on a 30-year, 80 per cent loan is about $2,000, assuming an interest rate of 2.6 per cent.

 

When the property market was rising in 2006, DBSS products met the needs of buyers who could not afford private homes.

 

The first such project, Premiere @ Tampines, was an instant hit, drawing 5,700 applications for 616 homes in late 2006. Although it sold only 500 flats initially, long queues formed when the remaining units were released for sale.

 

City View @ Boon Keng received 3,500 applications for 714 flats early this year, but only 460 were sold. Nearly 90 per cent of the flats have since been taken up, including all the three-roomers.

 

Park Central, Singapore's third DBSS project, garnered more than 2,300 applications. Prices average $490 to $500 per sq ft, putting the four-roomers at between $400,000 and $500,000 each.

 

The fourth DBSS project - Natura Loft in Bishan - saw about 680 applications for 480 flats last month. Its four-room units go for $465,000 to $586,000 each, while its five-roomers cost $600,000 to $739,000.

 

Once prices go above $600,000, the flats will be competing with old leasehold condos, executive condos and bigger executive flats, said Knight Frank's director of research and consultancy, Mr Nicholas Mak.

 

Unlike exec condos, which are initially subject to sale restrictions similar to those on public housing units, but become fully private after 10 years, a DBSS unit is just a value-added HDB flat, he said.

 

Indeed, demand for DBSS flats might be more severely affected than that for other segments as potential buyers have more choices, said Dr Sing.

 

Nevertheless, Mr Mak feels the DBSS concept is sustainable if the Government accepts lower land prices.

 

The problem is that most developers of DBSS sites bought them in good times.

 

There are two DBSS projects slated for launch in the first half of next year: one in Simei and a huge project of nearly 1,200 units in Toa Payoh.

[Stary]

Are they sure that the private property prices had came down?

 

I was at a few new showflats recently and the prices are still around the same.

[Damienic]

It has come down. Recently was invited to a new condo launch in river valley area...prices start from $1200 psf...earlier to middle of this yr, new condos in river valley area were typically going at $1500-1800 psf..

[Acemundo]

it has come down....i receive quite a few invitations from estate agents to go down for "exclusive launches" with special discounts. The discounted psf price they quoted to me were indeed meaningful drop from last done prices.

[Ahyoo2002]

Haha,

 

Looks like I am not as rich as you guys to be invited

[Ahyoo2002]

It depends on who can "tong" longer

[Acemundo]

haha i not rich la....jsut that i went to a few showflats before......and signed on their attendance book.

 

so naturally they hv my records haha

[Dj_spike]

  Quote

The Straits Times

Dec 12, 2008

Condo-style losing allure

Falling prices in private home market chipping away at demand for DBSS flats

By Joyce Teo, Property Correspondent

 

PRICEY condo-style HDB flats have not been spared in the property downturn, going by what has been left for sale at Park Central @ AMK.

 

While over 70 per cent of the project's 578 units have been sold, the larger five-room units costing $600,000 to $670,000 each are still available.

 

These levels put the flats in the same price bracket as older condominiums, which might prompt some potential HDB buyers to turn to the private home market, where prices are falling.

 

Developer United Engineers announced the figures yesterday, and also said foundation works had begun at the Ang Mo Kio estate, which is being developed under the HDB's design, build and sell scheme (DBSS). Under the scheme, public flats are designed, built and sold by private developers.

 

Sales at Park Central have been favourable in view of the challenging economic climate, said Mr David Liew, the managing director of the group's integrated facility management and property development business.

 

Buyers include young couples, retirees and those with proceeds from collective sales, the group said.

 

The DBSS concept has been quite popular, but some experts fear the fall in private condo prices could leave buyers spoilt for choice.

 

Price is the key factor in DBSS projects as they are targeted at HDB buyers whose household income must not exceed $8,000 a month.

 

'It's a price-sensitive sector. These buyers can choose between HDB flats and lower-end condos,' said Associate Professor Sing Tien Foo, the deputy head of the National University of Singapore's real estate department.

 

'During a downturn, the price gap between these segments will narrow, so demand (at DBSS projects) may be affected,' he noted.

 

Most DBSS flats are priced at $500,000 to $700,000 each, roughly the level for executive condos, said ERA Asia Pacific associate director Eugene Lim. 'There is already an overlap.'

 

For a $600,000 unit, the monthly instalment on a 30-year, 80 per cent loan is about $2,000, assuming an interest rate of 2.6 per cent.

 

When the property market was rising in 2006, DBSS products met the needs of buyers who could not afford private homes.

 

The first such project, Premiere @ Tampines, was an instant hit, drawing 5,700 applications for 616 homes in late 2006. Although it sold only 500 flats initially, long queues formed when the remaining units were released for sale.

 

City View @ Boon Keng received 3,500 applications for 714 flats early this year, but only 460 were sold. Nearly 90 per cent of the flats have since been taken up, including all the three-roomers.

 

Park Central, Singapore's third DBSS project, garnered more than 2,300 applications. Prices average $490 to $500 per sq ft, putting the four-roomers at between $400,000 and $500,000 each.

 

The fourth DBSS project - Natura Loft in Bishan - saw about 680 applications for 480 flats last month. Its four-room units go for $465,000 to $586,000 each, while its five-roomers cost $600,000 to $739,000.

 

Once prices go above $600,000, the flats will be competing with old leasehold condos, executive condos and bigger executive flats, said Knight Frank's director of research and consultancy, Mr Nicholas Mak.

 

Unlike exec condos, which are initially subject to sale restrictions similar to those on public housing units, but become fully private after 10 years, a DBSS unit is just a value-added HDB flat, he said.

 

Indeed, demand for DBSS flats might be more severely affected than that for other segments as potential buyers have more choices, said Dr Sing.

 

Nevertheless, Mr Mak feels the DBSS concept is sustainable if the Government accepts lower land prices.

 

The problem is that most developers of DBSS sites bought them in good times.

 

There are two DBSS projects slated for launch in the first half of next year: one in Simei and a huge project of nearly 1,200 units in Toa Payoh.

 

Seriously all the projects after Tampines's The Premiere are ridiculously overpriced.... only the Premiere's pricing is

 

Dun flame me hor... my opinion only

[Route88]

Good leh, can lelong lelong

[Damienic]

The Premiere pricing was ok because it was launched just before the ppty market got bullish..if it was launched early this yr, you can expect it to be selling at least 100K more..

[Ahyoo2002]

Only 100k more? The same HDB flat by HDB can be more ex by $200k easily depend on when they sell

[Ahyoo2002]

[Ahyoo2002]

Me same thinking as you.

[Gearoil]

Are you sure what you are talking about?

 

The Pappy sheltered Sinkies are risk adverse and most won't dare to take a private loan to bank roll on their condo.

 

They rather let H the D and B run their life and provide that roof over their Sinkie heads even though they know they are paying for a worthless piece of pigeon Hole and at such prices somemore!

 

Moreover, these Sinkie have a mentality of complaining why should they pay so much maintanence fees like in private condos....so they feel safe choosing such pigeon holes!

 

So you see, bro...it is the mentality mindset that had gotten hold of the typical HDB Sinkies and this is where the Pappies play to their advantage.

 

You can called it.... years of Nanny feeding that resulted in the eventual belief that the MIWs are always providing the best value for them even though a BLIND man can see otherwise!

 

Get it?

[DarkLord]

Thanks to it, my flat's value got appreciated more than 100K too.

[Gearoil]

When you play the game according to the Master's wishes, you do get rewarded in some way.

 

This is called virtual rewards.

 

Whether you are rewarded with gains that are only paper in value and make you feel delighted that you have made money is immaterial.

 

Simply becos there isn't any REAL material gain unless you decide to 'boot yourself' outta here and recover back what is in actual value of worth, that you will take along with you.

 

Called it paying obedience to the Master and you shall have a good feeling.

 

For as long as you 'stick around', the Master will make you 'feel rich' but it is only a feeling that you think you are getting!

 

So are you happy?

[Mydotcom]

  Quote

Price is the key factor in DBSS projects as they are targeted at HDB buyers whose household income must not exceed $8,000 a month.

 

combined 8K monthly pay can afford a 600-700K flat?

 

HDB is encouraging people to spend beyond their means

[Dj_spike]

  Quote

The Premiere pricing was ok because it was launched just before the ppty market got bullish..if it was launched early this yr, you can expect it to be selling at least 100K more..

 

Actually, it was before the sand crisis issue by our neighbours. After that, everything started upwards... i believe a couple of mths after the launch of the Premiere...