Profit margins for DBSS developers 'look high' , 'Up to 76%'

[Chpeck]

I respect UMA SHANKARI's courage and sincerely hope that she can keep her job.

Edited July 3, 2011 by Chpeck

[Jp66]

 

believe it or not, fifty years from now, historians may conclude that Singapore is shaped by mbt's after 1990.

千古罪人

[Porker]

where got such thing as over profit !!

 

Coming from a dumba$$... What do you expect

[Relacklabrudder]

Right. HDB should scrap DBSS and concentrate on building affordable HDB flats. Energy should be channel to improve these affordable flats into world class standard or condo standards. With DBSS, they are indirectly telling people that if you want better flat, go for DBSS. No money go for BTO. After awhile, BTO flats will be slow to improve its standard becasue DBSS is there. Anyway, the emphasis of DBSS are better apartments than normal HDB. The emphasis and its pricing policies is so very good that it shot up and even overtook condo. Imagine paying that kind of DBSS pricing and yet don't have condo facilities. Frankly, might as well buy condo which come with all the facilities. Overprice or not, it is everybody guess.

 

 

 

some cockanathan will tell u , they dun wan pay monthly maintenance fee for condo facilities but wan their flat look like condo.

[TandemAssassin]

Coming from a person who paid through his nose for a dbss; I have only this to say. Yes, it is overpriced and bloody expensive for something that is essentially a BTO flat.

 

But it does fulfill a niche in the market. After all, most of the dbss developments are sold out. Can we say that all the buyers are foolish? I doubt it. If even I (who by any measure is a sucker consumer) can realize that the dbss is overpriced and that I may (very likely) make a loss on it, I think most of the other buyers would have entertained similar thoughts at some point in the buying process.

 

But still they sell out. I suspect that they are for the following reasons.

 

First, they appeal to the cash-poor. Unlike BTO or resale, most who buy a dbss do not have to top up much cash (if at all) after the CPF grant of $30k. If you are taking a HDB loan, you only need to fork out 10% of the purchase price in either CPF or cash or a combination of the two. $30k CPF grant plus maybe $20k CPF (about one years' work for two) will cover the 10% of a $500k flat. And, as the renovation cost is "built into" the purchase price; there is no cash outlay there. This is ideal for couples who just stepped into the workforce but would like to get married young as well as those like me who love to spend money on useless stuff like cars.

 

Second, they appeal to those in a hurry. Due to the higher prices filtering out the lower income earners, the number of serious applicants in a dbss is typically lower. Most of the dbss will have a walk-in selection phase after the initial balloting because many drop out or did not even ballot. For mine, some with a double digit Q number dropped out. This would be unheard of in a BTO. So, for those in a rush to select a flat (say if your income is going to bust the income cap for hdb loan), then a dbss is a good way out. After all, the next most affordable option would be EC which may be in a totally different price bracket altogether (and is likely to prove an equally bad bargain).

 

Third, this is going to be controversial, but most of the buyers are able to afford the dbss units they buy. I bought a unit that is within comfortable reach for me (affordable on the lower of single income earned). I am sure most of the other buyers do have the income to support their purchase. Of course, this is all anecdotal, so I can't say I am 100% right on this point. I have a friend who purchased one of the most expensive unit in my dbss estate. But both halves of the couple are graduates and civil servants. Stable jobs with comfortable pay. I also have friends whose parents gave them a dbss unit as a wedding gift! Based on the facebook group of my dbss development, the profile of the dbss buyers seem to be those earning close to the $8k (hdb loan cap) or $10k (income cap). So long as they purchase the units with a long term view to making it their home, it seems like it won't be a big deal. Even if one sits on a paper loss, the HDB is a very lenient lender and I doubt if a margin call will be made. At most they continue living in the flat.

Edited July 3, 2011 by TandemAssassin

[Damienic]

How superior can the finishings be? After 5 years, most would come apart through wear and tear.

The so called quality stuffs are only beneficial to the first hand owner.

When we buy a flat, be it BTO or resale, we are just buying the shell. Rest of the furnishings like cabinets, aircons ... We still do them up seperately.

 

The buyers are just paying a premium price fir something that could be done by renovation contractors at a much lower price.

 

Precisely. I reckon some buyers of DBSS 5rm flat are actually paying at least 150k more compared to BTO of comparable locations...the so-called better furnishings actually would cost at most 40-50k more only if they engaged ID or contractors to do it for them but the premium that comes with buying a DBSS flat is at least 2-3 times more than that..and when the MOP is up, these owners will realise that their flats are not going to be worth more than the BTO flats when it becomes eligible for sale in the resale mkt later..

Edited July 3, 2011 by Damienic

[Pioneer]

Coming from a person who paid through his nose for a dbss; I have only this to say. Yes, it is overpriced and bloody expensive for something that is essentially a BTO flat.

 

But it does fulfill a niche in the market. After all, most of the dbss developments are sold out. Can we say that all the buyers are foolish? I doubt it. If even I (who by any measure is a sucker consumer) can realize that the dbss is overpriced and that I may (very likely) make a loss on it, I think most of the other buyers would have entertained similar thoughts at some point in the buying process.

 

But still they sell out. I suspect that they are for the following reasons.

 

First, they appeal to the cash-poor. Unlike BTO or resale, most who buy a dbss do not have to top up much cash (if at all) after the CPF grant of $30k. If you are taking a HDB loan, you only need to fork out 10% of the purchase price in either CPF or cash or a combination of the two. $30k CPF grant plus maybe $20k CPF (about one years' work for two) will cover the 10% of a $500k flat. And, as the renovation cost is "built into" the purchase price; there is no cash outlay there. This is ideal for couples who just stepped into the workforce but would like to get married young as well as those like me who love to spend money on useless stuff like cars.

 

Second, they appeal to those in a hurry. Due to the higher prices filtering out the lower income earners, the number of serious applicants in a dbss is typically lower. Most of the dbss will have a walk-in selection phase after the initial balloting because many drop out or did not even ballot. For mine, some with a double digit Q number dropped out. This would be unheard of in a BTO. So, for those in a rush to select a flat (say if your income is going to bust the income cap for hdb loan), then a dbss is a good way out. After all, the next most affordable option would be EC which may be in a totally different price bracket altogether (and is likely to prove an equally bad bargain).

 

Third, this is going to be controversial, but most of the buyers are able to afford the dbss units they buy. I bought a unit that is within comfortable reach for me (affordable on the lower of single income earned). I am sure most of the other buyers do have the income to support their purchase. Of course, this is all anecdotal, so I can't say I am 100% right on this point. I have a friend who purchased one of the most expensive unit in my dbss estate. But both halves of the couple are graduates and civil servants. Stable jobs with comfortable pay. I also have friends whose parents gave them a dbss unit as a wedding gift! Based on the facebook group of my dbss development, the profile of the dbss buyers seem to be those earning close to the $8k (hdb loan cap) or $10k (income cap). So long as they purchase the units with a long term view to making it their home, it seems like it won't be a big deal. Even if one sits on a paper loss, the HDB is a very lenient lender and I doubt if a margin call will be made. At most they continue living in the flat.

 

I have similar reasons like you too but I choose EC over DBSS.

 

When I was looking for a flat, I first try looking for the north side ( I stay in Sembawang and north side houses are supposedly the cheapest in Singapore).

 

To my horror, every freaking seller is asking for 20 - 50k COV. If I will to get one of the units, my required cash will be something like this:

- COV ($30K)

- Renovation ($30k)

- 5% deposit (20k)

- Furniture (10K)

- Electric Appliances (20K)

 

I need to come out with 110k cash to get a resale flat. That is not something I can afford. I will hence need to take a loan for a large part of the 110k at a higher rate than a normal loan.

 

I have problem getting a BTO because of my fiancee and my combined income is more than 8k. Getting a DBSS was kinda out of the question because we do not see the value in paying so much for condo-like HDB unit. Hence, against my initial belief many years ago, we bought an EC instead.

 

An EC is a move-in condition and has the facilities of a condo and will become a private condo in 10 yrs time. We will save on the COV, renovation, some of the electric appliances. Our plan is to live out the 10 years and move back to HDB from the profit of the EC.

 

We believe an EC will have a better resale value compared to DBSS HDB. After all, a EC is a cheaper condo with a 'MOP' of 10 years but a DBSS HDB is a more expensive BTO HDB.

 

That is why we chose EC over DBSS in the end.

 

So all in all, although I have to face the same issues (Lack of cash, I have the integrity not to depend on my parents for money to buy me my own house :p), I chose over to buy EC because:

 

- I will need less cash up font

- I will save on renovation, aircon, oven, etc

- Better location (In my case, I prefer quietness and yet near decent amenities)

- Better resale value compared to DBSS (My opinion anyway)

 

 

[Relacklabrudder]

...... Our plan is to live out the 10 years and move back to HDB from the profit of the EC. We believe an EC will have a better resale value compared to DBSS HDB. After all, a EC is a cheaper condo with a 'MOP' of 10 years but a DBSS HDB is a more expensive BTO HDB.

 

That is why we chose EC over DBSS in the end.

 

So all in all, although I have to face the same issues (Lack of cash, I have the integrity not to depend on my parents for money to buy me my own house :p), I chose over to buy EC because:

 

- I will need less cash up font

- I will save on renovation, aircon, oven, etc

- Better location (In my case, I prefer quietness and yet near decent amenities)

- Better resale value compared to DBSS (My opinion anyway)

 

 

 

i dun see there will be much profit left becuase u have to note the amount u paying back to cpf+ nterest and the amount paied back to HDB loan, and if u then wan buyhdb as 2nd timer, then u also subjected to reslae levy which could rang from 55k onwards depending on value of your EC.

 

 

and whatever meat left u will also spend on reno.

 

 

add in teh hustle of moving and searching for a new place, tink will be so worth it.

 

 

[Mockngbrd]

Yup its the interest that will be a huge factor when these ppl try to sell off their DBSS. imagine tampenis DBSS 700k apartment... how much to sell just to clear off ur loans and interests?

[Ivan_06]

i dun see there will be much profit left becuase u have to note the amount u paying back to cpf+ nterest and the amount paied back to HDB loan, and if u then wan buyhdb as 2nd timer, then u also subjected to reslae levy which could rang from 55k onwards depending on value of your EC.

 

 

and whatever meat left u will also spend on reno.

 

 

add in teh hustle of moving and searching for a new place, tink will be so worth it.

 

no leh, if you want to buy back HDB after selling EC.. There is a minimum waiting period of 30 months.. during that period of time,stay where?

[Relacklabrudder]

no leh, if you want to buy back HDB after selling EC.. There is a minimum waiting period of 30 months.. during that period of time,stay where?

 

 

if in laws or parents place allow then stay there, if not u have to add in further rental cost of 30mths! i think after selling EC, not only no profit but loss if in this case....

[Ben5266]

I think our HDB price is still manageable lah... If not, we will be doing like what the HongKonger is doing already...

 

http://www.breakingnews.ie/archives/2011/0...est-511165.html

 

"One of the big themes of the march marking the 14th anniversary is the growing rich-poor divide in Hong Kong, where soaring property prices have left many homes unaffordable and forced out small shopkeepers

 

Read more: http://www.breakingnews.ie/archives/2011/0...l#ixzz1R6JAxd6K

"

 

Those who think HK is better than Singapore....

[Relacklabrudder]

I think our HDB price is still manageable lah... If not, we will be doing like what the HongKonger is doing already...

 

http://www.breakingnews.ie/archives/2011/0...est-511165.html

 

"One of the big themes of the march marking the 14th anniversary is the growing rich-poor divide in Hong Kong, where soaring property prices have left many homes unaffordable and forced out small shopkeepers

 

Read more: http://www.breakingnews.ie/archives/2011/0...l#ixzz1R6JAxd6K

"

 

Those who think HK is better than Singapore....

 

 

 

"One of the big themes of the march marking the 14th anniversary is the growing rich-poor divide in Hong Kong, where soaring property prices have left many homes unaffordable and forced out small shopkeepers

 

 

can explain why the above statement why singapore is better than HK?

 

u mean there is less of poor rich dvide in singapore? there is no soaring prices making home unaffordable in singapore? shopkeepers, hawkers in sheng shiong acquired wt makret for example is not being force out due to high rental?

 

 

 

 

[Nonpareil]

I find it strange that there are so many people complaining about HDB prices nowadays. These prices aren't new, look at Duxton, and that's a true HDB project while at Bishan there was Natural Loft a DBSS.

 

Also to those complaining about the profit margins, seriously, are you that naive to think that once HDB absolves itself of responsibility to a profit driven company that the prices would remain competitive? Just look at the land prices sold recently, expect top draw prices for these accommodations. Its not difficult to do the sums.

 

I do agree that HDB has lost it way but it does correspond to my view of present government, which is to make money, lots of money at the expense of the people.

[Old-driver]

Anyway heard that they have suspended all future DBSS projects and reviewing this. Aint this a bit late?

[Kezg1]

 

 

Heard on the radio this morning that Cow have suspended the Dbss programme sale......those oredi so to private devlper ...he said bo pian....

 

[Kiadaw]

Anyway heard that they have suspended all future DBSS projects and reviewing this. Aint this a bit late?

 

Better late than never.

 

Actually, when you think about it, cannot put all blame on Government. Its people that wanted to profit on properties that drive the cost so high as well.

[Zze121]

Wat if the bank interest rate hit 5 or 8% next year or years down the road? Will Sg be next US?