"...Many modern HDB-dwelling Singaporeans are interested to know
how much more they are paying above the cost price of their
flats.
It is common knowledge that new HDB four- and five-room flats sell
from $200,000 upwards. Why are Singaporeans paying so much more for
their flats when the unit cost price hovers around only $50,000?
This is despite the subsidies the housing authorities grant to
public housing.
What are the additional costs HDB buyers are paying for? If the
land cost is factored in to the final purchasing price, it implies
the cost of the land is four to five times the construction cost.
This does not make market sense.
Private developers' construction cost generally does not differ too
much from the land cost. These developers bid for the land parcel
competitively, hence we can assume they have paid the optimum price
for their winning bid.
Let's take a typical low- to mid-range 99-year leasehold
condominium for comparison. Winning bids for land parcels go at
$150 to $250 psf. Construction cost hovers around $200 to $250 psf
and the final price goes at about $400 to $550 psf after including
allowance for profits and other miscellaneous costs such as legal
fees and marketing.
Land for HDB
flats is not bid for competitively and so the 'price' paid for it
cannot possibly be four to five times the construction
cost. This is an aberration when compared to the
private market.
Can the HDB explain how its flats are priced? The huge difference
between the selling price and the cost of construction is worrying.
What else are we paying for?..." (QUOTE ST FORUM)
Must be pretty big margins, that's why HDB's untouchable
S$14 billion dollars profits stashed neatly in Government's
treasure chest.
