Prices slashed after DBSS flats uproar

[mr funny]

http://www.businesstimes.com.sg/sub/...72740,00.html?

Published June 22, 2011

Tampines DBSS: prices of up to $778k


SIM Lian Group yesterday said that flats at its Centrale 8 public housing project in Tampines will sell for up to $778,000 - lower than the previous indicative top price of $880,000.

The property group, which is developing Centrale 8 under HDB's design, build and sell scheme (DBSS), has priced three-room flats from $389,000 to $445,000; four-room flats from $511,000 to $592,000; and five-room flats from $685,000 to $778,000.

Sim Lian said that the prices take into account resale prices of HDB flats in the same vicinity (taking into account the age and location); prevailing economic conditions; and the project's proximity to transport network, good public facilities and other amenities.

The developer came under fire last week after news reports said that the most expensive five-room flats at Centrale 8 will sell for $880,000. Sim Lian replied then that prices were only 'indicative' and will be firmed up closer to the actual booking date in July.

'It is regrettable that during the application period, the media and members of the public did not take note of our repeated public emphasis that the price range which we had announced was only an indicative price range, and would not be the final sale prices for the respective types of flat units,' it reiterated yesterday in a statement.

Flats sold under DBSS are offered to buyers under HDB's eligibility conditions. But the developers who buy such sites have some flexibility in designing, pricing and selling the flats.

[mr funny]

http://www.straitstimes.com/PrimeNew...ry_682389.html

Jun 22, 2011

Prices slashed after DBSS flats uproar

Five-room units drop from $880,000 to $778,000 now

By Cheryl Ong


DEVELOPER Sim Lian Group has slashed the prices of its Design, Build and Sell Scheme (DBSS) flats at Centrale 8 in Tampines by up to $102,000.

The move follows the public outcry at the record prices of the designer Housing Board (HDB) units launched last Thursday, when the developer asked $880,000 for the biggest five-room flats.

Outraged buyers complained to the Ministry of National Development (MND) and minister Khaw Boon Wan, who on Saturday wrote in his blog that consumers who thought the prices too high should give the flats a miss.

Others accused Sim Lian of profiteering, pointing out that while it did not pay a record sum for the land for Centrale 8, it priced the project at record prices of up to $750 per sq ft (psf).

They wanted MND to tell the developer to lower the prices, something the ministry said it could not do because under the DBSS, developers are free to set prices for the finished flats.

Sim Lian's announcement last night that it would cut Centrale 8 prices came hours after the ministry said in a letter to The Straits Times Forum Page that it would be reviewing the DBSS as part of its overall review of housing policies.

Last night, Sim Lian released what it called the 'confirmed price range' of its Centrale 8 units.

Three-room units now cost up to $445,000, down from $510,000. Four-room ones now cost a maximum of $592,000, down from $683,000. And five-room units will now cost up to $778,000, or $663 psf.

The price cuts still keep its five-room units at a record high for DBSS launches, but much closer to the maximum of around $720,000 for five-room flats at previous DBSS launches like The Peak@Toa Payoh and City View@Boon Keng, and $739,000 at Bishan's Natura Loft.

Sim Lian said it arrived at the new prices by taking into account resale prices of HDB flats in the area, the prevailing economic conditions and proximity to the transport network, good public facilities and other amenities.

It also commented on the backlash from the public since it released the initial prices of its units.

'It is regrettable that during the application period, the media and members of the public did not take note of our repeated public emphasis that the price range which we had announced was only an indicative price range, and would not be the final sale prices for the respective types of flat units,' said the statement.

It is the first developer to date to cite 'indicative prices' for a DBSS launch, only to lower them by so much within a week.

Sim Lian Group was the first private company to work with the HDB in 2005 on the pilot DBSS project, The Premiere, also in Tampines.

The Singapore Exchange-listed company's core businesses are construction and property, and its construction arm has been doing contracts for HDB flats for more than 30 years.

The hefty discounts took industry watchers by surprise. Some asked how Sim Lian could have arrived at its original indicative price range, if confirmed prices eventually turned out so much lower.

Said SLP International head of research Nicholas Mak: 'It is a sign that they are bowing to public pressure. It is a lesson to the other developers when it comes to pricing their own products.'

Said PropNex chief executive officer Mohamed Ismail: 'Definitely, I think that Sim Lian's reduction of the price is demonstrative of the fact that people are not prepared to pay such high prices for the flats, whether they are the intended sale prices or not.'

Indeed, MND warned in its letter to the Forum Page that DBSS developers which overprice their flats risk getting a poor response from buyers.

DBSS flats were first introduced in 2005 to offer more choices and variety to meet the demands of higher-income flat buyers.

Since then, 5,500 DBSS flats have been built and sold, or 916 units a year.

In comparison, HDB has launched more than 60,000 Build-to-Order (BTO) flats since the BTO scheme was introduced in 2001, which works out to about 6,300 units launched every year.

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