View Full Version : 'Shoebox' units: Govt will step in if necessary, says Khaw
'Shoebox' units: Govt will step in if necessary, says Khaw
The authorities could intervene if there is excessive supply
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by Cheow Xin Yi (http://forums.condosingapore.com/)
04:46 AM May 03, 2012
SINGAPORE - The Government is monitoring the sales of so-called "shoebox" apartments and may step in if there is excessive build-up of such units, National Development Minister Khaw Boon Wan said yesterday.
Speaking at a dialogue organised by government feedback agency REACH, Mr Khaw also allayed concerns about rising prices of public flats - there is "political will" to build at least 100,000 HDB flats if necessary during the Government's current term, he said.
Last week, latest statistics from the Urban Redevelopment Authority showed that "shoebox" apartments - or units smaller than 50 sq m - made up 27 per cent of sales in the first quarter, a new high since such units were made available in the market three years ago, according to analysts.
Responding to a participant who was concerned with what he felt was the shrinking size of HDB flats - this could risk eroding family bonding, the participant said - Mr Khaw replied that, in this regard, his concern was with the private housing market.
Mr Khaw said he has been watching the sales of "shoebox" units by private developers in the past few months. Said Mr Khaw: "If the percentage becomes too (high) we may have to step in and say, 'Hey, are you sure there will be demand for it?'"
Based on the profiles of buyers of "shoebox" units, Mr Khaw said he suspects that among them are Singaporeans who see them as a good investment.
For these investors, Mr Khaw said he hoped they made the "right decision". Rental yields would be less than expected if there are too many of such units, he pointed out.
Nevertheless, he cited his recent visit to two residents in "shoebox" apartments - both of whom were single and have a pet - and noted that there are people who would be "comfortable" living in such units.
'HDB flats not shrinking'
On public flats, Mr Khaw said that, based on his checks, HDB housing norms have not changed for the past 15 years. "There's been this misunderstanding that HDB has somehow in recent years shrunk the units but we have not. If you visit our new three-room, four-room and five-room (flats), they are very comfortable."
Mr Khaw said that what the HDB has done, instead, was to start building two-bedroom units - after recognising that some of the lower income may find three-room flats unaffordable. Nevertheless, such two-room units make up a "very small fraction" of the total units on offer in each Build-to-Order project, he said.
He reiterated: "We continue to build smaller units and large units and it's the choice of consumers."
Mr Khaw also addressed concerns on rising HDB prices, with one participant suggesting that Singaporeans may have to "pay S$1.5 million for a HDB (flat) in 20 years".
In response, Mr Khaw pointed out that there is a strong co-relation between economic growth, wages and property prices.
In the short term, property prices are rising as the infrastructure cannot catch up with the rapidly growing population, said Mr Khaw. Nevertheless, the property market has seen some stabilisation, following government measures in the past year, he added.
And as Singapore's economy reaches maturity, economic growth and wages will also moderate - the latter could "even stagnate", Mr Khaw noted. This would correspondingly have an effect on property prices here.
He reiterated that the trend of rising property prices will not continue once the Government corrects the imbalance, "which will take time".
'Shoebox' units: Govt will step in if necessary, says Khaw
The authorities could intervene if there is excessive supply
http://imcmsimages.mediacorp.sg/cmsfileserver/showimageCC.aspx?124&105&f=2407&img=2407_55716.jpg&h=65&w=55
by Cheow Xin Yi (http://forums.condosingapore.com/)
04:46 AM May 03, 2012
Mr Khaw said that what the HDB has done, instead, was to start building two-bedroom units - after recognising that some of the lower income may find three-room flats unaffordable. Nevertheless, such two-room units make up a "very small fraction" of the total units on offer in each Build-to-Order project, he said.
He reiterated that the trend of rising property prices will not continue once the Government corrects the imbalance, "which will take time". Hmmm... why would more people find 3 room hdb flats unaffordable? Building more 2 room flats now and not doing anything about the fact that hdb prices are climbing much faster than salary rise, in another 5 years' time, next MND minister will have to build more 1 room flat coz most are finding 2 room flats unaffordable! Not tackling the issue at its root Mr K.
Many have already suggested that HDB take in less profit or even use the profit from the HDB loans to subsidize the building cost of HDB flats, from 1 room to EA then it'll solve the problem more directly instead of beefing up our national piggy bank... :rolleyes:
Hmmm... why would more people find 3 room hdb flats unaffordable? Building more 2 room flats now and not doing anything about the fact that hdb prices are climbing much faster than salary rise, in another 5 years' time, next MND minister will have to build more 1 room flat coz most are finding 2 room flats unaffordable! Not tackling the issue at its root Mr K.
Many have already suggested that HDB take in less profit or even use the profit from the HDB loans to subsidize the building cost of HDB flats, from 1 room to EA then it'll solve the problem more directly instead of beefing up our national piggy bank... :rolleyes:
and you'll be accused of raiding the nation's reserves. singapore needs gazillions of trillions worth of secret reserves
ikan bilis
03-05-12, 10:05
OMG! OMG! Cow is going to kill all the mickeymouse soon, better go grab few mickeymouse and keep as pets before they become endangered species …. :scared-4:
and you'll be accused of raiding the nation's reserves. singapore needs gazillions of trillions worth of secret reservesStill contributing to it lah... just about couple of hundred million less a year lor... :D
phantom_opera
03-05-12, 10:09
No lah, he is giving warning to developers not to increase the % of MMs in a project further... if less than 30% acceptable, if 50% all MMs than he will do something
In fact if he bans MMs right now .. those who hold MMs right now will HUAT 10X, so the more reason you should chiong to buy :)
even if there's a ban now, i think it's too late and too little done. we have long known that MMs put a positive skew on the psf prices.
should have nipped it in the bud long time ago
If shoebox units continue to be bought at a crazy rate, Khaw will likely come up with some counter measures.
Either (1) limit the no of shoebox units at a new launch (say max 20%) or (2) impose ABSD on shoebox units, say at 10-15%.
FilthyRich
03-05-12, 10:20
shoebox houses are for ppl who want to invest.
The problem arises when more Singaporean purchase these private houses and rent it to the FT. Encourage more FT to come and live in Singapore, than complain bout high housing prices and FT stealing their jobs.
Who's making their life so comfortable in Singapore. We are.
No lah, he is giving warning to developers not to increase the % of MMs in a project further... if less than 30% acceptable, if 50% all MMs than he will do something
In fact if he bans MMs right now .. those who hold MMs right now will HUAT 10X, so the more reason you should chiong to buy :)Well if 27% are MM sized apartments, then 73% are 2 bedder, 2+1, 3, 3+1, 4 and even 4+1 (inclusive of all penthouses) and assuming an average split among them, then each will be about 13% (less than half of 27%) not withstanding that some MM units include 2 bedders too. Like that other units are even more precious leh coz less and less in market... Lol. I seriously doubt MM units will be curtailed. Maybe moderated only lah. :cool:
ikan bilis
03-05-12, 10:23
If shoebox units continue to be bought at a crazy rate, Khaw will likely come up with some counter measures.
Either (1) limit the no of shoebox units at a new launch (say max 20%) or (2) impose ABSD on shoebox units, say at 10-15%.
results....
1) shoebox price will shoot up more...
2) at what size is shoebox?... e.g. if mnd says 550sqft is MM, then developers all build 551sq ft....
:D
shoebox houses are for ppl who want to invest.
The problem arises when more Singaporean purchase these private houses and rent it to the FT. Encourage more FT to come and live in Singapore, than complain bout high housing prices and FT stealing their jobs.
Who's making their life so comfortable in Singapore. We are.
agree.....these are the ppl who only know to complain with no sense. ig govt continue to cater to these group.....we will be DONE very fast....they may gain more vote at the expense of jeopardising singapore's competitiveness
I propose an outright ban of all launches of MM < 500 sqft :D
In fact, they alr introduce the MM controls at Joo Chiat, TK and Kovan
In all parts of Singapore.
In all parts of Singapore.
I think they will. They would want to control the size.
So the next question is, if this is done, then those alr bot MM units will be Huat alr...as no more new supply in the market...
So in short, buy MM now before new measures
logical conclusion
the key word is monitoring...everything also monitoring...:doh:
I think they will. They would want to control the size.
So the next question is, if this is done, then those alr bot MM units will be Huat alr...as no more new supply in the market...
So in short, buy MM now before new measures
logical conclusion
The monitoring should be referring to complaints by landed property owners against MMs in their estates. If there are more, the rules will be extended on an area by area basis. So MMs in mass market condos with good access roads will not be controlled.
Hmmm... why would more people find 3 room hdb flats unaffordable? Building more 2 room flats now and not doing anything about the fact that hdb prices are climbing much faster than salary rise, in another 5 years' time, next MND minister will have to build more 1 room flat coz most are finding 2 room flats unaffordable! Not tackling the issue at its root Mr K.
Many have already suggested that HDB take in less profit or even use the profit from the HDB loans to subsidize the building cost of HDB flats, from 1 room to EA then it'll solve the problem more directly instead of beefing up our national piggy bank... :rolleyes:
its call wealth redistribution mah. Collect more $$$ then can fund workfare, food stamps, infra and give rebates... if not $ come from where? have to fleece the sheeps to make wool mah.
"inclusive" society mah. means include everyone!
I think they will. They would want to control the size.
So the next question is, if this is done, then those alr bot MM units will be Huat alr...as no more new supply in the market...
So in short, buy MM now before new measures
logical conclusion
its already controlling min MM 1bed room size cannot be smaller then 380sqf. so what developer do? 600sqf 2 bed room. or some even 3 bed room!
results....
1) shoebox price will shoot up more...
2) at what size is shoebox?... e.g. if mnd says 550sqft is MM, then developers all build 551sq ft....
:D
MM become collector items!!!! rare!
I propose an outright ban of all launches of MM < 500 sqft :D
Developers upsize the a/c ledge to 100sqft, add up to 500< sqft. :D
regency321
03-05-12, 13:43
How does holding on to MM = "HUAT!" ?
I noticed a number of these MM units are in OCR, priced very attractively during recent launches. When the MM developments TOP, say.. 200 units up for rental at the same time... will there be a mad rush of tenants going for these MMs? seriously?
I thought it is more like musical chair, see who is holding on to the baby when the music stops. just my personal opinion, no offence to MM buyers.
Developers upsize the a/c ledge to 100sqft, add up to 500< sqft. :D
and pray tell if you may, what are you going to put on the ledge? a fridge and an air-con compressor?
How does holding on to MM = "HUAT!" ?
I noticed a number of these MM units are in OCR, priced very attractively during recent launches. When the MM developments TOP, say.. 200 units up for rental at the same time... will there be a mad rush of tenants going for these MMs? seriously?
I thought it is more like musical chair, see who is holding on to the baby when the music stops. just my personal opinion, no offence to MM buyers.
As long u are optimistic and have the won't be me mentality its a HUAT!
regency321
03-05-12, 13:53
As long u are optimistic and have the won't be me mentality its a HUAT!
Fortunately the MM quantum is low, I don't think any buyers will go bankrupt over these even if there was a crash. But demand for OCR MM is unknown, so it is really either a big "HUAT !" or big fail.
and pray tell if you may, what are you going to put on the ledge? a fridge and an air-con compressor?
A/c ledge not incl in GFA, some developers got creative. See Lavernes Loft 37sqm but the a/c ledge is almost half the size of the bedroom, even W/D ended up in the balcony.
Sorry, no offense to Lavernes owners here.
A/c ledge not incl in GFA, some developers got creative. See Lavernes Loft 37sqm but the a/c ledge is almost half the size of the bedroom, even W/D ended up in the balcony.
Sorry, no offense to Lavernes owners here.
its not that the ac ledge is big. just that the room is tiny...
......
'HDB flats not shrinking'
On public flats, Mr Khaw said that, based on his checks, HDB housing norms have not changed for the past 15 years. "There's been this misunderstanding that HDB has somehow in recent years shrunk the units but we have not. If you visit our new three-room, four-room and five-room (flats), they are very comfortable."
......
so HDB 3room flat now versus 3 room flat 20 years ago bigger or smaller?
same for 4room,5room flats.
who ever asked Khaw about comfortability - which cannot be measured directly. :doh: sizes in square feet and square meters are definitely measurable.
If shoebox units continue to be bought at a crazy rate, Khaw will likely come up with some counter measures.
Either (1) limit the no of shoebox units at a new launch (say max 20%) or (2) impose ABSD on shoebox units, say at 10-15%. CM4MM:scared-1:
I'm very puzzled when I see this piece of news this morning.
What causes the illusion that it's the same 15yrs ago & today?
Finally, I think I found the answer.
As people get older, the body shrink so the surrounding appears larger. :D:D:D
No wonder I also find MM all appears BIG BIG. :ashamed1:
I'm very puzzled when I see this piece of news this morning.
What causes the illusion that it's the same 15yrs ago & today?
Finally, I think I found the answer.
As people get older, the body shrink so the surrounding appears larger. :D:D:D
No wonder I also find MM all appears BIG BIG. :ashamed1:
LIKE!!!!!!
'Shoebox' units: Govt will step in if necessary, says Khaw
...
Mr Khaw said that what the HDB has done, instead, was to start building two-bedroom units - after recognising that some of the lower income may find three-room flats unaffordable. Nevertheless, such two-room units make up a "very small fraction" of the total units on offer in each Build-to-Order project, he said.
He reiterated: "We continue to build smaller units and large units and it's the choice of consumers."
If it's ok to build smaller HDB units because it's the choice of consumers, why isn't it ok to build MM when it's the choice of consumers?
If it's ok to build smaller HDB units because it's the choice of consumers, why isn't it ok to build MM when it's the choice of consumers?
Well said! Agreed..
If it's ok to build smaller HDB units because it's the choice of consumers, why isn't it ok to build MM when it's the choice of consumers?
Because small HDB dont push up psf. And HDB buyers not as daft as PC buyers who only know how to look at psf...
If it's ok to build smaller HDB units because it's the choice of consumers, why isn't it ok to build MM when it's the choice of consumers?
Such statements are good during an election campaign and works.
Lets' us go deeper and ask ourselves do we want to live like what the people of Hong Kong do if given a choice? Consumers are free to make choices but in this instance, when developers are exploiting consumers by offering "cheaper" shoebox apartments knowing that people could not afford bigger units given the current high prices. They are maximizing their profits by selling more shoebox apartments instead of bigger apartments at a lower psf price.
The point here is that we the consumers are being exploited by developers without even knowing it. Sad!!!!
phantom_opera
04-05-12, 18:42
Don't agree MM is the new form of value store
Don't agree MM is the new form of value store
Better than store in banks, except for some buffer. Guarantee plus chop.
Are these shoe boxes easy to rent?
Must be only for singles....can't imagine a family living in them.
I always fret at investing in any property less than 2 beds. But I might have to change my mind now looking at the current trend..
We can complain all we want about developers making huge profit on such housing, but we cannot deny the fact that there is indeed a genuine demand for such apartment be it for own stay or for investment.
For these buyers, buying shoebox apartment is like buying mini or BMW 1series, they are not interested about the trunk space, or rear seat leg room etc, to them they are more interested about the feel and touch of the luxurious fittings and facilities,
my take is that apartment size between 500-700sqft will become a new norm in OCR as lifestyle becomes a much bigger priority for these new breed of property buyers.
Many analyst and traditional property investors are predicting a collapse of these apartment, I for one actually think that prices of such apartment will remain strong because of massive number of potential HDB upgraders waiting on the side line to "upgrade" to a PC.
So if I am in the market for an investment property, I would definitely consider getting a sub $1m apartment with around 6-700sqft targeting at potential MM and HDB upgraders.
FilthyRich
09-05-12, 09:36
It is impossible for a typical family to stay in a shoebox house,
Does not solve the current housing issue,
Encourage more foreigners coming into the country with easy access to small apartments.
and brings about a devaluation of houses.
which part of these seem beneficial to Singapore?
read an article HERE (http://www.stproperty.sg/articles-property/singapore-property-news/shoebox-units-pulling-down-value-of-new-homes/a/64275) bout how shoebox apartment is affecting Singapore
thomastansb
09-05-12, 09:44
The Government seems to have been putting a stop to those 300+ sq ft dog holes. I haven't seen them on new launches for some time. Maybe URA has been silently rejecting their proposal.
It is impossible for a typical family to stay in a shoebox house,
Does not solve the current housing issue,
Encourage more foreigners coming into the country with easy access to small apartments.
and brings about a devaluation of houses.
which part of these seem beneficial to Singapore?
read an article HERE (http://www.stproperty.sg/articles-property/singapore-property-news/shoebox-units-pulling-down-value-of-new-homes/a/64275) bout how shoebox apartment is affecting Singapore
We might need to redefine what is a typical family.
We might need to redefine what is a typical family.
I do not live in one as I do need space and a garden.
But I do agree with you that the typical family is indeed changing. Many more singles and DINKS. I work with young people everyday and this seems to be their attitude as well...happy go lucky, ok not to get married and have a vibrant life in the city!
more mm needed if ppl are not marrying, with higher earning power & not eligible for bto, so either mm or resale hdb
----------------------------------------------------------------------------
Warning Bell for Developed Countries: Declining Birth Rates
Lee Kuan Yew (http://search.forbes.com/search/colArchiveSearch?author=lee+kuan+and+yew&aname=Lee+Kuan+Yew), 04.20.12, 10:00 AM EDT
Forbes Magazine dated May 07, 2012
There will be a shift in power unless birth rates increase in the developed world.
In developed countries today many women receive educations and earn salaries that are on a par with those of men. The fact that women are no longer socially or economically dependent on men has radically altered young people’s lifestyles. A woman can now choose to remain single, marrying only when a man adds value to her life or when she desires to have children within such a framework.
This is creating big changes throughout the developed world. The replacement rate--the reproduction rate that keeps a population stable--for developed countries is 2.1, yet nearly half the world’s population has birth rates lower than that. The U.S. has a total fertility rate (TFR) of 2.0--nearly the replacement rate--with Hispanic immigrants leading in birth rates. The U.S. is aging but not as fast as many other countries. A 2010 census showed that 31.4 million Americans live alone--27% of all households (equal to the percentage of childless couples). Living alone allows people to pursue individual freedom, exert personal control and go through self-realization, but these people have fewer children.
Western European countries have low fertility rates, below the replacement rate of 2.1. Germany: 1.4 (its total population is 81.9 million, of which 8.2% are foreigners). Holland: 1.8 (16.5 million, of which 4.4% are foreigners). Belgium: 1.8 (10.8 million, of which 9.8% are foreigners). Spain: 1.4 (46.1 million, of which 12.4% are foreigners). Italy: 1.4 (60.2 million, of which 7.1% are foreigners), the Pope’s views notwithstanding. Sweden, which provides deep support for parents, has a high TFR of 1.9 (9.4 million, of which 6.4% are foreigners), but that’s still below the replacement rate. Ireland and the U.K. also have high TFRs, at 2.1 and 1.9, respectively, but these rates are derived from non-European immigrant parents.
During the 21st century the U.S. could become the slowly aging leader of a rapidly aging world.
Singapore’s experience is no different from that of these countries. Our birth rates have been steadily declining. The fertility rate of the Chinese segment of our population is the lowest, 1.08 (2011), with the rate for Indians 1.09 and for Malays 1.64. In other words, the size of each successive generation of Chinese Singaporeans will halve in the next 18 to 20 years.
To have babies is, of course, a personal decision, but for a nation’s population that decision carries considerable consequences. The education of our women and their ability to be high-income earners have altered social behavior and led to marriages later in life. But when women put off having children until their mid-30s, they have fewer children.
In Singapore in 2011 seven working adults supported one retiree. By 2030, 2.3 working adults will have to support one retiree. We have more than 340,000 people over the age of 65, with 2.36 million people between the ages of 15 and 64. By 2030 we will have 900,000 over the age of 65, with only 2.04 million working adults between the ages of 15 and 64.
Many women are deciding to either put off getting married or remain single. It’s a grave problem that finds 44.2% of Singaporean men and 31.0% of women between the ages of 30 and 34 single. Marriage rates in 2011 fell across all the below-30 age groups, with the greatest drop in the 25- to 29-year-old group. Hence, the number of children born has decreased drastically.
When I first became prime minister in 1959, more than 62,000 babies were born that year--and Singapore’s population was half that of today’s. Low fertility and an aging population are two of our greatest concerns. In the future we will have to depend on immigrants to make up our numbers, for without them Singapore will face the prospect of a shrinking workforce and a stagnant economy. Fewer young people means fewer new cars, stereos, computers, iPhones, iPads and clothes will be sold, not to mention that there will be fewer customers to partake in fine dining--and all the ancillary businesses.
To encourage marriage and parenthood, Singapore’s government has instituted a wide array of measures: improved accessibility to quality child care, leave entitlements for new mothers and parents of young children, and financial incentives to help defray the costs of raising children. We created a special account for each child in which parents’ savings have been matched, dollar for dollar, by the government, with caps ranging from $6,000 to $18,000, depending on the birth order of the child. This was done to encourage parents to have three or four--or more--children.
http://www.forbes.com/forbes/2012/0507/current-events-population-global-declining-birth-rates-lee-kuan-yew.html (http://www.forbes.com/forbes/2012/0507/current-events-population-global-declining-birth-rates-lee-kuan-yew.html)
Still, it is better to force them to buy bigger unit so that they have space for at least 1 additional kid (as space is there, regardless they use or not). However, shoebox units definitely discourage married couples to not have kids as there are just no more space for the additional even 1 kid! :tsk-tsk:
Furthermore, shoebox units definitely discourage married couples to live with parents - Excuse: No space in our house! bad bad bad! :simmering:
I do not live in one as I do need space and a garden.
But I do agree with you that the typical family is indeed changing. Many more singles and DINKS. I work with young people everyday and this seems to be their attitude as well...happy go lucky, ok not to get married and have a vibrant life in the city!
I do not live in one as I do need space and a garden.
But I do agree with you that the typical family is indeed changing. Many more singles and DINKS. I work with young people everyday and this seems to be their attitude as well...happy go lucky, ok not to get married and have a vibrant life in the city!
As a saying goes if you cant beat them, join them. And I honestly think this is going to be trend forward for many years to come.
shoebox units are definitely putting downward pressure on bigger apartments.
I do not live in one as I do need space and a garden.
But I do agree with you that the typical family is indeed changing. Many more singles and DINKS. I work with young people everyday and this seems to be their attitude as well...happy go lucky, ok not to get married and have a vibrant life in the city!
Agree. Oldies need to get wit da times man and wake up their moldy ideas!!!!!
" Fewer young people means fewer new cars, stereos, computers, iPhones, iPads and clothes will be sold, not to mention that there will be fewer customers to partake in fine dining--and all the ancillary businesses."
Why does Harry have that idea?
I have many 55yo and above on my grindr
Great Singapore Sale - you see mostly aunties going at the sales carts
And fine dining - isnt that what more senior folks do, as they have more time and money? The young club and pub, sir...
Actually, I dont understand the debate on shoebox units (have to stop using MM after watching The Nooose last night!).
If there is demand, there is supply.
Many of these units are now TOP-ed. And people can see for themselves what are they buying. I think the naiviety of buyers is overstated.
If people can stay in a 350 sqft unit, then let them stay lor! There is something call personal choice.
Some like to buy nice cars stay HDB, some like to buy nice house, take MRT. And for tenants, thats even a clearer picture. If you can find tenants to rent your 350 sqft unit for a high price, then it is a profitable investment !
Personally, I am not very much for SBU (ShoeBox Unit). But the trend of decreasing personal space in developed cities like Manhattan, HK, Tokyo, etc proves to us that there is no escaping this trend. Whether Sg will be an exception is for us to see.
I think it is a no brainer that given a choice, who wants to stay in a 350 sf SBU when they can pay the same and stay in a 650 sf normal studio ?
DKSG
Tanks everybirdy tanks... Esp my no. 1 dksg
The whole anti MM thing is just people refusing to accept the truth and blindly believing that psf is everything and only know how to assess price and value based on psf and psf only... and then find a convenient scapegoat for all the market ills they perceived such as forever escalating prices.
They naively think that without high psf benchmarked by small units the developers will price the regular or large units cheaper.
A movie ticket costs the same be it at a theatre situated in a heartland mall or right smack in Orchard.
Many still fail to understand the concept of market price.
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