Regarding MND’s response to questions raised on DBSS

Ministry of National Development (MND) responded today to Patrick Tan's letter on the Straits Times Forum titled, 'Four questions on DBSS'.

Sophia Tsang responds to MND's reply in her blog 'SpeakSpokeWriteWrote', and she says:

Let’s see. This response at best skirts the issue.

1. Land sold by open tender. This means that HDB has a reserve price – which is likely to be the marked to market price as evaluated by Chief Valuer. Hence the bidding cannot be below this price. The logical conclusion is there is a “profit” which is going to be borne by the buyers.

2. DBSS is subsidized by the government via grants. Right – for those who qualify, the maximum grant is $40 000. Check it out here. Grants for DBSS. The net effect for the buyer is a discounted property at almost private property prices with HDB limitations. Not that the discount is that large considering the price tag.

3. Ms Lee went on to describe the developer’s strategy for bidding and pricing. Err Ms Lee – whatever land the developer bids for and builds on, he is subjected to the same risks. In the case of DBSS, he has two distinct advantages – cheaper land and good location. On top of that, with pent-up demand, this blank cheque accorded to the developers is bound to cost buyers.

4. HDB does not profit from the sales of the units. Sure – but HDB allows private developers to profit, and it would seem, in no small measure, from public housing. This is something that just does not sit right nor seem quite principled.

5. DBSS offers more options and is well appreciated by buyers. MND is reviewing DBSS housing options. If the former is true, why bother with the latter?

Ms Lee, if you hear the grouses properly, mere semantics will not soothe. The issue at hand is that HDB imposes rules and restrictions on buyers. For private developers, they are allowed to extract as much profit as they think they can. Double standards, no? Is it for the benefit of the buyer or is it to encourage a positive business environment?

Furthermore, couples are encouraged to stay near their parents. Many parents stay in mature estate. The land for HDB in such estates is limited. This particular development is way out of reach of most Singaporeans. Sayang! At a time where many are still waiting for a house, it still appears that in whatever area, money talks.

I am beginning to understand the correlation between dignity and pay.

PS: I just read that tampines centrale has now reduced the price by up to $102k. That means the profit is way above $102k per unit?

The original letter:

MND's reply: