By Leong Sze Hian
I refer to the article “BTO prices will not rise with resale market: Khaw” (Straits Times, Feb 1).
BTO de-linked from resale prices?
It states that “National Development Minister Khaw Boon Wan today made clear that he has de-linked the prices of new flats sold by HDB from the resale flat market.
He has done this ever since he took over the housing portfolio in 2011 to ensure that Build-to-Order (BTO) flats remain affordable despite the rising resale market, he said.
Speaking to reporters at the HDB hub on Thursday morning, he noted that BTO prices across HDB’s new launches in the past 18 months have been stable, although prices of resale flats have been steadily climbing.”
Why only announce now?
Since the prices of new flats have been delinked from resale prices since mid 2011, why did we wait more than one and a half years to tell Singaporeans of this significant policy change?
Why wasn’t such good news announced before the Punggol-East by-election?
In a reply in parliament in November, it was said that “the overall BTO prices have increased by 12 per cent since January 2009.
This is despite the 34 per cent increase in the HDB Resale Price Index (RPI) over the same period.”
So, why was this “delinking of prices” policy change not mentioned in November in the parliamentary reply?
The parliamentary reply seems to imply that new flats’ prices have been moderated against resale prices, rather than delinking.
Breakdown of BTO prices?
We should be given a detailed breakdown of BTO prices since mid 2011, instead of just a statement that “BTO prices across HDB’s new launches in the past 18 months have been stable, although prices of resale flats have been steadily climbing”.
Affordability index should decline?
Also, the HDB’s affordability index which is first-timers buying flats in non-mature estates using about 23 per cent of their monthly income to pay for their housing loans, seems to have been creeping up from about 21 per cent.
If new flats’ prices have been kept “stable”, and presumably first-timers’ incomes have been increasing, shouldn’t the affordability index be declining?
“Chicken rice” analogy?
As to “This means that the subsidy that the Government is giving for the construction and sale of new flats has been growing”, allow me to use the “chicken rice” analogy.
If the restaurant has been increasing the price of chicken rice to $5, and you also increase your price to $3, even though your cost is $1, you then say that you are giving a subsidy of $2 to the customer.
All of a sudden now, you say that you will delink your price from the restaurant’s price, and will keep your price “stable” at $3.
Are you giving a subsidy or still making money?
Breakdown of construction and land costs?
Anyway, now that new flats’ prices have been delinked, isn’t it the right time now to disclose the breakdown of the construction and land costs?
Pay for extras?
I saw a posting in a newspaper forum page discussion thread which said “but HDB remove some standard finishing from some BTO flats. Previously for premium BTO flats, floor tiles/wooden flooring is included in the purchase price. But now buyers have to top up for floorings, bathroom equipments and even partition walls. After adding all these optionals, it is definitely more expensive to own a flat now than 18 months ago. And HDB have the practice of marking up prices at subsequent re-launches even though they are exactly the same units”. Of course, I am unable to verify what was said in this posting.