Why Build Flats When So Many Units Unsold?

Source : The Straits Times, Monday, October 8, 2007

Lawrence Ng Wai Chun

I READ with renewed surprise that the HDB will build even more flats (’Govt to boost supply of homes’; ST, Oct 2), even as many blocks in Jurong West remain fenced up and unsold and many individual units in my block and neighbouring blocks remain unsold.

The HDB should be responsible in its building programme as resources should be well used.

Who bears the brunt of these bad decisions in which poor planning led to these unsold flats? Buyers like me who collected my keys more than eight years ago when demand was so high I had to queue. I paid $387,000 for my HDB executive flat.

When I wrote previously to ST Forum about high prices, I was told they were subsidised and based on real cost of construction and so on. Well, guess what. Over the past 12 months, the HDB has sold the same types of flats including some in the same block as mine at about $260,000. Has their value dropped so drastically in eight years? Or does the costing now get some subsidy from elsewhere to allow the flats to be sold so cheaply?

Now, original buyers are unable to sell their second- hand flats, because the HDB is selling ‘new’ ones in the same block at more than $100,000 less than what we paid. The HDB has effectively taken the bottom off the resale market for new home owners who qualify to buy directly from it, leaving a much smaller group of resale buyers who do not meet the guidelines for direct HDB purchase. These buyers are willing to pay a little more but are unwilling to pay a decent price since the HDB set the ‘new’ sale benchmark.