Tag Archives: Pinnacle @ Duxton

Are homes affordable?

Posted on 27 Sep 2009 | Comments Off on Are homes affordable?

About a year ago, in a special report, I waded into the debate over the affordability of public flats.
The prices of Pinnacle@Duxton’s five-room units, which hit $645,000, sparked the debate on the affordability of Singapore’s public flats. — ST PHOTO: CHEW SENG KIM

The issue had been sparked by the relaunch of Pinnacle @ Duxton last September. With prices of its five-room units reaching $645,000, the Pinnacle has become Singapore’s costliest public housing project.

At that time as well, condo-style flats under the HDB’s Design, Build, and Sell Scheme (DBSS) were going for over $700,000 for the bigger units.

Indignant home buyers flooded The Straits Times Forum with letters on what they saw as an ‘upwards price spiral’ of HDB flats. Netizens also weighed in. Continue reading →

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Why we peg to market rates: HDB

Posted on 25 Sep 2009 | 1 comment

Letter from Ignatius Lourdesamy Deputy Director (Marketing & Projects) for Director (Estate Administration & Property), Housing & Development Board

I REFER to the letter “It’s not all about the numbers”, (Sept 16) by Mr See Leong Kit.

It is misleading for Mr See to use the example of flats at Pinnacle@Duxton to conclude that HDB is profiteering from the sale of public housing flats. HDB is able to recover the cost for some projects, while incurring significant losses for others. Overall, in the last three years, HDB incurred an average deficit of $1,045 million a year in its home ownership programme. This cost subsidy, which has to be financed by the Government, is reported in HDB’s audited financial statements.

Why does HDB benchmark its flat prices to market in spite of these huge deficits? Because this is the fairest way of pricing new HDB flats while ensuring equitable distribution of subsidies.

How is this done? HDB first determines a flat’s equivalent market price by taking into account various factors such as location, finishes for the flat and other attributes. This price reflects the flat’s value at the point of sale. It is what people are willing to pay in the open market. HDB then sells the flat at a significant discount, which is the subsidy given by the Government. Continue reading →

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