Home > Singapore Scene > Regarding MND’s response to questions raised on DBSS

Regarding MND’s response to questions raised on DBSS

The full response is copied below.

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.


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?


Reply from MND re the four questions asked by Patrick Tan to ST on 21 june 2011


Ministry to review DBSS housing option

MR PATRICK Tan asked four questions on Design, Build and Sell Scheme (DBSS) flats (‘Flat pricing: Four questions on DBSS’; yesterday).

They are good questions.

Land for DBSS flats is sold via open tender to private developers.

DBSS flat buyers are indeed subsidised by the Government, but they receive their subsidy directly through the Central Provident Fund housing grants.

In bidding for the land, developers will have to take into account the demand and the prices they will charge for their flats. If they over-bid, they will make a loss on the project. If they over-price their flats, they risk poor demand.

In the case of Centrale 8 at Tampines, Sim Lian, the developer, won the tender last year at $260 per sq ft.

In accordance with the contractual terms when it tendered for the land, the developer has the flexibility to price the units. HDB does not dictate their prices nor profit from their sales.

The DBSS scheme was introduced in 2005 to offer greater choice and wider variety to meet the housing aspirations of higher-income flat buyers for better design and finishes. So far, 5,500 DBSS units have been built and sold. They make up a small proportion of public housing, but are well appreciated by the buyers.

As part of the overall review of housing policies, the Ministry of National Development will be reviewing the DBSS housing option.

Lee May Gee (Ms)

Deputy Director, Housing Division

Ministry of National Development

  1. Ethan
    June 22, 2011 at 3:03 am

    Actually I don’t know what is wrong with Singaporeans. If it is too ex, then don’t buy. Whether the land is sold for private developments (eg: Condo) or tender out for HDB, they want profits. That is logical. The illogical thing is people complain and complain about a higher grade of HDB. Well, if you want higher grade, then pay for it. Are we going to complain next that restaurants earn profits at the expense of citizens?

  2. RC
    June 22, 2011 at 5:40 am

    Ethan, housing market is not the same as retail or F&B. Property prices are intertwined with many things. It is not simply about walking away especially if we are talking about public housing here. Once prices are inflated, while some will walk away others will come forward due to pent up demand. Such inflated prices have ripple effect on the pricing of the public housing market as a whole. When new developments are launched, new benchmarks will be used and unless something serious happen to cause a correction, it will continue to climb. The same benchmarks will also impact subsequent valuation of resale and new HDB flats. Remember, we are talking about public housing and NOT private development here.

  3. June 22, 2011 at 6:45 am

    HDB does not profit from the sales of the units . Does HDB profit from the sale of land ? SimLian got the land from HDB at SGD 260psf , how much did HDB get it from previous owner of the land ?

  4. Leong
    June 22, 2011 at 7:46 am

    Normally it would not have been so much of a problem if HDB had not sanction such marketting under ‘HDB public housing’ and offered housing grants for the sale of such units. But the problem sets in when the private developer is allowed a free hand to determine its sales prices of the units thus maximise its profits while at the same time enjoys a marketting discount offered by the govt in the form of a housing grant to eligible buyers. Which private developer is allowed a free hand to set its prices and yet are eligible for housing grants to help in the sale of their units ?

    Now not too long ago we were lectured that if HDB were not take into account prevailing land cost in the pricing of its HDB flats, it will be considered as a loss of revenue for the govt as it will represent a subsidy in the units. Why is itt hen that such housing grants granted to buyers of DBSS flats not considered as a loss of revenue for the govt when there is no control over the prices of such units by the private developer ?

    Can we not liken it now as public taxpayer’s monies in the form of grants being utilised to sponsor the private developer’s marketting of such units ? Isn’t the PAP govt shooting their leg again with this kind of policies ?

  5. SpeakSpokeWriteWrote
    June 23, 2011 at 7:23 am

    2x oversubscribed…. we cannot raid the reserves, but if people willingly open their wallets to us, we say thank you, even if private businesses gain the lion share!

  1. June 22, 2011 at 4:18 am

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