BTO launch near DBSS site upsets some

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#1
The Straits Times
Mar 21, 2012
BTO launch near DBSS site upsets some

BTO units usually cheaper, so some who opted for DBSS flats are unhappy

By Daryl Chin

LAST October, EL Development launched the Trivelis - a Design, Build and Sell Scheme (DBSS) project - in Clementi.

About 80 per cent of the 888 units of these public flats built by the private developer have been snapped up. Prices averaged $650 per sq ft.

In January this year, the HDB announced that a Build-To-Order (BTO) project of 670 units would be rolled out in Clementi - right next to Trivelis.

The news has made Trivelis buyers like Mr Low Tian Chye all hot and bothered. The businessman had booked a five-room unit for $706,000, and is now having second thoughts.

The reason? BTO flats, built by the HDB, are usually priced lower than DBSS ones.

Analysts said prices in the Clementi BTO project could be as much as 25 per cent cheaper than its DBSS neighbour.

However, they also warned that those who drop out run the risk of not getting the BTO units when they are put up for sale - given the popularity of Clementi as a mature estate.

Mr Low, 65, said: 'I didn't mind paying the $706,000 as the location is good but I would have gone for the BTO flats if I had known earlier.'

He has not yet exercised the option to buy his Trivelis unit. If he pulls out now, he will lose 1.25 per cent of the purchase price, or $8,900. If he had already exercised the option, the penalty would be 20 per cent of the cost of the flat.

EL Development's spokesman Lim Yew Soon said about 100 others who had booked a Trivelis unit have also not exercised their options.

Mr Lim said that, so far, two Trivelis buyers have pulled out of the deal and paid the 1.25 per cent penalty, citing the upcoming BTO launch as a reason.

The reason for the rest who have backed out - about 23 others - was linked to financial and eligibility factors.

Mr Lim is aware of the unhappiness on the ground, having received numerous e-mail from applicants. He said, however, that EL Development found out about the upcoming BTO project only in January, 'the same as everybody else'.

Dennis Wee Group spokesman Lee Sze Teck said it is rare for new flats to be launched close to DBSS units as the latter are generally in better locations such as mature estates. 'This could be a side effect of the Government's move to have more new flats in mature estates.'

At the Trivelis, three-room flats cost from $375,000 to $470,000, four-room units from $530,000 to $650,000, and five-room types from $658,000 to $770,000.While the exact prices are not out yet, analysts said the BTO flats might be up to 25 per cent cheaper.

'But, bear in mind, these are not apple- to-apple comparisons,' said PropNex chief executive Mohamed Ismail. 'A person who buys the cheaper BTO flat might still need to dip into his cash reserves to spend on renovations if the finishings are not as nice as the Trivelis'.'

He added that a Trivelis unit is a surer bet than the Clementi BTO, which will likely be oversubscribed.

Meanwhile Mr Low has not yet decided which road he will take. He hopes, however, that the developer will consider giving some 'discounts or concessions, to make the decision easier'.

darylc@sph.com.sg
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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#2
dbss vs bto...

dbss buyers are not too sure what they actually BROUGHT! :O
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 
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#3
Buyers who bought a dbss flat in an estate with lots of amendities must be very happy with their good fortune. Then they discovered others can buy a bto flat near by. The happiness turned into upset.
So pull out of the dbss to apply for the bto, no more upset.
Fail to get the ballot for bto selection, upset again.
Buy the dbss again, back to happiness.

No wonder there are some discussions about absolute happiness and relative happiness recently Smile
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#4
Just two words for everlasting happiness and contentment - Don't Compare! Tongue
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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#5
i think we have to compare... so that we know what is valued, and what is kanna chopped! Tongue
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 
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#6
This is the classic 'Keep up with the Tans' syndrome. Or maybe a case of 'bargain envy'. Or maybe the one that goes 'Want cheap. Want fresh. Want XXX' (You know what I mean)

I actually think those who applied DBSS has nothing to be upset about; given that higher quality of their finishes. So all else being equal, you would expect their valuations to far exceed those of vanilla BTO flats in the long run.
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