ValueBuddies.com : Value Investing Forum - Singapore, Hong Kong, U.S.

The Straits Times
www.straitstimes.com
Published on Mar 18, 2013
BTO flat buyers face longer wait amid labour and supply strains

By Esther Teo Property Correspondent

HOME buyers might have a longer wait for the keys to their Build-To-Order (BTO) flats.

A combination of the construction industry labour crunch and a ramp-up in the Housing Board's building programme is stretching the completion period for new BTO projects by several months.

The private sector has already taken a hit as contractors push back deadlines and take longer to complete projects, as the industry struggles with fewer workers.

And this seems to have affected the Housing Board sector as well, with estimated waiting times for some recent standard BTO projects of 20 storeys and below being stretched to as long as 43 months.

The National Development Ministry said in 2010 that the waiting time - from booking a flat to collecting the keys - for such BTO projects launched after the middle of 2011 would be about 2 1/2 years, or 30 months.

But this seems to be no longer the case, despite the Housing Board moving to a building "ahead of order" system.

A quick check of January's BTO launches shows that estimated completion times for projects of under 20 storeys range from 32 to 43 months.

For bigger projects - with more storeys and units - the waiting time stretches to as long as 58 months, or nearly five years.

The 1,058-unit Fengshan Greenville in Bedok, for instance, comprising eight blocks that are 16 to 19 storeys, has an estimated waiting time of 54 to 58 months for some of its blocks.

But even for typical standard BTO projects comprising five blocks of not more than 20 storeys, the 30-month timeframe seems unlikely to be met.

Tampines Greenforest, for instance, comprising 424 units in four blocks of 15 storeys each, has an estimated waiting time of 35 to 37 months. It was launched in January this year.

Similarly, Punggol Opal with four 17-storey blocks comprising 526 units also has a waiting time of 35 to 38 months, while GreenTops @ Sims Place in Geylang - a 19-storey block with 338 units - is expected to take 36 to 38 months. Both were launched in last July's BTO exercise.

A Housing Board spokesman noted that the construction time for each project depends on many factors, such as the complexity of the design features, soil conditions and other site constraints.

For standard BTO projects of 20 storeys and below completed from 2010 to last year, however, the average construction time was 30 months, he said.

Accountant K.C. Lee, 27, applied for a five-room flat at Keat Hong Mirage in Choa Chu Kang last November. The 1,159-unit development has an estimated waiting time of 39 to 43 months.

Mr Lee said that while the waiting time is quite long, it works for him. "It also gives me some time to get our finances ready for expenses like the honeymoon, renovation and deposit.

"But the long waiting time of three to four years might cause unpredictability for some relationships. I'm sure there are also some buyers who want a ready flat sooner so that they can start leading private lives."

esthert@sph.com.sg

Like that sure gg or possibly turn pg (purple). So what if Khaw rams up new launches and claimed success in the numbers? Basically, the numbers will not materialise until after a huge lag. If not manage carefully, when the supply arrives, a potential glut may just materialise.

(18-03-2013, 07:51 AM)Musicwhiz Wrote: [ -> ]The Straits Times
www.straitstimes.com
Published on Mar 18, 2013
BTO flat buyers face longer wait amid labour and supply strains

By Esther Teo Property Correspondent

HOME buyers might have a longer wait for the keys to their Build-To-Order (BTO) flats.

A combination of the construction industry labour crunch and a ramp-up in the Housing Board's building programme is stretching the completion period for new BTO projects by several months.

The private sector has already taken a hit as contractors push back deadlines and take longer to complete projects, as the industry struggles with fewer workers.

And this seems to have affected the Housing Board sector as well, with estimated waiting times for some recent standard BTO projects of 20 storeys and below being stretched to as long as 43 months.

The National Development Ministry said in 2010 that the waiting time - from booking a flat to collecting the keys - for such BTO projects launched after the middle of 2011 would be about 2 1/2 years, or 30 months.

But this seems to be no longer the case, despite the Housing Board moving to a building "ahead of order" system.

A quick check of January's BTO launches shows that estimated completion times for projects of under 20 storeys range from 32 to 43 months.

For bigger projects - with more storeys and units - the waiting time stretches to as long as 58 months, or nearly five years.

The 1,058-unit Fengshan Greenville in Bedok, for instance, comprising eight blocks that are 16 to 19 storeys, has an estimated waiting time of 54 to 58 months for some of its blocks.

But even for typical standard BTO projects comprising five blocks of not more than 20 storeys, the 30-month timeframe seems unlikely to be met.

Tampines Greenforest, for instance, comprising 424 units in four blocks of 15 storeys each, has an estimated waiting time of 35 to 37 months. It was launched in January this year.

Similarly, Punggol Opal with four 17-storey blocks comprising 526 units also has a waiting time of 35 to 38 months, while GreenTops @ Sims Place in Geylang - a 19-storey block with 338 units - is expected to take 36 to 38 months. Both were launched in last July's BTO exercise.

A Housing Board spokesman noted that the construction time for each project depends on many factors, such as the complexity of the design features, soil conditions and other site constraints.

For standard BTO projects of 20 storeys and below completed from 2010 to last year, however, the average construction time was 30 months, he said.

Accountant K.C. Lee, 27, applied for a five-room flat at Keat Hong Mirage in Choa Chu Kang last November. The 1,159-unit development has an estimated waiting time of 39 to 43 months.

Mr Lee said that while the waiting time is quite long, it works for him. "It also gives me some time to get our finances ready for expenses like the honeymoon, renovation and deposit.

"But the long waiting time of three to four years might cause unpredictability for some relationships. I'm sure there are also some buyers who want a ready flat sooner so that they can start leading private lives."

esthert@sph.com.sg

They simply shift this blame to those who opposed more FWs. Khaw is a good taiji master.

Any further delays in BTO supply will just result in prompt demand pressure flowing onto the resale market.

Look for the index to continue inching up, unless a major economic slowdown arrives to temper prices in a meaningful way.

Poh Lian $60m in the red 'due to mismanagement'
http://www.valuebuddies.com/thread-3003.html

Four of these are still profitable: St Anthony's School, H2O Residences in Sengkang West and two HDB Build-to-Order projects in Bukit Panjang - Segar Grove and Senja Gateway.

It looks like a ploy.

1) Delay the launch in order to cut back the supply; hence, raise the demand.

2)Blame the lack of FW for the delay so that there will be pressure to increase the FW; hence, raising the demand.

Either way, the property developers will win.

(18-03-2013, 01:17 PM)natnavi Wrote: [ -> ]It looks like a ploy.

1) Delay the launch in order to cut back the supply; hence, raise the demand.

2)Blame the lack of FW for the delay so that there will be pressure to increase the FW; hence, raising the demand.

Either way, the property developers will win.

what to do? we are just small fry

Call it whatever we want but it is a fact that few citizens want to do the hard work in construction so our infrastructure building (roads, trains lines, hospitals, housing, plants on Jurong Island, etc) depends on FW.

maybe next time all BTO must upfront put which developer in charge for that BTO

The real issue here is not whether Singaporeans are willing or not willing to do the work but rather, is the employer willing to compensate the Singaporeans enough to do such work. I am sure if you pay citizens >$5000/mth to be a construction worker, they would be plenty of people who will come into the construction line. It goes the same with cleaners. If I own a company, and I pay my cleaners $4000/mth to work 8 to 5, 5 days a week, how many Singaporeans do you think will apply for this post? I am sure I will be receiving plenty of resumes.

Yes, one can argue that then the developers' cost will go up because wages are up. However, If developers are willing to invest in new technologies to improve productivity, they can still earn a healthy amount of profit margin with much less workers.

Take a look at how other developed countries build their buildings? Did they employ FW to do the work? Do these construction workers get paid "peanuts"? I would say surely not. Do they employ as many construction workers to build a similar buildings? Surely not because they have invested the right amount of money in the proper equipment.

When companies are given an option to choose between hiring cheap FW or to invest in proper equipments to improve productivity, companies will tend to pick the easy way out. That is to hire cheap FW. If companies are restricted to hire FW, companies will then have to rethink, and they will need to improve productivity, else, they will a company stuck with 3rd world equipment to produce work.

If Singapore wants to improve and move up, it will need to jack up its productivity.

(18-03-2013, 02:01 PM)egghead Wrote: [ -> ]Call it whatever we want but it is a fact that few citizens want to do the hard work in construction so our infrastructure building (roads, trains lines, hospitals, housing, plants on Jurong Island, etc) depends on FW.