More choices for 'sandwich class'

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#1
I think this project is ridiculously expensive! A $900,000 apartment for those earning <$10,000 a month household income?? How much leverage will you need to take, and how long is your tenure going to be? It's scary how they price such flats, and how the newspapers keeps touting "more choices for sandwich class". Doesn't seem like much of a choice to me! Undecided

Dec 4, 2010
More choices for 'sandwich class'


It was a five-year wait that eventually bore fruit for Mr Ang Tiong Wei.

After unsuccessfully balloting for new flats directly from the Housing Board for the past few years, the 30-year-old finally clinched a unit at the newly launched Esparina Residences executive condominium in Sengkang last month.

Aggressive moves by the HDB to ramp up supply have seen new executive condominiums (ECs), such as Esparina and The Canopy in Yishun, launched recently.

The last EC launched was in 2005. There had been a hiatus in the building of ECs due to weak demand.

But the recent housing boom led the Government to release more land for ECs, which are a hybrid of public and private housing and include some condominium facilities. They are subject to HDB rules, such as a minimum five-year occupation period.

These units are targeted at helping the middle-income earners, also known as the sandwich class, by catering to households with a monthly income ceiling of $10,000.

Mr Ang, a teacher, said he gave up looking for resale flats as the cash upfront demanded by sellers, known as COV, was as high as $80,000 in some areas.

'I decided that an EC unit was the best choice, and I waited for the new supply,' he said.

The primary school teacher, whose wife is also a teacher, said he felt lucky to have secured a unit of his choice on the 14th storey.

'It was the first launch in a while, so the response was overwhelming,' he said. But the allocation of 95 per cent of the units for first-timers helped a great deal, he added.

'This measure helps because we don't have investors coming in to spoil the market.'

Prices, however, could have been lower, he felt. His three-bedroom, 1,184 sq ft unit cost $929,000 - or $899,000 after taking into account a Central Provident Fund housing grant of $30,000 that he received.
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#2
(05-12-2010, 04:57 PM)Musicwhiz Wrote: Prices, however, could have been lower, he felt. His three-bedroom, 1,184 sq ft unit cost $929,000 - or $899,000 after taking into account a Central Provident Fund housing grant of $30,000 that he received.

Wow. That's almost double of the 5rm BTO of similar size that was launched in Sengkang in Oct. What more, IMO, the Sengkang BTO has a better location than this one.

Good luck to this guy and his wife. On a positive note, they're both teachers and the govt's been raising the official retirement age. Big Grin If they're both willing to put in the hours, they could definitely make the loan more than affordable by giving tuition as well.
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#3
My God! 929,000, what is this guy thinking??? Leverage to what??

I guess, they have lots of money. I certainly will shutter to think of owning a 1 million dollar apartment that is leasehold . Its leasehold correct?

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#4
(06-12-2010, 12:47 PM)flinger Wrote: My God! 929,000, what is this guy thinking??? Leverage to what??

I guess, they have lots of money. I certainly will shutter to think of owning a 1 million dollar apartment that is leasehold . Its leasehold correct?

Yes it's leasehold 99 years, take a look here: http://theesparinacondo.com/

But there are websites touting that it's considered "cheap" as compared to other condos near MRT with 99-year leasehold selling at $1,150 psf.
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#5
Probably, I guess my paycheck has not kept up to date the current market rate. I certainly can't afford this. I am calculating so many times just to get a 4 - 5 room in areas like Yishun and Woodlands.

I certainly do not belong to the rich people in this country.
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#6
(06-12-2010, 12:53 PM)Musicwhiz Wrote: Yes it's leasehold 99 years, take a look here: http://theesparinacondo.com/

But there are websites touting that it's considered "cheap" as compared to other condos near MRT with 99-year leasehold selling at $1,150 psf.

Its cheap bcos valuation is increasing to no man's land.
It will be expensive when valuation starts dropping like flies when the critical level is reached.

Who is to determine how much that piece of property is valuated at? There isn't a "book value" to it, unless we are talking about construction cost and time and money saved due to ammenties nearby. Not easy to pin down a value to that.

B.S to the common thinking that HDB won't let this fall or that. We saw how politicians used the mantra of using HDB as investment retirement vehicles. They will change the policy once their seats of power is disrupted.
Its a case of either pain now or more pain later.

HDB should be a distinct property class not marked to private properties. This way, no speculators would want to invest and prop up the prices. Unless the older Singaporeans prefer to see large sum of $$ in their bank account while seeing their kids no $$ to buy housing.


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#7
i think not, but can anyone confirm if the ECs are not part of the "HDB" group for investment purposes? ie. that you can own both HDB and EC?
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#8
it's not more choices for sandwich class...

it's MORE TRAPS! haha! courtesy of MBT! 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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#9
People lay traps but that does not mean you have to step into it.

HDB still represents a better value than EC or DBSS. If the building is old, HDB will crack its head to do some upgrading with HDB footing main bulk of the bills. If it cannot be upgraded, there comes the chance of a SERS.

I forsee that those 10 storeys flats will undergo SERS sooner or later. HDB can easily make a bundle by building 50 storeys flat over the same plot of land.

For EC or DBSS, I suppose any upgrading must come from the owners' pocket fully.
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#10
Arthur is right - there's nothing to really benchmark the cost of resale and new HDB flats, unless you use land cost. HDB refuses to reveal the actual costs incurred in building a flat, so there's no way to know if they are really being "subsidized".

Latest news is that Mah Bow Tan has appeared on TV to announce proudly that COV has fallen yet again from $23,000 to $20,000. Maybe someone should remind him that $20,000 is still a very hefty amount to pay for a flat!
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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