| 
HDB's Design, Build and Sell scheme could negatively impact resale flats: property agents HDB's Design, Build and Sell scheme could negatively impact resale flats in the longer run: property agents
SINGAPORE : The new Design, Build and Sell Scheme (DBSS) launched by the Housing Development Board (HDB) will have a minimal impact on the HDB resale market initially, according to industry players.
But they say that in the medium to long term, the scheme could draw demand from the resale market.
That is due to the waiver of resale levy, better quality and design expected, and a fresh 99-year land tenure.
The Design, Build and Sell Scheme was implemented early this year.
It was designed to involve the private sector in the development of public housing in order to bring about greater innovation in building and design, and more housing choices.
While a pilot project in Tampines has been earmarked for the scheme, pricing has not been set.
But industry players say fair pricing is between 20% to 25% higher than a resale flat because quality is expected to be better and land tenure is a fresh 99-year lease.
They add that it will have a minimal impact on the HDB resale market initially, but expect the scheme to feature more prominently in future.
"If the DBSS scheme were to become a staple, medium and long term, I think it's going to draw demand from the resale market. It could draw demand from new home buyers who typically would buy their flats from HDB," said Nicholas Mak, director of Knight Frank.
But as for whether home buyers would be drawn towards flats under the Design, Build and Sell scheme, industry players say the resale levy, which is about 25% of the resale value, is a crucial determinant.
"I think the authorities are saying that it's time for the levy to be reviewed. If the levy is reviewed or scrapped altogether, the added advantage of the DBSS scheme will not longer be there," said PropNex's CEO Mohamed Ismail.
On participation by private developers, industry players say smaller developers, especially contractors, will be keen because the capital outlay required is lower. |
