Affordable HDB flats: Costings don’t add up

Source : Straits Times - 22 Jul 2008

I REFER to last Wednesday’s letter from the HDB, ‘How HDB flats are priced affordably’. It mentioned that a new four-room flat costs close to $300,000 to develop, taking into account land, building and other costs. It did not give details of how each cost is calculated.

I remember a similar Forum letter on July 12, 2004, asking the same questions. It was mentioned that one HDB contractor built flats in Bukit Batok for $50,400 each in 2000.

Even now, factoring in higher construction cost, I estimate building cost is $100,000 to $150,000. That leaves nearly $150,000 to $200,000 for land and other costs. A single block of flats typically has 100 units. That means land (and other costs) on which a single block of flats stands costs $15 to $20 million. Can it cost so much?

For $15 to $20 million, what kind of property can one buy? In District 9 or 10, one can buy property up to 20,000 sq ft.

So is the HDB willing to release details on actual construction costs, say in the Punggol or Sengkang area?

Steven Yeo