BTO flat prices remain ‘affordable’ at around 5 times of median annual household income or less: Desmond Lee

SINGAPORE: Market values of new Build-to-Order flats are determined by prices of comparable resale flats nearby, individual attributes of the flat and prevailing market conditions, said National Development Minister Desmond Lee in Parliament on Wednesday .

Thereafter, a subsidy is applied to ensure that flats are priced at a “significant discount” to the market, he said, adding that the approach is similar for BTO flats in mature and non-mature estates.Mr Lee was responding to a question by People’s Action Party Member of Parliament Gan Thiam Poh about the pricing policy of BTO flats.

“On top of the subsidised price, HDB also offers first-time flat buyers the Enhanced CPF Housing Grant of up to $80,000, to give more help to lower- to middle-income households buying their first home,” said Mr Lee.With all these “significant subsidies” keeping flats “affordable”, HDB BTO flat prices remain at around five times of the median annual household income or less, said Mr Lee, noting that the ratio can be nearly 10 or 20 times in other major cities in the world.

While several resale flats have transacted at prices of more than a million dollars, these transactions are a “small minority” and represent less than 0.3 per cent of total resale transactions this year, or 38 out of more than 14,400 resale transactions so far this year, he said.

Source: News Formal (newsformal.com)

After salary adjustment during Covid-19, the ratio should have increased.

Meaning to say it 10 times of median annual salary for a single income household?

Quite amazing that it is only at around 5 times! Especially when you take into account that this is land scarce Singapore.

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