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HDB puts up five-room and executive flats for rent

 
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Patbabeth
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PostPosted: Wed Feb 01, 2006 11:25 am    Post subject: HDB puts up five-room and executive flats for rent Reply with quote

HDB puts up five-room and executive flats for rent

By Daryl Loo
Feb 1, 2006
The Straits Times

FOR the first time, the Housing Board is putting up five-room and executive flats for rent through a private company.

On offer are 160 five-room and 90 executive flats in Jurong West, Sengkang and Bukit Merah.

Property agents say these are likely to be from the HDB's stock of 9,000 unsold flats. In the past, it has only offered smaller units for rent through property companies.

The move to rent out bigger units came to light in a tender the HDB called last December for a contractor to renovate, maintain and rent out the 250 bigger flats for two years.

The tender includes 300 three-room flats in Boon Lay and Hougang.

The successful bidder must collect and pay rent to the HDB, keep the flats clean and attend to any tenant disputes or public complaints.

It will also be responsible for paying all town council service and conservancy fees, and utilities charges.

Each five-room and executive rental unit can take a maximum of eight occupants and these can be rented to anyone, except work-permit holders.

This means that while foreigners on student and employment passes may rent the flats, foreign construction and factory workers are barred.

The tender closed last week and drew just one bid above the HDB's minimum rent of $320 a month per unit. HDB subsidiary EM Services put in a bid of $405.

The company and the HDB declined to comment as the tender has not been awarded yet.

Property agents expect EM Services to rent out the flats at the best price, pay the HDB $405 a month, and keep the difference as profit.

Mr Albert Lu, managing director of C&H Realty, said five-room flats in outlying areas like Jurong and Sengkang go for $700 to $1,000 a month, while those in a central area like Bukit Merah can fetch $1,200.

'This means that the contractor will have some room to play with, even after factoring in renovation and furnishing costs,' he added.

PropNex chief executive Mohamed Ismail was surprised to find 50 five-room flats up for rent in a popular, mature estate like Bukit Merah.

The HDB's annual report for the year ending March 2005 said it had 19,488 one-room and 23,057 two-room units for rent, mainly to low-income households.

It also rented out 6,856 three-room and 702 four-room units, mainly to companies as workers' housing.

MPs Amy Khor (Hong Kah GRC) and Teo Ho Pin (Holland-Bukit Panjang GRC) welcomed the latest move to rent out unsold HDB flats rather than leave them empty.

Dr Khor, chairman of the Government Parliamentary Committee for National Development, did not think it unusual that the tender drew a single bid. There is risk involved, she said, as the company must pay the HDB the rent even when there is no tenant for a flat.

'HDB is probably testing the market to see if there is demand,' she added. 'It also needs to iron out any issues that come up before putting up more of these units for rent.'

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Winwin
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PostPosted: Wed Feb 01, 2006 10:02 pm    Post subject: Re: HDB puts up five-room and executive flats for rent Reply with quote

Patrickpang wrote:
[b]

Mr Albert Lu, managing director of C&H Realty, said five-room flats in outlying areas like Jurong and Sengkang go for $700 to $1,000 a month, while those in a central area like Bukit Merah can fetch $1,200.


good info!

but abit expensive... anyway, even if i rent one, dun think i need such a big one like 5-rm...

wondering if they have smaller... like 3-rm?
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zing
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PostPosted: Thu Feb 02, 2006 12:33 am    Post subject: Reply with quote

3-room is available in the market oredi mah...
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Winwin
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PostPosted: Thu Feb 02, 2006 9:15 pm    Post subject: Reply with quote

is it. din know that.
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Patbabeth
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PostPosted: Thu Feb 02, 2006 10:15 pm    Post subject: Reply with quote

New batch of larger rental HDB flats could be priced lower
By Wong Siew Ying, Channel NewsAsia

SINGAPORE : Property agents expect the new batch of five-room and executive flats put up for rent by the HDB to be priced at 10 percent below market rate.

Agents are getting a handful of enquiries about the larger flats HDB intends to put up for rent through a private company, which will have to manage the units and pay a minimum rent to the HDB even if the flats are not taken up.

The project's only bidder, EM Services, tendered a bid of S$405 per unit per month, excluding any mark-ups which it will pocket as profits.

Many flat hunters wanted to know if it will be cheaper compared to what is available in the rental market.

Currently, the rent for five-room and executive flats in the outer areas is between S$800 and S$900, while flats at prime areas command at least S$1,000 a month.

Demand for these larger flats is estimated at 1,000 units a month.

Said Mohamed Ismail, CEO of Propnex, "Overall the price at the end of the day will come more or less closer to the resale price. At best -- because whoever who is marketing it, they do not want to hold it vacant for long as there is a cost factor -- it may well go at best 10 to 15 percent lower than what is available in the market, especially for the outer areas."

The majority of the 250 units released are in outer areas like Sengkang and Jurong West, with 50 units in Bukit Merah.

Property agents believe these units will appeal to those looking for short-term leases of between three and six months, which are presently lacking in the market.

Potential clients include newly-weds who are waiting for their new flat or those in the process of selling and buying.

Said Eugene Lim, assistant vice president at ERA, "The others may possibly be corporate owners -- so people like schools, institutions, companies which are looking for housing for their expatriate staff or foreign students coming in."

Another plus for the lessee is a more professional approach to handling tenant disputes, with the successful bidder taking on the role of a landlord.

Still, industry players say a limited supply of 250 larger units should not put pressure on prices or demand in the open market.

Several property agencies are also watching the development closely and could pitch for similar projects should HDB decide to release more units for rent. - CNA /ct

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