City Life’s giant penthouse four times as big as a 5BR HDB causes storm of controversy
Seriously, tax payers are paying for this over $2M luxurious property?
CityLife at Tampines, which bills itself as Singapore’s first luxury hotel-style executive condominium developed by Tampines EC, is offering a Penthouse Suite with a sprawling size of over 4,000 sft.
The developer is a consortium comprising Amara Holdings, Kay Lim Holdings and SingXpress Land.
Market observers note that assuming the penthouse costs $500 price per square foot, similar with the other units, the total cost of the unit is estimated to be above $2M well above the typical $1M price for executive condo.
Tampines EC bills that the giant penthouse at City Life is likely to be the largest of its kind for ECs in Singapore.
Some industry observers said that the developer defeats the purpose of executive condo which targeted young couple with combined $12,000 monthly income.
Some of the comments generated include:
“I think income ceiling for this kind of EC should be raised as how can a young couple with combined income of 12K a month comfortably pay for the mortgage? Come to think of it.
“ The policy should be amended. I suggest individuals buying EC above certain quantum which exceeds the $12K income limit should be denied any grants,”
“Putting affordability aside, what on earth does a young couple need such a big house?”
Singapore Business Review meanwhile received a letter from a market observer which requested anonymity defending the property.
The market observer notes of 6 points as follows:
1) Contrary to what most people think, EC developers do not design big penthouses based on profit motive. This is because, typically, penthouse per square foot price is drastically lower than the average psf price of an EC project, due to the bigger floor areas, and also a relatively large terrace space. This is a common practice. In fact, if a EC developer seeks to maximise profitability, he should build loft units at the top floor, as smaller units typically command a higher psf pricing. Therefore, developers do not design big penthouses for profitability, in fact, such big penthouse units drag the average psf price of the project down. Most developers build bigger penthouses to up the ante in public housing design, and to provide a different option for buyers.
2) Buyers of such big penthouse units are not necessarily young couples. More often than not, they could HDB upgraders or big families, or families anticipating a growing family size. With rising HDB resale prices over the years, most HDB dwellers sell their home and encashed a big sum of money. As such, they could use that gain from the sale of their HDB flat to lessen borrowed amount when they buy a big EC penthouse. This would address the profitability issue. Please note that it not uncommon for HDB dwellers to make a couple of hundred thousands, which is a handy sum for downpayment.
3) It is not uncommon for an extended family to be dwelling in a penthouse, and not just a young couple. As a matter of fact, most EC penthouses are purchased by mult-generational families and upgraders. Not sure why the perception that big penthouses are popular with young couples. If I am not wrong, the Heron Bay penthouse was reported to be purchased by a young couple, but that does not mean all EC penthouses are only popular with childless, young couples?
4) All EC projects and pricing are to be approved by authorities before they go on sale. Developers build what the market forces dictate. There must be a demand for big penthouses, otherwise why would they build such penthouses. As to whether it is too big, or right for the government to be subsidising these purchases, these are issues best addressed by authorities rather.
A spokesperson of the developer said that City Life will be officially launched on December 29.