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BTO quality not compromised, says MND

By Tay Hock Meng

/ The Edge Property |

August 13, 2015 9:00 AM SGT

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The past two months have seen the emergence of reports of unhappiness over defects in public housing projects built under the Design, Build and Sell Scheme (DBSS) such as Trivelis in Clementi, Centrale 8 in Tampines and Pasir Ris One in Pasir Ris. There were also complaints of defects in build-to-order (BTO) flats at Punggol Waterway Terraces, from shoddy workmanship to water leaks and flooding during heavy downpours.

In response to various ministers’ queries on the quality of BTO and DBSS flats, Minister of State for National Development Desmond Lee said that, despite a significant ramp-up of the BTO programme over the past four years, the quality of these flats has not been compromised.

The number of defects reported has not changed significantly, and such imperfections are within industry norms and common in private developments, which can be rectified quickly by contractors without compromising the integrity of the building structure, Lee said in Parliament on July 13.

On average, about one-third of all new residents approach the Building Service Centre (BSC) for assistance after collecting their keys, says Lee. About 25% of their requests are related to issues such as low water pressure, owing to compliance with water-saving measures, as well as paint stains that needed to be removed. The other 75% of the requests involved defects. Most of the reported defects are surface imperfections such as hairline cracks on walls, scratches on timber floor or uneven tile joints.

For DBSS projects, the private developer of the project is primarily responsible for the design, pricing and construction quality of the flat, says Lee. DBSS developers have to comply with requirements of the relevant authorities such as URA and BCA. Furthermore, under the sale and purchase agreement between the DBSS developer and home buyers, the developer is contractually obliged to build the unit with good workmanship. The S&P agreement also requires the developer to rectify any defects within the Defect and Liability Period (DLP).

DBSS flats are public housing, and buyers have to meet HDB’s eligibility criteria, says Eugene Lim, key executive officer of ERA.

The sale of DBSS sites was discontinued in 2011 after Centrale 8 created a stir when the indicative prices for five-room flats were set as high as $888,000. “It was an era when developers were bidding for DBSS land parcels at quite high prices,” recalls Nicholas Mak, executive director of research and consultancy at SLP International. “Speculation then was that, if a five-room DBSS flat costs $888,000, it could fetch $1 million five years later in the resale market.”

That prompted the government to discontinue DBSS, as higher launch prices by developers would have ramifications on HDB resale prices, explains Mak.

In an effort to rein in prices, the government decided to pump up supply. A record 50,000 new BTO flats were launched in 2011 and 2012. The ramp-up in supply also coincided with the increase in private- housing supply.

“Contractors were stretched, and construction resources — from raw materials to construction workers — were in short supply,” recounts Mak. “Many of the developers of DBSS projects were also contractors themselves, and they really felt the squeeze. The unprecedented ramp-up in supply in both the public and private housing sectors over the last few years could lead to unforeseen lapses in quality."

This article appeared in the City & Country of Issue 686 (July 20) of The Edge Singapore.

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