Your Letters

No guarantee local developers will sell units at a lower price

Tenders must be open and transparent, and I do not agree that foreign developers should be kept out of the Government Land Sales programme (Keep foreign bidders out of housing; June 11).

Given that the Queenstown plot is well located on the fringe of the city, and near an MRT station, it is not surprising that there was fierce competition for it.

A foreign bidder won the tender at $1.003 billion. It was reported that to make a profit, the developer would have to sell the units at a minimum of $1,820 per sq ft.

There is no guarantee that a local developer would not try to maximise profits and sell at the same price, had it won the tender.

The Government should maintain the property curbs, or increase the levy or additional buyer's stamp duty that foreign property buyers have to pay to 20 per cent or even 25 per cent.

This will prevent speculation and escalating prices beyond the reach of Singaporeans.

In this way, the local property market will adjust naturally to local market conditions and eliminate any inflationary pressure from foreign property buyers even though foreign developers bid for the land.

It will be a huge task to determine the fair market and affordable price of private housing without the necessary tools to limit the profits of both local and foreign developers in an open market environment.

Sum Kam Weng

A version of this article appeared in the print edition of The Sunday Times on June 18, 2017, with the headline 'No guarantee local developers will sell units at a lower price'. Print Edition | Subscribe