Sunday, March 31, 2013

Building Cheap Homes Using BSB



30 Story Hotel in 15 days

Building Cheap Homes Using BSB
(Broad Sustainable Building)


Building cheap apartments from 300 to 700 sq. ft. of 20 to 30 stories.


Using the BSB system, a building can be constructed in less than 20 to 60 days. It will be cheaper and much faster than using the traditional ways. It is also more ecological, less labor intensive and less wastage.



A 400 sq.ft. studio home in the city can be sold for RM120,000. Monthly instalment will be about RM500 for a loan of RM100,000, making it cheaper to buy than rent. It is ideal for single/double or family of three.


It can solve the severe shortage of cheap housing for the lower income group. It will also be more profitable if we can complete a project in 3 months instead of 3 to 5 years.


Best of all it can enable almost everyone to afford a home of their own.


Why are houses so expensive in Penang 
and in other cities?


The main reason is that it can take 3 to 5 years to complete a high rise building project under the traditional way. Thereby incurring a huge labor, interest and other expenses.


A 50% margin on a 5 years project will mean only 10% simple annual return. To make a profit, most developers choose to build only high end high margin housing. Causing a severe shortage for affordable home for the lower and middle income group. By employing the super fast BSB system, we only need to make a slim margin to earn a reasonable return on investment as we can complete a project in 4 months or less. A 20% margin in 4 months means an annual return of 60%!


For a 30 story residential building, land cost is quite insignificant. For land costing RM200 per sq ft, it will add only about RM15 or less to the cost of homes, less than 10% of the selling price. Affordable homes can even be built on land costing RM500 per sq ft or more.


We should be able to sell a 400 sq ft studio home for less than RM120,000 even without any subsidies. Tens of thousands of homes can be built in 6 to 12 months, solving the severe shortage of affordable homes in almost no time. 

Advantages:

  • Maximizing salable space by minimizing common area and facility
  • Utility rather than aesthetic design to maximize net saleable area
  • Employing BSB will save about 30% cost
  • Speed = fatter margin over time, also lower interest cost
  • Lower marketing cost if we sell below market price
  • More revenue by providing renovation service
  • Factor in S&P and legal fee to lessen final price and save paperwork and time


A way to prevent non or late payment of maintenance fee is to waive it altogether. We can collect a monthly fee for parking of cars and bike and security entry pass. That should be enough to pay for the maintenance of the building. Example RM60 for car, RM20 for motorbike and RM10 for 2 entry passes per month.






A 200+ sq ft apartment design





No comments:

Post a Comment