How is the estimated breakeven for Lakeside Drive calculated?

The estimated breakeven for a residential development in Singapore is calculated by adding up all the major costs incurred by the developer and then dividing by the total saleable area or number of units, to estimate the minimum average price at which each unit must be sold to avoid a loss.

Key components included in the calculation are:
- The land purchase cost, including government charges and legal fees.
- Construction and development costs such as building, landscaping, and infrastructure.
- Financing costs, covering interest on loans and other related expenses.
- Professional and consultancy fees for architects, engineers, and other specialists.
- Government taxes, duties, and fees, including stamp duties and development charges if applicable.
- Marketing and sales costs to launch and sell the project.
- Developer’s overheads and a typical margin to ensure commercial viability.

All these are summed and divided by the gross floor area or number of saleable units to derive the breakeven price per square foot or per unit. This figure serves as a baseline: selling below it means a loss for the developer, while selling above it means profit.

EdgeProp Singapore provides tools and reports allowing buyers and investors to see estimated breakeven prices for various projects, helping users make more informed decisions based on the anticipated cost base of new developments.