HDB launches more than 6,000 BTO flats in December exercise; analysts expect demand to dip
A TOTAL of 6,057 flats were launched for sale on Tuesday (Dec 5) by the Housing and Development Board (HDB) under its December 2023 Build-To-Order (BTO) exercise, across eight new projects in both mature and non-mature estates.
Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, cautioned that demand for BTO flats is expected to dip slightly from the previous month’s levels, with the overall application rate in December potentially at below two applicants per unit on average.
“The decline in applications could be due to the introduction of non-selection rules which discourage less serious buyers from applying,” she said.
“Additionally, those who received a queue number in October will not be able to apply for a flat in December, leading to a decrease in the number of applicants, while the holiday season may contribute to a slower rate of buying activities since some potential buyers may be overseas.”
The BTO projects in this exercise are in Bedok, Bishan, Bukit Merah, Bukit Panjang, Jurong West, Queenstown and Woodlands. Flat types range from two-roomers to five-roomers and Community Care Apartments (CCAs).
Four of these new eight projects, amounting to about half of all flats offered, have a waiting time of four years or less.
The median waiting time for BTO projects launched in 2023 is three years and 10 months. HDB said this represents a return to the pre-pandemic norm, and a “significant improvement” from the peak of the pandemic, when waiting times were four to five years.
Flat buyers looking to move in sooner may consider applying for the shorter waiting time (SWT) project at Sin Ming Residences, which has a waiting time of about two years and eight months.
“HDB is committed to offering more BTO projects with waiting time of three to four years, and launching more SWT flats from 2024,” said the board.
Lee Sze Teck, senior director of data analytics at Huttons, said Sin Ming Residences will be the first flats to be built in the area since 1988.
“Flats in Bishan are extremely popular, judging from the past BTO exercises and the number of million-dollar flats. The recent two BTOs in 2020 saw an overall application rate above six (applicants per unit) for the four-room flats… Bishan ranks second in terms of the number of million-dollar flats among HDB towns,” he noted.
“Furthermore, this is possibly the first BTO project in a mature estate with a shorter completion time of less than three years.”
Two projects – Alexandra Peaks (in Bukit Merah) and Ulu Pandan Vista (in Queenstown) – are offered under the Prime Location Public Housing (PLH) model, which offers pricing with additional subsidies considering their higher market values.
HDB said it will also be increasing additional subsidies to ensure that the PLH projects offered in this month’s exercise will remain affordable.
The subsidy recovery rate for these two projects will be set at 8 per cent to match the extent of additional subsidies provided. This means owners of these flats will have to return 8 per cent of the resale price or valuation, whichever is higher, upon selling their flats.
HDB is expecting high application rates for flats in the mature estates of Bedok and Bishan, as well as the non-mature estate of Bukit Panjang, where the supply is “relatively small”.
OrangeTee & Tie’s Sun said projects in Woodlands, Bishan and Queenstown could prove more popular than others.
The two projects at Woodlands – Urban Rise @ Woodlands and Woodlands Beacon – are foreseen by Sun to be well-received due to their proximity to the Woodlands MRT station, while demand for Sin Ming Residences at Bishan is expected to be “healthy” due to a lack of new BTO flats in the area.
Sun also said she anticipates “keen interest” at Ulu Pandan Vista in Queenstown, as it marks the final release of new flats on the Dover Forest site. “Applicants who failed in their previous applications will likely apply for this final round,” she added.
Excluding grants, starting prices for flats in the December 2023 BTO exercise range from S$80,000 for a 30-year-leasehold CCA, to S$598,000 for a four-room flat at Ulu Pandan Vista.
Eligible first-timer families may apply for the Enhanced CPF Housing Grant of up to S$80,000.
HDB said this will allow flat buyers to purchase a three-room flat at S$132,000 and a four-room flat at S$255,000 in the non-mature estate of Jurong West, and they can service their mortgages through CPF with no cash outlay.
In the mature estates, prices after grants start from S$238,000 for a three-room flat and S$376,000 for a four-roomer.
With the December 2023 launch, HDB has launched a total of 22,780 BTO flats in the year to date. The total number of flats launched in 2023 stands at 24,447, including 1,500 flats offered under the Sale of Balance Flats exercise and 167 flats offered under open booking.
The next BTO exercise will take place in February 2024. HDB will be offering about 4,100 flats in Bedok, Queenstown, Choa Chu Kang, Hougang, Punggol and Woodlands.
HDB launches more than 6,000 BTO flats in December exercise; analysts expect demand to dip. Available at: https://www.businesstimes.com.sg/property/hdb-launches-more-6000-bto-flats-december-exercise-analysts-expect-demand-dip