Larger flats in mature estates draws most interest

Larger flats in mature estates have once again drawn the most interest in the latest Build-To-Order (BTO) exercise, a trend that is likely to continue along with the promise of rising resale values.

When the most recent exercise closed last night, there were 12 applicants for every five-room flat on offer in Ang Mo Kio and six for every four-room unit there. In Tampines, each four-room flat drew about seven bids.


With the Government's promise to keep prices of new flats affordable, bigger units offer top prospects for price appreciation amid rising resale prices, analysts noted. Last week, National Development Minister Khaw Boon Wan made it clear that he had delinked prices of new flats from that of resale units to keep them affordable for first-time buyers.

He had implemented the change since taking over the housing portfolio 18 months ago, and would continue to do so, so long as "property remains hot".

For instance, prices of four-room units in Tampines start from $293,000 in the latest exercise, similar to last September's BTO rollout where prices started from $305,000. Prices for resale counterparts in the area range from $440,000 to $481,000, according to the Housing Board's website.

HDB resale flat prices have been climbing steadily after a slight dip in 2009 due to the financial crisis..

The overall application rate for the first exercise of the year, which offered 3,346 flats in six towns, is 3.5. The overall rates for the past three years, from 2010 to last year, had been 5.7, 3.8 and 2.9 respectively.

One reason could be the implementation of a priority scheme for married couples with children younger than 16, although the application rate for this group was not made known.

Now, 30 per cent of the BTO-flat supply is reserved for them.

In the past, they had to vie with other first-timers, including engaged couples. Among the non-mature towns, Choa Chu Kang emerged as the poorest performer due to its location, while Hougang attracted the most bids as it was considered developed by many buyers.

Those who have yet to apply for a flat said they are assured that there is a strong supply in the pipeline.

HDB has promised to launch at least 23,000 flats this year.

Source: The Straits Times –5 February 2013