Fewer BTO flats will not have significant impact on resale market: Analysts

On Monday (Oct 20), National Development Minister Khaw Boon Wan said that there will be a 25 per cent drop in the number of Build-to-Order (BTO) flats launched next year. However, real estate analysts believe that a lower number of BTO flats next year will not have a significant impact on the resale market.

Analysts Channel NewsAsia spoke to said that while first-time home buyers may consider resale flats, HDB resale prices are projected to continue to fall, but not so drastically. HDB resale prices have fallen for eight consecutive months.

Citing a falling application rate for BTO flats, as well as balance flats from past years which would be introduced into the market, analysts said the estimated 16,000 BTO flats to be launched next year are more than enough.

Mr Nicholas Mak, executive director of research and consultancy at SLP International Property Consultants, said: “In 2007 and 2008, the Government actually offered less than 10,000 BTO units every year. The large ramp-up in BTO supply over the past three years was something necessary but not sustainable. Hence, the Government needed to scale back to a more sustainable level.”

The Government also announced that land supply for executive condominiums and condominiums will be reduced, but no details were given.

A total of 16,700 private residence units were completed this year, while the number of new units sold by developers is the lowest in four years. Analysts expect 21,900 private units to be completed next year.

Source : Channel NewsAsia – 22 Oct 2014

Join The Discussion

Compare listings