Large flats in mature estates most popular in latest BTO exercise

Large flats in mature estates have proven to be the most popular among potential home buyers in HDB’s latest Build-to-Order (BTO) exercise.

As at 5pm, 8,776 applications have been received for 3,428 units offered, excluding studio apartments.

Each four-room unit in Tampines Greenlace received about 3.3 applications from first-timers.

Likewise, in Ang Mo Kio’s Cheng San Court, each four-room unit had about 3.2 applications.

In Ang Mo Kio’s Teck Ghee Parkview, each five-room flat received 3 applications from first timers.

Analysts say such high demand is not unexpected.

“These are mature estates with infrastructure in. At the same time, these estates, you don’t get many BTOs coming up in such estates,” said Mr Chris Koh, the director of Chris International.

“Children who want to stay near their parents who are staying in such mature estates will also apply to such estates. We also see very high numbers for second-timers because some of them could already be staying in these estates so when they want to upgrade to another flat, they’ll think of (applying to) the same estates.”

However, demand for smaller three-room flats might be dwindling, a property analyst said.

Each three-room flat in Kallang-Whampoa, a mature estate, received only 0.1 application from first-timers.

Senior Manager of Training, Research and Consultancy at Dennis Wee Group, Lee Sze Teck, said first-timer application rates for three-room or smaller units have remained relatively low throughout the year, even though the demand from second timers for a three-room flat stayed strong.

He said: “The demand for this group of buyers could have been satisfied and HDB could look into fine-tuning their policy to help different groups of buyers instead of just applying a broad brush policy of just allocating more BTO flats to all second-timers.

“HDB could allocate more resources to the room-type that people actually want, rather than building what they actually think the market actually needs.”

“Government could look at allocating more resources to building bigger flats like four or five room. But they shouldn’t stop building three-room flats because there’s some social element to providing these flats,” he suggested.

Mr Lee also said the latest Sale of Balance Flats has shown stronger demand compared to the other exercise in March.

More than 14,600 applications were received.

A S2 unit, the equivalent of a five-room flat at the [email protected] at Cantonment Road, attracted more than 200 applications.

It was the only unit that was on offer.

Almost 29 applications were also received for each five-room, executive flat in Bedok, a mature estate. Three units in the area are on offer.

Analysts say the demand could be due to the recent high resale flat prices, which push buyers to apply for BTO flats.

“Once one does not have the cash, especially to pay the premium for the resale flats, the next option is to buy a BTO flat,” said Mr Koh.

“When they look at the BTO flats and see some very good ones (in mature estates)… then (buyers) will eye those flats more than those flats in the less mature towns.”

Another 6,400 flats will be launched in the next BTO exercise in November.

Source : Channel NewsAsia – 3 Oct 2012