Large number of applications for cheaper BTO flats defys expectations – more SGs tightening their belts?

by Vincent Low

A total of 4,381 new flats were launched by HDB last week (6 Feb). They include 3,664 Build-to-Order (BTO) units and another 717 units under the Re-offer of Balance Flats exercise.

The BTO flats will be offered in 4 places: non-mature estates in Choa Chu Kang and Woodlands, and mature estates in Geylang and Tampines.

(source from HDB website)

Eugene Lim, Key Executive Officer at ERA Realty, said that for Choa Chu Kang, with prices starting from $109,000 including grants for a 3-room flat, “the combination of affordability and convenience will be the main draw of the flats” there.

But he also noted that Geylang flats are a bit pricey. He said that some potential applicants may be discouraged from applying for the Geylang flats as the majority are 4-room flats priced relatively higher from $424,000, even including grants. (source)

Overall, HDB has said it plans to launch a total of 17,000 BTO flats this year.

The cheaper Choa Chu Kang BTO flats most popular

Indeed, a Straits Times report today (13 Feb) confirmed that BTO flats in non-mature estate Choa Chu Kang have proven to be the most popular in this latest HDB sale, defying expectations that home buyers usually prefer mature estates.

Teck Whye View in Choa Chu Kang saw a rate of more than seven applicants per unit, with more than 2,400 applicants going for 322 units. This far exceeded the subscription rate of about two applicants per flat for Ubi Grove in Geylang, a mature estate.

25-year-old Cheryl Tan agreed that the prices in Choa Chu Kang BTO flats represent a “super good deal”, though she thinks she has a very low chance of getting a unit there.

In the case of the Geylang units which were priced much higher because they fall into “mature estate”, the application take up rate is much lower. In fact, the take up rate has slowed to 2.1 (Ubi Grove), compared with another BTO launch in Geylang three months ago at a rate of 3.8.

Thaddaeus Aaron Tan, 24, who applied for a unit in Geylang was expecting a much higher subscription rate but was surprised that it was much lower than the 3.8 figure for Eunos Court, also in Geylang, which was part of last November’s BTO launch.

This first HDB BTO launch in the new 2018 year could be an indication that Singaporeans are all tightening their belts because they couldn’t afford buying higher-priced HDB flats in mature estates anymore.