First-time buyers who find the HDB resale market still too pricey will benefit greatly from the 3,957 Build-To-Order (BTO) flats launched by HDB today over six BTO projects, the largest number ever launched at once.
“The Government has certainly responded to the public’s demand for affordable housing, especially for first-time buyers,” says PropNex Corporate Communications Manager Mr Adam Tan. “This is especially so, given that at least 95% of the units, or 3,759 flats, will be set aside for these first-timers.”
The six BTO projects are spread out over four estates, namely Punggol, Pasir Ris, Tampines and Woodlands, giving first-time buyers plenty of choices in relatively popular neighbourhoods.
“All the estates are rather well-developed,” surmises Mr Tan, “and should see a huge take-up rate from potential buyers.”
Another reason he gives for an expected oversubscription rate is the fact that the BTO flats are going at prices around 14% to 35% cheaper than similar resale flats in their areas, based on the 1Q11 price results from HDB.
“The 3-room flats in Tampines GreenLeaf and Tampines GreenWood, for example, are a whopping 35% cheaper than resale flats in that town,” reveals Mr Tan, “and should therefore be very popular with the first-time buyers with a tight budget. For the reason of cost-effective pricing, the flats in Punggol Parcvista and Woodlands Peak should also see high subscription rates, having prices between 25% and 30% cheaper than similar flats in the vicinity.”
Despite the huge number of flats released, Mr Tan expects the overall oversubscription rate to be around four times, given that demand is still high from first-timers, based on previous BTO launches this year.
“Golden Lily at Pasir Ris and the studio apartments at Woodlands Peak will probably receive the lowest subscriptions,” he says, “as these flats are not conducive for first-time buyers looking to start a family. Therefore, subscription rates for these might be only double or so.
“However, for the 3-room and 4-room flats, we should see oversubscription rates of at least five times, if not more. By project, the most popular project is likely to be Punggol Parcvista, given that Punggol is still a very popular estate (its COV levels for 1Q11 were higher than the national average, and there are only 682 flats on offer there.”
Mr Tan concludes by lauding the Government’s efforts in heeding the demand from first-time buyers who are asking for more BTO flats in a greater variety of areas. He commends them on the bold move of increasing the number of flats offered this year to 25,000 flats.
“COV prices are bottoming out at around $21,000,” he observes, “and many first-time buyers will still be priced out of the resale market for this reason. Hence, they will definitely find great relief in this bumper crop of BTO flats.”
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