New BTOs face possible oversubscription

Recently launched Build-To-Order (BTO) projects Fernvale Ridge in Sengkang and Sembawang RiverLodge in Sembawang are expected to be well-oversubscribed by at least eight times each.

The 828 units being offered, 95 percent of which will be set aside for first-timers, are part of HDB's plan to offer at least 12,000 new BTO flats this year. HDB said eligible first-timers with a monthly household income of $5,000 or less can apply for the Additional CPF Housing Grant of up to $40,000, which can be used to offset the initial down-payment.

In addition, new HDB flats are priced below their equivalent market prices to keep public housing affordable for first-time homebuyers. "The median prices for a 4-room flat in Fernvale Ridge in Sengkang and Sembawang RiverLodge, at just $243,500 and $240,000, are 35% and 24% cheaper respectively than the median resale prices for similar flats in their areas," commented PropNex CEO Mr Mohamed Ismail, suggesting that potential homeowners will find these low prices very appealing.

Elaborating on the projects' attractiveness, he said, "Recent BTOs have offered studio apartments which do not make much sense to a young couple who are looking to start a family, as they will be locked into the BTO flat for a further five years after collecting their keys. Flats offered at the Fernvale Ridge and Sembawang RiverLodge BTOs only consist of 3-room, 4-room and 5-room flats."

He added, referring to Sembawang RiverLodge's eating house, supermarket and childcare centre within the development, "The convenient provision of these amenities will certainly increase the popularity of the flats there."

Although these new BTO projects are expected to be well-oversubscribed by at least eight times each, they will not impact current resale flat prices. Meanwhile the two launches pushed HDB's offerings to a total of 3,653 units of new flats under the BTO in the first quarter of 2010.