Project ‘rarity’, HDB resale prices boost demand for BTO flats: PropNex

HDB said there were 37,406 applicants for about 5,000 build-to-order flats.

The rising House and Development (HDB) resale prices in the past year and rarity of some projects propelled the demand for build-to-order (BTO) flats announced in August, according to PropNex Realty.

The HDB data on August 2021 exercise’s applications showed that there were 37,406 applicants for the 4,989 new BTO units, which is a 74.6% increase from the 4.3 times achieved in May.

“We think this could be due to the strong attributes and rarity of some of the BTO projects in this launch,” PropNex Realty CEO Ismail Gafoor said.

The application rates meant there was a renewed interest in new BTO flats, he said.

“We believe that the rising HDB resale prices over the past year, to a certain extent, drove up demand for BTO flats in this launch, resulting in the strong over-subscription rates and application volumes,” Gafoor said.

“Applicants who are not successful in securing a flat from this round’s launch, are likely to turn to the resale market, taking advantage of the generous housing grants of up to $160,000 for first-timers,” he added.

The flats at Hougang (Hougang Citrine and Kovan Wellspring) were in “hottest demand” with 10,602 applicants for 459 four-room flats, and 1,815 applicants for 178 three-room units. Toh Guan Grove at Jurong East also saw 3,348 applicants for 240 four-room flats and 480 applicants for 85 three-room units.

Gafoor said the non-mature estate projects in Hougang and Jurong East saw higher applicants due to affordable price-points compared to mature projects and attractive locations and rarity of BTO projects.

In Queenstown, there were 3,747 applicants for 534 four-room flats, which is an application rate of seven times. But this is lower than the application rates of 43.3 times in Bukit Merah project in May 2021 (Telok Blangah Beacon). The lower application rates in Queenstown could be due to the longest waiting time out of all projects with 67 months which might have put off applicants, he said.

The Tampines project received an application rate of less than five times with 3,319 and 3,940 applicants for four-room and five-room flats, respectively. This could be due to the higher number of flats available in its launch, Gafoor said