Reducing the wait for home-buyers

SINGAPORE — Some 17,000 Build-To-Order (BTO) flats will be launched next year, about 1,000 fewer than the number put up for sale this year, as the Government tapers the supply of public housing units.

Announcing the supply for next year, National Development Minister Lawrence Wong also said that young couples can look forward to shorter wait times for BTO units, possibly by 2018. Upcoming executive condo launches include Yio Chu Kang EC, Inz Residence EC, Choa Chu Kang EC, Anchorvale Lane EC,  while existing ones include The Terrace EC, Brownstone EC, The Vales EC, Parc Life EC , Sol Acres EC, The Visionaire, Bellewoods EC, Signature at Yishun, The Criterion EC and Northwave EC.

“Over the past year, I’ve received feedback from young couples to make the waiting time for BTO flats shorter,” he said on his blog. “So I’ve asked the HDB (Housing and Development Board) to plan and prepare the land for several new sites which can subsequently be put out as BTO units with shorter waiting time. These units will not be ready next year, but I hope we can begin to offer them by 2018.”

Mr Wong had said in October during an interview with the Straits Times and Lianhe Zaobao that he was looking to reduce the wait for home-buyers by getting HDB to start the construction process for some BTO projects before their launches. The move will cut wait time from the current three to four years, to two to three years.

On the supply of flats next year, Mr Wong said there will be “a good spread across the mature and non-mature estates”, providing choices for couples who want to live near their parents and for seniors who want to age in place.

He said: “We are gradually tapering supply but still ensuring a healthy pipeline to meet demand … at the same time, we will continue to monitor the market, make adjustments to our building programme, and review our schemes to meet the housing needs of Singaporeans.”

With the sluggish economic conditions, property analysts were divided over whether the reduced BTO supply could still result in a glut.

Century 21 Singapore chief executive Ku Swee Yong said: “The fact is that with a slowing economy … we may expect more families to (stay out of the BTO market) next year if the employment situation worsens.” The surplus of flats in the market could be exacerbated by the baby boomer generation entering retirement and selling off their flats, he added.

However, OrangeTee head of research and consultancy Wong Xian Yang noted that BTO flats are “still the cheapest form of housing in Singapore, as compared to other housing options”. “People might choose to hold off buying private property and go for public housing instead,” he said.

Mr Alan Cheong, research head at Savills Singapore, said the geographical distribution of the new flats will be key. “If you launch 17,000 in the outskirts, then the number would seem like an oversupply,” said Mr Cheong.

ERA key executive officer Eugene Lim noted that it was “not a drastic reduction in supply”, compared to the number of units launched this year.

“Also, this number is not set in stone and can be adjusted upwards or downwards, according to the demand for BTO flats,” he said.

Mr Wong said that for 2016, the BTO application rate for first-timers applying for three-room or larger flats in non-mature estates remained “stable and manageable”, at 1.5 times for the most recent BTO launch last month and an average of two times for projects over the entire year.

“From experience, this means that BTO applicants will be able to get a flat within their first or second try, and most definitely by the third try … I always advise young families to apply for BTO flats in non-mature estates to increase their chances of success,” he said.

During the BTO launch last month, projects in mature estates such as Kallang-Whampoa and Bidadari drew much stronger interest, compared to those in the non-mature towns.

Referring to Mr Wong’s plan to shorten the wait for some BTO projects, Mr Chris Koh, director of property firm Chris International, suggested locating these units in the non-mature estates in order to draw more buyers to these areas.

“This will relieve pressure in mature estates,” he said.

From 2011 to 2013, some 25,000 BTO units were released each year. Supply was cut to about 22,400 units in 2014, and about 15,000 last year. This year, the HDB turned on the tap again, in anticipation of higher demand because of recent policy changes.

On his blog, Mr Wong also provided an update on the number of families and singles who have benefited from Government initiatives that were announced last year: There were 2,200 more households buying subsidised flats under the higher income ceiling, 4,100 households using the enhanced special Central Provident Fund housing grant, and about 6,000 households tapping on the Proximity Housing Grant to buy resale flats near their parents or married children.

executive condo and the land site pic 4