Higher, 95% of flats reserved for first-timers

http://www.straitstimes.com/PrimeNew...ry_455215.html

November 17, 2009 Tuesday

Higher, 95% of flats reserved for first-timers

HDB increases their chances of getting a home

By Jessica Cheam


THE Housing Board (HDB) has moved to address mounting concern about inadequate flat supply by upping the first-timer's success rate for getting a flat and by launching more than 1,000 homes for sale in Punggol.

With immediate effect, the Board has increased the number of flats reserved for first-timers at its sales launches from the current level of 90per cent to 95 per cent.

This applies to both its build-to-order (BTO) scheme - which provides the bulk of HDB flats and where units are built when a certain demand is reached - and the sale of balance flat (SBF) exercise, which typically offers ready flats across the island.

Flats offered in the latter exercise are highly popular given that buyers do not have to wait for homes to be built and are given access to a wide variety of locations.

HDB said yesterday its move was designed to 'give greater priority to first-timers, who generally have more urgent housing needs than second-timers'.

'HDB will monitor the demand situation closely and make adjustments where necessary,' it added.

The Board first introduced this scheme for first-timers in August 2007 to prevent them from being crowded out of the then-booming market.

Prior to that, there was no quota and first-timers were balloted along with everyone else.

The scheme also gave a leg-up to applicants who had tried and failed in four or more ballots by favouring them in BTO project ballots. (see below)

Yesterday's move by the HDB is a response to those first-time home buyers who fear missing out on the chance to buy a property because of historically high resale flat prices - they rose 3.8per cent in the first nine months of the year - and a perceived supply shortage.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak, an industry observer, believes the HDB is likely responding to feedback that young couples cannot afford resale flat prices.

'In this case, they are reserving so many flats for first-timers so they can ensure affordability,' said Mr Mak, who added that the HDB's decision might help shift some demand away from the resale market to demand for new flats directly from HDB.

PropNex chief executive Mohamed Ismail does not see the HDB's five-point increase having a major impact on the market, but said it clearly demonstrated that first-timers and not upgraders were being given priority for new flats.

'It is a clear signal that the current concern is to provide a roof for all young couples,' he said.

The HDB yesterday unveiled 1,078 new standard flats for sale at Punggol Sails and Punggol Ripples. The units range from studio apartments to five-room flats and prices range from $65,000 to $377,000.

Punggol Sails offers 279 three-room, 218 four-room and 109 five-room flats, while Punggol Ripples has 130 studio apartments, 157 three-roomers and 185 four-roomers for sale.

Both projects are located along Punggol field, are served by the Punggol MRT and LRT stations, and are near the future Punggol Town Centre.

PropNex's Mr Ismail noted that the typical selling price of the new flats was 10 to 20per cent cheaper than those of comparative resale units in the area.

With the vision for Punggol as Singapore's waterfront town starting to become a reality, flats in the area will become increasingly popular, said Mr Ismail, who expects the projects to be five times over-subscribed.

Home buyers need to submit their applications before the closing date of Nov30.

Including yesterday's sale, HDB has offered 10,800 flats for sale this year. It said that 2,700 more flats will be offered next month in Bukit Panjang, Sembawang and Dawson.

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A leg-up for young couples

YOUNG couples now have a greater chance of securing a flat, with the Housing Board setting aside 95per cent of all its sales exercise - BTO and sales of balance flats - for first-timers.

The HDB's priority scheme was first introduced in August 2007 and, prior to that, no quota existed so first-timers were balloted along with everyone else.

The revised scheme additionally gives a leg-up to applicants who have tried and failed in four or more ballots.

On their fifth attempt they will be accorded one extra chance, with their name being entered for the ballot one more time.

For their sixth try, they get entered two more times, and so on. However, this only applies to BTO projects in non-mature areas.

Couples already receive a helping hand under the Married Child Priority Scheme, which gives them double the chance during the balloting.