http://www.straitstimes.com/Singapor...ry_725095.html

Low take-up but 3 BTO projects go on

HDB says this is in line with new approach of building ahead of order

Published on Oct 20, 2011

By Daryl Chin


THE Housing Board will proceed with three Build-To-Order (BTO) projects in Jurong West and Sengkang despite a mediocre subscription rate.

The Jurong West project, called Golden Peony, had six bidders vying for every 10 flats while the two projects in Sengkang - Anchorvale Harvest and Fernvale Rivergrove - had 1.3 bidders for every unit available.

In a statement yesterday, the HDB said that, based on past experiences, these projects would not achieve the 70 per cent take-up rate when successful applicants got down to choosing units.

'Nonetheless, in line with the new approach of building ahead of order, the HDB has proceeded to start the process of building all seven BTO projects.'

The other four projects are in Jurong East, Punggol and Ang Mo Kio. All seven projects were part of HDB's bumper crop of 8,200 flats - new units and surplus flats from previous launches - offered last month.

Typically in the past, new flats were built only when the target take-up rate was met. However, there were exceptions to the rule in 2003 and 2005 when work on two projects with a take-up rate of 67 per cent went ahead.

The latest move is in line with National Development Minister Khaw Boon Wan's promise to meet a burgeoning demand for homes from Singaporeans, especially first-time buyers.

In May, he blogged that he had informed HDB to start building new flats regardless of response.

'Given robust demand, I told them to proceed to build, knowing that the orders will definitely come. In other words, build ahead of demand during this period of demand backlog. We can return to normal BTO approach after we have stabilised the situation,' he said.

In BTO launches, at least 95 per cent of the flats are set aside for first-time buyers who also enjoy grants. The monthly household income ceiling was revised from $8,000 to $10,000 in August.

SLP International's head of research Nicholas Mak said: 'This means the Government is serious about ramping up supply, while trying to minimise the risk of oversupply, which could lead to depressed resale prices. Build-To-Order usually means just that - you build when there are enough orders.'

He added that the three projects did not do well possibly due to the popularity of sale-of-balance flats.

There were more than 14,000 applicants for the 2,847 surplus flats.

The decision to proceed with BTO construction has cheered applicants like sales executive Aloysius Tan, 25, who is eyeing a four-room unit in Sengkang.

'At first, I was happy that there were not that many applicants. But then I had to worry that my dream home might not even be built. Now at least, I can breathe a little easier,' he said.

All seven projects are expected to be completed between 2014 and 2015.

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