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Published March 3, 2012
Budget debate
More options for families and second-timers
Minister Khaw Boon Wan unveils new measures with regard to HDB's executive condominiums and Built-To-Order flats
By MINDY TAN
MORE options will be available for Singaporeans who wish to live nearer their parents, and for second-timer HDB applications, through a series of measures unveiled yesterday.
Acknowledging that previous policies were skewed, Minister for National Development Khaw Boon Wan unveiled a host of new measures, including a six-fold increase in executive condominium (EC) allocation and a three-fold increase in Built-To-Order (BTO) flat supply allocation in non-mature estates for second-timers. In addition, 30 per cent of BTO flats to be launched this year will be in mature estates, for children to live near parents.
To give second-timers better access to ECs, the 95/5 split between first-timer/second-timer applications will be adjusted to 70/30. The allocation was effective as at yesterday on all EC projects, including those currently within their first month of public sales launch.
For BTOs, the second-timer allocation of new flats in non-mature estates will increase from 5 per cent to 15 per cent, starting with the next BTO launch. The allocation for second-timers will remain at 5 per cent for BTO flats in mature estates, and Sale of Balance Flat exercises.
'This should cut the second-timer application rate from above 25 to a single digit, while keeping first-timer application rate below two,' said Mr Khaw.
Both these measures should be well-received, says PropNex Realty chief executive Mohamed Ismail.
The 670-unit Tampines Trilliant in Tampines Central 7, which saw the 5 per cent quota allocated to second-time buyers in the initial launch period being fully taken up, will be immediately affected by the above policy.
According to developer Sim Lian, an additional 168 units will now be available to second-time buyers. Previously, second-time buyers had to wait until Sunday for the quota for first-timers to be lifted. Prices for the units remain unchanged at $766 per square foot. As at yesterday, 190 units have been sold.
On the improved quota for BTO flats, PropNex's Mr Ismail noted: 'This is a good balance . . . that has taken much consideration in giving priority to first-timers the opportunity of owning a BTO flat in the mature estates near their parents. Only genuine second-timers are willing to uproot from their current mature-estate resale flat into a non-mature-estate new BTO flat.'
The measures should not bear significant impact on mass-market condominiums, according to Mr Ismail.
HSR Property Group's special adviser Donald Han agreed: 'The mass market has proven to be most resilient. Now that the government is opening the door a bit more, allowing second-time buyers to have a better chance in BTO and EC allocation, I expect a fairly muted impact on the mass market, mainly because it is well supported by the upgraders' market.'
As part of an overall aim to help families live closer to one another, the government will double the allocation of BTO flats in mature estates - 30 per cent of BTO flats to be launched this year will be in estates such as Bedok, Kallang, Whampoa and Geylang, versus just 14 per cent in 2011.
According to HSR's Mr Han, this could have an impact on mass-market projects located in fringe areas such as Toa Payoh, Bishan and Bukit Merah.
'One of the attractions of such projects is that they allow potential owners to stay near mature towns, and the added accessibility for those who want to stay near the CBD. This may have some dilution impact on mass-market condominiums,' he said.
Ong Kah Seng, director at R'ST Research, added: 'This may not necessarily put pressure on prices of resale flats in mature estates as prices are fundamentally well underpinned by established amenities and accessibility, and the ability of the resale flat to be 'immediately' occupied. Further, these are tried and tested 'investor locations' for buyers of resale flats, who focus on the convenience of their property as tenants are likely to be willing to pay a rental premium for it.'
The Multi-Generation Priority Scheme (MGPS) will offer families more options to stay near each other. Under the scheme, parents and their married child can submit a joint application to purchase a studio apartment (SA) or a two-room flat, together with a larger unit in the same BTO project. A total of 250 paired units will be made available for joint selection in 2012, starting with the Bedok BTO project.
In addition, applicants who apply for a BTO flat under the Married Child Priority Scheme (MCPS) - married child and parents apply for a BTO flat together - will see their chances increase from twice to three times, compared with a non-MCPS applicant.
To meet the needs of retirees who may wish to 'right-size' their units, HDB will launch 2,000 SAs this year, with many in mature estates, in addition to the Silver Housing Bonus and enhancements to the Lease Buyback Scheme.
Mr Khaw added that the Ministry for National Development will review the CPF Retirement top-up criterion with the Ministry of Finance, and hopefully complete the review and announce details in the coming months.
The Ageing-in-Place Priority Scheme (APPS) was also introduced, to give elderly applicants of SAs a higher ballot chance if the SA is in the same estate, or within 2km of their existing property. Under this programme, more ballot chances are given to elderly applicants, on top of the MCPS.
Mr Khaw added that the government will continue to look into helping people who rent flats to move to home ownership, and look after victims of misfortune.