The month of August saw the debut of close to 5,000 BTO units, including two key projects

Aug 30, 2022

As part of the build-to-order (BTO) exercise that took place in August, the Housing and Development Board (HDB) has made 4,993 apartments available for purchase.

The apartments are located in seven different developments throughout mature and non-mature estates in the areas of Ang Mo Kio, Bukit Merah, Choa Chu Kang, Jurong East, Tampines, and Woodlands respectively.

The Prime Location Housing (PLH) model, which was introduced in October 2021 and applies to flats built in prime and central locations, is being used in two of these developments, both of which are located in the Bukit Merah area.

Prices for apartments in the Bukit Merah PLH developments, which include Alexandra Vale and Havelock Hillside, start at S$370,000 for a three-room flat and range up to S$531,000 for a four-room flat. This does not include any subsidies.

The Alexandra Vale project, which will be situated along Alexandra View close to the Redhill MRT station, will provide a total of 782 BTO units, comprising 600 4-room flats and 182 3-roomers spread across 2 residential blocks ranging in height from 41 to 50 storeys. In total, there will be a total of 782 BTO units available. According to HDB, one of the blocks would also provide rental apartments with two rooms as part of an effort to "create an inclusive living environment."

According to Nicholas Mak, head of research and consultancy for ERA Realty, including such rental flats would reduce the number of units available to homebuyers in Alexandra Vale, while also potentially reducing the "snob appeal" of PLH flats. Homebuyers in Alexandra Vale would have fewer options to choose from.

Along Havelock Road, close to the soon-to-be-built Havelock MRT station on the Thomson-East Coast Line, a new residential community called Havelock Hillside will be constructed. It will consist of 2 residential buildings that are 42 and 45 stories tall, with a total of 869 units that are comprised of 698 apartments with four rooms and 171 apartments with three rooms.

Both PLH developments are located adjacent to a number of schools, including Zhangde Primary School, Gan Eng Seng Primary School, Gan Eng Seng School, and Crescent Girls' Secondary School, all of which are easily accessible through the Central Expressway.

The transaction prices of surrounding resale flats for the two developments vary from S$590,000 to S$720,000 for a 3-room flat, and from S$750,000 to S$1 million for resale flats for a 4-room apartment.



Under the Married Child Priority Scheme, up to 20 percent of the PLH apartments for both projects will be reserved for families having their first child, and up to 2 percent of the PLH flats will be reserved for families having their second child. This allotment is highlighted as being two-thirds of the customary quotas, and HDB feels that this would create additional options for Singaporeans who do not have family relations residing in the region.

Due to the fact that PLH apartments are sold at prices that include extra subsidies, the owners of these flats will be required to pay back to HDB a percentage of the higher of the selling price or the value when they decide to sell their flats.

No matter when in the future the apartments in Havelock Hillside or Alexandra Vale are sold, the amount that will be recovered from the buyers of those apartments will remain same at 6% of the purchase price.

Lee Sze Teck, senior research director at Huttons Asia, remarked that PLH flats do not appear to be as exclusive as they once were, adding that the most recent announcement increases the total number of PLH BTO projects that have been launched since November 2021 to 6.

Lee says that the Alexandra Vale site might have been utilized for private housing given that the neighborhood is bordered by dwellings of this type; nevertheless, "the government opted to push out a BTO project for inclusion." He is also of the opinion that the project is offered at a price that is somewhat cheaper than that of Bukit Merah Ridge, probably because of its location further away from the core of the city.

Huttons anticipates that the aggregate application rate for both of the Bukit Merah BTO projects will fall between between 4 and 6. This November, the agency also anticipates the possibility of launching two to three PLH BTO projects in the Kallang/Whampoa and Queenstown areas.

In a press statement released on Tuesday (30 August), HDB stated that the prices of its most recent launch of BTO apartments include a "generous subsidy" and are far lower than the prices that have been traded for comparable resale flats in the surrounding area.

Rates for non-mature estates begin at S$97,000 for a 2-room flexi unit in Jurong East; they start at S$188,000 for a 3-room flat in Woodlands; they start at S$277,000 for a 4-room flat in Choa Chu Kang; however, prices for 5-room flats provided in Choa Chu Kang begin at S$390,000.

ERA's Mak highlights Woodlands as a likely non-mature estate area with potential to garner more attention from home buyers. This is due to the fact that BTO flats located in Woodlands are located within a proximity of only 200 meters from the new Woodlands South MRT along the Thomson East-Coast Line.

"Furthermore, the Muslim community may find this property interesting since it is extremely accessible to a neighboring mosque, which is placed just 50 meters away," added Mak. "This land is situated in a location that is highly accessible to a nearby mosque."

In non-mature estates, at least 85 percent of the BTO flats with three bedrooms and 95 percent of the BTO flats with four bedrooms or more will be reserved for first-timer families. This is an increase from the current levels of at least 70 percent and 85 percent, respectively. Up to fifty percent of the non-senior two-room flexi flats are now reserved for first-timer singles. This number will climb to up to sixty-five percent of the available units in the near future.

According to Christine Sun, the senior vice president of research and analytics at OrangeTee & Tie, this policy change indicates that more first-time homebuyers may move to applying for flats in non-mature complexes in order to boost their chances of acquiring a unit.

"For second-timers, the chances of acquiring a BTO flat in non-mature estates are much lower than they were in the past." As a result, some people would look to the secondary market, and the increased demand might drive up the prices of resale apartments in some areas, as Sun pointed out.

Prices in mature estates start at S$198,000 for a 2-room flexi unit in Ang Mo Kio, S$381,000 for a 4-room flat in Tampines, and S$520,000 for a 5-room flat in Tampines. These prices are before grants.

At least 95% of the available BTO apartments in established neighborhoods have previously been designated for first-time buyer families.

HDB said that qualified first-timer families would spend as little as S$113,000 for a three-room flat in Woodlands and S$217,000 for a four-room flat in Choa Chu Kang if they used the Enhanced CPF Housing Grant (EHG), which is up to S$80,000 and may be used toward the purchase of a property.

According to the agency's press statement, "this BTO activity offers a wide selection of flats, ranging from 2-room flexi flats all the way up to 5-room and 3Gen units in order to suit a diversified range of housing demands."

According to the agency, the majority of prospective purchasers will be able to afford the apartments that are for sale since the monthly loan installments that they will need to pay will take up less than 25 percent of their total monthly family income. According to HDB, this implies that first-time apartment owners may be able to finance their mortgage using the monthly contributions they make to their CPF (Central Provident Fund), with low or no cash outlay required.

Home buyers who are interested in moving into their apartments sooner are also encouraged to investigate BTO developments in Choa Chu Kang, Tampines, and Woodlands, which have the shortest waiting times at 3.8 years or less. Buyers who are interested in purchasing a home are asked to consider these projects.

Given its "great position" in mature estates, Sun of OrangeTee & Tie anticipates a high level of demand for the Central Wave @ AMK development in Ang Mo Kio as well as the Sun Plaza Spring development in Tampines.

She made the following observation: "There are hardly many new 5-room flats that have been issued in recent launches, particularly in older estates." Families looking for larger living quarters will find both of these developments appealing because they offer apartments with five bedrooms.

She also mentioned the prospect of more people applying for the Ang Mo Kio project since around 10% of the apartments are going to be reserved for residents who are going to be displaced as a result of the Selective En-bloc Redevelopment Scheme run by HDB (Sers).

Lee of Huttons, on the other hand, thought it was "strange" that the Central Weave @ AMK mature town project did not offer any apartments with three rooms.

"While HDB had enabled homeowners impacted by Sers in Ang Mo Kio to apply for apartments at Central Weave, the omission of the availability of 3-room flats will mean that the 364 affected Sers owners of 3-room flats in Ang Mo Kio will either have to downsize or purchase a bigger unit in Central Weave @ AMK. This may be seen as denying the occupants of the three-room Sers the option to apply for a flat in a more desirable location, he argued.