October BTO exercise: Standard projects in Pasir Ris most popular; Plus, Prime projects also well-received

SINGAPORE: More than 35,600 applications were received for the 8,573 Build-to-Order (BTO) flats on offer in the October sales exercise, which marked the launch of a new classification system.

This is the highest number of applications received since the sales exercise in August 2022, with most of the 15 projects launched drawing strong interest, analysts said.

The launch, which ran from Oct 16 to 23, was the first time new flats were labelled as Standard, Plus and Prime based on their proximity to the city centre, transport connectivity and amenities. This replaces the decades-old classification of mature and non-mature estates.

In general, Prime and Plus flats have better locations and are priced with more subsidies. But they also come with stricter resale rules, like a 10-year minimum occupation period and subsidy clawbacks of 6 to 9 per cent, to counter what authorities call the “lottery effect” of owning flats in prime areas.

This time, seven projects were placed in the Plus category, one in Prime and another seven given the Standard classification.

The two Standard projects in Pasir Ris were the most sought-after, based on final figures available on HDB's website on Thursday after (Oct 24).

The Costa Riviera I and II projects had a first-time application rate of 6.7 for the 145 five-room and three-generation (3Gen) flats on offer, meaning about six applicants were vying for each unit.

The two projects, located near Pasir Ris MRT station, also saw first-time rates of 3.6 and 2.4 for the 394 four-room and 86 three-room units respectively.

Also well-received was the West BrickVille @ Bukit Batok project, which will be near the future Jurong Regional Line’s Tengah Park MRT station. Around three first-timer families were gunning for each of the 260 four-room units and 208 five-room and 3Gen flats available.

The project also offered 91 three-room units, which attracted a first-timer application rate of 1.7.

Shorter waiting times and being located near MRT stations are reasons behind the strong demand for these BTO projects, said ERA’s key executive officer Eugene Lim.

For instance, the flats at Bukit Batok will be completed within two years – the project with the shortest waiting time in this sales exercise. Those at Pasir Ris will take around three years.

On the other hand, the Taman Jurong Skyline BTO project in Jurong West was undersubscribed. 

The first-timer application rate was 0.6 for three-room flats and 0.4 for four- and five-room and 3Gen flats, despite the project having the lowest launch prices.

This is likely due to the project’s “subpar location” where the nearest MRT station - Lakeside - is a 20-minute bus ride away, said Mr Lim.

“This attests that convenience is king, especially as Singapore receives more infrastructure upgrades and people grow used to the convenience of a nearby MRT station,” he added.

PRIME, PLUS PROJECTS OVERSUBSCRIBED

Most of the flat types offered under the Plus and Prime projects in areas such as Ang Mo Kio, Bedok, Geylang and Kallang/Whampoa, were oversubscribed, in line with analysts' expectations.

The most sought-after among these projects was Central Trio @ AMK, which drew 1,763 applications for 267 four-room units. The application rate among first-timer families was 4.1, meaning there were about four applicants vying for each such unit.

The four-room units in other Plus and Prime projects had between two and three first-time applicants for each unit.

“The sustained enthusiasm – even with stricter resale conditions on Plus and Prime flats – suggests that buyers could be focusing on affordability and location over resale flexibility,” said ERA’s Mr Lim.

The 146 three-room flats in Kallang/Whampoa yielded a “lukewarm” application rate of 0.9 among first-timer families. This could be due to young couples who intend to start a family being “hesitant to commit to an extended minimum occupation period in a smaller flat”, Mr Lim added.

Kallang/Whampoa had two Plus projects and one Prime project on offer for this exercise. The four-room offerings across all three projects attracted a first-time application rate of 2.8.

This was higher than the application rate of 2.4 for Tanjong Rhu I and II - the two projects launched under the Prime Location Public Housing (PLH) model during the June sales exercise, noted PropNex CEO Ismail Gafoor.

Similarly, the Plus projects in Bedok also performed better than nearby projects that were launched in February's BTO sales exercise. Then, the BTO projects - Bedok South Bloom and Bedok North Springs - drew an application rate of 2.8 times.

"We think this is an early indication of the buy-in for the Plus and Prime flat types which carry tighter restrictions, longer minimum occupation period and subsidy clawback on resale," said Mr Gafoor.

"It suggests that many buyers – both first-timers and second-timers - are willing to commit long-term to their flat, and that the additional restrictions are not a dampener on their buying decision, especially if the BTO project is in a choice location."

SURGE IN APPLICATION BY SINGLES

The October sales exercise also marked the first time that eligible singles can apply for two-room flexi flats in any location. Previously, they could only apply for such flats in non-mature estates.

This “pent-up demand” contributed to a surge in applications this time, with first-time singles making up about 20 per cent of the applications, the HDB said earlier this week.

Huttons Asia estimated that the relaxing of BTO rules for singles could have led to an additional 6,000 applications this time.

“This increase was expected and showed the level of pent-up demand from singles. It may take at least five years before this demand is satisfied,” said its senior director of data analytics Lee Sze Teck,

Among the nearly 2,000 flats available across seven BTO projects, Bukit Batok saw the highest application rate among first-time singles. More than 36 first-time single applicants were vying for each of the 130 two-room flexi units by the time the sales exercise ended.

Such flats in Ang Mo Kio, Kallang/Whampoa and Pasir Ris were also popular with singles, with application rates ranging from 26.3 to 29.5.