An artist impression of Kallang Horizon, one of three PLH projects launched as part of the Nov 2022 BTO sales exercise. (Picture: HDB)
SINGAPORE (EDGEPROP) - The November 2022 Build-To-Order (BTO) sales exercise closed on Dec 2 with 24,562 applications received, according to data released by HDB. HDB is offering 9,655 flats for sale under the exercise, making it the largest offering to date for a single launch.
The number of applications received works out to an overall application rate of 2.5. This is lower than the 7.8 application rate registered for the August 2022 BTO sales exercise, when 39,136 applications were received for 4,993 launched flats.
Christine Sun, senior vice president of research and analytics at OrangeTee & Tie, notes that the number of applications in November fell by 37.2% compared to the August exercise. “This is the lowest overall BTO application rate since September 2019 with an application ratio of 2.1,” she highlights.
Sun attributes the lower number of applicants to a few reasons, including buyer demand being diverted to the Sale of Balance Flats (SBF). Citing data released by HDB, she points out that 25,350 applications were received for the 1,071 SBF units available in the November sales exercise, translating to an application rate of 23.7. According to Sun, the stronger demand for SBF units points to a preference by buyers for flats with a shorter completion period. “Most SBF flats may be completed faster than newly launched BTO flats in the same town since they are launched in earlier phases,” she remarks. (Find HDB flats for rent or sale with our Singapore HDB directory)
Other reasons for the lower BTO applications may include the cooling measures that came into effect on Sept 30. According to Sun, some buyers may be anticipating prices in the resale market to fall, and are thus holding back on purchasing a BTO flat in order to buy a completed home in the secondary market.
The highest application rates in the November BTO exercise were recorded for the three- and four-room flats under the Prime Location Public Housing (PLH) Model project in the mature Kallang/Whampoa estate. 4,561 applications were received for the 405 four-room flats available, which works out to an application rate of 11.3. For the three-room flats, 550 applications were received for the 72 units launched, translating to a 7.6 application rate.
Read also: November BTO launch: Our in-depth analysis
Apart from the Kallang/Whampoa PLH flats, flats in Queenstown, which include both PLH and non-PLH units, were also popular among applicants, points out Lee Sze Teck, senior director, research at Huttons Asia.
Nonetheless, OrangeTee & Tie’s Sun highlights that PLH flats in Kallang/ Whampoa were more popular than those in Queenstown, possibly due to their closer proximity to the downtown core. “This indicates that there could be some buyer resistance if the boundaries of PLH model flats are pushed too far inland, and not everyone is willing to trade a further location for a long minimum occupation period,” she observes.
Among the non-mature estates in the launch, which comprises Bukit Batok, Tengah and Yishun, five-room flats in Tengah saw the highest interest, with 2,849 applications received for the 670 units available, or an application rate of 4.3. Huttons’ Lee attributes this to buyers seeking bigger units, which provide more flexibility to accommodate hybrid work and home-based learning activities. “Tengah has consistently attracted many applicants for its sustainability theme and proximity to major employment centres in Jurong East Regional Centre and Jurong Innovation District,” he adds.
From a full-year perspective, OrangeTee & Tie’s Sun highlights that the total number of applicants for all BTO and SBF sales exercises this year clocked in at 167,119, 16.3% higher than the 143,706 applicants logged in 2021. In terms of BTO launches, the number of applicants increased by 22.6% y-o-y in 2022 to 117,251, while the number of SBF applicants increased by 3.7% y-o-y to 49,868.
From a supply standpoint, the number of BTO units launched this year jumped by 35.5% y-o-y to 23,184 units, while SBF units launched fell 29.6% y-o-y to 3,023 units. Altogether, units launched in 2022 totalled 26,207 flats, up 22.5% y-o-y.