October 2023 BTO exercise sees underwhelming response

/ EdgeProp Singapore |

October 10, 2023 6:38 PM SGT

Plantation Edge I & II in Tengah has the highest overall application rate based on applications submitted as of 5pm on Oct 10 (Picture: HDB)

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SINGAPORE (EDGEPROP) - Applications for the October 2023 Build-To-Order (BTO) exercise will close at 11.59pm on Oct 10. The exercise sees 6,800 flats up for sale across six projects in Queenstown, Kallang-Whampoa, Choa Chu Kang and Tengah, including two Prime Location Public Housing (PLH) projects.

Response to the exercise has been underwhelming, notes Lee Sze Teck, senior director of data analytics at Huttons Asia. HDB data as of 5pm on Oct 10 show that 9,848 applications have been received. “In comparison, there were more than 16,000 applicants for the February 2023 BTO exercise and more than 20,000 applicants for the May 2023 BTO exercise,” he points out. The two exercises had 4,428 and 5,495 flats up for sale respectively.

Lee believes the lukewarm demand is due to the penalties for non-selection of flats that have kicked in with this exercise. First-timer applicants who reject their chance to book a flat when invited to do so will be considered a second-timer with lower priority for a year. Meanwhile, second-timers who have one non-selection count will have to wait one year before they can apply for a flat again.

Some buyers may also be waiting for the December 2023 BTO exercise, which will see long-awaited flats at Sin Ming in Bishan and Alexandra Vale in Bukit Merah put up for sale, Lee adds.

Based on the applications submitted as of 5pm on Oct 10, the October 2023 BTO exercise has an overall subscription rate of about 1.4 times. “It is possibly one of the lowest BTO application rates in recent years,” remarks Ismali Gafoor, CEO of PropNex Realty. The last time overall BTO application rates fell below 2 times was in November 2017 when the application rate came in at 1.7 times for the 4,829 flats launched at the time.

Gafoor notes that the October BTO projects in Tengah (Plantation Edge I & II) saw the highest subscription rate of 2.1 times. He attributes this to applicants vying for the five-room flats available, along with the Tengah projects’ shorter waiting times of 3 to 3.3 years. The projects are also located right in front of the future Tengah Park MRT Station on the Jurong Region Line which will open in 2028.

The flats at the Choa Chu Kang project (Rail Green I & II) achieved the second-highest overall application rate of about 1.6 times for the 1,895 flats launched for sale. However, Gafoor points out that the rate is still lower compared to the last Choa Chu Kang BTO project launched in the August 2022 BTO exercise (Keat Hong Grange) which garnered an overall application rate of 2.4 times.

Meanwhile, the projects in the mature estates saw a more muted response. The Kallang-Whampoa projects, including the 1,143-unit Verandah @ Kallang PLH project, got an overall application rate of about 1.3 times for the 2,922 flats launched. This iscomparatively lower than past Kallang-Whampoa projects, such as the Farrer Park Arena project in May 2023 which recorded an application rate of 3.6 times and the Kallang-Whampoa projects in February 2023 (Farrer Park Fields and Rajah Summit) which registered an application rate of 4.7 times.

The 973-unit Tanglin Halt Cascadia PLH project also observed a more measured application rate of 1.1 times.

Given the lower application rates, Gafoor notes that most first-timers stand a high chance of securing a flat. The first-timer application rate for most projects’ four-room flats ranges from 0.8 to 1.0 times. Five-room flats stand at about 1.6 times, while three-room flats range from 0.2 to 0.8 times.

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