Wednesday, September 28, 2011

Huge demand for HDB's 'leftover' flats

THE sale of 'leftover' Housing Board (HDB) flats - many in popular mature estates - has attracted an overwhelming response, with more than 14,000 potential home-buyers applying for them.
These 2,847 flats, called 'balance flats', are a mix of those left unselected from previous build-to-order (BTO) launches, surplus replacement flats under the Selective En Bloc Redevelopment Scheme, and those bought back by HDB.

And because so many people went for them, a parallel BTO exercise for new flats launched the same day has seen a muted response. Some BTO estates and flat types were even undersubscribed with just one day left to apply.

Applications for both exercises close today.

The HDB has always advised buyers to opt for BTO flats where possible because there are more of them for sale, increasing a buyer's chance of successfully selecting a flat.

In BTO launches, 95 per cent of the flats are reserved for first-time buyers.

But this has not deterred potential home-owners from trying their luck at getting one of the balance flats, which are popular because they are often in mature estates which are more central in location. They also involve a shorter waiting time since some are completed and most others are already being built.

The balance flats in this exercise are scattered across 15 towns, including mature estates such as Queenstown and Bukit Merah, and non-mature estates such as Punggol and Woodlands.

Some are wildly popular. As of last night, the 30 four-room balance units being offered in Yishun had attracted 858 applications.

More than 1,800 applicants were vying for 422 three-, four- and five-room flats in Clementi, and there were almost 2,500 in the queue for 491 three- and four- room flats in Bukit Merah.

The balance flats were put up for sale last Thursday together with 5,415 BTO flats in Sengkang, Punggol, Jurong West, Jurong East and Ang Mo Kio in a bumper launch of sorts.

The BTO units range from 398.3 sq ft studio apartments with a starting price of $70,000 in Sengkang, to 1,205.5 sq ft five-room units costing from $375,000 in Punggol.

Balance flats cost from $82,000 for a two-room unit in Sengkang, to $611,000 for a five-room flat in Bukit Merah.

As of yesterday evening, there were only 7,200 applicants for the BTO units, with some three-room flats in Sengkang and Jurong East undersubscribed.

Property experts say the huge demand seen in this launch is partly due to last month's revision of income eligibility rules, from $8,000 to $10,000, which has made more people eligible to buy flats.

'The Sale of Balance Flats exercise was supposed to be the supporting cast and the BTO exercise the main star of the show. But the supporting cast has outshone the main star now,' said property consultancy SLP International's research head Nicholas Mak.

PropNex chief executive officer Mohamed Ismail said the response was within his expectations, but noted buyers must take responsibility for their own actions if they end up not getting a flat in this exercise.

'Those who chose the Sale of Balance Flats know they are taking a chance, and those who were not distracted by the balance flats and chose BTO flats will be rewarded for it,' he said.

'As far as the ministry should be concerned, this launch will have helped over 8,200 people clear the queue.'

Banking executive Claude Lee, 24, is keeping his fingers crossed. He applied for a four-room balance unit in Sengkang, which was more than three times oversubscribed yesterday evening.

'I knew the flats would be popular. You could say it's a calculated risk,' he said. 'I decided to try my luck because the balance flat is still cheaper than a resale unit, and if I get it, I won't have to wait as long as I would for a BTO.'

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